TeleNav, Inc. (Form: 10-Q, Received: 11/08/2019 16:57:35)

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)



☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2019



☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number: 001-34720

TELENAV, INC.

(Exact name of registrant as specified in its charter)



Delaware		77-0521800
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification Number)

4655 Great America Parkway, Suite 300

Santa Clara, California 95054

(Address of principal executive offices, including zip code)

(408) 245-3800

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:



Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common stock, $0.001 Par Value per Share	TNAV	The NASDAQ Global Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.



Large accelerated filer	☐	Accelerated filer	☒

Non-accelerated filer	☐	Smaller reporting company	☐

		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of September 30, 2019, there were 48,566,077 shares of the Registrant’s Common Stock outstanding.

Table of Contents

TELENAV, INC.

TABLE OF CONTENTS



		Page No.
PART I. FINANCIAL INFORMATION		1

Item 1.	Financial Statements	1

	Condensed Consolidated Balance Sheets	1

	Condensed Consolidated Statements of Operations	2

	Condensed Consolidated Statements of Comprehensive Loss	3

	Condensed Consolidated Statements of Stockholders’ Equity	4

	Condensed Consolidated Statements of Cash Flows	5

	Notes to Condensed Consolidated Financial Statements	6

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	22

Item 3.	Quantitative and Qualitative Disclosures about Market Risk	37

Item 4.	Controls and Procedures	37

PART II. OTHER INFORMATION		39

Item 1.	Legal Proceedings	39

Item 1A.	Risk Factors	40

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	71

Item 6.	Exhibits

Table of Contents

PART I. FINANCIAL INFORMATION


Item 1.	Financial Statements.

TELENAV, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except par value)

(unaudited)



	September 30, 2019			June 30, 2019
Assets
Current assets:
Cash and cash equivalents	$	19,278		$	27,275
Short-term investments	102,515			72,203
Accounts receivable, net of allowances of $7 and $7 at September 30, 2019 and June 30, 2019, respectively	52,973			69,781
Restricted cash	2,452			1,950
Deferred costs	19,416			18,752
Prepaid expenses and other current assets	4,281			3,784
Assets of discontinued operations	1,788			6,330
Total current assets	202,703			200,075
Property and equipment, net	5,304			5,583
Operating lease right-of-use assets	9,325			—
Deferred income taxes, non-current	798			998
Goodwill and intangible assets, net	15,483			15,701
Deferred costs, non-current	58,379			61,050
Other assets	18,977			1,414
Assets of discontinued operations, non-current	259			12,194
Total assets	$	311,228		$	297,015
Liabilities and stockholders’ equity
Current liabilities:
Trade accounts payable	$	17,804		$	16,061
Accrued expenses	38,365			48,899
Operating lease liabilities	3,566			—
Deferred revenue	43,073			31,270
Income taxes payable	635			800
Liabilities of discontinued operations	1,876			3,373
Total current liabilities	105,319			100,403
Deferred rent, non-current	—			1,266
Operating lease liabilities, non-current	7,011			—
Deferred revenue, non-current	104,184			103,865
Other long-term liabilities	639			811
Liabilities of discontinued operations, non-current	107			30
Commitments and contingencies	—			—
Stockholders’ equity:
Preferred stock, $0.001 par value: 50,000 shares authorized; no shares issued or outstanding	—			—
Common stock, $0.001 par value: 600,000 shares authorized; 48,566 and 46,911 shares issued and outstanding at September 30, 2019 and June 30, 2019, respectively	49			47
Additional paid-in capital	192,055			182,349
Accumulated other comprehensive loss	(1,729		)	(1,477		)
Accumulated deficit	(96,407		)	(90,279		)
Total stockholders’ equity	93,968			90,640
Total liabilities and stockholders’ equity	$	311,228		$	297,015

See accompanying Notes to Condensed Consolidated Financial Statements.

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TELENAV, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share amounts)

(unaudited)



	Three Months Ended
	September 30,
	2019			2018
Revenue:
Product	$	55,183		$	39,930
Services	9,272			6,322
Total revenue	64,455			46,252
Cost of revenue:
Product	31,989			23,588
Services	4,862			3,954
Total cost of revenue	36,851			27,542
Gross profit	27,604			18,710
Operating expenses:
Research and development	20,663			18,492
Sales and marketing	1,946			1,703
General and administrative	7,287			5,450
Total operating expenses	29,896			25,645
Loss from operations	(2,292		)	(6,935		)
Other income, net	561			1,590
Loss from continuing operations before provision for income taxes	(1,731		)	(5,345		)
Provision for income taxes	411			740
Loss from continuing operations	(2,142		)	(6,085		)
Discontinued operations:
Income (loss) from operations of Advertising business, net of tax	832			(1,485		)
Loss from sale of Advertising business	(4,818		)	—
Loss on discontinued operations	(3,986		)	(1,485		)
Net loss	$	(6,128	)	$	(7,570	)

Basic and diluted loss per share:
Loss from continuing operations	$	(0.04	)	$	(0.14	)
Loss on discontinued operations	$	(0.09	)	$	(0.03	)
Net loss	$	(0.13	)	$	(0.17	)
Weighted average shares used in computing basic and diluted loss per share	47,780			45,018

Stock-based compensation expense included in continuing operations above:
Cost of revenue	$	16		$	24
Research and development	1,095			1,251
Sales and marketing	135			166
General and administrative	506			607
Total stock-based compensation expense	$	1,752		$	2,048

See accompanying Notes to Condensed Consolidated Financial Statements.

Table of Contents

TELENAV, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(in thousands)

(unaudited)



	Three Months Ended
	September 30,
	2019			2018
Net loss	$	(6,128	)	$	(7,570	)
Other comprehensive income (loss):
Foreign currency translation adjustment, net of tax	(310		)	(217		)
Available-for-sale securities:
Unrealized gain on available-for-sale securities, net of tax	59			89
Reclassification adjustments for (loss) gain on available-for-sale securities recognized, net of tax	(1		)	2
Net increase from available-for-sale securities, net of tax	58			91
Other comprehensive loss, net of tax	(252		)	(126		)
Comprehensive loss	$	(6,380	)	$	(7,696	)

See accompanying Notes to Condensed Consolidated Financial Statements.

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TELENAV, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(in thousands)

(unaudited)



	Common Stock			Additional Paid-in Capital			Accumulated Other Comprehensive Loss			Accumulated Deficit			Total Stockholders' Equity
Three Months Ended September 30, 2019	Shares	Amount		Additional Paid-in Capital			Accumulated Other Comprehensive Loss			Accumulated Deficit			Total Stockholders' Equity
Balance at June 30, 2019	46,911	$	47	$	182,349		$	(1,477	)	$	(90,279	)	$	90,640
Issuance of common stock upon exercise of stock options	1,326	1		8,340			—			—			8,341
Release of restricted stock units	329	1		(1,273		)	—			—			(1,272		)
Stock-based compensation expense, continuing operations	—	—		1,752			—			—			1,752
Stock-based compensation expense, discontinued operations	—	—		887			—			—			887
Foreign currency translation adjustment, net of tax	—	—		—			(310		)	—			(310		)
Unrealized net loss on available-for-sale securities, net of tax	—	—		—			58			—			58
Net loss	—	—		—			—			(6,128		)	(6,128		)
Balance at September 30, 2019	48,566	$	49	$	192,055		$	(1,729	)	$	(96,407	)	$	93,968

Three Months Ended September 30, 2018
Balance at June 30, 2018	44,871	$	45	$	167,895		$	(1,855	)	$	(57,202	)	$	108,883
Issuance of common stock upon exercise of stock options	5	—		25			—			—			25
Release of restricted stock units	385	—		(1,205		)	—			—			(1,205		)
Stock-based compensation expense, continuing operations	—	—		2,048			—			—			2,048
Stock-based compensation expense, discontinued operations	—	—		221			—			—			221
Foreign currency translation adjustment, net of tax	—	—		—			(217		)	—			(217		)
Unrealized net loss on available-for-sale securities, net of tax	—	—		—			91			—			91
Net loss	—	—		—			—			(7,570		)	(7,570		)
Balance at September 30, 2018	45,261	$	45	$	168,984		$	(1,981	)	$	(64,772	)	$	102,276

See accompanying Notes to Condensed Consolidated Financial Statements.

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TELENAV, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(unaudited)



	Three Months Ended
	September 30,
	2019			2018
Operating activities
Net loss	$	(6,128	)	$	(7,570	)
Loss on discontinued operations	3,986			1,485
Loss from continuing operations	(2,142		)	(6,085		)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Stock-based compensation expense	1,752			2,048
Depreciation and amortization	922			1,010
Operating lease amortization, net of accretion	544			—
Accretion of net premium on short-term investments	12			5
Unrealized gain on non-marketable equity investments	—			(1,259		)
Realized loss on non-marketable equity investments	100			—
Other	1			—
Changes in operating assets and liabilities:
Accounts receivable	16,653			(252		)
Deferred income taxes	171			198
Deferred costs	1,979			(4,381		)
Prepaid expenses and other current assets	(502		)	369
Other assets	28			(35		)
Trade accounts payable	1,738			3,267
Accrued expenses and other liabilities	(10,259		)	(2,467		)
Income taxes payable	(152		)	149
Deferred rent	—			37
Operating lease liabilities	(897		)	—
Deferred revenue	12,221			6,842
Net cash provided by (used in) operating activities	22,169			(554		)
Investing activities
Purchases of property and equipment	(461		)	(99		)
Purchases of short-term investments	(41,418		)	(10,624		)
Purchase of long-term investments	(2,000		)	—
Proceeds from sales and maturities of short-term investments	11,052			10,865
Net cash provided by (used in) investing activities	(32,827		)	142
Financing activities
Proceeds from exercise of stock options	8,306			24
Tax withholdings related to net share settlements of restricted stock units	(832		)	(1,206		)
Net cash provided by (used in) financing activities	7,474			(1,182		)
Effect of exchange rate changes on cash, cash equivalents and restricted cash	(336		)	(239		)
Net decrease in cash, cash equivalents and restricted cash	(3,520		)	(1,833		)
Net cash used in discontinued operations	(3,975		)	(1,740		)
Cash, cash equivalents and restricted cash, beginning of period	29,225			20,099
Cash, cash equivalents and restricted cash, end of period	$	21,730		$	16,526
Supplemental disclosure of cash flow information
Income taxes paid, net	$	739		$	166
Non-cash investing: Investment in LLC acquired in exchange for sale of Advertising business	$	15,600		$	—
Cash flows from discontinued operations:
Net cash used in operating activities	$	(3,569	)	$	(1,740	)
Net cash used in financing activities	(406		)	—
Net cash transferred from continuing operations	3,975			1,740
Net change in cash and cash equivalents from discontinued operations	—			—
Cash and cash equivalents of discontinued operations, beginning of period	—			—
Cash and cash equivalents of discontinued operations, end of period	$	—		$	—
Reconciliation of cash, cash equivalents and restricted cash to the condensed consolidated balance sheets
Cash and cash equivalents	$	19,278		$	13,596
Restricted cash	2,452			2,930
Total cash, cash equivalents and restricted cash	$	21,730		$	16,526

See accompanying Notes to Condensed Consolidated Financial Statements.

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TELENAV, INC.

Notes to Condensed Consolidated Financial Statements

(unaudited)


1.	Summary of business and significant accounting policies

Description of business

Telenav, Inc., also referred to in this report as “we,” “our” or “us,” was incorporated in September 1999 in the State of Delaware. We are a leading provider of connected car and location-based products and services. We utilize our automotive navigation platform to deliver these products and services. Our automotive navigation platform allows us to deliver enhanced location-based services to automobile manufacturers, as well as original equipment manufacturers and tier one suppliers, to which we refer collectively as tier ones. Our automotive solutions primarily include navigation systems built into vehicles, or on-board, mobile phone based navigation systems, or brought-in, and advanced navigation solutions that offer on-board functionality combined with cloud functionality, or hybrid. Our fiscal year ends on June 30, and in this report we refer to the fiscal year ended June 30, 2019 as “fiscal 2019” and the fiscal year ending June 30, 2020 as “fiscal 2020.”

Commencing July 1, 2019, we operate in a single segment, automotive. Through June 30, 2019, we operated in three segments - automotive, advertising and mobile navigation. In August 2019, we completed the disposition of our digital advertising operations (the "Ads Business") and have presented the results of operations for the Ads Business as discontinued operations for all prior periods presented. See Note 12. Our mobile navigation services business represented less than 5% of total revenue for the three months ended September 30, 2019 and we expect the business to continue to decline. Our CEO, the chief operating decision maker, does not review mobile navigation revenue and cost of revenue separately. As a result, we have combined the mobile navigation business with the automotive business in a single segment.

Basis of presentation

The unaudited condensed consolidated financial statements and accompanying notes have been prepared in accordance with accounting principles generally accepted in the United States of America, or GAAP. The condensed consolidated financial statements include the accounts of Telenav, Inc. and its wholly owned subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation. The financial statements include all adjustments (consisting only of normal recurring adjustments) that our management believes are necessary for a fair presentation of the periods presented. These interim financial results are not necessarily indicative of results expected for the full fiscal year or for any subsequent interim period.

Our condensed consolidated financial statements also include the financial results of Shanghai Jitu Software Development Ltd., or Jitu, located in China. Based on our contractual arrangements with the shareholders of Jitu, we have determined that Jitu is a variable interest entity, or VIE, for which we are the primary beneficiary and are required to consolidate in accordance with Accounting Standards Codification, or ASC, subtopic 810-10, or ASC 810-10, Consolidation: Overall. The results of Jitu did not have a material impact on our financial statements for the three months ended September 30, 2019 and 2018.

The condensed consolidated financial statements and related financial information should be read in conjunction with the audited consolidated financial statements and the related notes thereto for fiscal 2019, included in our Annual Report on Form 10-K for fiscal 2019 filed with the U.S. Securities and Exchange Commission, or SEC, on August 22, 2019, which we refer to as the Form 10-K.

Effective July 1, 2019, we adopted the requirements of Accounting Standards Update, or ASU, No. 2016-02, Leases (ASC 842) as discussed in the section titled “Recently adopted accounting pronouncements” of this Note 1. All amounts and disclosures set forth in this Form 10-Q have been updated to comply with this standard.

Certain prior period balances have been reclassified to conform to the current period presentation of discontinued operations.

Significant accounting policies

With the exception of changes in accounting policies associated with our adoption of the new lease accounting standard, there have been no material changes to our significant accounting policies as compared to the significant accounting policies described in our Form 10-K.

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TELENAV, INC.

Notes to Condensed Consolidated Financial Statements—(Continued)

(unaudited)

Use of estimates

The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. Significant estimates and assumptions made by us include the determination of revenue recognition and deferred revenue, including estimating and allocating the transaction price of customer contracts, the recoverability of accounts receivable and short-term investments, the determination of acquired intangibles and assessment of goodwill for impairment, the fair value of stock-based awards issued, the determination of income taxes and the recoverability of deferred tax assets. Actual results could differ from those estimates.

Disaggregation of revenue

In order to further depict how the nature, amount, timing and uncertainty of our revenue and cash flows are affected by economic factors, the following table depicts the disaggregation of revenue according to revenue type and pattern of recognition (in thousands):



	Three Months Ended September 30,
	2019		2018
Product
On-board automotive navigation solutions (point in time)⁽¹⁾	$	55,183	$	39,930
Total product revenue	55,183		39,930
Services
Brought-in automotive navigation solutions (over time)⁽²⁾	6,222		3,542
Automotive maintenance and support and other (over time)	600		10
Mobile navigation services (over time)	2,450		2,770
Total services revenue	9,272		6,322
Total revenue	$	64,455	$	46,252
⁽¹⁾Includes i) royalties earned and recognized at the point in time usage occurs, ii) map updates and iii) customized software development fees.
⁽²⁾Includes royalties earned and recognized over time from the allocation of transaction price to service obligations for hybrid automotive solutions.

Contract assets

Contract assets relate to our rights to consideration for performance obligations satisfied but not billed at the reporting date. As of September 30, 2019 and June 30, 2019, we had no contract assets.

Deferred costs

Changes in the balance of total deferred costs (current and non-current) during the three months ended September 30, 2019 were as follows (in thousands):



	Deferred Costs
	Content			Development			Total
Balance, June 30, 2019	$	71,466		$	8,336		$	79,802
Content licensing costs incurred	31,257			—			31,257
Customized software development costs incurred	—			1,215			1,215
Less: cost of revenue recognized	(33,304		)	(1,175		)	(34,479		)
Balance, September 30, 2019	$	69,419		$	8,376		$	77,795

Concentrations of risk and significant customers

Revenue related to products and services provided through Ford Motor Company and affiliated entities, or Ford, comprised 54% and 67% of total revenue for the three months ended September 30, 2019 and 2018, respectively. As of September 30, 2019 and June 30, 2019, receivables due from Ford were 42% and 33% of total accounts receivable, respectively.

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TELENAV, INC.

Notes to Condensed Consolidated Financial Statements—(Continued)

(unaudited)

Revenue related to products and services provided through General Motors Holdings and its affiliates, or GM, comprised 25% and 16% of total revenue for the three months ended September 30, 2019 and 2018, respectively. As of September 30, 2019 and June 30, 2019, receivables due from GM were 23% and 15% of total accounts receivable, respectively.

Receivables due from Xevo, Inc. were 13% and 29% of total accounts receivable as of September 30, 2019 and June 30, 2019, respectively.

Restricted cash

As of September 30, 2019 and June 30, 2019, we had restricted cash of $2.5 million and $2.0 million, respectively, on our consolidated balance sheets, comprised primarily of prepayments from a customer.

Accumulated other comprehensive loss, net of tax

The components of accumulated other comprehensive loss, net of related taxes, and activity as of September 30, 2019, were as follows (in thousands):



	Foreign Currency Translation Adjustments			Unrealized Gains (Losses) on Available-for-Sale Securities			Total
Balance, net of tax as of June 30, 2019	$	(1,623	)	$	146		$	(1,477	)
Other comprehensive income (loss) before reclassifications, net of tax	(310		)	59			(251		)
Amount reclassified from accumulated other comprehensive loss, net of tax	—			(1		)	(1		)
Other comprehensive income (loss), net of tax	(310		)	58			(252		)
Balance, net of tax as of September 30, 2019	$	(1,933	)	$	204		$	(1,729	)

The amount of income tax benefit allocated to each component of accumulated other comprehensive loss was not material for the three months ended September 30, 2019.

Recently adopted accounting pronouncements

In August 2018, the FASB issued ASU 2018-15, Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract, or ASU 2018-15, which requires a customer in a cloud computing arrangement that is a service contract to follow the internal-use software guidance in ASC 350-40 to determine which implementation costs to defer and recognize as an asset. We early adopted ASU 2018-15 on July 1, 2019 on a prospective basis, and it did not have a material impact on our financial position or results of operations.

In February 2016, the FASB issued ASU No. 2016-02, Leases (ASC 842) which supersedes the guidance in topic ASC 840, Leases. The new standard, including subsequent amendments, requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase by the lessee. This classification will determine whether lease expense is recognized based on an effective interest method or on a straight-line basis over the term of the lease. A lessee is also required to record a right-of-use asset and a lease liability for all leases with a term of greater than 12 months regardless of their classification. Leases with a term of 12 months or less will be accounted for similar to existing guidance for operating leases today.

We adopted ASC 842 effective July 1, 2019. We adopted the standard using the modified retrospective transition approach applying the new standard to all leases existing at the date of initial application and not restating comparative periods. The most significant impact was the recognition of right-of-use (ROU) assets and lease liabilities for operating leases that were not previously recorded. For information regarding the impact of ASC 842 adoption, see Leases and Note 5.

Leases

On July 1, 2019, we adopted ASC 842 using the modified retrospective transition approach by applying the new standard to all leases existing at the date of initial application. Results and disclosure requirements for reporting periods beginning after July 1, 2019 are presented under ASC 842, while prior period amounts have not been adjusted and continue to be reported in accordance with our historical accounting.

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TELENAV, INC.

Notes to Condensed Consolidated Financial Statements—(Continued)

(unaudited)

We elected the package of practical expedients permitted under the transition guidance, which allowed us to carry forward our historical lease classification, our assessment on whether a contract was or contains a lease, and our initial direct costs for any leases that existed prior to July 1, 2019. We also elected to keep leases with an initial term of 12 months or less off the balance sheet and recognize the associated lease payments in the consolidated statements of income on a straight-line basis over the lease term.

Upon adoption, we recognized total ROU assets of $11.7 million, with corresponding liabilities of $13.0 million on the condensed consolidated balance sheets. The adoption did not impact our beginning retained earnings, or our prior year condensed consolidated statements of operations and statements of cash flows.

We recognize operating lease ROU assets and operating lease liabilities at the commencement date based on the present value of the future minimum lease payments over the lease term. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. The operating lease ROU asset also includes any lease payments made and excludes lease incentives and initial direct costs incurred. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term.

We include operating leases in operating lease right-of-use assets, operating lease liabilities and operating lease liabilities, non-current on our condensed consolidated balance sheets.

Recent accounting pronouncements

With the exception of the recently adopted accounting pronouncements discussed above, there have been no other changes in accounting pronouncements during the three months ended September 30, 2019, as compared to the recent accounting pronouncements described in our Annual Report on Form 10-K for fiscal 2019, that are of significance or potential significance to us.


2.	Net income (loss) per share

Basic net income (loss) per share is calculated by dividing net income (loss) by the weighted-average number of common shares outstanding for the period. Diluted net income (loss) per share is computed by dividing net income (loss) by the weighted-average number of common shares outstanding for the period, including potential dilutive common shares assuming the dilutive effect of outstanding stock options and restricted stock units using the treasury-stock method.

The following table presents the calculation of basic and diluted net loss per share (in thousands, except per share amounts):



	Three Months Ended September 30,
	2019			2018
Loss from continuing operations	$	(2,142	)	$	(6,085	)
Net loss	$	(6,128	)	$	(7,570	)
Weighted average shares used in computing loss per share, basic and diluted	47,780			45,018
Loss from continuing operations per share, basic and diluted	$	(0.04	)	$	(0.14	)
Loss on discontinued operations	$	(0.09	)	$	(0.03	)
Net loss per share, basic and diluted	$	(0.13	)	$	(0.17	)

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TELENAV, INC.

Notes to Condensed Consolidated Financial Statements—(Continued)

(unaudited)

The following potential shares outstanding as of September 30, 2019 and 2018 were excluded from the computation of diluted loss per share for the periods presented because including them would have had an antidilutive effect (in thousands):



	September 30,
	2019	2018
Stock options	2,059	5,263
Restricted stock units	2,967	2,536
Total	5,026	7,799


3.	Cash, cash equivalents and short-term investments

Cash and cash equivalents consist of highly liquid fixed-income investments with original maturities of three months or less at the time of purchase, including money market funds and commercial paper. Short-term investments consist of readily marketable debt securities with a remaining maturity of more than three months from the date of purchase. Short-term investments are classified as current assets, even though maturities may extend beyond one year, because they represent investments of cash available for operations. We classify all cash equivalents and short-term investments as “available for sale,” as these investments are free of trading restrictions. Marketable debt securities are carried at fair value, with the unrealized gains and losses, net of tax, reported as accumulated other comprehensive income (loss) and included as a separate component of stockholders’ equity. Gains and losses are recognized when realized. When we have determined that an other-than-temporary decline in fair value has occurred, the amount of the decline that is related to a credit loss is recognized in earnings. Gains and losses are determined using the specific identification method. We had no material realized gains or losses in the three months ended September 30, 2019 or 2018.

Short-term investments as of June 30, 2019 also included marketable equity securities, which are carried at fair value with unrealized gains and losses recognized in other income (expense), net. We had no net realized gains (losses) from marketable equity securities in the three months ended September 30, 2019 or 2018. As of September 30, 2019, we had no marketable equity securities.

Cash, cash equivalents and short-term investments consisted of the following as of September 30, 2019 (in thousands):



Description	Amortized Cost		Unrealized Gains		Unrealized Losses			Estimated Fair Value
Cash	$	14,348	$	—	$	—		$	14,348
Cash equivalents:
Money market mutual funds	650		—		—			650
U.S. treasury securities	2,071		—		—			2,071
Commercial paper	1,994		—					1,994
Corporate bonds	215		—		—			215
Total cash equivalents	4,930		—		—			4,930
Total cash and cash equivalents	19,278		—		—			19,278
Short-term investments:
U.S. treasury securities	6,121		9		(3		)	6,127
U.S. agency securities	4,547		8		(4		)	4,551
Asset-backed securities	18,259		108		(13		)	18,354
Municipal securities	8,011		24		(1		)	8,034
Commercial paper	1,735		1		—			1,736
Corporate bonds	63,407		328		(22		)	63,713
Total short-term investments	102,080		478		(43		)	102,515
Cash, cash equivalents and short-term investments	$	121,358	$	478	$	(43	)	$	121,793

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TELENAV, INC.

Notes to Condensed Consolidated Financial Statements—(Continued)

(unaudited)

Cash, cash equivalents and short-term investments consisted of the following as of June 30, 2019 (in thousands):



Description	Amortized Cost		Unrealized Gains		Unrealized Losses			Estimated Fair Value
Cash	$	25,987	$	—	$	—		$	25,987
Cash equivalents:
Money market mutual funds	790		—		—			790
Commercial paper	498		—		—			498
Total cash equivalents	1,288		—		—			1,288
Total cash and cash equivalents	27,275		—		—			27,275
Short-term investments:
U.S. treasury securities	3,570		6		(4		)	3,572
U.S. agency securities	3,002		9		(2		)	3,009
Asset-backed securities	12,319		104		(10		)	12,413
Municipal securities	4,124		16		—			4,140
Commercial paper	1,986		—		—			1,986
Corporate bonds	45,492		269		(27		)	45,734
Total debt securities	70,493		404		(43		)	70,854
Marketable equity securities	250		1,099		—			1,349
Total short-term investments	70,743		1,503		(43		)	72,203
Cash, cash equivalents and short-term investments	$	98,018	$	1,503	$	(43	)	$	99,478

The following table summarizes the fair value and gross unrealized losses related to available-for-sale securities, aggregated by investment category, that have been in an unrealized loss position for less than 12 months or a continuous unrealized loss position for 12 months or greater, as of September 30, 2019 and June 30, 2019 (in thousands):



	September 30, 2019
	Less than 12 Months					12 Months or Greater					Total
	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
U.S. treasury securities	$	2,609	$	(1	)	$	2,998	$	(1	)	$	5,607	$	(2	)
U.S. agency securities	2,034		(4		)	—		—			2,034		(4		)
Asset-backed securities	5,128		(10		)	2,061		(3		)	7,189		(13		)
Municipal securities	1,621		(1		)	—		—			1,621		(1		)
Corporate bonds	18,388		(21		)	4,729		(2		)	23,117		(23		)
Total	$	29,780	$	(37	)	$	9,788	$	(6	)	$	39,568	$	(43	)



	June 30, 2019
	Less than 12 Months					12 Months or Greater					Total
	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
U.S. treasury securities	$	—	$	—		$	2,992	$	(5	)	$	2,992	$	(5	)
U.S. agency securities	—		—			998		(1		)	998		(1		)
Asset-backed securities	—		—			3,537		(11		)	3,537		(11		)
Commercial paper	493		(1		)	—		—			493		(1		)
Corporate bonds	4,600		(3		)	14,615		(24		)	19,215		(27		)
Total	$	5,093	$	(4	)	$	22,142	$	(41	)	$	27,235	$	(45	)

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TELENAV, INC.

Notes to Condensed Consolidated Financial Statements—(Continued)

(unaudited)

There were 88 securities and 11 securities in an unrealized loss position for less than 12 months at September 30, 2019 and at June 30, 2019, respectively, and 25 securities and 51 securities in an unrealized loss position for 12 months or greater at September 30, 2019 and June 30, 2019, respectively.

The following table summarizes the cost and estimated fair value of short-term fixed income securities classified as short-term investments based on stated maturities as of September 30, 2019 (in thousands):



	Amortized Cost		Estimated Fair Value
Due within one year	$	33,742	$	33,770
Due between one and two years	41,908		42,147
Due between two and three years	26,430		26,598
Total	$	102,080	$	102,515

Declines in fair value judged to be other-than-temporary on securities available for sale are included as a component of other income (expense), net. In order to determine whether a decline in value is other-than-temporary, we evaluate, among other factors: the duration and extent to which the fair value has been less than the carrying value and our intent and ability to retain the investment for a period of time sufficient to allow for any anticipated recovery in fair market value. As of September 30, 2019, we did not consider any of our short-term investments to be other-than-temporarily impaired.


4.	Fair value of financial instruments

Cash equivalents and short-term investments

We measure certain financial instruments at fair value on a recurring basis. We utilize a hierarchy, which consists of three levels, for disclosure of the inputs used to determine the fair value of our financial instruments.

Level 1 valuations are based on quoted prices in active markets for identical assets or liabilities.

Level 2 valuations are based on inputs that are observable, either directly or indirectly, other than quoted prices included within Level 1. Such inputs used in determining fair value for Level 2 valuations include quoted prices in active markets for similar assets or liabilities, quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

Level 3 valuations are based upon information that is unobservable and significant to the overall fair value measurement.

Where applicable, we use quoted prices in active markets for similar assets to determine fair value of Level 2 short-term investments. If quoted prices in active markets for identical assets are not available to determine fair value, we use quoted prices for similar assets and liabilities or inputs that are observable either directly or indirectly. If quoted prices for identical or similar assets are not available, we use third-party valuations utilizing underlying assets assumptions.

All of our cash equivalents and short-term investments are classified within Level 1 or Level 2. As of September 30, 2019 and June 30, 2019, we did not have any short-term investments that require Level 3 valuations. The fair values of these financial instruments were determined using the following inputs at September 30, 2019 (in thousands):

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TELENAV, INC.

Notes to Condensed Consolidated Financial Statements—(Continued)

(unaudited)



	Fair Value Measurements at September 30, 2019 Using
			Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
Description	Total		(Level 1)		(Level 2)		(Level 3)
Cash equivalents:
Money market mutual funds	$	650	$	650	$	—	$	—
U.S. treasury securities	2,071		2,071		—		—
Commercial paper	1,994		—		1,994		—
Corporate bonds	215		—		215		—
Total cash equivalents	4,930		2,721		2,209		—
Short-term investments:
U.S. treasury securities	6,127		6,127		—		—
U.S. agency securities	4,551		—		4,551		—
Asset-backed securities	18,354		—		18,354		—
Municipal securities	8,034		—		8,034		—
Commercial paper	1,736		—		1,736		—
Corporate bonds	63,713		—		63,713		—
Total short-term investments	102,515		6,127		96,388		—
Cash equivalents and short-term investments	$	107,445	$	8,848	$	98,597	$	—

The fair values of our financial instruments were determined using the following inputs at June 30, 2019 (in thousands):



	Fair Value Measurements at June 30, 2019 Using
			Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
Description	Total		(Level 1)		(Level 2)		(Level 3)
Cash equivalents:
Money market mutual funds	$	790	$	790	$	—	$	—
Commercial paper	498		—		498		—
Total cash equivalents	1,288		790		498		—
Short-term investments:
U.S. treasury securities	3,572		3,572		—		—
U.S. agency securities	3,009		—		3,009		—
Asset-backed securities	12,413		—		12,413		—
Municipal securities	4,140		—		4,140		—
Commercial paper	1,986		—		1,986		—
Corporate bonds	45,734		—		45,734		—
Total debt securities	70,854		3,572		67,282		—
Marketable equity securities	1,349		1,349		—		—
Total short-term investments	72,203		4,921		67,282		—
Cash equivalents and short-term investments	$	73,491	$	5,711	$	67,780	$	—

Accretion of net premium on short-term investments totaled $12,000 and $5,000 in the three months ended September 30, 2019 and 2018, respectively.

There were no transfers between Level 1 and Level 2 financial instruments in the three months ended September 30, 2019 and 2018.

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TELENAV, INC.

Notes to Condensed Consolidated Financial Statements—(Continued)

(unaudited)

We did not have any financial liabilities measured at fair value on a recurring basis as of September 30, 2019 or June 30, 2019.

Non-marketable equity investments

Our non-marketable equity securities are investments in privately held companies without readily determinable market values.

The carrying value of our non-marketable equity securities is measured at cost and adjusted to fair value for observable transactions for identical or similar investments of the same issuer or impairment (referred to as the measurement alternative). All gains and losses on non-marketable equity securities, realized and unrealized, are recognized in other income (expense), net. Non-marketable equity securities that we remeasure are classified within Level 3 in the fair value hierarchy because we estimate the value based on valuation methods using the observable transaction price at the transaction date and other unobservable inputs including volatility, rights, and obligations of the securities we hold.

Our net realized gains (losses) from non-marketable equity securities were $(100,000) and zero in the three months ended September 30, 2019 and 2018. Our net unrealized gains (losses) from the remeasurement of non-marketable equity securities were zero and $1.3 million in the three months ended September 30, 2019 and 2018.

The carrying value of our non-marketable equity securities, none of which required remeasurement to fair value, was $458,000 and $458,000 at September 30, 2019 and June 30, 2019, respectively.

In August 2019, we completed the disposition of our Ads Business in exchange for a non-marketable equity investment in inMarket Media, LLC ("inMarket") valued at $15.6 million. See Note 12. In assessing the fair value of our investment in inMarket, we made assumptions regarding estimated future cash flows, weighted average cost of capital and timing over which the cash flows will occur, amongst other factors.

An investment in a limited liability company such as inMarket that maintains a specific ownership account for each investor is deemed to be similar to an investment in a limited partnership. Accordingly, because we hold more than a 3% to 5% ownership interest in inMarket, we are required to account for our inMarket investment under the equity method of accounting. Our proportionate share of inMarket earnings for the period from the date of closing of the inMarket Transaction, August 16, 2019, through September 30, 2019 was not material.

Non-marketable debt investment

In the three months ended September 30, 2019, we invested $2.0 million in the form of a convertible note receivable in a privately held company without a readily determinable market value. The note receivable matures upon request for payment by a majority of note holders no sooner than October 31, 2021, or otherwise upon a change of control or event of default involving the privately held company. The note converts to preferred stock or common stock upon certain events as defined, including a qualified preferred stock financing round or a change in control of ownership. Interest accrues annually at 6% and is due in full upon maturity.

The convertible note is classified as available for sale and is carried at fair value within Level 3, with any unrealized gains and losses, net of tax, reported as accumulated other comprehensive income (loss) and included as a separate component of stockholders’ equity. Gains and losses are recognized when realized. We did not have any unrealized or realized gains or losses in the three months ended September 30, 2019. The carrying value of our non-marketable debt investment was $2.0 million at September 30, 2019. We did not hold any non-marketable debt investments at June 30, 2019.


5.	Leases

We have entered into various non-cancelable office space operating leases with original lease periods expiring between 2019 and 2024. These do not contain material variable rent payments, residual value guarantees, covenants or other restrictions.

Operating lease costs for the three months ended September 30, 2019 were $817,000. The weighted-average remaining term of our operating leases was 3.4 years and the weighted-average discount rate used to measure the present value of the operating lease liabilities was 5.0% as of September 30, 2019.

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TELENAV, INC.

Notes to Condensed Consolidated Financial Statements—(Continued)

(unaudited)

Maturities of our operating lease liabilities, which do not include short-term leases, as of September 30, 2019 were as follows (in thousands):



Fiscal Year	September 30, 2019
2020	$	2,995
2021	3,124
2022	2,761
2023	2,313
2024	619
Total lease payments	11,812
Less: imputed interest	(978		)
Total operating lease liabilities	$	10,834

Cash payments included in the measurement of our operating lease liabilities were $0.9 million for the three months ended September 30, 2019.


6.	Balance sheet information

Goodwill and intangible assets, net

Goodwill as of September 30, 2019 and June 30, 2019 was $14.3 million and $26.1 million, respectively. The reduction in goodwill of $11.8 million was due to the sale of the Ads Business to inMarket. See Note 12.

Intangible assets consisted of the following (in thousands):



	September 30, 2019			June 30, 2019
Acquired developed technology	$	13,875		$	13,875
Less accumulated amortization	(12,712		)	(12,494		)
Intangible assets, net	$	1,163		$	1,381

Acquired developed technology is amortized on a straight-line basis over the expected useful life. Amortization expense related to intangibles was $218,000 and $284,000 for the three months ended September 30, 2019 and 2018, respectively.

As of September 30, 2019, remaining amortization expense for intangible assets by fiscal year was as follows: $654,000 in fiscal 2020 and $509,000 in fiscal 2021.

Other assets

Other assets consisted of the following (in thousands):



	September 30, 2019		June 30, 2019
Deposits and other assets	$	919	$	956
Non-marketable equity investments	458		458
Non-marketable equity investment greater than 5% in LLC	15,600		—
Non-marketable debt investment	2,000		—
Total other assets	$	18,977	$	1,414

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TELENAV, INC.

Notes to Condensed Consolidated Financial Statements—(Continued)

(unaudited)

Accrued expenses

Accrued expenses consisted of the following (in thousands):



	September 30, 2019		June 30, 2019
Accrued compensation and benefits	$	7,051	$	13,288
Accrued royalties	14,672		21,604
Customer overpayments and related reserves	4,674		4,291
Other accrued expenses	11,968		9,716
Total accrued expenses	$	38,365	$	48,899


7.	Deferred revenue and remaining performance obligations

Deferred revenue

Deferred revenue, which is a contract liability, consists primarily of payments received in advance of revenue recognition under our contracts with customers and is recognized upon transfer of control. Changes in the balance of total deferred revenue (current and non-current) during the three months ended September 30, 2019 were as follows (in thousands):



Beginning balance, June 30, 2019	$	135,135
Revenue recognized that was included in beginning balance	(13,515		)
Amount billed, net of revenue recognized that was not included in beginning balance	25,637
Ending balance, September 30, 2019	$	147,257

The cumulative adjustment as a result of changes in the estimate of the transaction price of customer contracts during the three months ended September 30, 2019 was a net increase in revenue recognized of $228,000. In addition, the amount of revenue recognized in the three months ended September 30, 2019 from performance obligations satisfied or partially satisfied in previous periods was $230,000.

Remaining performance obligations

Transaction price allocated to the remaining performance obligations represents contracted revenue that has not yet been recognized, which includes deferred revenue and amounts that are expected to be invoiced and recognized as revenue in future periods. As of September 30, 2019, the aggregate amount of the transaction price allocated to remaining performance obligations for our automotive segment was $84.6 million, which is expected to be recognized over a remaining period of approximately 5 to 8 years. This amount excludes the variable consideration that falls under the exemption for usage-based royalties promised in exchange for a license of intellectual property. We have used the practical expedient to not disclose amounts related to the comparative period under ASC 606.

The aggregate amount of transaction price allocated to the remaining performance obligations as of September 30, 2019 was not material.


8.	Commitments and contingencies

Guarantees and indemnifications

Our agreements with our customers generally include certain provisions for indemnifying them against liabilities if our products and services infringe a third party’s intellectual property rights or for other specified matters. We have in the past received indemnification requests or notices of their intent to seek indemnification in the future from our customers with respect to specific litigation claims in which our customers have been named as defendants. The maximum amount of potential future indemnification is unlimited.

We have agreed to indemnify our directors, officers and certain other employees for certain events or occurrences, subject to certain limits, while such persons are or were serving at our request in such capacity. We may terminate the indemnification agreements with these persons upon the termination of their services with us, but termination will not affect claims for indemnification related to events occurring prior to the effective date of termination. The maximum amount of potential future indemnification is unlimited. We have a directors’ and officers’ insurance policy that limits our potential exposure. We believe that any financial exposure related to these indemnification agreements is not material.

Other contractual commitments

As of September 30, 2019, we had $7.6 million of future minimum non-cancelable financial commitments primarily related to license fees due to certain of our third-party content providers, regardless of usage level. These commitments are primarily due within five years.

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TELENAV, INC.

Notes to Condensed Consolidated Financial Statements—(Continued)

(unaudited)

Contingencies

From time to time, we may become involved in legal proceedings, claims and litigation arising in the ordinary course of business. When we believe a loss or a cost of indemnification is probable and which we can reasonably estimate, we accrue our estimate of the loss or cost of indemnification in our consolidated financial statements. Where we cannot determine the outcome of these matters, we do not make a provision in our financial statements until the loss or cost of indemnification, if any, is probable and can be reasonably estimated or the outcome becomes known. We expense legal fees related to these matters as they are incurred.

In addition, we have received, and expect to continue to receive, demands for indemnification from our customers, which demands can be very expensive to settle or defend, and we have in the past offered to contribute to settlement amounts and incurred legal fees in connection with certain of these indemnity demands. Furthermore, in response to these demands we may be required to assume control of and bear all costs associated with the defense of our customers in compliance with our contractual commitments.

Legal proceedings are subject to inherent uncertainties. Unfavorable outcomes could have a material adverse impact on our business, financial position, cash flows or overall trends in results of our operations.


9.	Stock-based compensation

Under our 2009 Equity Incentive Plan and 2011 Stock Option and Grant Plan, eligible employees, directors and consultants are able to participate in our future performance through awards of nonqualified stock options, incentive stock options and restricted stock units as authorized by our board of directors. In addition, we have granted restricted common stock in connection with certain acquisitions.

A summary of our stock option activity is as follows (in thousands except per share and contractual life amounts):



	Number of Shares		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (years)	Aggregate Intrinsic Value
Options outstanding as of June 30, 2019	3,409		$	6.49
Granted	—		—
Exercised	(1,326	)	6.29
Canceled or expired	(24	)	5.22
Options outstanding as of September 30, 2019	2,059		$	6.64	4.92	$	—
As of September 30, 2019:
Options vested and expected to vest	2,021		$	6.67	4.87	$	—
Options exercisable	1,555		$	7.02	4.30	$	—

A summary of our restricted stock unit, or RSU, activity is as follows (in thousands except contractual life amounts):



	Number of Shares		Weighted Average Remaining Contractual Life (years)	Aggregate Intrinsic Value
RSUs outstanding as of June 30, 2019	2,637
Granted	1,120
Vested	(485	)
Canceled	(305	)
RSUs outstanding as of September 30, 2019	2,967		1.74	$	14,181
As of September 30, 2019:
RSUs expected to vest	2,510		1.58	$	11,998

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TELENAV, INC.

Notes to Condensed Consolidated Financial Statements—(Continued)

(unaudited)

Performance-based RSUs

In September 2019, the Compensation Committee of our Board of Directors (the “Compensation Committee”) approved the grant under our 2009 Equity Incentive Plan of performance-based RSUs covering a target of 560,000 shares of common stock under individual grants to several of our executive officers, which we refer to as the PSU Awards.

The PSU Awards are subject to four performance milestones, each requiring achievement of a specified trailing average closing stock price for a 30 trading day period on or before the three-year anniversary of the PSU Awards’ grant date. Achieving each individual stock price performance milestone will result in one quarter of the shares subject to the PSU Award becoming eligible to vest. If a stock price performance milestone is achieved, then one half of the shares that became eligible to vest under the PSU Award upon achievement of that stock price performance milestone will vest on the later of November 1, 2020, or the date that the Compensation Committee certifies achievement of the milestone, and the remaining one half of the shares that became eligible to vest will vest on the one-year anniversary of the date the performance milestone was achieved, in each case subject to the respective executive’s continued service with the Company through the applicable vesting date. The maximum number of shares subject to the PSU Award that may vest is 560,000.

In October 2018, the Compensation Committee approved the grant under our 2009 Equity Incentive Plan of performance-based RSUs covering a target of 240,000 shares of common stock to Dr. HP Jin, our Chairman of the Board of Directors, President and Chief Executive Officer, or CEO, which we refer to as the CEO PSU Award. The CEO PSU Award is subject to four performance milestones, each requiring achievement of a specified trailing average closing stock price for a 30 trading day period on or before the three-year anniversary of the CEO PSU Award’s grant date. Achieving each individual stock price performance milestone will result in one quarter of the shares subject to the CEO PSU Award becoming eligible to vest. If a stock price performance milestone is achieved, then one half of the shares that became eligible to vest under the CEO PSU Award upon achievement of that stock price performance milestone will vest on the later of November 1, 2019, or the date that the Compensation Committee certifies achievement of the milestone, and the remaining one half of the shares that became eligible to vest will vest on the one-year anniversary of the date the performance milestone was achieved, in each case subject to Dr. Jin’s continued service with the Company through the applicable vesting date. The maximum number of shares subject to the CEO PSU Award that may vest is 240,000. No shares had vested as of November 1, 2019.

Since achievement of the awards is dependent on a market condition, stock-based compensation expense associated with these awards is recognized regardless of whether the market condition is satisfied, provided that the requisite service period has been met. We utilized the Monte Carlo valuation method to determine the fair value and derived service periods of each of the stock price performance milestones. Total stock-based compensation expense associated with the PSU Awards and the CEO PSU Award for the three months ended September 30, 2019 and 2018was not material. Total stock-based compensation expense associated with the CEO PSU Award for the three months ended 43373 was not material.

As of September 30, 2019, no performance-based RSUs had been earned or canceled, and 800,000 performance-based RSUs remained outstanding.

During the three months ended September 30, 2019, pursuant to the annual increase provisions of our 2009 Equity Incentive Plan, the number of shares available for grant under this plan increased by 1,666,666 shares. The last annual increase in the shares reserved for issuance under our 2009 Equity Incentive Plan occurred on July 1, 2019, and the plan expired in October 2019 as to new awards. Our board of directors also terminated the 2011 Stock Option and Grant Plan. A summary of our shares available for grant activity is as follows (in thousands):



	Number of Shares
Shares available for grant as of June 30, 2019	4,472
Additional shares authorized	1,667
Granted	(1,680	)
RSUs withheld for taxes in net share settlements	155
Canceled	329
Shares available for grant as of September 30, 2019	4,943

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TELENAV, INC.

Notes to Condensed Consolidated Financial Statements—(Continued)

(unaudited)

The following table summarizes the stock-based compensation expense for continuing operations recorded for stock options and RSUs, including performance-based RSUs, issued to employees and nonemployees (in thousands):



	Three Months Ended September 30,
	2019		2018
Stock option awards	$	308	$	417
RSU awards	1,444		1,631
Total stock-based compensation expense	$	1,752	$	2,048

We use valuation pricing models to determine the fair value of stock-based awards. The determination of the fair value of stock-based payment awards on the date of grant is affected by the stock price as well as assumptions regarding a number of complex and subjective variables. These variables include expected stock price volatility over the term of the awards, actual and projected employee stock option exercise behaviors, risk-free interest rates and expected dividends. The weighted average assumptions used to value stock option awards granted and the resulting weighted average grant date fair value per share were as follows:



	Three Months Ended September 30,
	2019			2018
Expected volatility	—		%	39		%
Expected term (in years)	—			6.87
Risk-free interest rate	—		%	2.99		%
Dividend yield	—		%	—		%
Weighted average grant date fair value per share	$	—		$	2.32

No stock option awards were granted during the three months ended September 30, 2019.


10.	Stock repurchase program

In February 2019, our board of directors authorized a program for the repurchase of up to $20.0 million of our shares of common stock through open market purchases. The term of the program is 18 months. The timing and amount of repurchase transactions under this program will depend on market conditions, cash flow and other considerations. No shares were repurchased under this program during the three months ended September 30, 2019. As of September 30, 2019, the remaining authorized amount of stock repurchases that may be made under this repurchase program was $18.7 million.

Repurchased shares are retired and designated as authorized but unissued shares. We use the par value method of accounting for our stock repurchases. Under the par value method, common stock is first charged with the par value of the shares involved. The excess of the cost of shares acquired over the par value is allocated to additional paid-in capital, or APIC, based on an estimated average sales price per issued share with the excess amounts charged to retained earnings.

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TELENAV, INC.

Notes to Condensed Consolidated Financial Statements—(Continued)

(unaudited)


11.	Income taxes

The effective tax rate for the periods presented is the result of the mix of forecasted fiscal year income earned or loss incurred in various tax jurisdictions that apply a broad range of income tax rates. Our provision for income taxes for continuing operations was $411,000 in the three months ended September 30, 2019 compared to $740,000 in the three months ended September 30, 2018 and was comprised primarily of foreign withholding taxes and income taxes in foreign jurisdictions where we have profit. Our effective tax provision rate of 24% and 14% of loss from continuing operations for the three months ended September 30, 2019 and 2018, respectively, was greater than the tax amount computed at the U.S. federal statutory income tax rate due primarily to losses for which no benefit will be recognized since the tax assets are not likely to be realized due to the lack of current and forecasted future income. Although the total income tax provision did not change for the three months ended September 30, 2018, taxes were allocated to discontinued operations in an amount equal to the difference between the tax originally computed on loss from operations and the tax recomputed on the amount of loss from continuing operations.

We record liabilities related to unrecognized tax benefits in accordance with authoritative guidance on accounting for uncertain tax positions. As of September 30, 2019 and June 30, 2019, our cumulative unrecognized tax benefits were $4.8 million and $4.6 million, respectively. Included in the balance of unrecognized tax benefits at September 30, 2019 and June 30, 2019 was $100,000 and $100,000, respectively, that if recognized, would affect the effective tax rate.

We recognize interest and penalties related to unrecognized tax benefits as part of our provision for federal, state and foreign income taxes. We accrued zero and zero for the payment of interest and penalties at September 30, 2019 and June 30, 2019, respectively.

We file income tax returns with the Internal Revenue Service, or IRS, California and various states and foreign tax jurisdictions in which we have filing obligations. The statute of limitations remains open from fiscal 2016 for federal tax purposes, from fiscal 2014 in state jurisdictions and from fiscal 2013 in foreign jurisdictions. Fiscal years outside the normal statute of limitation remain open to audit by tax authorities due to tax attributes generated in those early years which have been carried forward and may be audited in subsequent years when utilized.

Due to operating losses in previous years and continued earnings volatility, we maintain a valuation allowance on the majority of our deferred tax assets. Our valuation allowance at June 30, 2019 was $48.4 million. In evaluating our ability to recover our deferred tax assets each quarter, we consider all available positive and negative evidence, including current and previous operating results, ability to carryback losses for a tax refund, and forecasts of future operating results.


12.	Sale of Ads Business

On August 16, 2019, we completed the disposition of our Ads Business to inMarket (the "inMarket Transaction"). In exchange, inMarket issued to us units of inMarket representing a 14.5% member interest in inMarket at the time of the closing of the inMarket Transaction. We also received a perpetual, non-exclusive, irrevocable, royalty-free license under software and other intellectual property rights being assigned to inMarket as part of the inMarket Transaction, as set forth in the Asset Purchase Agreement, dated August 8, 2019, by and among Telenav, Thinknear, Inc., a wholly owned subsidiary of Telenav, and inMarket, as amended. Pursuant to the terms of a Transition Services Agreement, we also agreed to provide inMarket with transition services for a period of time generally not to exceed eight months following the closing of the inMarket Transaction.

The historical financial results attributable to the Ads Business are presented as discontinued operations in our condensed consolidated statements of operations for all periods presented. The carrying amounts of assets and liabilities included as part of discontinued operations have been classified as assets of discontinued operations and liabilities of discontinued operations, respectively, in our condensed consolidated balance sheet at June 30, 2019.

Reconciliations of the carrying amounts of major classes of assets and liabilities included as part of discontinued operations to the amounts presented separately in our September 30, 2019 and June 30, 2019 balance sheet are presented in the following tables:

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TELENAV, INC.

Notes to Condensed Consolidated Financial Statements—(Continued)

(unaudited)



	September 30, 2019		June 30, 2019
Assets
Accounts receivable	$	628	$	6,011
Prepaid and other current assets	1,160		319
Assets of discontinued operations	$	1,788	$	6,330

Property and equipment, net	$	72	$	72
Operating lease right-of-use assets	187		—
Deferred income taxes, non-current	—		(59		)
Goodwilll and intangible assets, net	—		11,786
Other assets	—		395
Assets of discontinued operations, non-current	$	259	$	12,194

Liabilities
Accounts payable	$	176	$	974
Accrued expenses	1,550		2,399
Operating lease liabilities	150		—
Liabilities of discontinued operations	$	1,876	$	3,373

Deferred rent, non-current	$	—	$	30
Operating lease liabilities, non-current	107		—
Liabilities of discontinued operations, non-current	$	107	$	30

Reconciliations of the major line items comprising loss from operations of the Ads Business included as part of discontinued operations to the amounts presented separately in our statements of operations for the three months ended September 30, 2019 and 2018 are presented in the following tables:



	Three Months Ended September 30,
	2019		2018
Revenue - services	$	3,614	$	5,947
Cost of revenue - services	1,335		3,220
Gross profit	2,279		2,727
Operating expenses:
Research and development	697		1,610
Sales and marketing	750		2,712
General and administrative	—		—
Total operating expenses	1,447		4,322
Income (loss) from operations of Ads Business, net of tax provision (benefit) of $0 and $(110), respectively	$	832	$	(1,485	)

Our 14.5% member interest in inMarket was valued at $15.6 million at the closing of the inMarket Transaction and is recorded in other assets on our condensed consolidated balance sheet at September 30, 2019. See Note 4. Our loss from the sale of the Ads Business of $4.8 million included $1.9 million comprising severance for Ads Business employees who were not offered employment with inMarket and acceleration of stock-based awards vesting for certain Ads Business executives who were not offered employment with inMarket, and $363,000 comprising legal fees and third-party consulting fees associated with the inMarket Transaction.

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Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion and analysis should be read together with our condensed consolidated financial statements and the notes to those statements included elsewhere in this Form 10-Q. This Form 10-Q contains forward-looking statements that are based on our management’s beliefs and assumptions and on information currently available to our management. The forward-looking statements are contained principally in the sections entitled “Risk Factors” and this Management’s Discussion and Analysis of Financial Condition and Results of Operations. Forward-looking statements include information concerning our possible or assumed future results of operations, accounting for and future sources of revenue, expectations regarding expenses, business strategies, financing plans, competitive position, industry environment, potential growth opportunities, retention and expansion of existing customer relationships and the effects of competition. Forward-looking statements include statements that are not historical facts and can be identified by terms such as “anticipates,” “believes,” “could,” “seeks,” “estimates,” “expects,” “intends,” “may,” “plans,” “potential,” “predicts,” “projects,” “should,” “will,” “would” or similar expressions and the negatives of those terms.

Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. We discuss these risks in greater detail in “Risk Factors” and elsewhere in this Form 10-Q. Given these uncertainties, you should not place undue reliance on these forward-looking statements. Also, forward-looking statements represent our management’s beliefs and assumptions only as of the date of this Form 10-Q.

Except as required by law, we assume no obligation to update these forward-looking statements, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future. You should read this Form 10-Q completely and with the understanding that our actual future results may be materially different from what we expect.

Investors and others should note that we announce material financial information to our investors using our investor relations website (http://investor.telenav.com), SEC filings, press releases, public conference calls and webcasts. We use these channels to communicate with our investors and the public about our company, our products and services and other issues. It is possible that the information we post on our investor relations website could be deemed to be material information. Therefore, we encourage investors, the media, and others interested in our company to review the information we post on our investor relations website.

In this Form 10-Q, “we,” “us,” “our,” “the Company” and “Telenav” refer to Telenav, Inc. and its subsidiaries. We operate on a fiscal year ending June 30 and refer to the fiscal year ended June 30, 2019 as “fiscal 2019” and the fiscal year ending June 30, 2020 as “fiscal 2020.”

Overview

Telenav is a leading provider of location-based products and services for connected cars. We utilize our connected car platform to deliver these products and services. Our connected car platform allows us to deliver enhanced location-based navigation services to automobile manufacturers and tier one suppliers, or tier ones. In addition, as discussed below, until August 2019, we utilized our advertising platform, which we refer to as our Ads Business, to deliver highly targeted advertising services to advertisers and advertising agencies by leveraging our location expertise. We reported results through June 30, 2019 in three business segments: automotive, advertising and mobile navigation. Commencing with the quarter ended September 30, 2019, we report results in a single segment, automotive. Our mobile navigation services business, which generates revenue from our partnerships with wireless carriers who sell our navigation services to their subscribers, represented less than 5% of total revenue for the three months ended September 30, 2019 and we expect the business to continue to decline. Our CEO, the chief operating decision maker, does not review mobile navigation revenue and cost of revenue separately. As a result, we have combined the mobile navigation business with the automotive business in a single segment.

We derive revenue primarily from automobile manufacturers and tier ones whose vehicles or systems incorporate our proprietary personalized navigation software and services. These manufacturers and tier ones generally do not provide us with any volume or revenue guarantees.

We offer four variations of our connected car products and services to our automobile manufacturer and tier one customers for distribution with their vehicles and systems. First, we offer on-board navigation systems that are built into vehicles with all key elements of the system residing in the vehicle as a self-contained application along with the related software and content. Our on-board navigation products do not require access to the Internet or wireless networks to function. Second, we offer advanced navigation solutions that contain on-board functionality and also add cloud functionality such as cloud search, cloud routing, map updates and “live” data. We refer to these solutions as hybrid navigation. Third, we offer mobile phone-based navigation solutions that run on the phone and provide an interactive map and navigation instructions to

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the vehicle's video screen and audio system, which we refer to as brought-in navigation. Finally, we offer a software development kit, or SDK, that enables our customers to add mapping and location capabilities to their cloud, mobile and on-board automotive applications. We believe our history as a supplier of cloud-based navigation services combined with our proven track record of delivering navigation solutions to three of the top five global automobile manufacturers provides a unique advantage in the automotive navigation marketplace over our competitors.

We provide our automotive navigation products and services to automobile manufacturers such as Ford Motor Company and affiliated entities, or Ford, which represented 54% of our revenue in the three months ended September 30, 2019, General Motors Holdings and its affiliates, or GM, which represented 25% of our revenue in the three months ended September 30, 2019, and Toyota Motor Corporation, or Toyota. We also provide our products and services indirectly through tier ones such as Xevo Inc., or Xevo, for certain Toyota solutions, LG Electronics, Inc., or LG, for certain Opel Automobile GmbH, or Opel, solutions and Panasonic Automotive Systems Company of America, or Panasonic, for certain Fiat Chrysler Automobiles, or FCA, solutions.

We generate product revenue from the delivery of customized software and royalties from the distribution of this customized software in certain automotive navigation applications, map updates to the software and customized software development. We generate services revenue from brought-in automotive navigation solutions, advertising services and mobile navigation services.

Ford utilizes our on-board automotive navigation product in its Ford SYNC® platform. Ford pays us a royalty fee on SYNC 3 on-board solutions as our software is installed in the vehicle. We also derive product revenue from map update fees.

We generate automotive services revenue primarily from our brought-in automotive navigation solutions. We earn a fee for each new vehicle owner who downloads and activates the associated mobile application featuring GM's branded mobile and web-based applications, whereby we provide enhanced search capabilities for contracted service periods. We also earn a fee for each new Toyota and Lexus vehicle sold and enabled to connect with our Scout GPS Link mobile application, similarly provided over a contracted service period.

For its hybrid navigation solutions, GM pays us a royalty fee as the SD card is shipped for installation in vehicles; this royalty includes a fee for the initial connected service to be provided once the vehicle is sold. GM will pay us an additional service fee for connected solution subscriptions for each end user that elects to renew their OnStar Connected Navigation or Connected Navigation subscription with GM.

Through August 2019, we generated services revenue from our Ads Business through the delivery of advertising impressions based on the specific terms of the advertising contract. In August 2019, we sold the Ads Business to inMarket. Upon the terms and subject to the conditions of the Asset Purchase Agreement, inMarket acquired substantially all of the assets and assumed certain liabilities related to and used in the Ads Business. In exchange, inMarket issued to Telenav units of inMarket representing a 14.5% member interest in inMarket at the time of closing of the inMarket Transaction. In addition, inMarket granted to us a perpetual, non-exclusive, irrevocable, royalty-free, license back to the software and other intellectual property rights being assigned to inMarket as part of the inMarket Transaction. For the three months ended September 30, 2019 and for all prior comparative periods, we reported the operating results of the Ads Business and the loss on its sale as discontinued operations in our condensed consolidated financial statements. In August 2019, we entered into certain agreements with affiliates of Grab Holdings, Inc., which, collectively with certain of its affiliates, we refer to as Grab, including: (i) a services agreement pursuant to which we agreed that we will provide certain services to Grab through certain of our employees designated to work on our OpenTerra Platform; (ii) a license agreement pursuant to which we have granted to Grab a perpetual license to certain intellectual property associated with the OpenTerra Platform; and (iii) an asset purchase agreement pursuant to which we will sell certain intellectual property associated with the OpenTerra Platform to Grab and facilitate the making of offers for employment or consulting arrangements by Grab of certain of our OpenTerra employees. The transactions contemplated by the services agreement, license agreement and asset purchase agreement together comprise the “Grab Transaction.” The consideration for the services agreement, license agreement and asset purchase agreement is a mix of cash and Grab Holdings, Inc. ordinary shares. The asset purchase component of the Grab Transaction is subject to customary closing conditions and is expected to close before June 30, 2020.

For a discussion of trends, uncertainties and other factors that could impact our business, financial condition and operating results, see the section entitled "Risk Factors" in Part II, Item 1A, which is incorporated herein by reference.

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Key operating and financial performance metrics

We monitor the key operating and financial performance metrics set forth in the tables below to help us evaluate growth trends, establish budgets, measure the effectiveness of our sales and marketing efforts and assess our operational efficiencies. Certain of these measures such as billings, changes in deferred revenue and deferred costs, adjusted earnings before interest, taxes, depreciation and amortization, or adjusted EBITDA and free cash flow are not measures calculated in accordance with GAAP, and should not be considered as an alternative to any measure of financial performance calculated and presented in accordance with GAAP. In addition, these non-GAAP measures may not be comparable to similarly titled measures of other companies because other companies may not calculate them in the same manner that we do.

Our key operating and financial performance metrics are as follows (in thousands, except percentages and per share amounts):



	Three Months Ended September 30,
	2019			2018
Revenue	$	64,455		$	46,252
Revenue from Ford as a percentage of total revenue	54		%	67		%
Revenue from GM as a percentage of total revenue	25		%	16		%
Billings (Non-GAAP)	$	76,577		$	53,094
Billings to Ford as a percentage of total billings (Non-GAAP)	39		%	60		%
Billings to GM as a percentage of total billings (Non-GAAP)	26		%	19		%
Increase in deferred revenue	$	12,122		$	6,842
Increase in deferred costs	$	(2,007	)	$	4,381
Gross profit	$	27,604		$	18,710
Gross margin	43		%	40		%
Loss from continuing operations	$	(2,142	)	$	(6,085	)
Net loss	$	(6,128	)	$	(7,570	)
Diluted loss from continuing operations per share	$	(0.04	)	$	(0.14	)
Diluted net loss per share	$	(0.13	)	$	(0.17	)
Adjusted EBITDA (Non-GAAP)	$	382		$	(3,877	)
Net cash provided by (used in) operating activities	$	22,169		$	(554	)
Free cash flow (Non-GAAP)	$	21,708		$	(653	)

Gross margin is our gross profit, or total revenue less cost of revenue, expressed as a percentage of our total revenue. Our gross margin has been and will continue to be impacted by the increasing percentage of our revenue base derived from automotive navigation solutions and advertising network services, which generally have higher associated third-party content costs and third-party display ad inventory costs, respectively, than our mobile navigation offerings provided through wireless carriers.

Billings equals revenue recognized plus the change in deferred revenue from the beginning to the end of the applicable period. We have also provided a breakdown of the calculation of the change in deferred revenue by segment, which is added to revenue in calculating our non-GAAP billings metric. In connection with our presentation of the change in deferred revenue, we have provided a similar presentation of the change in the related deferred costs. Such deferred costs primarily include costs associated with third-party content and certain development costs associated with our customized software solutions whereby customized engineering fees are earned. As we enter into more hybrid and brought-in navigation programs, deferred revenue and deferred costs become larger components of our operating results, so we believe these metrics are useful in evaluating cash flows.

We consider billings to be a useful metric for management and investors because billings drive revenue and deferred revenue, which is an important indicator of our business. There are a number of limitations related to the use of billings versus revenue calculated in accordance with GAAP. First, billings include amounts that have not yet been recognized as revenue. For example, billings related to certain brought-in solutions cannot be fully recognized as revenue in a given period due to requirements for ongoing map updates and provisioning of services such as hosting, monitoring, customer support, map updates and, for certain customers, additional period content and associated technology costs. Second, we may calculate billings in a

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manner that is different from peer companies that report similar financial measures, making comparisons between companies more difficult. When we use this measure, we attempt to compensate for these limitations by providing specific information regarding billings and how they relate to revenue calculated in accordance with GAAP.

Adjusted EBITDA measures our GAAP net loss adjusted for discontinued operations and excluding the impact of stock-based compensation expense, depreciation and amortization, other income (expense), net, provision (benefit) for income taxes, and other applicable items such as legal settlements and contingencies and merger and acquisition, or M&A, transaction expenses, net of tax. Stock-based compensation expense relates to equity incentive awards granted to our employees, directors, and consultants. Legal settlements and contingencies represent settlements, offers made to settle, or loss accruals relating to litigation or other disputes in which we are a party or the indemnitor of a party. M&A transaction expenses relate primarily to costs associated with transactions, such as the inMarket Transaction and the Grab Transaction.

Adjusted EBITDA, while generally a measure of profitability, can also represent a loss. Adjusted EBITDA is a key measure used by our management and board of directors to understand and evaluate our core operating performance and trends, to prepare and approve our annual budget and to develop short- and long-term operational plans. In particular, we believe that the exclusion of the expenses eliminated in calculating adjusted EBITDA can provide a useful measure for period-to-period comparisons of our core business. Accordingly, we believe that adjusted EBITDA generally provides useful information to investors and others in understanding and evaluating our operating results in the same manner as our management and board of directors.

Free cash flow is a non-GAAP financial measure we define as net cash provided by (used in) operating activities less purchases of property and equipment. We consider free cash flow to be a liquidity measure that provides useful information to management and investors about the amount of cash (used in) generated by our business after purchases of property and equipment.

These non-GAAP measures have limitations as analytical tools and should not be considered in isolation or as substitutes for our financial results as reported under GAAP. Some of these limitations are:


•	We expect to incur additional costs in the future due to requirements to provide ongoing provisioning of services such as hosting, monitoring and customer support; accordingly, deferred costs do not reflect all costs associated with billings;


•	assets being depreciated and amortized may have to be replaced in the future, and adjusted EBITDA does not reflect cash capital expenditure requirements for such replacements or for new capital expenditures;


•	adjusted EBITDA does not reflect the potentially dilutive impact of equity-based compensation;


•	adjusted EBITDAs does not reflect the use of cash for net share settlements of RSUs;


•	adjusted EBITDA does not reflect tax payments that historically have represented a reduction in cash available to us or tax benefits that may arise as a result of generating net losses; and


•	adjusted EBITDA, free cash flow or similarly titled measures may be calculated by other companies differently, which reduces their usefulness as comparative measures.

Because of these and other limitations, billings, adjusted EBITDA and free cash flow should be considered alongside other GAAP-based financial performance measures.

We reconcile the most directly comparable GAAP financial measure to each non-GAAP financial metric used. The following tables present reconciliations of revenue to billings, deferred revenue to the change in deferred revenue, deferred costs to the change in deferred costs, net loss to adjusted EBITDA, and net loss and net cash flow used in operating activities to free cash flow for each of the periods indicated (dollars in thousands):

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Reconciliation of Revenue to Billings

	Three Months Ended September 30,
	2019		2018
Revenue	$	64,455	$	46,252
Adjustments:
Change in deferred revenue	12,122		6,842
Billings	$	76,577	$	53,094



Reconciliation of Deferred Revenue to Change in Deferred Revenue
Reconciliation of Deferred Costs to Change in Deferred Costs

	Three Months Ended September 30,
	2019			2018
Deferred revenue, September 30	$	147,257		$	81,380
Deferred revenue, June 30	135,135			74,538
Change in deferred revenue	$	12,122		$	6,842

Deferred costs, September 30	$	77,795		$	62,806
Deferred costs, June 30	79,802			58,425
Change in deferred costs(1)	$	(2,007	)	$	4,381



Reconciliation of Revenue to Billings - Ford and GM

	Three Months Ended September 30,
	2019			2018
Revenue from Ford	$	34,912		$	30,811
Adjustments:
Change in deferred revenue attributed to Ford	(4,782		)	962
Billings to Ford	$	30,130		$	31,773
Billings to Ford as a percentage of total billings	39		%	60		%

Revenue from GM	$	16,362		$	7,446
Adjustments:
Change in deferred revenue attributed to GM	3,272			2,855
Billings to GM	$	19,634		$	10,301
Billings to GM as a percentage of total billings	26		%	19		%

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Reconciliation of Net Loss to Adjusted EBITDA

	Three Months Ended September 30,
	2019			2018
Net loss	$	(6,128	)	$	(7,570	)
Loss on discontinued operations	3,986			1,485
Loss from continuing operations	(2,142		)	(6,085		)
Adjustments:
Stock-based compensation expense	1,752			2,048
Depreciation and amortization expense	922			1,010
Other income, net	(561		)	(1,590		)
Provision for income taxes	411			740
Adjusted EBITDA	$	382		$	(3,877	)



Reconciliation of Net Loss to Free Cash Flow

	Three Months Ended September 30,
	2019			2018
Net loss	$	(6,128	)	$	(7,570	)
Loss on discontinued operations	3,986			1,485
Loss from continuing operations	(2,142		)	(6,085		)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Change in deferred revenue ⁽¹⁾	12,221			6,842
Change in deferred costs ⁽²⁾	1,979			(4,381		)
Changes in other operating assets and liabilities	6,780			1,266
Other adjustments ⁽³⁾	3,331			1,804
Net cash provided by (used in) operating activities	22,169			(554		)
Less: Purchases of property and equipment	(461		)	(99		)
Free cash flow	$	21,708		$	(653	)

⁽¹⁾ Consists of product royalties, customized software development fees, service fees and subscription fees.
⁽²⁾ Consists primarily of third-party content costs and customized software development expenses.
⁽³⁾ Consist primarily of depreciation and amortization, stock-based compensation expense and other non-cash items.

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Key components of our results of operations

Sources of revenue

Overview. We classify our revenue as either product or services revenue. Product revenue consists primarily of revenue we receive from the delivery of customized software and royalties from the distribution of this customized software in certain automotive navigation applications, map updates to the software and customized software development. Services revenue consists primarily of revenue we derive from our brought-in automotive navigation services.

Commencing July 1, 2019, we operate in a single segment, automotive. Through June 30, 2019, we operated in three segments - automotive, advertising and mobile navigation. In August 2019, we completed the disposition of our Ads Business and have presented the results of operations for the Ads Business as discontinued operations for all prior periods presented. Our mobile navigation services business represented less than 5% of total revenue for the three months ended September 30, 2019 and we expect the business to continue to decline. Our CEO, the chief operating decision maker, does not review mobile navigation revenue and cost of revenue separately. As a result, we have combined the mobile navigation services business with the automotive business in a single segment.

In the three months ended September 30, 2019 and 2018, revenue from Ford represented 54% and 67% of our total revenue, respectively, and revenue from GM comprised 25% and 16% of total revenue, respectively.

Our contract with Ford covers a broad range of products and services that we provide to Ford. On March 28, 2018, we entered into an amendment with Ford that extends the term of the agreement from December 31, 2018 to December 31, 2020 for each jurisdiction in which we currently provide our products to Ford. On December 14, 2017, Ford also selected us to provide its next generation navigation solution in North America, subject to certain conditions and execution of an agreement regarding those solutions. The terms of this next generation navigation solution were embodied in an amendment executed in December 2018. With respect to North America production, this amendment extended the term of the agreement to December 31, 2022, which term may be further extended at Ford’s option subject to certain conditions. We were not awarded the contracts for Europe, South America and Australia and New Zealand. Furthermore, a substantial portion of our revenue, and, to a lesser extent, gross profit, is impacted by the underlying licensed content cost negotiated through HERE North America, LLC, or HERE, and other content providers and we cannot predict the impact on our revenue and gross profit of any changes between Ford and the map or other content providers.

Our contract with GM includes the provision of our on-board, hybrid, and brought-in navigation solutions across a wide assortment of GM vehicles. Our mobile navigation SDK powers GM’s branded mobile and web-based applications and is covered under a services agreement that was entered into June 13, 2014 and extends to December 31, 2019. Our on-board and hybrid navigation solutions for GM are covered under a product and services agreement that became effective February 1, 2017. These solutions began shipping in a limited number of vehicles beginning with model year 2017 and are gradually expanding across additional regions and models. In May 2017, additional vehicles through model year 2025 were added to this products and services agreement, which terminates on December 31, 2026. Although it does not affect the terms of our agreement with GM, on September 5, 2019, GM announced that it intended to utilize GAS solutions on certain models beginning with model year 2022.

Product revenue. Our automotive product revenue is generated primarily from on-board and hybrid automotive navigation solutions provided to Ford and GM. Our on-board solutions consist of software, memory card, map and point of interest, or POI, data loaded in the vehicle that provides voice-guided turn by turn navigation displayed on the vehicle screen. Our hybrid navigation solutions contain on-board software functionality and also add cloud functionality such as cloud search, cloud routing, map updates and “live” data.

Royalties for on-board navigation solutions are generally earned at various points in time, depending upon the individual customer agreement. We earn each royalty upon either the re-imaging of the software on each individual memory card or the time at which each vehicle is produced.

We recognize revenue from on-board automotive navigation solutions upon transfer of control of the customized software and any associated integrated content together forming a distinct performance obligation. Transfer of control generally occurs at a point in time upon acceptance. Any royalties for the use of distinct software combined with integrated content, with an allocation of the transaction price based on the relative standalone selling price, or SSP, of map updates, specified upgrades, and other services as applicable, are recognized at the later of when the royalties are earned or when transfer of control of the related performance obligation has occurred.

For hybrid automotive solutions, the transaction price allocated to the on-board component is generally recognized as product revenue as described above, and the transaction price allocated to the included cloud functionality based on SSP is

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generally recognized as services revenue. Since the on-board software is still the predominant item in the hybrid solution, the royalties recognition guidance applies as it does for on-board navigation solutions described above. Our brought-in automotive navigation solutions as described below are subject to variable consideration and constraint guidance.

Our product revenue from Ford is primarily derived from Ford’s SYNC 3 on-board solutions. In each geography where we provide navigation products to it, Ford also provides a map update program under which Ford owners in North America, South America, China and Europe with SYNC 3 and in Australia and New Zealand with SYNC 2 or SYNC 3 are eligible to receive annual map updates at no additional cost through the applicable contractual period. We earn an annual compilation fee and a per unit fee for these updates included in the pricing arrangement. We anticipate that we will continue to depend on Ford for a material portion of our revenue for the foreseeable future.

We also have agreements with GM. In February 2017, GM launched its first model featuring integration of our hybrid navigation solution in North America, the 2017 Cadillac CTS and CTS-V. Our solution is currently available in North America on select 2019 models of Cadillac, GMC, Chevrolet and Buick. GM has also launched vehicles with our hybrid navigation solution in China and the Middle East. Our on-board and connected navigation solution is scheduled to become available in additional regions and GM models for model years 2020 through 2025. We anticipate that we will continue to depend on GM for a material portion of our revenue for the foreseeable future.

We provide entry level on-board navigation through LG, a tier one supplier for the Opel and Vauxhall line of vehicles, for the European market. This solution launched in Opel’s Adam, Corsa, Karl and Zafira model vehicles in July 2017. These products are expected to be made available in other select vehicles for model years 2020 to 2022. GM sold its Opel and Vauxhall business to Groupe PSA in August 2017, and we continue to engage in development of similar solutions for Opel and Vauxhall.

We also have an agreement to offer our on-board navigation solution in select Jeep and Chrysler vehicles in the China market through Panasonic. Our on-board navigation was initially included in the 2018 Jeep Grand Cherokee, which had its China launch in August 2017, and is now included in Jeep Cherokee and Compass models in China.

In August 2019, we entered into certain agreements with Grab, including: (i) a services agreement pursuant to which we agreed that we will provide certain services to Grab through certain of our employees designated to work on our OpenTerra Platform; (ii) a license agreement pursuant to which we have granted to Grab a perpetual license to certain intellectual property associated with the OpenTerra Platform; and (iii) an asset purchase agreement pursuant to which we will sell certain intellectual property associated with the OpenTerra Platform to Grab and facilitate the making of offers for employment or consulting arrangements by Grab of certain of our OpenTerra employees. We amended the license agreement with Grab during the three months ended September 30, 2019. The combined agreements, as amended, contain the following distinct performance obligations: the right to use software significantly modified to operate within the Grab environment, implementation services, and software support and maintenance. In addition, Grab has the right to purchase the assets associated with our OpenTerra Platform for a limited period of time. Software is recognized as product revenue when testing has been completed for the transferred software modules.

Services revenue. We derive services revenue primarily from our brought-in automotive navigation solutions and, to a lesser extent, from the cloud functionality that is a component of our hybrid automotive navigation solutions as discussed above. Royalties for brought-in navigation solutions are earned upon vehicle sales reporting or upon initial usage by the end user.

Since these contracts typically contain a substantial amount of variable consideration that is required to be estimated and included in the transaction price, we include in the transaction price only variable consideration such that it is probable that a risk of significant revenue reversal will not occur when the uncertainty associated with the variable consideration is subsequently resolved. Total variable consideration to be received is estimated at contract inception and updated at each reporting date. We utilize the expected value method and consider expected unit volume combined with a risk-based probability based on factors including, but not limited to: model year cycles, customer history, technology life cycles, nature of competition and other contract-specific factors. Because customers of our brought-in automotive navigation solutions simultaneously receive and consume the benefit from our performance, we recognize revenue ratably over the period the services obligation is expected to be fulfilled, generally 8 to 12 years, as this provides a faithful depiction of the transfer of control.

In October 2017, we amended our agreement with Ford to provide certain connected services for SYNC 3 in North America, Europe and China. Ford launched connected search across various model year 2018 SYNC 3 vehicles in North America using its FordPass^TM and Lincoln Way^TM mobile applications. The vast majority of Ford vehicles with SYNC 3 produced in North America and Europe during the three months ended September 30, 2019 were capable of providing connected services.

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GM offers its OnStar RemoteLink feature including our location-based services platform, and we earn a one-time fee for each new vehicle owner who downloads the associated MyBrand mobile application, including a localized version offered in Europe for the Opel and Vauxhall brands.

We have a partnership with Toyota for brought-in navigation services where our Scout GPS Link mobile application is available in select Entune® Audio equipped Toyota vehicles in North America and in select Lexus Enform® equipped Lexus models. Toyota and Lexus vehicles enabled to connect with our Scout GPS Link began shipping in August 2015 and September 2016, respectively. We earn a one-time fee for each new Toyota or Lexus sold and enabled to connect to our Scout GPS Link mobile application.

In addition, our Scout GPS Link and Xevo’s Xevo^TM Engine Link provide brought-in navigation services, including a fully interactive moving map, for select Toyota vehicles equipped with Entune 3.0 Audio, as well as select Lexus vehicles equipped with Lexus Enform. Our fully interactive solution first became available on select model year 2018 Toyota Camry and Sienna and Lexus NX and RC models, and was expanded to select model year 2019 Toyota Corolla hatchback, Avalon, CHR and RAV4 models, as well as Lexus UX and select model year 2020 Corolla, Prius,Avalon and Sienna models. On most Toyota and Lexus models, a premium embedded connected navigation option is also available that provides connected search, powered by our platform.

While we have seen expansion of our latest version of Scout GPS Link solution across more Toyota and Lexus models in fiscal 2019, we expect that Toyota may limit or reduce the number of models or vehicles on which Scout GPS Link is offered by Toyota and Lexus, beginning in model year 2021, due in part to the offering of alternative brought-in solutions such as Apple’s CarPlay, which Toyota is offering across certain Toyota models, and the expanded offering of Google’s Android Auto solution across more automobile manufacturers.

During the fourth quarter of fiscal 2019, Telenav entered into an amended agreement with Xevo. The amended agreement provides that we will receive a one-time $17.0 million cash pre-payment in the first quarter of fiscal 2020 in exchange for removing a contractual minimum unit commitment that otherwise would have resulted in a payment to us in fiscal 2027. We recorded the receivable as deferred revenue in the fourth quarter of fiscal 2019, and it will be recognized as revenue over future periods. Our contract with Xevo relating to the implementation of our solutions in Toyota and Lexus vehicles is expected to remain in place through 2026, and we are exploring additional opportunities with Xevo and Toyota as well.

We recognize services revenue from the Grab Transaction for implementation services performed over time using an input-based methodology based on hours incurred. Other services revenue from Grab includes software support and maintenance that is recognized over time during the entitlement period.

We generate mobile navigation revenue from our partnerships with wireless carriers who sell our navigation services to their subscribers either as a standalone service or in a bundle with other data or services. Mobile navigation revenue is included with automotive revenue for all periods presented.

Revenue concentrations. We generated 76% and 84% of our revenue in the United States in the three months ended September 30, 2019 and 2018, respectively. With respect to revenue we receive from automobile manufacturers and tier ones for sales of vehicles in other countries, we classify the majority of that revenue as being generated in the United States, because we provide deliverables to and receive compensation from the manufacturer’s or tier one’s United States’ entity. It is possible that this classification may change in the future, as existing and new customers may elect to contract through subsidiaries. For example, in fiscal 2017, Ford assigned certain contract rights for its production of vehicles with our SYNC 3 products to its joint venture in China.

Cost of revenue

We classify our cost of revenue as either cost of product revenue or cost of services revenue. Cost of product revenue consists primarily of the cost of third-party content we incur in providing our on-board automotive navigation solutions, memory cards and recognition of deferred software development costs. Cost of services revenue consists primarily of the costs associated with third-party content we incur in providing our brought-in automotive navigation solutions, data center operations and outsourced hosting services, software maintenance, customer support, the amortization of capitalized software, recognition of deferred customized software development costs, stock-based compensation and amortization of acquired developed technology.

We capitalize and defer recognition of certain third-party royalty-based content costs associated with the fulfillment of future automotive product and services obligations, and we recognize these deferred content costs as cost of revenue as we transfer control of the related performance obligation. As the deferred revenue and related deferred costs are recognized as we

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transfer control of the related performance obligation, we will also incur ongoing costs of revenue for network operations, hosting and data center, customer service support, and other related costs over time.

We also capitalize and defer recognition of certain costs, primarily payroll and related compensation and benefits expense, of customized software we develop for customers. We begin deferring development costs when they relate directly to a contract or specific anticipated contract and such costs are incurred to satisfy performance obligations in the future, provided they are expected to be recovered. We recognize these deferred software development costs as cost of revenue upon transfer of control of the associated performance obligation.

We primarily provide navigation service customer support through a third-party provider to whom we provide training and assistance with problem resolution. In addition, we use outsourced, hosting services and industry standard hardware to provide our navigation services. We generally maintain at least 99.9% uptime every month, excluding designated periods of maintenance. Our internal targets for service uptime are even higher. We have in the past, and may in the future, not achieve our targets for service availability, which could result in penalties for failure to meet contractual service availability requirements or termination of our customer agreement.

Operating expenses

We generally classify our operating expenses into three categories: research and development, sales and marketing and general and administrative. Our operating expenses consist primarily of personnel costs, which include salaries, bonuses, payroll taxes, employee benefit costs and stock-based compensation expense. Other expenses include marketing program costs, third-party contractor and temporary staffing services, facilities-related costs including rent expense, legal, audit and tax consulting and other professional service fees. We allocate stock-based compensation expense resulting from the amortization of the fair value of stock-based awards granted, based on the department in which the award holder works. We allocate overhead, such as rent and depreciation, to each expense category based on headcount. In addition, when we incur legal settlements, make offers to settle contingencies or accrue losses relating to litigation or other disputes in which we are a party or the indemnitor of a party, we classify such operating expense amounts separately as legal settlements and contingencies. We anticipate continued investment of resources, including the hiring of additional headcount, or reallocation of employee personnel to automotive and advertising. We may also be required to pay judgments, indemnification claims or other amounts, which we are unable to predict or estimate at this time.

Research and development. Research and development expenses consist primarily of personnel costs for our development and product management employees and related costs of outside consultants and temporary staffing. We have focused our research and development efforts on improving the ease of use and functionality of our existing products and services as well as developing new products and services. In addition to our U.S. employee base, a significant number of our research and development employees are located in our development centers in China and Romania; as a result, a portion of our research and development expense is subject to changes in foreign exchange rates, notably the Chinese Renminbi, or RMB, the Romanian Leu, or RON, and the Euro.

Sales and marketing. Sales and marketing expenses consist primarily of personnel costs for our sales and marketing staff and the cost of marketing programs, advertising and promotional activities. Our sales and marketing activities include the costs of our business development efforts. Our automobile manufacturer partners and tier ones also provide primary marketing for our on-board and brought-in navigation services.

General and administrative. General and administrative expenses consist primarily of personnel costs for our executive, finance, legal, human resources and administrative personnel, legal, audit and tax consulting and other professional services and corporate expenses.

Legal settlements and contingencies. Legal settlements and contingencies represent settlements, offers made to settle, or loss accruals relating to litigation or other disputes in which we are a party or the indemnitor of a party.

Other income (expense), net. Other income (expense), net consists primarily of interest we earn on our cash and cash equivalents and short-term investments, gain or loss on investments, unrealized gains or losses on non-marketable equity investments and foreign currency gains or losses.

Provision for income taxes. Our provision for income taxes primarily consists of corporate income taxes related to profits earned in foreign jurisdictions, foreign withholding taxes, and changes to our tax reserves. Our effective tax rate could fluctuate significantly from period to period, particularly in those periods in which we incur losses, due to our inability to benefit from net operating losses since the tax assets are not likely to be realized due to the lack of current and forecasted future income. Furthermore, on a quarterly basis our tax rates can fluctuate due to changes in our tax reserves resulting from the settlement of tax audits or the expiration of the statute of limitations. Our effective tax rate could also fluctuate due to a change in our

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earnings or loss projections, changes in the valuation of our deferred tax assets or liabilities, or changes in tax laws, regulations, or accounting principles, as well as the expiration and retroactive reinstatement of tax holidays.

Critical accounting policies and estimates

We prepare our condensed consolidated financial statements in accordance with GAAP. In many cases, the accounting treatment of a particular transaction is specifically dictated by GAAP and does not require our judgment in its application. In other cases, our judgment is required in selecting among available alternative accounting policies that allow different accounting treatment for similar transactions. The preparation of condensed consolidated financial statements also requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, costs and expenses and related disclosures. We base our estimates on historical experience and various other assumptions that we believe are reasonable under the circumstances. In many instances, we could reasonably use different accounting estimates, and in some instances changes in the accounting estimates are reasonably likely to occur from period to period. Accordingly, actual results could differ significantly from the estimates made by our management. To the extent that there are differences between our estimates and actual results, our future financial condition, results of operations and cash flows will be affected.

There have been no material changes in our critical accounting policies and estimates during the three months ended September 30, 2019 as compared to the critical accounting policies and estimates disclosed in Part II, Item 7 of our Annual Report on Form 10-K for fiscal 2019, except as described in Note 1 to our condensed consolidated financial statements, “Summary of business and significant accounting policies.”

Recent Accounting Pronouncements

For information with respect to recent accounting pronouncements and the impact of these pronouncements on our consolidated financial statements, see Note 1 to our condensed consolidated financial statements, “Summary of business and significant accounting policies.”

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Results of operations

The following tables set forth our results of operations for the three months ended September 30, 2019 and 2018, as well as a percentage that each line item represents of our total revenue for those periods. The additional key metrics presented are used in addition to the financial measures reflected in the condensed consolidated statements of operations data to help us evaluate growth trends, establish budgets and measure the effectiveness of our sales and marketing efforts. The period to period comparison of financial results is not necessarily indicative of financial results to be achieved in future periods.



	Three Months Ended September 30,
Consolidated Statements of Operations Data	2019			2018
	(in thousands)
Revenue:
Product	$	55,183		$	39,930
Services	9,272			6,322
Total revenue	64,455			46,252
Cost of revenue:
Product	31,989			23,588
Services	4,862			3,954
Total cost of revenue	36,851			27,542
Gross profit	27,604			18,710
Operating expenses:
Research and development	20,663			18,492
Sales and marketing	1,946			1,703
General and administrative	7,287			5,450
Total operating expenses	29,896			25,645
Income (loss) from operations	(2,292		)	(6,935		)
Other income, net	561			1,590
Income (loss) from continuing operations before provision for income taxes	(1,731		)	(5,345		)
Provision for income taxes	411			740
Income (loss) from continuing operations	(2,142		)	(6,085		)
Loss on discontinued operations	(3,986		)	(1,485		)
Net loss	$	(6,128	)	$	(7,570	)



	(as a percentage of revenue)
Revenue:
Product	86	%	86	%
Services	14	%	14	%
Total revenue	100	%	100	%
Cost of revenue:
Product	50	%	51	%
Services	7	%	9	%
Total cost of revenue	57	%	60	%
Gross profit	43	%	40	%
Operating expenses:
Research and development	32	%	40	%
Sales and marketing	3	%	3	%
General and administrative	12	%	12	%
Total operating expenses	47	%	55	%
Income (loss) from operations	(4	)%	(15	)%
Other income, net	1	%	3	%
Income (loss) from continuing operations before provision for income taxes	(3	)%	(12	)%
Provision for income taxes	—	%	1	%
Income (loss) from continuing operations	(3	)%	(13	)%
Loss on discontinued operations	(6	)%	(3	)%
Net loss	(10	)%	(16	)%

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Comparison of the three months ended September 30, 2019 and 2018

Revenue, cost of revenue and gross profit.

Revenue. Product revenue increased 38% to $55.2 million in the three months ended September 30, 2019 from $39.9 million in the three months ended September 30, 2018. The increase in product revenue for the comparable three months was due primarily to increases in map update revenue of $7.3 million, royalty revenue of $4.7 million resulting primarily from a higher volume of GM automotive navigation units, partially offset by a decline in Ford automotive navigation units, and customized software development revenue of $3.3 million resulting primarily from our license agreement with Grab. Services revenue increased 47% to $9.3 million in the three months ended September 30, 2019 from $6.3 million in the three months ended September 30, 2018. The increase in services revenue for the comparable three months was due primarily to increased revenue from our brought-in automotive solutions for GM, Toyota and Ford and, to a lesser extent, revenue from implementation services provided for Grab.

Cost of revenue. Our cost of product revenue increased 36% to $32.0 million in the three months ended September 30, 2019 from $23.6 million in the three months ended September 30, 2018. The increase in the comparable three months was due primarily to increased third-party content costs associated with higher map update revenue and increased automotive navigation unit volume. Our cost of services revenue increased 23% to $4.9 million in the three months ended September 30, 2019 from $4.0 million in the three months ended September 30, 2018. The increase in the comparable three months was due primarily to an increase in content costs associated with increased revenue from brought-in solutions. The increase in total cost of revenue of $9.3 million in the comparable three months was due primarily to an increase in third-party content costs of $8.6 million and an increase in deferred development costs recognized of $0.7 million.

Gross profit. Our gross profit increased 48% to $27.6 million in the three months ended September 30, 2019 from $18.7 million in the three months ended September 30, 2018. Our gross margin increased to 43% in the three months ended September 30, 2019 from 40% in the three months ended September 30, 2018. The increase in gross margin for the comparable three months was due primarily to a significantly higher margin earned on software development revenue from Grab, partially offset by a decrease in gross margin resulting from increased map update revenue, which carries a higher relative cost and lower gross margin. We anticipate somewhat higher gross margins in periods of fiscal 2020 during which we are able to recognize revenue from Grab for the development and delivery of customized software.

Revenue concentrations. In the three months ended September 30, 2019 and 2018, revenue from Ford represented 54% and 67% of our total revenue, respectively, and revenue from GM comprised 25% and 16% of our total revenue, respectively.

We primarily sell our services in the United States. In the three months ended September 30, 2019 and 2018, revenue derived from U.S. sources represented 76% and 84% of our total revenue, respectively.

Operating expenses

Our total operating expenses increased 17% to $29.9 million in the three months ended September 30, 2019 from $25.6 million in the three months ended September 30, 2018. The increase in the comparable three months was due primarily to an increase in payroll and related compensation and benefits expense resulting from increased research and development headcount, and an increase in outside consulting services.

Research and development. Our research and development expenses increased 12% to $20.7 million in the three months ended September 30, 2019 from $18.5 million in the three months ended September 30, 2018. The increase in the comparable three months was due primarily to increases in payroll and related compensation and benefits expense of $1.7 million and outside consulting services of $0.9 million. These increases were partially offset by a decrease of $0.9 million primarily as a result of higher capitalized deferred development costs in the three months ended September 30, 2019. As a percentage of revenue, research and development expenses decreased to 32% in the three months ended September 30, 2019 from 40% in the three months ended September 30, 2018. The total number of research and development personnel increased 8% to 672 at September 30, 2019 from 625 at September 30, 2018. We believe that as we deliver our contracted customer requirements for our automotive customers and establish relationships with new automobile manufacturers and tier ones, revenue from those research and development efforts will lag the related expenses.

Sales and marketing. Our sales and marketing expenses increased 14% to $1.9 million in the three months ended September 30, 2019 from $1.7 million in the three months ended September 30, 2018. The increase in the comparable three months was due primarily to an increase in outside consulting services. As a percentage of revenue, sales and marketing expenses were comparable at 3% in each of the three months ended September 30, 2019 and 2018. The total number of sales and marketing personnel increased 4% to 24 at September 30, 2019 from 23 at September 30, 2018.

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General and administrative. Our general and administrative expenses increased 34% to $7.3 million in the three months ended September 30, 2019 from $5.5 million in the three months ended September 30, 2018. The increase in the comparable three months was due primarily to increases in outside consulting services of $1.2 million and payroll and related compensation and benefits expense of $0.6 million. As a percentage of revenue, general and administrative expenses were comparable at 12% in each of the three months ended September 30, 2019 and 2018. The total number of general and administrative personnel increased 3% to 62 at September 30, 2019 from 60 at September 30, 2018.

Other income, net. Our other income, net decreased to $0.6 million in the three months ended September 30, 2019 compared to $1.6 million in the three months ended September 30, 2018. The decrease in the comparable three months was due primarily to the inclusion in the three months ended September 30, 2018 of an unrealized gain of $1.3 million recorded on non-marketable equity investments resulting from a change in accounting for such investments due to our adoption of ASU 2016-01 effective July 1, 2018.

Provision for income taxes. Our provision for income taxes was $0.4 million in the three months ended September 30, 2019 compared to $0.7 million in the three months ended September 30, 2018. Our provision for income taxes was $411,000 in the three months ended September 30, 2019 compared to $740,000 in the three months ended September 30, 2018 and was comprised primarily of foreign withholding taxes and income taxes in foreign jurisdictions where we have profit. Our effective tax provision rate of 24% and 14% of loss from continuing operations for the three months ended September 30, 2019 and 2018, respectively, was greater than the tax amount computed at the U.S. federal statutory income tax rate due primarily to losses for which no benefit will be recognized since the tax assets are not likely to be realized due to the lack of current and forecasted future income. Although the total income tax provision did not change for the three months ended September 30, 2018, taxes were allocated to discontinued operations in an amount equal to the difference between the tax originally computed on loss from operations and the tax recomputed on the amount of loss from continuing operations.

We anticipate that our foreign tax withholding obligations will continue into the future and that we will not be able to benefit from an offsetting deduction in the United States for an extended period of time given our existing net operating loss carryforwards.

We record liabilities related to uncertain tax positions in accordance with authoritative guidance on accounting for uncertainty in income taxes. As of September 30, 2019 and June 30, 2019, our cumulative unrecognized tax benefits were $4.8 million and $4.6 million, respectively. Included in the balance of unrecognized tax benefits at September 30, 2019 and June 30, 2019 was $0.1 million and $0.1 million that if recognized, would affect the effective tax rate.

We recognize interest and penalties related to unrecognized tax benefits as part of our provision for income taxes. We accrued zero and zero for the payment of interest and penalties at September 30, 2019 and June 30, 2019.

We file income tax returns with the Internal Revenue Service, or IRS, California, various states and foreign tax jurisdictions in which we have filing obligations. The statute of limitations remains open from fiscal 2016 for federal tax purposes, from fiscal 2014 in state jurisdictions, and from fiscal 2013 in foreign jurisdictions. Fiscal years outside the normal statute of limitations remain open to audit by tax authorities due to tax attributes generated in those early years which have been carried forward and may be audited in subsequent years when utilized.

Due to operating losses in previous years and continued earnings volatility, we maintain a valuation allowance on the majority of our foreign deferred tax assets. Our valuation allowance at June 30, 2019 was $48.4 million. In evaluating our ability to recover our deferred tax assets each quarter, we consider all available positive and negative evidence, including current and previous operating results, ability to carryback losses for a tax refund, and forecasts of future operating results.

Loss on discontinued operations.

Our loss on discontinued operations of $4.0 million in the three months ended September 30, 2019 consisted of income of $0.8 million from operations of our Ads Business offset by a loss of $4.8 million from the sale of our Ads Business in August 2019. Our loss from the sale of the Ads Business of $4.8 million included $1.9 million comprising severance for Ads Business employees who were not offered employment with inMarket and acceleration of stock-based awards vesting for certain Ads Business executives who were not offered employment with inMarket, and $0.4 million comprising legal fees and third-party consulting fees associated with the inMarket Transaction.

Our loss on discontinued operations in the three months ended September 30, 2018 consisted of a $1.5 million loss from operations of our Ads Business.

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Liquidity and capital resources

The following table sets forth the major sources and uses of cash, cash equivalents and restricted cash for continuing operations for each of the periods set forth below (in thousands):



	Three Months Ended September 30,
	2019			2018
Net cash provided by (used in) operating activities	$	22,169		$	(554	)
Net cash provided by (used in) investing activities	(32,827		)	142
Net cash provided by (used in) financing activities	7,474			(1,182		)
Effect of exchange rate changes on cash, cash equivalents and restricted cash	(336		)	(239		)
Net decrease in cash, cash equivalents and restricted cash, continuing operations	$	(3,520	)	$	(1,833	)

At September 30, 2019, we had cash, cash equivalents and short-term investments of $121.8 million, which primarily consisted of corporate bonds, asset-backed securities, U.S. treasury securities, commercial paper and municipal securities held. Our cash, cash equivalents and short-term investments are held and managed by financial institutions that are required to adhere to our investment policy.

Our accounts receivable are heavily concentrated in a small number of customers. As of September 30, 2019, our accounts receivable balance was $53.0 million, of which Ford and GM represented 42% and 23%, respectively.

Our future capital requirements will depend on many factors, including our ability to continue to increase our billings and control our expenses in fiscal 2020 and beyond, whether and when we return to profitability, the timing and extent of expenditures to support development efforts, the extent of our research and development and sales and marketing activities and the size of our related headcount, the introduction of our new and enhanced service and product offerings and the timing and scale of the introduction of vehicles including our navigation products relative to when we are required to develop the product. We believe our cash, cash equivalents and short-term investments will be sufficient to satisfy our financial obligations through at least the next 12 months. However, we may continue to use cash in operating activities in the remainder of fiscal 2020 and we may experience greater than expected cash usage in operating activities if revenue or collections are lower than we anticipate or we incur greater than expected cost of revenue or operating expenses. Our revenue and operating results could be lower than we anticipate if, among other reasons, our customers, two of which we are substantially dependent upon for a large portion of our revenue, were to limit or terminate our relationships with them, we were to fail to successfully compete in our highly competitive market or our revenue did not grow as expected, we were unable to record revenue from our agreement with Grab or we were required to record losses related to our ownership interest in inMarket. In the future, we may acquire businesses or technologies or license technologies from third parties, and we may decide to raise additional capital through debt or equity financing to the extent we believe this is necessary to successfully complete these acquisitions or license these technologies. However, additional financing may not be available to us on favorable terms, if at all, at the time we make such determinations, which could have a material adverse effect on our business, operating results, financial condition and liquidity and cash position.

Net cash provided by (used in) operating activities. Net cash provided by (used in) operating activities was $22.2 million and $(0.6) million in the three months ended September 30, 2019 and 2018, respectively. Cash provided by or used in operating activities is affected by anticipated growth in our automotive business and increases in our operating costs, which are primarily driven by headcount related costs and royalty payments for portions of the content provided in our products. In the three months ended September 30, 2019, cash provided by operating activities was primarily the result of a net loss of $6.1 million, adjusted for loss from discontinued operations of $4.0 million, which was more than offset by non-cash charges for stock-based compensation of $1.8 million, depreciation and amortization of $0.9 million and $21.0 million from changes in our operating assets and liabilities. In the three months ended September 30, 2018, cash used in operating activities was primarily the result of a net loss of $7.6 million, adjusted for loss from discontinued operations of $1.5 million, which was partially offset by non-cash charges for stock-based compensation of $2.0 million, depreciation and amortization of $1.0 million and $3.7 million from changes in our operating assets and liabilities.

Net cash provided by (used in) investing activities. Our investing activities (used) provided $(32.8) million and $0.1 million during the three months ended September 30, 2019 and 2018, respectively. Cash flows from investing activities have historically been affected by purchases, sales and maturities of short-term investments, purchases of property and equipment, internal software development costs, and acquisitions. In the three months ended September 30, 2019, cash used in investing activities was principally the result of purchases of short-term investments, net of proceeds from sales and maturities of $30.4 million and purchases of property and equipment of $0.5 million. In the three months ended September 30, 2018, cash provided

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by investing activities was principally the result of proceeds from sales and maturities of short-term investments, net of purchases, of $0.2 million, partially offset by purchases of property and equipment of $0.1 million.

Net cash provided by (used in) financing activities. During the three months ended September 30, 2019 and 2018, our financing activities provided (used) cash of $7.5 million and $(1.2) million, respectively. In the three months ended September 30, 2019, we received cash of $8.3 million provided from the exercise of stock options, partially offset by the utilization of $0.8 million for payment of tax withholdings related to net share settlements of RSUs. In the three months ended September 30, 2018, we utilized $1.2 million for payment of tax withholdings related to net share settlements of RSUs.

Contractual obligations, commitments and contingencies

As of September 30, 2019, we had $19.5 million of future minimum non-cancelable financial commitments primarily related to office space under operating leases and license fees due to certain of our third-party content providers, regardless of usage level. These commitments are primarily due within five years.


Item 3.	Quantitative and Qualitative Disclosures about Market Risk.

Interest rate sensitivity. The primary objectives of our investment activities are to preserve principal, provide liquidity and maximize income without significantly increasing risk. By policy, we do not enter into investments for trading or speculative purposes. Some of the securities we invest in are subject to market risk. This means that a change in prevailing interest rates may cause the fair value of the investment to fluctuate. To minimize this risk, we invest in a variety of securities, which primarily consist of money market funds, commercial paper, municipal securities and other debt securities of domestic corporations. Due to the nature of these investments and relatively short duration of the underlying securities, we believe that we do not have any material exposure to changes in the fair value of our investment portfolio as a result of changes in interest rates. Declines in interest rates, however, will reduce future interest income. During the three months ended September 30, 2019, a 10% appreciation or depreciation in overall interest rates would not have had a material impact on our interest income or the fair value of our marketable securities.

Foreign currency risk. A substantial majority of our revenue has been generated to date from our end users and customers in the United States and, as such, our revenue has not been substantially exposed to fluctuations in currency exchange rates. However, some of our contracts with our wireless carrier customers outside of the United States are denominated in currencies other than the U.S. dollar and therefore expose us to foreign currency risk. Should the revenue generated outside of the United States grow in absolute amounts and as a percentage of our revenue, we will increasingly be exposed to foreign currency exchange risks. In addition, a substantial portion of our operating expenses are incurred outside the United States, are denominated in foreign currencies and are subject to changes in foreign currency exchange rates, particularly the RMB, RON and Euro. We also recognize foreign exchange gains and losses resulting from the translation of an intercompany loan receivable held by our German subsidiary and denominated in U.S. dollars. Additionally, changes in foreign currency exchange rates may cause us to recognize transaction gains and losses in our statement of operations.

To date, we have not used any foreign currency forward contracts or similar instruments to attempt to mitigate our exposure to changes in foreign currency rates.


Item 4.	Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our CEO and our Chief Financial Officer, or CFO, evaluated the effectiveness of our disclosure controls and procedures as of September 30, 2019. Based on the evaluation of our disclosure controls and procedures as of September 30, 2019, our CEO and CFO concluded that, as of such date, our disclosure controls and procedures were not effective due to the existence of the material weakness in internal control over financial reporting described below.

During the three months ended December 31, 2018, we identified certain errors related to our implementation of ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) (“ASC 606”) due to our internal control over financial reporting relating to supervision and review of the financial models supporting our revenue recognition accounting and disclosures not operating effectively. We concluded that, because this deficiency created a more than remote likelihood of a material misstatement not being prevented or detected on a timely basis, this deficiency constituted a material weakness in internal control over financial reporting. While the original remediation plan adopted shortly after the discovery of the errors relating to our adoption of ASC 606 was fully implemented during the third quarter of fiscal 2019, during the fourth quarter of fiscal 2019, we decided to implement additional remediation measures to further address that control deficiency. The material weakness will not be deemed remediated until the affected internal controls have been tested and determined to be operating effectively.

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The term “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended, or the Exchange Act, means controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the company’s management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

Changes in Internal Control over Financial Reporting

Except for the remediation plan described below, which we implemented to address the identified control deficiencies relating to our adoption of ASC 606, there were no changes in our internal control over financial reporting that occurred during the three months ended September 30, 2019 that our certifying officers concluded have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

A material weakness is a control deficiency or combination of control deficiencies that results in more than a remote likelihood that a material misstatement of the annual or interim financial statements will not be prevented or detected on a timely basis. We are committed to maintaining a strong internal control environment, and we have implemented a remediation plan that is designed to address the identified control deficiency relating to our adoption of ASC 606. This remediation plan includes formalizing and documenting the communication of information among our internal teams, the hiring or other engagement of additional accounting personnel, the creation of checklists for the review of supporting documentation relating to the application of ASC 606, and conducting additional training of the members of those internal teams regarding the requirements of ASC 606. While the remediation plan has been fully implemented, the material weakness will not be deemed remediated until the affected internal controls have been tested and determined to be operating effectively. Notwithstanding the foregoing, based on the results of that testing, we may need to implement additional remediation measures to address the material weakness.

Limitations on the Effectiveness of Controls

Control systems, no matter how well conceived and operated, are designed to provide a reasonable, but not an absolute, level of assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected. Because of the inherent limitations in any control system, misstatements due to error or fraud may occur and not be detected.

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PART II. OTHER INFORMATION


Item 1.	Legal Proceedings.

From time to time, we may be subject to legal proceedings and claims in the ordinary course of business. We have received, and may in the future continue to receive, claims from third parties asserting infringement of their intellectual property rights. Future litigation may be necessary to defend ourselves and our customers by determining the scope, enforceability and validity of third-party proprietary rights or to establish our proprietary rights. From time to time, we also may be subject to claims from our third-party content providers that we owe them additional royalties and interest, which claims may result in litigation if we and the third-party content provider are unable to resolve the matter. There can be no assurance with respect to the outcome of any current or future litigation brought against us or pursuant to which we have indemnification obligations and the outcome could have a material adverse impact on our business, operating results and financial condition.

In addition, we have received, and expect to continue to receive, demands for indemnification from our customers and OEM partners, which demands can be very expensive to settle or defend, and we have in the past offered to contribute to settlement amounts and incurred legal fees in connection with certain of these indemnity demands. In response to these demands we may be required to assume control of and bear all costs associated with the defense of our customers in compliance with our contractual commitments.

Large future indemnity payments and associated legal fees and expenses, including potential indemnity payments and legal fees and expenses relating to our wireless carrier and other customers’ indemnity demands with respect to pending litigation, could materially harm our business, operating results and financial condition and create uncertainty regarding our business, any of which could also cause the price of our common stock to decline.

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Item 1A.	Risk Factors.

We operate in a rapidly changing environment that involves numerous uncertainties and risks. The following risks and uncertainties may have a material and adverse effect on our business, financial condition or results of operations. You should consider these risks and uncertainties carefully, together with all of the other information included or incorporated by reference in this Form 10-Q. If any of the risks or uncertainties we face were to occur, our business, financial condition, operating results, and prospects could be materially harmed. In that event, the price of our common stock could decline, and you may lose all or part of your investment.

Risks related to our business

We incurred losses in each period since fiscal 2015. We expect that we will incur losses during fiscal 2020, and we do not know when, or if, we will return to profitability as we make further expenditures to enhance and expand our operations in order to support growth and diversification of our business.

As a percentage of revenue, our net loss was 10% and 16% in the three months ended September 30, 2019 and 2018, respectively. Our revenue from paid wireless carrier mobile navigation has substantially declined and we expect it to continue to do so, and we may be unable to generate sufficient revenue from our automobile navigation businesses to return us to profitability in the short-term, if at all.

We anticipate that we will continue to incur net operating losses during fiscal 2020. These expected losses are also due to the expected continued decline in our higher margin mobile navigation revenue and the costs we expect to incur prior to generating revenue in connection with new automotive navigation products and services that will not be integrated into production vehicles for several years, if at all. The time required to develop, test and deploy products between the time we secure the award of a new contract with any automobile manufacturer or tier one, and the timing of revenue thereunder, as well as a substantial required upfront investment in research and development resources prior to entering into contracts with automobile manufacturers and tier ones contribute to these expected losses. We also expect to continue to experience pressure on pricing in our negotiations with automobile manufacturers and tier ones as we enter into negotiations for contract renewals or new products where we are competing with larger suppliers that are competing on price, rather than features, or for vehicles where customers are price sensitive regarding navigation solutions or where the automobile manufacturer is offering or is considering brought-in solutions such as Apple’s CarPlay or Google’s Android Auto.

Although we are working to replace the continued decline in wireless carrier revenue, our efforts to develop new services and products and attract new customers require investments in anticipation of longer-term revenue. For example, the design cycle for automotive navigation products and services is typically 18 to 24 months, and in order to win designs and achieve revenue from this growth area, we typically have to make investments two to four years before we anticipate receiving revenue, if any. This is the case for our relationship with GM. In addition, the revenue commencement at initial launch may not be significant depending on the automobile manufacturer’s or tier one’s launch timing schedule across vehicle models and regions. For example, although our hybrid product with GM launched in February 2017, it has only launched in select vehicle models and we do not have any control over when and whether it launches in other GM models. In addition, GM recently announced that effective in 2021 (model year 2022), it will begin offering vehicles with Google Auto Services, or GAS, which may reduce the number of new models and vehicles in which our products and services are provided. Although we recently entered into a series of agreements with Grab with respect to the intellectual property underlying our OpenTerra Platform, we cannot provide any assurance that we will be able to enter into other arrangements for our OSM mapping technologies in the future.

We are required to recognize certain automotive revenue over time if there are contractual service periods or other obligations to fulfill, such as specified contractual deliverables. Certain contractual service periods or other obligations currently extend up to eight years. We intend to make additional investments in systems and continue to expand our operations to support diversification of our business, but it is likely that these efforts at diversification will not replace our declining wireless carrier revenue in the short-term, if at all. As a result of these factors, we believe we will incur a net operating loss and we will incur net losses during fiscal 2020, and we cannot predict when, or if, we will return to profitability. Our investments and expenditures may not result in the growth that we anticipate.

Our quarterly revenue and operating results have fluctuated in the past and may fluctuate in the future due to a number of factors. As a result, we may fail to meet or exceed the expectations of securities analysts or investors, which could cause our stock price to decline.

Our quarterly revenue and operating results may vary significantly in the future. Therefore, you should not rely on the results achieved in any one quarter as an indication of future performance. Period to period comparisons of our revenue and operating results may not be meaningful. Our quarterly results of operations may fluctuate as a result of a variety of factors, including, but not limited to, those listed below, many of which are outside of our control:

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•	the ability of automobile manufacturers to sell automobiles equipped with our products;


•	GM’s decision, announced on September 5, 2019, and perhaps similar decisions of other OEMs and partners, to utilize third-party offerings, such as provided by GAS, in future model years;


•	competitive in-car platforms and products, such as Apple’s CarPlay and Google’s auto initiatives, which are currently offered in North America on Ford vehicles equipped with its SYNC 3 platform and most GM models;


•	the decision by Toyota to expand Apple’s CarPlay compatibility to certain of its 2019 model year and beyond Toyota and Lexus vehicles;


•	Ford’s announced intentions to modify its North America and European passenger car portfolio whereby it has begun phasing out certain car models;


•	GM’s announced intentions to end production of certain passenger vehicles in North America;


•	work stoppages affecting our automobile manufacturer customers and their partners, such as the labor stoppage announced by GM workers in September 2019, which will reduce our revenue during the stoppage period and for some time thereafter;


•	the seasonality and unpredictability of new vehicle production, including tooling and assembly changes and plant shutdowns, such as the impact to production of certain Ford pickup truck models in U.S. factories due to a May 2018 fire at a supplier plant;


•	the potential disruption of the anticipated departure of the United Kingdom from the European Union on automotive supply chains and potential plant closures in the United Kingdom;


•	changes made to existing contractual obligations with a customer that may affect the nature and timing of revenue recognition, such as the adoption of our map update solution for Ford’s customers in multiple geographies and its impact on the timing of our revenue recognition;


•	competitive pressures on automotive navigation pricing from low cost suppliers and for vehicles where consumers are extremely price sensitive;


•	the introduction and success of in-car integration, such as Google's in-car integration of Android Auto with Google Maps which did not require a mobile handset;


•	investments made by HERE North America, LLC, or HERE, and TomTom North America, Inc., or TomTom, in high definition maps that may be leveraged to displace our products and services in new vehicle models;


•	the seasonality of new vehicle model introductions and consumer buying patterns, as well as the effects of economic uncertainty on vehicle purchases, particularly outside of the United States;


•	the impact of tariffs and other trade negotiations on vehicle prices and supply chains;


•	the impact on vehicle sales resulting from tariffs on imported vehicles and parts and disruption to automobile manufacturer supply chains resulting therefrom;


•	the effectiveness of our entry into new business areas;


•	the loss of our relationship, a change in our revenue model, a change in pricing, or a reduction in geographic scope with any particular customer;


•	poor reviews of automotive service offerings into which our navigation solutions are integrated resulting in limited uptake of navigation options by car buyers;


•	warranty claims based on the performance of our products and the potential impact on our reputation with navigation users and automobile manufacturers and tier ones;


•	the sale of vehicle brands by automobile manufacturers to an automobile manufacturer with which we do not have an existing relationship;


•	the timing and quality of information we receive from our customers and the impact of customer audits of their reporting to us;

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•	the inability of our automobile manufacturer customers to attract new vehicle buyers and new subscribers for connected services;


•	the timing of customized software development and other deliverables such as map updates;


•	the amount and timing of operating costs and capital expenditures related to the expansion of our operations and infrastructure through acquisitions or organic growth;


•	the timing of expenses related to the development, acquisition or divestiture of technologies, products or businesses;


•	the cost and potential outcomes of existing and future litigation;


•	the timing and success of new product or service introductions by us or our competitors and customer reviews of those products or services;


•	the timing and success of marketing expenditures for our products and services;


•	the extent of any interruption in our services;


•	potential foreign currency exchange gains and losses associated with expenses and sales denominated in currencies other than the U.S. dollar;


•	general economic, industry and market conditions, including any change in U.S. interest rates, that impact expenditures for new vehicles, smartphones and mobile location services in the United States and other countries where we sell our services and products;


•	changes in interest rates and our mix of investments, which would impact our return on our investments in cash and marketable securities;


•	changes in our effective tax rates; and


•	the impact of new accounting pronouncements such as ASC 842.

Fluctuations in our quarterly operating results might lead analysts and investors to change their models for valuing our common stock. As a result, our stock price could decline rapidly and we could face costly securities class action lawsuits or other unanticipated issues.

We are dependent on Ford and GM for a substantial portion of our billings and revenue, and our business, financial condition and results of operations will be harmed if our billings and revenue from Ford and GM do not continue to grow or if they decline.

Ford represented approximately 54% and 67% of our revenue and approximately 39% and 60% of our billings in the three months ended September 30, 2019 and 2018, respectively. GM represented approximately 25% and 16% of our revenue and approximately 26% and 19% of our billings in the three months ended September 30, 2019 and 2018, respectively. During the first quarter of fiscal 2020, we experienced a decline in billings to Ford and we expect to experience a decline in billings to GM during the second quarter of fiscal 2020 due to GM’s work stoppage. Despite the decrease in Ford’s billings, we expect that Ford, GM, other automobile manufacturers and tier ones will account, at least in the near-term, for an increasing percentage of our revenue and billings, as our revenue and billings from paid wireless carrier provided navigation continues to decline. However, our total revenue and billings could potentially decline if Ford or GM increases the cost to consumers of our navigation products, reduces the number of vehicles or the geographies in which vehicles with our products as an option are sold, if their sales of vehicles fall below forecast due to competition, or if they determine to offer on their vehicles third-party platforms or solutions in place of ours. For example, GM announced on September 5, 2019 that it intended to utilize GAS solutions on certain models beginning with GM’s model year 2022. Work stoppages, such as GM announced in September 2019, global macro-economic conditions or other factors could also cause automobile manufacturer and tier ones to reduce their production of vehicles in which our products and services are incorporated and our revenues. Ford offers Apple’s CarPlay and Google’s Android Auto on its vehicles in North America equipped with its SYNC 3 platform and announced that Waze is available on its vehicles equipped with the SYNC 3 platform, which may reduce the number of vehicle purchasers who purchase built-in navigation services. GM also offers Apple’s CarPlay and Google’s Android Auto on most of its vehicles in North America and its announcement regarding GAS commencing in model year 2022 may result in a larger proportion of GM vehicles being sold without our products and services. We may not successfully increase our revenue and billings from Ford or GM if our products are replaced within vehicles with our competitors’ products or we experience price competition for those products and services. Moreover, Ford and GM have announced their intention to modify their North American passenger car

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portfolio strategies and has begun phasing out certain car models, and they recently indicated that they are also considering changes in their respective European portfolio strategies. This could lead to a significant reduction in the sales of vehicles with our products as an option. We may not be able to mitigate the effect of any lost billings and revenue and our business, financial condition, results of operations and prospects could be materially adversely affected, our stock price could be volatile, and it may be difficult for us to achieve and maintain profitability.

Our contract with Ford covers a broad range of products and services that we provide to Ford. On March 28, 2018, we entered into an amendment to our contract with Ford that extends the term of the agreement to December 31, 2020 for each jurisdiction in which we currently provide our products to Ford. On December 14, 2017, Ford also selected us to provide its next generation navigation solution in North America, subject to certain conditions and execution of an agreement regarding those solutions. The terms of this next generation navigation solution were embodied in an amendment executed in December 2018, and this amendment extended the term of the agreement to December 31, 2022 for North America production; provided that Ford may extend the term further subject to certain conditions. We were not awarded the contracts for Europe, South America and Australia and New Zealand. The loss of any contracts awarded, or our failure to be awarded contracts for certain geographies, may adversely impact our business, financial condition and results of operations.

Our contract with GM includes the provision of our on-board, hybrid, and brought-in navigation solutions across a wide assortment of GM vehicles. Our mobile navigation SDK powers GM’s branded mobile and web-based applications and is covered under a services agreement that was entered into June 13, 2014 and extends to December 31, 2019. Our on-board and hybrid navigation solutions for GM are covered under a product and services agreement that became effective February 1, 2017. These solutions began shipping in a limited number of vehicles beginning with model year 2017 and are gradually expanding across additional regions and models. In May 2017, additional vehicles through model year 2025 were added to this products and services agreement, which terminates on December 31, 2026. However, our contract with GM does not assure us of minimum order quantities, overall or during any period. Although it does not affect the terms of our agreement with GM, on September 5, 2019, GM announced that it intended to utilize GAS solutions on certain models beginning with model year 2022, which could also have a negative effect on the number of vehicles GM produces that incorporate our products and services.

In addition, a substantial portion of our revenue and billings and, to a lesser extent, gross profit from Ford is impacted by the underlying licensed content cost negotiated through HERE and other content providers. We cannot predict the impact on our revenue, billings, and gross profit of any changes between the automobile manufacturers and the map or other content providers.

We have limited experience managing, supporting and retaining automobile manufacturers and tier ones as customers, and if we are not able to maintain Ford and GM as customers our revenue will decline.

If we fail to comply with our automobile manufacturer and tier one contracts, our business, financial condition and results of operations could suffer.

Our contracts with our automobile manufacturer and tier one customers include increasingly specialized, complex and strict performance requirements. We have experienced and may continue to experience increased challenges in achieving certain milestones under our contracts with our automobile manufacturer and tier one customers, such as Ford, our largest OEM customer, as well as other tier one customers, and may not be able to demonstrate those milestones on a timely basis or otherwise as required under our agreements. This could cause our automobile manufacturers, such as Ford, and other tier one customers to reduce their level of business with us or to utilize third-party platforms or solutions in place of ours in future model; years. In particular, our agreement with Ford requires that we become certified under a set of technical standards for the computer software development process in the automobile industry, which requirement currently requires certification by the fall of 2019. We do not currently have any such certification, and we may not be able to obtain it in a timely manner, if at all, for our software to be included in that customer’s model year 2021 vehicles. In addition, our automobile manufacturer and tier one customers regularly evaluate our capabilities against those of our competitors and may even engage one or more of our competitors as a dual source supplier. Any failure by us to timely perform under our automobile manufacturer and tier one contracts could at any time result in the termination of those contracts, the awarding of work to one or more of our competitors, or other adverse actions being taken by the applicable automobile manufacturer or tier one customer. Further, any negative publicity related to our automobile manufacturer or tier one contracts or any proceedings surrounding them, regardless of its accuracy, may damage our business by affecting our ability to compete for new contracts. If one of our automobile manufacturer or tier one contracts is terminated, or if our ability to compete for new contracts is adversely affected, our business, reputation, financial condition and results of operations could suffer.

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Our automotive revenue and earnings could fluctuate due to the complexities of revenue recognition and capitalization of expenses related to customized products.

We adopted ASC 606, Revenue from Contracts with Customers, effective July 1, 2018, utilizing the full retrospective transition method. Under this accounting methodology, royalty amounts earned are bifurcated when there exist various underlying obligations. Revenue is recognized upon fulfillment of the underlying obligation. Such obligations related to earned royalties generally can include an onboard navigation component recognized as revenue once delivered and accepted, a connected services component recognized to revenue over the applicable service period, and a map update component recognized as revenue upon periodic delivery. Due to the complexities of revenue recognition, we may be required to recognize certain revenue over extended periods. For example, because customers of our brought-in automotive navigation solutions simultaneously receive and consume the benefit from our performance, we recognize revenue ratably over the period the services obligation is expected to be fulfilled, which is generally 8 to 12 years, as this provides a faithful depiction of the transfer of control.

Revenue recognition could also be impacted by future amendments to automobile manufacturer and tier one agreements, such as providing our map update solution in other regions, changes in procurement patterns, shipping terms and title transfer. As our solutions encompass greater value-added services, there is potential for changes in the timing of revenue recognition. Investors and securities analysts may not understand the subtleties of these revenue recognition requirements, and the trading prices of our common stock may be negatively affected.

In addition, our revenue recognition is becoming increasingly more complex with the evolution of our value-added products and services, such as our hybrid navigation solutions. The agreements for these solutions can extend over several years and require multiple deliverables. Given the length of our contractual obligations, which often extend beyond the manufacture and sale of the vehicle when the royalty is determined and paid, we may have significant post-production obligations to provide brought-in navigation services or map updates over an extended period of time. These extended obligations can result in a delay in recognition of revenue, or the need to defer and recognize revenue over the period that we are required to provide these post-production obligations or other services.

In conjunction with the adoption of ASC 606, development costs subject to ASC 340-40 incurred to fulfill future obligations under certain actual or anticipated contracts for automotive solutions are capitalized, provided they are expected to be recovered, and then recognized as the related performance obligations are transferred. For on-board automotive solutions, such costs represent the customized portion of software development, which will continue to be recognized upon acceptance of the software under ASC 340-40 since acceptance is generally required for control of the software to transfer. As a result, our recognition of deferred costs may be lumpy and not tied to the production of the vehicles in which the software is installed. For brought-in automotive solutions, such costs will be amortized over the period the services obligation is expected to be fulfilled because software development does not represent a distinct performance obligation in the case of brought-in automotive solutions. Historically, we recognized such costs for brought-in automotive solutions upon acceptance of the software.

We may also incur significant expense to develop products for automobile manufacturers, such as under our worldwide connected navigation services agreement with GM, prior to receiving any significant revenue related to the sale of vehicles with our navigation services. As our offerings in automotive navigation expand, we may not correctly anticipate the financial accounting treatment for the various products.

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We may not be successful at adapting our business model for the Chinese automotive navigation market, which may reduce our revenue per vehicle.

Demonstrating growth in the Chinese market is an important component of our global growth strategy. While we have significant research and development facilities in China, we have a limited business presence and, so far, have not been successful in expanding our initial automotive entry in the Chinese market. The automotive software market in China is highly competitive. This competition comes from large international automotive software providers as well as strong domestic providers. The Chinese navigation software market is seeing transition towards new business models by third-party navigation product vendors, such as substantially lower per unit license fees that are intended to be offset by opportunities to monetize navigation usage in additional ways that may include, but not be limited to, advertising, usage-based insurance and utilizing data to create high definition maps. Global platform navigation products tend to fare poorly in China. For example, our revenue from Ford China declined materially in fiscal 2018 and 2019, and we expect it to continue to decline in the absence of a new, localized product. We may need to change or modify our license fee model in China in order to compete effectively. Our inability to do so may have a material impact on our ability to continue to participate in the Chinese market. Even if we adopt new license fee models for China based automobile manufacturers, we may not recognize revenue from those new models sufficient to compensate us for the costs of supporting those automobile manufacturers in the short-term, if at all. In addition, many of the same business model, pricing and licensing changes, could also impact us in additional markets including, but not limited to, North America and Europe.

We may not be successful in generating material revenue from automobile manufacturers and tier ones other than Ford and GM. As a result, our business, financial condition and results of operations will be harmed if we are unable to diversify our automotive revenue.

Although we have attempted to mitigate our dependence on Ford and GM by establishing relationships with other automobile manufacturers and tier ones, these relationships may not produce significant revenue if the products are launched in limited models or face competition from third parties. Even if we are able to diversify our automotive navigation business through new arrangements, customers may not elect to purchase automobile manufacturer and tier one navigation offerings that include our software and/or services for reasons unrelated to performance of our software or services. Even if we win new awards, once those programs go into production, consumers may not widely adopt our navigation offerings or may criticize the performance or quality of the navigation software and our reputation may be harmed. If customer purchase rates are less than anticipated, or if our relationships with one or more of these other automobile manufacturers and tier ones are terminated or not renewed or extended, we may be unable to effectively diversify our automotive navigation revenue and our business, financial condition and results of operations may be harmed.

We may be unable to enter into agreements to provide automotive navigation products if we do not offer navigation products that serve geographies throughout the world or automobile manufacturers and tier ones are uncomfortable with our ability to support markets outside of the United States. Our automobile manufacturer and tier one customers may choose to partner with providers of location services with extensive international operations. We may be at a disadvantage in attracting such customers due to our business being concentrated in the United States, and we may not be successful in other geographies if customers are uncomfortable with the look and feel of our solutions. If we are unable to attract or retain such automobile manufacturer and tier one customers, our revenue and operating results will be negatively affected.

We may incur substantial costs when engaging with a new automotive navigation customer and may not realize substantial revenue from that new customer in the short-term, if at all.

The design and sales cycle for on-board or brought-in automotive navigation services and products is substantially longer than those associated with our mobile navigation services to customers of wireless carriersand require significant up-front and ongoing research, engineering and other development investments to secure and support those relationships. As a result, we may not be able to achieve significant revenue growth with new customers from the automotive navigation business in a short period of time, or at all. In addition, these lengthy cycles make it difficult to predict if and when we will generate revenue from new customers or when, if at all, we may recoup the up-front and ongoing investments we make in order to secure and support such business. For example, design wins for vehicles may be awarded 12 to 36 months prior to the anticipated commercial launch of the vehicle. We also entered into a contract with GM in 2014 to provide worldwide hybrid navigation solutions beginning in model year 2017 and continuing through model year 2025, and our hybrid product launched in its first GM models, the Cadillac CTS and CTS-V, in February 2017. We cannot assure you that our products will be in a wide variety of geographic markets in which GM sells vehicles in or across a variety of models and brands. Our contract with GM does not assure us of minimum order quantities, overall or during any period. Although it does not affect the terms of our agreement with GM, on September 5, 2019, GM announced that it intended to utilize GAS solutions on certain models beginning with model year 2022. Accordingly, GM has not provided us with any volume or revenue guarantees, and we cannot assure you that we will continue to receive material revenue from these products and services.

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We have a partnership with Toyota for Toyota and Lexus vehicles and a separate partnership with Xevo for another navigation solution for Toyota and Lexus vehicles. While we have seen expansion of our latest version of Scout GPS Link solution across more Toyota and Lexus models in fiscal 2019, we expect Toyota to limit or reduce the number of models or vehicles on which Scout GPS Link is offered by Toyota and Lexus, beginning in model year 2021, due in part to the offering of alternative brought-in solutions such as Apple’s CarPlay, which Toyota recently announced it is offering across certain Toyota models, and the expanded offering of Google’s Android Auto solution across more automobile manufacturers. In addition, during the fourth quarter of 2019, we entered into an amended agreement with Xevo, under which we received a one-time $17.0 million cash pre-payment in exchange for removing a contractual minimum unit commitment that otherwise would have resulted in a payment to us in 2027. We recorded the receivable as deferred revenue in the fourth quarter of fiscal 2019 and we will recognize it as revenue over future periods. We currently expect that our contract with Xevo relating to the implementation of our solutions in Toyota and Lexus vehicles will remain in place through 2026. We cannot assure you that we will receive significant revenue from the solutions for Toyota in the long-term. While we continue to invest in our existing and new relationships with automobile manufacturers, if our products do not meet the consumer’s expectations, automobile manufacturer customers may not continue to offer our solutions.

We also may not price our solutions in such a way that is profitable for us and enables us to recoup the development expenses we incurred to provide such solutions in the time we expect or at all. Development schedules for automotive navigation products are difficult to predict, and there can be no assurance that we will achieve timely delivery of these products to our customers. To the extent that we charge service fees beyond an initial fee at the time the vehicle is purchased, we may not be successful in gaining traction with customers to provide services and charge ongoing monthly or annual fees outside of the traditional on-board navigation service model.

Our ability to build demand for our automotive navigation products and services is also dependent upon our ability to provide the products and services in a cost-effective manner, which may require us to renegotiate map and POI content relationships to address the specific demands of our automotive navigation products and services. If we are unable to improve our margins, we may not be able to operate our automotive navigation business profitably. If we fail to achieve revenue growth in any of our automotive navigation solutions (whether on-board, brought-in or other), we may be unable to achieve the benefits of revenue diversification. In addition, our map and content suppliers, HERE and TomTom, are also becoming competitors through the offering of their own automotive navigation services.

The success of our automotive navigation products may be affected by the number of vehicle models offered with our navigation solutions, as well as overall demand for new vehicles.

Our ability to succeed long term in the automotive industry depends on our ability to expand the number of models offered with our navigation solutions by our current automobile manufacturer customers. We are also dependent upon our ability to attract new automobile manufacturers and tier ones. For automobile manufacturers with whom we have established relationships, such as Ford, our success depends on continued production and sale of new vehicles offered with, and adoption by end users of, our products when our product is not a standard feature. Our on-board and hybrid solutions may not satisfy automobile manufacturers’ or end customers’ expectations for those solutions. If automobile manufacturers and tier ones do not believe that our services meet their customers’ needs, our products and services may not be designed into future model year vehicles. As we move forward, our existing automobile manufacturers and tier ones may not include our solutions in future year vehicles or territories, which would negatively affect our revenue from these products. Production and sale of new vehicles are subject to delay due to forces outside of our control, such as natural disasters, parts shortages and work stoppages, as well as general economic conditions. For example, in September and October 2019, GM ceased production in the United States due to a work stoppage.

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We rely on our customers for timely and accurate vehicle and subscriber sales information. A failure or disruption in the provisioning of this data to us would materially and adversely affect our ability to manage our business effectively.

We rely on our automobile manufacturers and tier one customers to provide us with reports on the number of vehicles they sell with our on-board, brought-in and hybrid navigation products and services included, depending on the nature of our contractual relationship, and to remit royalties for those sales to us. We also rely on our wireless carrier customers to bill subscribers and collect monthly fees for our mobile navigation services, either directly or through third-party service providers. The risk of inaccurate reports may increase as our customers expand internationally and increase the number of manufacturing locations. For example, in the three months ended March 31, 2017 and September 30, 2017, Ford determined that it had misreported the production of vehicles to us in certain factories. If our customers or their third-party service providers provide us with inaccurate data or experience errors or outages in their own billing and provisioning systems when performing these services, our revenue may be less than anticipated or may be subject to adjustment with the customer. In the past, we have experienced errors in reporting from automobile manufacturers and wireless carriers. If we are unable to identify and resolve discrepancies in a timely manner, our revenue may vary more than anticipated from period to period, which could harm our business, operating results and financial condition.

Our business practices with respect to data could give rise to liabilities or reputational harm as a result of governmental regulation, legal requirements or industry standards relating to consumer privacy and data protection.

Our automotive navigation services depend on our ability to collect, store and use such information as we deliver personalized navigation. Federal, state and international laws and regulations govern the collection, use, retention, sharing and security of data that we collect across our navigation platform. We strive to comply with all applicable laws, regulations, policies and legal obligations relating to privacy and data protection. However, it is possible that these requirements may be interpreted and applied in a manner that is inconsistent with our business practices or service offerings. Any failure, or perceived failure, by us to comply with such laws could result in proceedings or actions against us by governmental entities, consumers or others. Such proceedings or actions could hurt our reputation, force us to spend significant amounts to defend ourselves, distract our management, increase our costs of doing business, adversely affect the demand for our services and ultimately result in the imposition of monetary liability or changes to our business practices or service offerings. We may also be contractually liable to indemnify and hold harmless our users from the costs or consequences of inadvertent or unauthorized disclosure of data that we store or handle as part of providing our services.

Changes to United States tax, tariff and import/export regulations may have a negative effect on global economic conditions, financial markets and our business.

The current administration, along with Congress, has created significant uncertainty about the future relationship between the United States and other countries with respect to the trade policies, treaties, taxes, government regulations and tariffs that would be applicable. It is unclear what changes might be considered or implemented and what response to any such changes may be by the governments of other countries. These changes have created significant uncertainty about the future relationship between the United States and China, as well as other countries, including with respect to the trade policies, treaties, government regulations and tariffs that could apply to trade between the United States and other nations. For example, in 2018, the Office of the U.S. Trade Representative, or the USTR, enacted new tariffs on imports into the United States from China. Since then, additional tariffs have been imposed by the USTR on imports into the United States from China and China has also imposed tariffs on imports into China from the United States. The countries continue to negotiate a trade deal. If additional tariffs or other restrictions are placed on Chinese imports or any additional counter-measures are taken by China, our revenue and results of operations may be materially harmed. Furthermore, current or future tariffs imposed by the United States may negatively impact the automobile manufacturers to which we provide our automotive navigation products and services, thereby causing an indirect negative impact on our own sales. Any reduction in the sales of our customers and business partners, and/or any apprehension among our customers and business partners of a possible reduction in such sales, would likely cause an indirect negative impact on our own sales. Even in the absence of further tariffs, the related uncertainty and the market's fear of an escalating trade war might create forecasting difficulties for us and could cause our customers and business partners to place fewer orders for our products and services, which could have a material adverse effect on our business, liquidity, financial condition, and/or results of operations. These developments, or the perception that any of them could occur, may have a material adverse effect on global economic conditions and the stability of global financial markets, and may significantly reduce global trade and, in particular, trade between these nations and the United States. Any of these factors could depress economic activity and restrict our access to suppliers or customers and have a material adverse effect on our business, financial condition and results of operations and affect our strategy in China and elsewhere around the world. Given the relatively fluid regulatory environment in China and the United States and uncertainty how the U.S. administration or foreign governments will act with respect to tariffs, international trade agreements and policies, a trade war, further governmental action related to tariffs or international trade policies, or additional tax or other regulatory changes in the future could directly and adversely impact our financial results and results of operations.

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Our operations in certain emerging markets expose us to political, economic and regulatory risks.

Our growth strategy depends in part on our ability to expand our operations in emerging markets, including Asia Pacific, the Middle East and Africa, and Latin America. However, some emerging markets have greater political, economic and currency volatility, and greater vulnerability to infrastructure and labor disruptions than more-established markets. In many countries outside of the United States, particularly those with emerging economies, it may be common for others to engage in business practices prohibited by laws and regulations with extraterritorial reach, such as the U.S. Foreign Corrupt Practices Act ("FCPA"), the United Kingdom’s, or U.K.’s, Bribery Act, or other local anti-bribery laws. These laws generally prohibit companies and their employees, contractors or agents from making improper payments to government officials, including in connection with obtaining permits or engaging in other actions necessary to do business. Failure to comply with these laws could subject us to civil and criminal penalties that could materially and adversely affect our reputation, financial condition and results of operations.

For example, under the FCPA, U.S. companies may be held liable for the corrupt actions taken outside the United States by employees, strategic or local partners, or other representatives. Under the FCPA, we and our partners are required to maintain accurate books and records and a system of internal accounting controls. As such, if we or our intermediaries fail to comply with the requirements of the FCPA or similar legislation outside the United States, governmental authorities in the United States and elsewhere could seek to impose civil or criminal fines and penalties, which could have a material adverse effect on our business, operating results and financial conditions. While our employee handbook and other policies prohibit our employees from engaging in corrupt conduct, we do not yet have in place compliance measures and training to require both our employees and our third-party intermediaries to comply with the FCPA and similar anticorruption laws.

Establishing operations and partners in these emerging markets may also require complex legal arrangements and operations to deliver services on global contracts for our end customers. Because of our limited experience with international operations and developing and managing sales in international markets, our international expansion efforts may not be successful. Additionally, we have established operations in locations remote from our more developed business centers. As a result, we are subject to heightened risks inherent in conducting business internationally, including the following:


•	failure to comply with local regulations or restrictions;


•	enactment of legislation, regulation or restriction, whether by the United States or in the foreign countries, including unfavorable labor regulations, tax policies or economic sanctions (such as potential economic sanctions arising from political disputes), and currency controls or restrictions on the transfer of funds;


•	enforcement of legal rights or recognition of commercial procedures by regulatory or judicial authorities in a manner in which we are not accustomed, would not reasonably expect or with which we could not reasonably comply;


•	differing technical and environmental standards, data protection and telecommunications regulations and certification requirements, which could prevent the import, sale or use of our products or SaaS offerings in such countries;


•	difficulties and costs associated with staffing and managing foreign operations;


•	potentially longer payment cycles and greater difficulty collecting accounts receivable;


•	the need to adapt and localize our services for specific countries, including conducting business and providing services in local languages;


•	reliance on third parties over which we have limited control, such as our partners or their resellers or agents, for marketing and reselling our products and solutions;


•	difficulties in understanding and complying with local laws, regulations, and customs in foreign jurisdictions or unanticipated changes in such laws;


•	application of or changes in anti-bribery laws, such as the FCPA and U.K. Bribery Act, which may disrupt our staffing or ability to manage our foreign operations;


•	changes in political and economic conditions leading to changes in the business environment in which we operate, as well as changes in foreign currency exchange rates;


•	sanctions restricting local commercial activity, including retaliatory actions by local governments; and

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•	natural disasters, pandemics or international conflict, including terrorist acts or labor or political disputes, which could interrupt our operations or endanger our personnel.

In addition, our competitors may also expand their operations in these markets or others we may also target, and low-cost local manufacturers may also expand and improve products and their production capacities, thus increasing competition in these emerging markets. Our success in emerging markets is important to our growth strategy. If we cannot successfully increase our business in emerging markets and manage associated political, economic, regulatory and currency volatility, our product sales, financial condition and results of operations could be materially and adversely affected.

We conduct substantial research and development operations in China; risks associated with a business presence in China could negatively affect our business and results of operations.

We currently operate a research and development center in China, which subjects us to a number of risks relating to China’s political and legal systems, including;


•	uncertainty regarding the validity, enforceability, scope and ability to protect and secure our intellectual property rights and the practical difficulties or enforcing such rights;


•	ability to secure our business' proprietary information when residing in or is accessible from China from illegal or unauthorized access or use;


•	extensive government regulation; and


•	an uncertain legal system.

Any actions and policies taken or adopted by the government of the People’s Republic of China, particularly with regard to our intellectual property, products and legal rights, could have an adverse effect on our business, results of operations and financial condition. For example, development in China or by entities supported by the China government of competing products or technologies using our intellectual property could significantly erode the market or pricing for our products. In addition, actions or policies to incorporate technical capabilities into our products, without our knowledge or permission or the appearance or threat of the same, could undermine product or data security features of our products. Whether any such actions or policies actually exist, or have been effected, the fact of a significant research and development presence in China could expose our products and data and security offerings to government or market scrutiny regarding the integrity of our product or data security features. Any of the foregoing could similarly discourage the purchase or use of our products and cause significant harm to our reputation in the market.

We could be subject to additional income tax liabilities.

We are subject to income taxes in the United States and numerous foreign jurisdictions. We use significant judgment in evaluating our worldwide provision for income taxes, which could be adversely affected by several factors, many of which are outside our control. During the ordinary course of business, there are many transactions for which the ultimate tax determination is uncertain. For example, our effective tax rates could be adversely affected by earnings being lower than we anticipate in countries that have lower statutory rates and higher than we anticipate in countries that have higher statutory rates, by changes in foreign currency exchange rates, by changes in the valuation of our deferred tax assets and liabilities, or by changes in the relevant tax, accounting and other laws, regulations, principles and interpretations, including possible changes to the U.S. taxation of earnings of our foreign subsidiaries or to the deductibility of expenses attributable to foreign income or the foreign tax credit rules. We are subject to audit in various jurisdictions, and such jurisdictions may assess additional income tax against us as well as penalties and fines. As we operate in multiple taxing jurisdictions, the application of tax laws can be subject to diverging and sometimes conflicting interpretations by tax authorities of these jurisdictions. The time and expense necessary to defend and resolve a tax audit may be significant. Although we believe our tax estimates are reasonable, the final outcome of tax audits and any related litigation could be materially different from our historical income tax provisions and accruals and may have a material effect on our operating results or cash flows in the period or periods for which we make such determination.

Our international operations and corporate structure subject us to potential adverse tax consequences.

We generally conduct our international operations through wholly owned subsidiaries and report our taxable income in various jurisdictions worldwide based upon our business operations in those jurisdictions. Our intercompany relationships are subject to complex transfer pricing regulations administered by taxing authorities in various jurisdictions. The relevant taxing authorities may disagree with our determinations as to the income and expenses attributable to specific jurisdictions. If such a disagreement were to occur, and our position not sustained, we could be required to pay additional taxes, interest and penalties,

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which could result in one-time tax charges, higher effective tax rates, reduced cash flows and lower overall profitability of our operations. We may not have adequate reserves to cover such a contingency.

In the future, we may reorganize our corporate structure or intercompany relationships, which would likely require us to incur expenses in the near term for which we may not realize related benefits, at all or within a reasonable period, to justify the expense. Changes in domestic and international tax laws, including enacted legislation to reform U.S. taxation of international business activities, may negatively impact our ability to effectively restructure, or reduce the benefits we expected from such corporate restructuring. Any such restructuring would likely involve sophisticated analysis, including analysis of U.S. and international tax regimes. Compliance with such laws and regulations may be difficult and expensive and subject our business to additional risks, costs and uncertainties.

Our customer requirements and content management obligations are complex. If we inadvertently include content for which we have liability to the vendor but may not be entitled to payment from our customer, our financial condition and results of operation could be harmed.

The nature and extent of content that is delivered as part of our navigation solutions is complex to manage. Matching the requirements of our customers with the content offered by our vendors may result in our inclusion of content which we believe is necessary to meet our customers’ requirements for which the customer may not have agreed to make payment to us. In addition, our customers speak directly to our vendors and often those conversations influence the expected content for our end products; however, customers may not be fully informed as to the license costs associated with the various components. Therefore, there is some risk that we may include content for which we have liability to the vendor but may not be entitled to payment from our customer. If these situations were to occur, our business, financial condition and results of operations could be adversely affected.

We face intense competition in our market, especially from competitors that offer their location services for free, which could make it difficult for us to acquire and retain customers and end users.

The market for development, distribution and sale of location services is highly competitive. Many of our competitors have greater name recognition, larger customer bases and significantly greater financial, technical, marketing, public relations, sales, distribution and other resources than we do. Competitors may offer location services that have at least equivalent functionality to ours for free. For example, Google offers free voice-guided turn by turn navigation as part of its Google Maps and Waze products for mobile devices, including those based on the Android and iOS operating system platforms, and Apple offers proprietary maps and voice-guided turn by turn directions. Microsoft Corporation also provides a free voice-guided turn by turn navigation solution on its Windows Mobile and Windows Phone operating systems. Competition from these free offerings may reduce our revenue, result in our incurring additional costs to compete and harm our business. If our wireless carrier customers can offer these mobile location services to their subscribers for free, they may elect to cease their relationships with us, similar to Sprint, alter or reduce the manner or extent to which they market or offer our services or require us to substantially reduce our fees or pursue other business strategies that may not prove successful. In addition, new car buyers may not value navigation solutions built in to their vehicles if they believe that free (brought-in) offerings, such as Apple’s CarPlay or Google’s auto initiatives, are adequate and may not purchase our solutions with their new cars. Ford offers Apple’s CarPlay and Google’s Android Auto on its vehicles in North America equipped with its SYNC 3 platform and announced that Waze will be available on its vehicles equipped with the SYNC 3 platform, which may reduce the number of vehicle purchasers who purchase on-board navigation solutions. GM also offers Apple’s CarPlay and Google’s Android Auto on most of its vehicles in North America. GM announced on September 5, 2019 that it intended to utilize GAS solutions on certain models beginning with GM’s model year 2022. In addition, while we have seen expansion of our latest version of Scout GPS Link solution across more Toyota and Lexus models in fiscal 2019, we expect that Toyota may limit the number of future models or vehicles on which Scout GPS Link is offered by Toyota and Lexus due in part to the offering of alternative brought-in solutions such as Apple’s CarPlay, which Toyota announced it is offering across certain Toyota models, and the expanded offering of Google’s Android Auto solution across more automobile manufacturers. We may not successfully increase our revenue from Ford, GM or Toyota, and our revenue could decrease, if our products are replaced within vehicles by Ford, GM or Toyota with our competitors’ products or due to price competition from third parties.

We compete in the automotive navigation market with established automobile manufacturers and tier ones and providers of on-board navigation services such as AISIN AW CO., Ltd, AutoNavi Software Co., Ltd., Robert Bosch GmbH, Elektrobit Corporation, Garmin, Ltd., HERE, Navinfo Co., Ltd., NNG LLC, Shenyang MXNavi Co., Ltd., and TomTom, as well as other competitors such as Apple and Google. Lear announced in April 2019 that it had agreed to acquire Xevo, with which we provide an offering to Toyota, which could result in Xevo moving into the on-board navigation services space. Some of our competitors’ and our potential competitors’ advantages over us, either globally or in particular geographic markets, include the following:

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•	significantly greater revenue and financial resources;


•	ownership of mapping and other content allowing them to offer a more vertically integrated solution;


•	stronger brand and consumer recognition in a particular market segment, geographic region or worldwide;


•	the capacity to leverage their marketing expenditures across a broader portfolio of products;


•	access to core technology and intellectual property, including more extensive patent portfolios;


•	access to custom or proprietary content;


•	quicker pace of innovation;


•	stronger automobile manufacturer and tier one relationships;


•	more financial flexibility and experience to make acquisitions;


•	ability or demonstrated ability to partner with others to create stronger or new competitors;


•	stronger international presence, which could make our larger competitors more attractive partners to automobile manufacturers and tier ones;


•	lower labor and development costs; and


•	broader global distribution and presence.

Our competitors’ and potential competitors’ advantages over us could make it more difficult for us to sell our navigation services, and could result in increased pricing pressures, reduced profit margins, increased sales and marketing expenses and failure to increase, or the loss of, market share or expected market share, any of which would likely cause harm to our business, operating results and financial condition.

If we are unable to integrate future investments or acquisitions successfully, our operating results and prospects could be harmed.

In the future, we may make acquisitions to improve our navigation services offerings or expand into new markets. Our future acquisition strategy will depend on our ability to identify, negotiate, complete and integrate acquisitions and, if necessary, to obtain satisfactory debt or equity financing to fund those acquisitions. Investments and mergers and acquisitions are inherently risky. We do not have experience identifying, executing or integrating such investments or acquisitions and any investments we make or mergers and acquisitions we complete may not be successful, may fail to demonstrate a return or fail to advance our product offerings or overall strategy. Future investments or mergers and acquisitions we may pursue would involve, numerous risks, including the following:


•	our ability to realize synergies expected to result from an acquisition or strategic investment;


•	difficulties in integrating and managing the operations, technologies and products of the companies we acquire, that are geographically remote from our existing operations;


•	the potential disruption to our ongoing business;


•	diversion of our management’s attention from normal daily operation of our business;


•	our inability to maintain the key business relationships and the reputations of the businesses we acquire;


•	our inability to retain key personnel of the companies we acquire;


•	uncertainty of entry into markets in which we have limited or no prior experience and in which competitors have stronger market positions;


•	our dependence on unfamiliar affiliates and customers of the companies we acquire;


•	insufficient revenue to offset our increased expenses associated with acquisitions;


•	potential unknown liabilities associated with acquired companies;

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•	our responsibility for the liabilities of the businesses we acquire, including those which we may not anticipate; and


•	our inability to maintain internal standards, controls, procedures and policies.

Completion of acquisitions is typically subject to the satisfaction of various closing conditions, including but not limited to regulatory approvals. There can be no assurance that any of such conditions will be satisfied and the acquisition will be completion. In addition, we may be unable to secure the equity or debt funding necessary to finance future acquisitions on terms that are acceptable to us. If we finance acquisitions by issuing equity or convertible debt securities, our existing stockholders will likely experience dilution, and if we finance future acquisitions with debt funding, we will incur interest expense and may have to comply with financial covenants and secure that debt obligation with our assets.

If we are not successful in completing acquisitions that we may pursue in the future, we may be required to reevaluate our business strategy, and we may incur substantial expenses and devote significant management time and resources without a productive result. We could also in the future record impairment losses in connection with acquisitions.

We may be required to recognize a significant charge to earnings if our goodwill or other intangible assets become impaired.

We have recorded goodwill related to our prior acquisitions and may do so in connection with any potential future acquisitions. We do not amortize goodwill and other intangible assets with indefinite lives, but we review such assets for impairment annually or on an interim basis whenever events or changes in circumstances indicate that we may not recover the carrying value of these assets. Factors that may indicate that the carrying value of our goodwill or other intangible assets may not be recoverable include a persistent decline in our stock price and market capitalization, reduced future cash flow estimates and slower growth rates in our industry. We may be required to record a significant charge in our financial statements during the period in which any impairment of our goodwill or other intangible assets is determined, which would adversely impact our results of operations.

We performed our annual goodwill impairment test as of April 1, 2019, and we determined that no impairment was indicated. Subsequent to the completion of our annual assessment, in May 2019 we entered into substantive discussions with inMarket regarding the sale of certain assets and the assumption of certain liabilities associated with the Ads Business in exchange for an equity interest in inMarket. In June 2019, we considered it more likely than not that a sale would occur, and we concluded that this represented a triggering event that required an interim goodwill impairment assessment. Accordingly, in June 2019, we performed an interim goodwill impairment test for our advertising business segment. In assessing its fair value, we made assumptions regarding our estimated future cash flows, weighted average cost of capital and timing over which the cash flows will occur, among other factors. Based on the results of this interim goodwill impairment test, the carrying value of our advertising business segment exceeded its estimated fair value and, accordingly, in fiscal 2019 we recognized a $2.6 million impairment of the goodwill associated with our advertising business segment.

We may make similar determinations regarding the impairment of goodwill in the future, which could have a material and adverse effect on our profitability.

Warranty claims, product liability claims, product recalls and regulatory liability claims could subject us to significant costs and adversely affect our financial results.

We warrant our automotive navigation products to be free from defects in materials, workmanship and design for periods ranging from three months to seven years. If our navigation services or products contain defects, there are errors in the maps supplied by third-party map providers or if our end users do not heed our warnings about the proper use of these products, collisions or accidents could occur resulting in property damage, personal injury or death. If any of these events occurs, we could be subject to significant liability for personal injury and property damage and under certain circumstances could be subject to a judgment for punitive damages. In addition, if any of our designed products are defective or are alleged to be defective, we may be required to participate in a recall campaign. These recall and warranty costs could be exacerbated to the extent they relate to global platforms or we are unable to deliver software updates over the air. Furthermore, recall actions could adversely affect our reputation or market acceptance of our products, particularly if those recall actions cause consumers to question the safety or reliability of our products. Warranty claims, a successful product liability claim or a requirement that we participate in a product recall campaign may adversely affect our results of operations and financial condition.

We accrue costs related to warranty claims when they are probable of being incurred and reasonably estimable. Our warranty costs have historically not been material. From time to time, we experience incidents where it may be necessary for us to expend resources to investigate and remedy a potential warranty claim.

We maintain limited insurance against accident related risks involving our products. However, we cannot assure you that this insurance would be sufficient to cover the cost of damages to others or will continue to be available at commercially

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reasonable rates. In addition, our errors and omissions insurance policy excludes coverage for certain consumer protection regulatory claims, including any future claims brought under the Telephone Consumer Protection Act. We may also be named as a defendant in litigation by consumers individually or on behalf of a class if their handsets or automobiles suffer problems from software downloads from our customers. If we are unable to obtain indemnification from our customer for any damages or legal fees we may incur in connection with such complaints, our financial position may be adversely impacted. In addition, insurance coverage generally will not cover awards of punitive damages and may not cover the cost of associated legal fees and defense costs. If we are unable to maintain sufficient insurance to cover product liability or regulatory liability costs, or if we experience losses not covered by our insurance, our business, financial condition and results of operations could be adversely affected.

Indemnity provisions in various agreements potentially expose us to substantial liability for intellectual property infringement, damages caused by defective software and other losses.

Our agreements with our customers include indemnification provisions. We agree to indemnify them for losses suffered or incurred in connection with our navigation services or products, including as a result of intellectual property infringement, damages caused by defects and damages caused by viruses, worms and other malicious software. The term of these indemnity provisions is generally perpetual after execution of the corresponding agreement, and the maximum potential amount of future payments we could be required to make under these indemnification provisions is generally substantial and may be unlimited. In addition, some of these agreements permit our indemnitees to terminate their agreements with us if they determine that the use of our navigation services or products infringes third-party intellectual property rights.

We have received, and expect to receive in the future, demands for indemnification under these agreements. These demands can be very expensive to settle or defend, and we have in the past incurred substantial legal fees and settlement costs in connection with certain of these indemnity demands. Furthermore, we have been notified by several customers that they have been named as defendants in certain patent infringement cases for which they may seek indemnification from us. Large future indemnity payments and associated legal fees and expenses, including potential indemnity payments and legal fees and expenses relating to the current or future notifications, could materially harm our business, operating results and financial condition.

We may in the future agree to defend and indemnify our customers in connection with the pending notifications or future demands, irrespective of whether we believe that we have an obligation to indemnify them or whether we believe that our services and products infringe the asserted intellectual property rights. Alternatively, we may reject certain of our customers’ indemnity demands, which may lead to disputes with our customers and may negatively impact our relationships with them or result in litigation against us. Our customers may also claim that any rejection of their indemnity demands constitutes a material breach of our agreements with them, allowing them to terminate such agreements. Our agreements with certain customers may be terminated in the event an infringement claim is made against us and it is reasonably determined that there is a possibility our technology or services infringed upon a third party’s rights. If, as a result of indemnity demands, we make substantial payments, our relationships with our customers are negatively impacted or if any of our customer agreements is terminated, our business, operating results and financial condition could be materially adversely affected.

Our investment portfolio may become impaired by deterioration of the financial markets.

Our cash equivalent and short-term investment portfolio as of September 30, 2019 consisted of corporate bonds, asset-backed securities, U.S. treasury securities, municipal securities, U.S. agency securities, commercial paper and money market mutual funds. We follow an established investment policy and set of guidelines to monitor and help mitigate our exposure to interest rate and credit risk. The policy sets forth credit quality standards and limits our exposure to any one issuer, as well as our maximum exposure to various asset classes.

Should financial market conditions worsen in the future, investments in some financial instruments may pose risks arising from market liquidity and credit concerns. In addition, any deterioration of the capital markets could cause our other income and expense to vary from expectations. As of September 30, 2019, we had no material impairment charges associated with our short-term investment portfolio. Although we believe our current investment portfolio has little risk of material impairment, we cannot predict future market conditions or market liquidity, or credit availability, and can provide no assurance that our investment portfolio will remain materially unimpaired.

Our effective tax rate may fluctuate, which could reduce our anticipated income tax benefit in the future.

Our effective tax rate could be adversely affected by several factors, many of which are outside of our control. Our effective tax rate may be affected by the proportion of our revenues and income (loss) before taxes in the various domestic and international jurisdictions in which we operate. Our revenue and operating results are difficult to predict and may fluctuate substantially from quarter to quarter. We are also subject to changing tax laws, regulations and interpretations in multiple

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jurisdictions in which we operate, as well as the requirements of certain tax and other accounting body rulings. Since we must estimate our annual effective tax rate each quarter based on a combination of actual results and forecasted results of subsequent quarters, any significant change in our actual quarterly or forecasted annual results may adversely impact the effective tax rate for the period. Our estimated annual effective tax rate may fluctuate for a variety of reasons, including:


•	changes in forecasted annual operating income or loss by jurisdiction and forecasted withholding taxes;


•	changes in relative proportions of revenue and income or loss before taxes in the various jurisdictions in which we operate;


•	requests by customers to bill their foreign subsidiaries and related entities, which may subject us to income tax withholding requirements on sales made in such jurisdictions;


•	changes to the valuation allowance on net deferred tax assets;


•	changes to actual or forecasted permanent differences between book and tax reporting, including the tax effects of purchase accounting for acquisitions and non-recurring charges which may cause fluctuations between reporting periods;


•	impact from any future tax settlements with state, federal or foreign tax authorities;


•	impact from increases or decreases in tax reserves due to new assessments of risk, the expiration of the statute of limitations or the completion of government audits;


•	impact from changes in tax laws, regulations and interpretations in the jurisdictions in which we operate, as well as the expiration and retroactive reinstatement of tax holidays;


•	impact from withholding tax requirements in various non-U.S. jurisdictions and our ability to recoup those withholdings, which may depend on how much revenue we have in a particular jurisdiction to offset the related expenses;


•	changes in customer arrangements where the customer’s domicile may impose withholding tax on our revenue that we previously were not subject to;


•	impact from acquisitions and related integration activities or divestitures; or


•	impact from new FASB requirements.

Although we believe our estimates are reasonable, the ultimate tax outcome may differ from the amounts recorded in our financial statements and may materially affect our financial results in future periods. In fiscal 2014, we recorded a valuation allowance on the majority of our deferred tax assets, net of liabilities since the assets are not more likely than not to be realized based upon our assessment of all positive and negative evidence. Realization of deferred tax assets is dependent upon future taxable earnings, the timing of which is uncertain. Due to operating losses in previous years and expected losses in fiscal 2019 and potentially future years in the United States, we continue to maintain a full valuation allowance on deferred tax assets in the United States. Due to operating losses in previous years and expected losses in future years in the United Kingdom, we continue to maintain a full valuation allowance for our foreign deferred tax assets in the United Kingdom. In the event deferred tax assets in Germany cannot be realized based upon the ability to generate future income in Germany, our effective tax rate will be negatively impacted.

Changes in accounting principles, or interpretations thereof, could have a significant impact on our financial position and results of operations.

We prepare our consolidated financial statements in accordance with GAAP. These principles are subject to interpretation by the SEC and various bodies formed to interpret and create appropriate accounting principles. A change in these principles can have a significant effect on our reported results and may even retroactively affect previously reported transactions. Additionally, the adoption of new or revised accounting principles, such as ASC 842, Leases, may require that we make significant changes to our systems, processes and controls.

It is not clear if or when other potential changes in accounting principles may become effective, whether we have the proper systems and controls in place to accommodate such changes and the impact that any such changes may have on our financial position and results of operations.

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We rely on a proprietary provisioning and reporting system for our navigation products and services to track end user activation, deactivation and usage data, and any material failures in this system could harm our revenue, affect our costs and impair our ability to manage our business effectively.

Our provisioning and reporting system that authenticates end users and tracks the number of end users and their use of our services is a proprietary and customized system that we developed internally. Although we believe that the flexibility of this service to integrate tightly with automobile manufacturers’ reporting and provisioning systems gives us a competitive advantage, we might lose revenue and the ability to manage our business effectively if the system were to experience material failures or be unable to scale as our business grows. In addition, we may not be able to report our financial results on a timely basis if our customers question the accuracy of our records or we experience significant discrepancies between the data generated by our provisioning and reporting systems and data generated by their systems, or if our systems fail or we are unable to report timely and accurate information to our third-party data providers. The inability to timely report our financial results would impair the quality of our financial reporting and could result in the delisting of our common stock.

We rely on third-party data and content to provide our services, and if we were unable to obtain content at reasonable prices, or at all, our gross margins and our ability to provide our services would be harmed.

We rely on third-party data and content to provide our services, including map data, POI, traffic information, gas prices and weather information. If our suppliers of this data or content were to enter into exclusive relationships with other providers of location services or were to discontinue providing such information and we were unable to replace them cost effectively, or at all, our ability to provide our services would be harmed. Our gross margins may also be affected if the cost of third-party data and content increases substantially. Although we have integrated OSM data into our products, we may experience difficulty with customer acceptance if the quality of the consumer generated data within OSM is lower than that of paid maps. We introduced mobile phone-based navigation with OSM and launched our first brought-in automotive navigation service with OSM in 2015. In addition, the entry into the Grab Transaction, which transaction includes, among other things, the performance of certain OSM development services for Grab during fiscal 2020 and the subsequent planned hiring by Grab of certain of our employees focused on OSM development activities, may limit the amount of OSM development work that is completed for internal purposes during fiscal 2020. As a result, we may not have sufficient data for automobile manufacturers and tier ones to feel comfortable electing to use OSM in the products and services we provide them.

We obtain map data from TomTom and HERE, which are companies owned by our current and potential competitors. Accordingly, these third-party data and content providers may act in a manner that is not in our best interest. For example, they may cease to offer their map and POI data to us. The termination dates of our licenses to data from TomTom utilized in our mobile and automotive products generally approximate the respective termination dates of our obligations to provide map data to the applicable wireless carriers and automobile manufacturers. Our master data license agreement with HERE was automatically renewed under its existing terms through January 31, 2020, and automatically renews for successive one-year periods unless either party provides notice of non-renewal at least 180 days prior to the expiration of the applicable term. However, individual territory licenses with distinct term, termination and renewal provisions further govern the license of map data to support individual programs and products for our automobile manufacturers and tier ones.

We may identify other requisite content and content-related technologies, including certain geocoding data necessary for our OSM products, that we may be unable to license or develop internally. If we are unsuccessful in these endeavors, we may be unable to successfully launch our OSM-based products globally and across all desired product offerings.

We may not be able to upgrade our navigation services platform to support certain advanced features and functionality without obtaining technology licenses from third parties. Obtaining these licenses may be costly and may delay the introduction of such features and functionality, and these licenses may not be available on commercially favorable terms, or at all. The inability to offer advanced features or functionality, or a delay in our ability to upgrade our navigation services platform, may adversely affect consumer demand for our navigation services and, consequently, harm our business.

We may be subject to our automobile manufacturer or tier one’s selection of map and other content providers, and our ability to negotiate and enter into a license with such provider(s) may be dependent on the timing of such automobile manufacturer or tier one’s official nomination for such content providers. Accordingly, we may have contractual obligations to provide certain products and services for certain model years or periods to our automobile manufacturer or tier one partners, prior to our ability to enter into agreements with our map and other content providers to support such products and services. We may be unable to obtain data licenses with the necessary content providers to support these products and services, or we may not be able to secure such data licenses without additional, unplanned costs or delays.

We also use our proprietary provisioning and reporting system to record and report royalties we owe to third-party providers of content used by end users in connection with our services. Certain of the third-party content providers have the right to audit our use of their services and, if we are found to have under or incorrectly reported usage, we may be required to

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pay the third-party content providers for the actual usage, as well as interest and the cost of the audit. Any significant error in our recording and payment of royalties to our third-party content providers could have a material and adverse effect on our financial results. We may also incur losses as a result of any significant error.

Network failures, disruptions or capacity constraints in our third-party hosted data center facilities could affect the performance of our navigation services and harm our reputation and our revenue.

We use hosted services provided by Amazon Web Services, or AWS, and wireless carrier networks to deliver our navigation and advertising platform services. Our operations rely to a significant degree on the efficient and uninterrupted operation of the third-party data centers we use. In the event that AWS or wireless carrier networks experience a disruption in services or a natural disaster, our ability to continue providing our services would be compromised. Depending on the growth rate in the number of our end users and their usage of our services, if we do not timely complete the negotiation for and scale of additional hosting services, we may experience capacity issues, which could lead to service failures and disruptions. In addition, if we are unable to secure third-party hosting services with appropriate power, cooling and bandwidth capacity, we may be unable to efficiently and effectively scale our business to manage the addition of new automobile manufacturers and tier ones, increases in the number of our end users or increases in data traffic.

AWS hosting services are potentially vulnerable to damage or interruption from a variety of sources, including fire, flood, earthquake, power loss, telecommunications or computer systems failure, human error, terrorist acts or other events. We have not yet completed a comprehensive business continuity plan, and there can be no assurance that the measures implemented by us to date, or measures implemented by us in the future, to manage risks related to network failures or disruptions in our data centers will be adequate, or that the redundancies built into our servers will work as planned in the event of network failures or other disruptions. In particular, if we were to experience damage or interruptions to AWS hosting services our ability to provide efficient and uninterrupted operation of our services would be significantly impaired.

We could also experience failures of our data centers or interruptions of our services, or other problems in connection with our operations, as a result of:


•	damage to or failure of our computer software or hardware or our connections and outsourced service arrangements with third parties;


•	errors in the processing of data;


•	computer viruses or software defects;


•	physical or electronic break-ins, sabotage, intentional acts of vandalism and similar events; or


•	errors by our employees or third-party service providers.

Poor performance in or disruptions of our services could harm our reputation, delay market acceptance of our services and subject us to liabilities. Our automobile manufacturer and tier one agreements for on-board and hybrid solutions require us to meet at least 99.9% operational uptime requirements, excluding scheduled maintenance periods, or be subjected to penalties. Any outage in a network or system, or other unanticipated problem that leads to an interruption or disruption of our navigation services, could have a material adverse effect on our operating results and financial condition.

We may not be able to enhance our location services to keep pace with technological and market developments, or develop new location services in a timely manner or at competitive prices.

The market for location services is characterized by rapid technological change, evolving industry standards, frequent new product introductions and short product life cycles. To keep pace with technological developments, satisfy increasing customer requirements and achieve product acceptance, our future success depends upon our ability to enhance our current navigation services platform and to continue to develop and introduce new navigation services and other location-based product offerings and enhanced performance features and functionality on a timely basis at competitive prices. Our inability, for technological or other reasons, to enhance, develop, introduce or deliver compelling services and products in a timely manner, or at all, in response to changing market conditions, technologies or consumer expectations could have a material adverse effect on our operating results or could result in our services becoming obsolete. Our ability to compete successfully will depend in large measure on our ability to maintain a technically skilled development and engineering team and to adapt to technological changes and advances in the industry, including providing for the continued compatibility of our services platform with evolving industry standards and protocols and competitive network operating environments.

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The U.K.’s vote to leave the EU will have uncertain effects and could adversely affect us.

On June 23, 2016, the electorate in the U.K. voted in favor of leaving the EU, which is commonly referred to as the “Brexit”. Although Brexit is scheduled to take place by January 31, 2020, given prior extensions of the deadline for Brexit, it is unclear when and if such withdrawal will take place.

The effects of Brexit will depend on agreements the UK makes to retain access to EU markets either during a transitional period or more permanently. Brexit creates an uncertain political and economic environment in the UK and potentially across other EU member states for the foreseeable future, including during any period while the terms of Brexit are being negotiated and such uncertainties could impair or limit our ability to transact business in the member EU states.

Further, Brexit could adversely affect European and worldwide economic or market conditions and could contribute to instability in global financial markets, and the value of the Pound Sterling currency or other currencies, including the Euro. We are exposed to the economic, market and fiscal conditions in the U.K. and the EU and to changes in any of these conditions. Depending on the terms reached regarding Brexit, it is possible that there may be adverse practical and/or operational implications on our business.

A significant amount of the regulatory regime that applies to us in the U.K. is derived from EU directives and regulations. For so long as the U.K. remains a member of the EU, those sources of legislation will (unless otherwise repealed or amended) remain in effect. However, Brexit could change the legal and regulatory framework within the U.K. where we operate and is likely to lead to legal uncertainty and potentially divergent national laws and regulations as the U.K. determines which EU laws to replace or replicate. Consequently, no assurance can be given as to the impact of Brexit and, in particular, no assurance can be given that our operating results, financial condition and prospects would not be adversely impacted by the result.

We rely on our management team and need specialized personnel to grow our business, and the loss of one or more key employees or our inability to attract and retain qualified personnel could harm our business.

Our success and future growth depend on the skills, working relationships and continued services of our management team. We have experienced significant turnover in our management team since the beginning of fiscal 2019, including the departure of our Chief Financial Officer in January 2019 and our General Counsel in October 2018. In addition, our Senior Vice President, Engineering resigned in October 2019. Although we recently hired a new Chief Financial Officer and a new General Counsel, our future performance will depend on our ability to retain these and other members of our senior management, particularly in the growth areas of our business, such as hybrid or brought-in automotive navigation.

Our future success also depends on our ability to attract, retain and motivate highly skilled personnel in the United States and internationally. All of our U.S. employees work for us on an at will basis. Competition for highly skilled personnel is intense, particularly in the software industry and for persons with experience with GPS and location services. The high degree of competition for personnel we experience has resulted in and may also continue to result in the incurrence of significantly higher compensation costs to attract, hire and retain employees. We have from time to time experienced, and we expect to continue to experience, difficulty in attracting, hiring and retaining highly skilled employees with appropriate qualifications. Many of the companies with which we compete for experienced personnel have greater resources than we have. If we hire employees from competitors, their former employers may attempt to assert that these employees or we have breached the former employees’ legal obligations to the former employer, resulting in a diversion of our time and resources. In addition, existing employees often consider the value of the stock awards they receive in connection with their employment. If our stock price performs poorly, it may adversely affect our ability to retain highly skilled employees. Our inability to attract and retain the necessary personnel could adversely affect our business and future growth prospects.

We rely on network infrastructures provided by our wireless carriers, mobile phones and in-car wireless connections for the delivery of our navigation services to end users.

We generally provide our navigation services from third-party hosted servers, which require close integration with the wireless carriers’ networks. We may be unable to provide high quality services if the wireless carriers’ networks perform poorly or experience delayed response times. Our future success will depend on the availability and quality of our wireless carrier customers’ networks in the United States and abroad to run our mobile navigation services. This includes deployment and maintenance of reliable networks with the speed, data capacity and security necessary to provide reliable wireless communications services. We do not establish or maintain these wireless networks and have no control over interruptions or failures in the deployment and maintenance by wireless carrier customers of their network infrastructure. In addition, these wireless network infrastructures may be unable to support the demands placed on them if the number of subscribers increases, or if existing or future subscribers increase their use of limited bandwidth. Market acceptance of our mobile navigation services will depend in part on the quality of these wireless networks and the ability of our customers to effectively manage their subscribers’ expectations.

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In addition, certain automotive navigation applications rely on wireless connections between the vehicle and our network. We have no influence or control over the vehicle’s wireless equipment and if it does not operate in a satisfactory manner, our ability to provide those services would be impaired and our reputation would be harmed.

Wireless communications have experienced a variety of outages and other delays as a result of infrastructure and equipment failures and could face outages and delays in the future. These outages and delays could affect our ability to provide our navigation services successfully. In addition, changes by a wireless carrier to its network infrastructure may interfere with the integration of our servers with their network and delivery of our navigation services and may cause end users to lose functionality for services they have already purchased. Any of the foregoing could harm our business, operating results and financial condition.

We cannot control the quality standards of our wireless carriers, their mobile phone providers, automobile manufacturers and other technology infrastructure providers. We cannot guarantee that the mobile phones or in-car wireless equipment are free from errors or defects. If errors or defects occur in mobile phones or services offered by our wireless carrier customers, it could result in consumers terminating our services, damage to our reputation, increased customer service and support costs, warranty claims, lost revenue and diverted development resources, any of which could adversely affect our business, results of operations and financial condition.

Mergers, consolidations or other strategic transactions in the mapping data industry could weaken our competitive position, reduce the number of our map providers and adversely affect our business.

The mapping data industry continues to experience consolidation. Should one of our map providers consolidate or enter into an alliance with another navigation provider, this could have a material adverse impact on our business. Currently, two of our map suppliers are owned by competitors in the navigation space. Such a consolidation may cause us to lose a map supplier or require us to increase the royalties we pay to map vendors as a result of enhanced supplier leverage, which would have a negative effect on our business. In the event that we lose a map supplier, we may be unable to replace our map suppliers, and the remaining map suppliers may increase license fees. In addition, if we continue to use more OSM-based maps and no longer purchase maps from those suppliers, we may be unable to purchase other data that is integral to our navigation products from our existing map suppliers.

Changes in business direction and market conditions could lead to charges related to structural reorganization and discontinuation of certain products or services, which may adversely affect our financial results.

In response to changing market conditions and the desire to focus on new and more potentially attractive opportunities, we may be required to strategically realign our resources and consider restructuring, eliminating, or otherwise exiting certain business activities. Any decision to reduce investment in, dispose of, or otherwise exit business activities may result in the recording of special charges, such as workforce reduction and excessive facility space costs.

Risks related to our intellectual property and regulation

We operate in an industry with extensive intellectual property litigation. Claims of infringement against us, our customers, or other business partners may cause our business, operating results and financial condition to suffer.

Our commercial success depends in part upon us, our partners and our customers not infringing intellectual property rights owned by others and being able to resolve claims of intellectual property infringement without major financial expenditures and/or need to alter our technologies or cease certain activities. We operate in an industry with extensive intellectual property litigation and it is not uncommon for our automobile manufacturers and tier ones and competitors to be involved in infringement lawsuits by or against third parties. Many industry participants that own, or claim to own, intellectual property aggressively assert their rights, and our customers and other business partners, who we agree in certain circumstances to indemnify for intellectual property infringement claims related to our services, are often targets of such assertions. We cannot determine with certainty whether any existing or future third-party intellectual property rights would require us to alter our technologies, obtain licenses or cease certain activities.

We have received, and may in the future receive, claims from third parties alleging infringement and other related claims. Current and future litigation may make it necessary to defend ourselves and our customers and other business partners by determining the scope, enforceability and validity of third-party proprietary rights or to establish our proprietary rights. Some of our competitors may have substantially greater resources than we do and may be able to sustain the costs of complex intellectual property litigation to a greater degree and for longer periods of time than we could. In addition, patent holding companies that focus solely on extracting royalties and settlements by enforcing patent rights may target us, our wireless carrier customers or our other business partners. These companies typically have little or no product revenue and therefore our patents may provide little or no deterrence against such companies filing patent infringement lawsuits against us. Regardless of

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whether claims that we are infringing patents or other intellectual property rights have any merit, these claims are time consuming and costly to evaluate and defend and could:


•	adversely affect our relationships with our current or future customers and other business partners;


•	cause delays or stoppages in the shipment of Telenav-enabled or preloaded mobile phones or vehicles, or cause us to modify or suspend the provision of our navigation services;


•	cause us to incur significant expenses in defending claims brought against our customers, other business partners or us;


•	divert management’s attention and resources;


•	subject us to significant damages or settlements;


•	require us to enter into settlements, royalty or licensing agreements on unfavorable terms; or


•	require us or our business partners to cease certain activities and/or modify our products or services.

In addition to liability for monetary damages against us or, in certain circumstances, our customers, we may be prohibited from developing, commercializing or continuing to provide certain of our navigation services unless we obtain licenses from the holders of the patents or other intellectual property rights. We cannot assure you that we will be able to obtain any such licenses on commercially reasonable terms, or at all. If we do not obtain such licenses, our business, operating results and financial condition could be materially adversely affected, and we could, for example, be required to cease offering our navigation services or be required to materially alter our navigation services, which could involve substantial costs and time to develop.

Unauthorized control or manipulation of our systems in vehicles may cause them to operate improperly or not at all, or compromise their safety and data security, which could result in loss of confidence in us and our products, cancellation of contracts with certain of our automobile manufacturer or tier one customers and harm our business.

There have been reports of vehicles of certain automobile manufacturers being “hacked” to grant access and operation of the vehicles to unauthorized persons and would-be thieves. Modern vehicles are technologically advanced machines requiring the interoperation of numerous complex and evolving hardware and software systems, including the navigation system, and with respect to vehicles with autonomous driving features, control of the vehicle. We have agreed with some of our automobile manufacturer and tier one customers to adopt certain security procedures and we may be subject to claims or our contracts with those automobile manufacturers and tier ones may be terminated if we do not comply with our covenants or if our products are the source of access to the systems in their vehicles by intruders.

Although we have designed, implemented and tested security measures to prevent unauthorized access to our products when installed in vehicles, our information technology networks and communications with vehicles in which our products are installed may be vulnerable to interception, manipulation, damage, disruptions or shutdowns due to attacks by hackers or breaches due to errors by personnel who have access to our networks and systems. Any such security incidents could result in unexpected control of or changes to the vehicles’ functionality and our products’ user interface and performance characteristics. Hackers may also use similar means to gain access to data stored in or generated by the vehicle, such as its current geographical position, previous and stored destination address history and web browser “favorites.” Any such unauthorized control of vehicles or access to or loss of information could result in legal claims or proceedings and negative publicity, which would negatively affect our brand and harm our business, prospects, financial condition and operating results.

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Our business is subject to online security risks, including potential security and privacy incidents.

Our business involves the collection, storage, processing and transmission of information about our users, including users’ locations, routes mapped and taken. Additionally, our apps transmit information to users’ personal devices, which creates opportunities for hackers to exploit vulnerabilities, if any, in our apps. An increasing number of organizations, including large online and offline merchants and businesses, other large Internet companies, financial institutions, and government institutions, have disclosed breaches of their security, some of which have involved sophisticated and highly targeted attacks, including on portions of their websites or infrastructure. While we are investing significant resources to evaluate and improve our security, we have been subject to such attacks in the past, although they have not, to our knowledge, resulted in a breach of security involving unauthorized acquisition of users’ personal information. A breach of security or privacy could have negative consequences to our reputation, which could result in users discontinuing or reducing their use of our products and our automotive customers terminating their agreements with us, and could have significant out-of-pocket financial impact, which could harm our business. Similarly, a breach of security or privacy in vehicles in which our navigation products are installed could result in a reduction in adoption of our navigation products.

The techniques used to obtain unauthorized, improper or illegal access, disable or degrade service, or sabotage systems or access our data change frequently, may be difficult to detect quickly, and often are not recognized until launched against a target. Certain efforts may be state-sponsored and supported by significant financial and technological resources and may therefore be even more difficult to detect. As a result, we may be unable to anticipate these techniques or to implement adequate preventative measures. Unauthorized parties also may attempt to gain access to our systems or facilities through various means, including hacking into our systems or facilities, fraud, trickery or other means of deceiving our employees, contractors and temporary staff. A party that is able to circumvent our security measures could misappropriate our, our customers’ or our employees’ personal or proprietary information, cause interruption in our operations and damage our computers and systems or those of our customers. In addition, our customers have been and likely will continue to be targeted by parties using fraudulent “spoof” and “phishing” emails to misappropriate user names, passwords, payment card numbers, GPS data or other personal information or to introduce viruses or other malware, including through “trojan horse” programs, to our users’ phones and vehicles. Also, our information technology and infrastructure may be vulnerable to cyberattacks or security incidents, and third parties may be able to access our customers’ personal or proprietary information and payment card data that are stored on or accessible through our systems. Any security or privacy incident at a company providing services to us or our tier one customers, or integrated with our products and services, could have similar effects. We may also need to expend significant additional resources to protect against security or privacy incidents or to redress problems caused by such incidents. These issues are likely to become more difficult and costly as we expand the number of markets where we operate. Additionally, our insurance policies carry low coverage limits, which may not be adequate to reimburse us for losses caused by security incidents, and we may not be able to collect fully, if at all, under these insurance policies.

Vulnerabilities in our products and services have been publicly disclosed before, and if we are unable to adequately detect and address vulnerabilities in our products and services, it may result in harm to our business.

As with any application, our products may contain known and unknown vulnerabilities, coding errors, design flaws, or other issues that could allow an attacker to maliciously exploit our software. Vulnerabilities in our software and applications have been publicly exposed in the past, although they have not, to our knowledge, resulted in the disclosure of user information or been maliciously exploited. While we are investing significantly to evaluate and improve our security on the vulnerabilities we have identified, addressing vulnerabilities in our software is an ongoing process. Malicious exploitation of our products could result in the introduction of malicious software onto our users’ devices, the theft of confidential or private information, damage to users’ devices, and harm to our reputation, among other issues. Successful exploitation of a vulnerability in our software may subject us to numerous lawsuits or regulatory inquiries. Additionally, the disclosure of any vulnerability may result in a loss of confidence in us or our products, the cancellation of contracts with certain of our automotive tier one customers, discontinued use of our products, and harm to our business and reputation. These events could have significant out-of-pocket financial impact.

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Changes in government regulation of the wireless communications, automobile and in car commerce industries may adversely affect our business.

It is possible that a number of laws and regulations may be adopted in the United States and elsewhere that could restrict the wireless communications industry, further regulate the automobile industry or impair the ability to conduct in car commerce, including laws and regulations regarding lawful interception of personal data, hands free use of mobile phones or navigation services within autos, autonomous driving or the control of such use, privacy, taxation, content suitability, copyright and antitrust. Furthermore, the growth and development of electronic storage of personal information may prompt calls for more stringent consumer protection laws that may impose additional burdens on companies such as ours that store personal information. We anticipate that regulation of the industries in which our products and services are used will increase and that we will be required to devote legal and other resources to address this regulation. In addition, governments have recently begun to consider and adopt laws regarding vehicles using advanced driver assistance systems, or ADAS, and semi-autonomous driving capabilities and those laws may curtail or preclude using the services our products provide. Changes in current laws or regulations or the imposition of new laws and regulations in the United States or elsewhere regarding the wireless communications or automobile industries may make operation more costly, and may materially reduce our ability to increase or maintain sales of our products and services.

We are subject to complex and evolving U.S. and foreign laws and regulations regarding privacy, data protection and other matters and violations of these complex and dynamic laws, rules and regulations may result in claims, changes to our business practices, monetary penalties, increased costs of operations, and/or other harms to our business.

Numerous provincial, state, national and international laws and regulations apply to our collection, use, retention, protection, disclosure, transfer and other processing of data, including personal data. These laws and regulations are evolving rapidly and imposing increasingly varied requirements across the jurisdictions in which we do business.. For example, the European Union’s, or EU, General Data Protection Regulation, or GDPR, took effect in May 2018. The GDPR replaces Directive 95/46/EC of 1995 and is directly applicable in EU member states. Among other things, the GDPR regulates data controllers and processors outside of the EU whose processing activities relate to the offering of goods or services to, or monitoring the behavior within the EU of, EU data subjects. Efforts to comply with the GDPR may cause us to incur substantial operational costs or require us to change our business practices or service offerings. Despite our efforts to bring practices into compliance with the GDPR, we cannot guarantee that we are fully compliant or will be able to demonstrate compliance as of a future date if required to do so. In addition, because the GDPR is new, it may be subject to new or changing interpretations by courts, and our interpretation of the law and efforts to comply with the rules and regulations of the law may be ruled invalid. The GDPR imposes significant penalties of up to the greater of 4% of worldwide turnover and €20 million for violations of the GDPR. Similarly, in June 2018, California enacted the California Consumer Privacy Act of 2018, or the CCPA, which will become effective in January 2020. The CCPA will, among other things, require covered companies to provide new disclosures to California consumers and afford such consumers new rights to opt-out of certain sales of personal information. The CCPA creates a private right of action for statutory damages for certain breaches of information. In addition, the Office of the California Attorney General promulgated proposed regulations and, following a public comment period, will issue final regulations to establish procedures to facilitate these new rights and as necessary to further the purposes of the CCPA. The proposed regulations were published in October 2019 and the deadline for the California Attorney General to release final regulations is July 1, 2020. As such and as additional amendments to the CCPA could be introduced during California’s next legislative session, it remains unclear what procedures will be required to comply with the CCPA or how the CCPA and final regulations will be interpreted and enforced. In addition, other states have enacted or proposed legislation that regulates the collection, use, and sale of personal information, and such laws and regulations might not be compatible with either the GDPR or the CCPA. We cannot yet predict the impact of the CCPA or impending legislation on our business or operations, but it may require us to modify our data processing practices and policies and to incur substantial costs and expenses in an effort to comply. If we fail to implement practices and procedures deemed necessary by regulators or consumers or to comply with the GDPR, CCPA or other applicable laws and regulations, we may be subject to fines, penalties, litigation, and reputational harm and our business may be seriously harmed. In addition, various government and consumer agencies and public advocacy groups have called for new regulation and changes in industry practices, including some directed at the mobile and advertising industries in particular. It is possible that new laws, regulations, standards, recommendations, best practices or requirements will be adopted that would affect our business, particularly with regard to location-based services, collection or use of data to target ads and communication with consumers via mobile devices. To the extent that we or our clients are subject to new laws or recommendations or choose to adopt new standards, recommendations, or other requirements, we may have greater compliance burdens. If we are perceived as not operating in accordance with industry best practices or any such guidelines or codes with regard to privacy or data protection, our reputation may suffer, and we could lose relationships with developer partners.

The application and interpretation of these laws and regulations may be uncertain, particularly in the new and rapidly evolving industry in which we operate. At the same time that these data protection requirements are increasing in number,

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variation, and complexity, the consequences of noncompliance are also increasing. As a result, we anticipate (i) heightened privacy and data protection compliance costs; (ii) an increased risk of legal, financial, or reputational harm in case of actual or perceived noncompliance, whether by us, our business partners, customers or end users; and (iii) an increased risk of a reduced return on investments in some strategic partnerships and product and service development efforts. These risks include:

•

Heightened Privacy and Data Protection Compliance Costs. Privacy and data protection laws and regulations affecting our business are evolving rapidly and may result in heightened long-term compliance costs for our business. In some cases, this may result in longer customer contract cycles and delayed onboarding. Additionally, as part of our own compliance efforts, we anticipate increasing our scrutiny of the vendors that support data-related aspects of our services. Further, as data subject access rights become more widespread and frequently exercised under these evolving requirements, we anticipate heightened compliance costs in implementing policies, procedures and technologies to respond to our business partners and others regarding requests to exercise data subject or consumer rights related to “personal data” or “personal information,” as defined under the laws of various jurisdictions.

•

Increased Risk of Legal, Financial, or Reputational Harm in Cases of Actual or Perceived Noncompliance (whether by us, our business partners, customers, or end users). In cases of our potential noncompliance with any of these privacy and data protection laws and regulations, regulatory trends suggest the risk of heightened enforcement and more significant fines, including monetary penalties, for example, under the GDPR, which went into effect May 25, 2018 and, among other things, authorizes fines up to 4% of global annual revenue or €20 million, whichever is greater, for some types of violations. In other cases, new laws may authorize a private right of action and/or a statutory framework for damages that are likely to increase the risk and costs of litigation, in particular, in the case of certain security incidents involving personal information, such as under the recently enacted CCPA, which becomes operative January 1, 2020. Additional litigation risks may arise due to contractual obligations with our customers and business partners.

In most cases, our processing of personal data is a service we provide at the direction of a partner or end customer, including in conjunction with a service the customer provides for its end-users. Our role in delivering services for customers to end-users may increase the risk of a perceived violation, even when the fault is not attributable to our action or inaction (e.g., in the case of a data breach resulting from a customer’s or end-user’s failure to secure systems or passwords within their control). We might be included in others’ perceptions of inadequate data protection measures, regardless of whether such perceptions are invalid, and this could harm our reputation and inhibit adoption of our products, applications and services by current and prospective customers. Even where it is clear that we are not responsible, privacy or data protection violations caused by one of our business partners could negatively affect us by association. We may incur costs to investigate and disprove perceptions. We may also experience challenges recovering trust from customers whose information may have been affected (e.g., disclosed more broadly than intended due to a data breach, regulatory inquiry, or litigation). Such reputational harms could result in potentially decreased demand for our products and services.

•

Reduced Return on Investments in Some Strategic Partnerships and Product and Service Development Efforts. As legal requirements and interpretations change, are called into question, or increase in variability across jurisdictions, some of our assumptions leading to investments in strategic partnerships and product and service development may be challenged. This may reduce the return on some of our investments in products, services, and partnerships in key markets. Our ability to operate or expand our business may be inhibited if we must implement increased or higher-cost security measures, establish alternate business processes or infrastructure, or are prohibited from capitalizing on cost-saving efficiencies related to the automated processing of data previously not anticipated to be subject to such requirements. For example, evolving and increasingly varied legal definitions of personal information and personal data in the United States, EU and elsewhere may affect our legal treatment of IP addresses, MAC addresses, machine identification, location and tracking data, data analytics and other information as well as the extent to which we can lawfully apply machine learning and artificial intelligence to those data sets for certain purposes and in certain jurisdictions. Some countries’ data localization laws may require us to establish additional infrastructure or engage service providers in those jurisdictions, increasing the cost and complexity of our business operations and potentially limiting sales of our products in those jurisdictions. While we do not anticipate the same rapid evolution and proliferation of data localization laws as with privacy and data protection laws and regulations, we continue to monitor overall legal developments in this area for impact on our current products and services, as well as those in development. We also note that our introduction of new data platforms, applications and services or expansion of our activities in certain jurisdictions may subject us to additional laws and regulations. For instance, participation in certain funding programs may subject us to additional privacy and data use restrictions under U.S. federal, state, and local laws and regulations relating to the processing of data relating to students or children. Risks remain that new or

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expanded products and services may be commercially infeasible in some markets in light of actual or potential compliance costs under current or developing legal requirements in this area.

Certain of our products are subject to U.S. export controls; where we fail to comply with these laws, we could suffer monetary or other penalties.

Certain of our products are subject to U.S. export controls, specifically the Export Administration Regulations, and economic sanctions enforced by the Office of Foreign Assets Control. We incorporate standard encryption algorithms into our products, which, along with the underlying technology, we may export outside of the United States only with the required export authorizations, including by license, license exception or other appropriate government authorizations. Each of these authorizations may require us to file an encryption registration and classification request. Furthermore, U.S. export control laws and economic sanctions prohibit the shipment of certain products and services to countries, governments and persons targeted by U.S. sanctions. We also are restricted from exporting products to certain government and state-owned enterprises. We take precautions to prevent our products and services from being exported in violation of these laws and, in many instances, we rely on our partners to assure compliance when selling, distributing and/or using our products outside the United States. In certain instances, we may have shipped encryption products prior to obtaining the required export authorizations and/or submitting the required requests, including a classification request and request for an encryption registration number. Additionally, even though we take precautions to ensure that our partners comply with all relevant regulations, any failure by our partners to comply with such regulations could have negative consequences for us, including reputational harm, government investigations and penalties and interruptions in our ability to distribute and sell our products.

Various countries also regulate the import of certain encryption technology and operation of our products, including through import permitting, certification and licensing requirements, and have enacted laws that could limit our ability to distribute our products or our end customers’ ability to operate our products in those countries, or could impose additional expense on us to meet these requirements as a condition to distribute our products. Encryption products and the underlying technology may also be subject to export-control restrictions. Governmental regulation of encryption technology and regulation of imports or exports of encryption products, or our failure to obtain required import or export approval for our products, when applicable, could harm our international sales and adversely affect our revenue. Compliance with applicable regulatory laws and regulations regarding the export or import of our products, including with respect to new releases of our products, may create delays in our introduction of products in international markets, prevent our end customers with international operations from deploying our products throughout their globally distributed systems or, in some cases, prevent the export or import of our products to some countries altogether.

In addition, because our sales are made through partners, if these partners fail to obtain appropriate import, export or re-export licenses or authorizations, we may also be adversely affected, including potentially being liable for penalties under government restrictions and regulations, even where the partner failed to obtain the appropriate licenses or authorizations. Obtaining the necessary authorizations, including any required license, for a particular sale may be time-consuming, is not guaranteed and may result in the delay or loss of sales opportunities. Changes in our products or changes in applicable export or import laws and regulations may also create delays in the introduction and sale of our products in international markets, prevent our end customers with international operations from deploying our products or, in some cases, prevent the export or import of our products to certain countries, governments or persons altogether. Any change in export or import laws and regulations, shift in the enforcement or scope of existing laws and regulations, or change in the countries, governments, persons or technologies targeted by such laws and regulations, could also result in decreased use of our products, or in our decreased ability to export or sell our products to existing or potential end customers with international operations. Any decreased use of our products or limitation on our ability to export or sell our products could adversely affect our business, financial condition and results of our operations.

U.S. export control laws and economic sanctions programs also prohibit the shipment of certain products and services to targeted countries, governments and persons that are subject to U.S. economic embargoes and trade sanctions. If we or our partners ship products to those targets, or third parties provide our products to these targets, we could be subject to government investigations, penalties and reputational harm. Furthermore, any new embargo or sanctions program, or any change in the countries, governments, persons or activities targeted by such existing programs, could result in decreased use of our products, or in our decreased ability to export or sell our products to existing or potential end customers, which could adversely affect our business and our financial condition.

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Government regulation designed to protect end user privacy may make it difficult for us to provide our services or provide in car commerce services.

We transmit and store a large volume of information collected from or about end users or their devices in the course of providing our products and services. This information is increasingly subject to legislation and regulations, such as the GDPR and CCPA, in numerous jurisdictions around the world. This government regulation is typically intended to protect the privacy and security of personal or sensitive information about its residents or that is collected, stored and transmitted in or from the relevant jurisdiction.

We could be adversely affected if domestic or international legislation or regulations are expanded to require changes in our business practices or if governing authorities interpret or implement their legislation or regulations in ways that negatively affect our business. For example, the USA PATRIOT Act provides certain rights to U.S. law enforcement authorities to obtain personal information in the control of U.S. persons and entities without notifying the affected individuals. If we are required to allocate significant resources to modify the delivery of our services to enable enhanced legal interception of the personal information that we transmit and store, our results of operations and financial condition may be adversely affected.

In addition, because various foreign jurisdictions have different laws and regulations concerning the storage and transmission of personal information, we may face unknown requirements that pose compliance challenges in new international markets that we seek to enter. Such variation could subject us to costs, delayed service launches, liabilities or negative publicity that could impair our ability to expand our operations into some countries and therefore limit our future growth.

As privacy and data protection have become more topical issues, we may also be subject to increased scrutiny or potential liabilities as a result of developing views on the relevance of privacy or sensitivity of personal information. These and other privacy concerns could adversely impact our business, results of operations and financial condition.

If we are unable to obtain the required government licenses or approvals to comply with government regulation relating to map data and location-based services, we may not be able to provide our products and services and our business could be adversely impacted.

A number of countries and local jurisdictions require certain licenses and/or government approvals in order to comply with regulations governing the creation or distribution of map data and/or the provision of location-based services, including the collection of location information. If we are unable to obtain the necessary licenses or approvals or fail to comply with the regulations in each jurisdiction where we or our partners offer location-based products and services, we may be unable to offer to our partners or customers the full scope of planned products and services. In addition, should any map data or location-based services related regulations change, we may incur additional expense in modifying our existing products and product roadmaps to comply with the requirements of individual jurisdictions. Such laws or regulations or the imposition of new laws and regulations regarding the provision of map data or location-based services may make operation more costly, and may materially reduce our ability to increase or maintain sales of our products and services.

If we are unable to protect our intellectual property and proprietary rights, or if claims are asserted against us, our competitive position and our business could be harmed.

Our success depends in part upon our ability to protect our core technology and intellectual property. We rely on patents, trademarks, copyrights and trade secret laws, confidentiality procedures, and employee disclosure and invention assignment agreements to protect our intellectual property rights. As of September 30, 2019, we had 164 patents issued in the United States and 49 patent applications pending in the United States relating to our current and next-generation products, operating platform and solutions applications, and the ability to claim priority to many of the patent applications worldwide. Our patents issued in the U.S. will expire between April 11, 2020 and March 1, 2037. However, these patents or any patents that may issue to us in the future may be subject to re-examination, contest, circumvention, or found unenforceable or invalidated, and we may or may not be able to prevent third parties from infringing them. We also license software from third parties for integration into our products, including open-source software.

We utilize internal and external controls to restrict access to and use of our proprietary software and other confidential information, including contractual protections with employees, contractors, end customers and partners. Our software is also protected by U.S. and international copyright laws. However, despite our efforts to protect our trade secrets and proprietary rights through intellectual property rights, licenses and confidentiality agreements, and reasonable security measures, third parties may still copy our products or otherwise gain access to or obtain and use our proprietary software and technology without our knowledge or authority or in ways we do not intend.

Monitoring unauthorized use of our intellectual property is difficult and costly. The steps we have taken to protect our proprietary rights may not be adequate to prevent misappropriation of our intellectual property. We may not be able to detect

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unauthorized use of, or take appropriate steps to enforce, our intellectual property rights. Our competitors may also independently develop similar technology. In addition, the laws of many countries do not protect our proprietary rights to as great an extent as do the laws of the United States. Any failure by us to meaningfully protect our intellectual property could result in competitors offering products that incorporate our most technologically advanced features, which could seriously reduce demand for our navigation services. In addition, we may in the future need to initiate infringement claims or litigation. Litigation, whether we are a plaintiff or a defendant, can be expensive, time consuming and may divert the efforts of our technical staff and managerial personnel, which could harm our business, whether or not such litigation results in a determination favorable to us.

Our industry is characterized by the existence of a large number of patents, and competitors increasingly may utilize litigation regarding patent and other intellectual property rights to protect or expand their market position. In particular, leading and more mature companies have extensive patent portfolios and are regularly involved in both offensive and defensive litigation. As end customers increasingly use our products and services, we face a higher risk of being the subject of intellectual property infringement claims from third parties, not only from our competitors but also increasingly from non-operating entities, who will be more likely to claim that our platform infringes their proprietary rights. From time-to-time, such third parties, including certain of these leading companies and, increasingly, non-operating entities, may assert patent, copyright, trademark, and other intellectual property rights against us, our partners or our end customers. In these instances, our standard license and other agreements may obligate us to indemnify our partners and end customers against such claims. Successful claims of infringement by a third party could prevent us from distributing certain products or performing certain services, require us to expend significant management attention and money to develop non-infringing solutions or force us to pay substantial damages, royalties or other fees. This could include treble damages, if we are found to have willfully infringed patents or copyrights. We currently do not maintain insurance coverage against any such claims.

In addition, our products utilize software under third-party open-source licenses, including as incorporated into software we receive from third-party commercial software vendors. Some open-source licenses contain requirements that we make available source code for modifications or derivative works we create based upon the type of open-source software that we use. If we combine our proprietary software with open-source software in a certain manner, we could, under certain open-source licenses, be required to release portions of the source code of our proprietary software to the public. This could allow our competitors to create similar products with lower development effort and time, and ultimately could result in a loss of product sales for us.

We cannot assure that we do not currently infringe, or that we will not in the future infringe, or that we can resolve through litigation or on reasonable settlement terms, any such claims against us relating to, any third-party patents or other proprietary rights, including relating to use of third-party open source software. See “Part II, Item 1 - Legal Proceedings” and “Part II, Item 1A - Risks Related to Our Intellectual Property” for additional information.

Confidentiality agreements with employees and others may not adequately prevent disclosure of our trade secrets and other proprietary information.

We have devoted substantial resources to the development of our proprietary technology, including the proprietary software components of our navigation services and related processes. In order to protect our proprietary technology and processes, we rely in part on confidentiality agreements with our employees, licensees, independent contractors and other advisors. These agreements may not effectively prevent disclosure of our confidential information and may not provide an adequate remedy in the event of unauthorized disclosure of our confidential information. In addition, others may independently discover trade secrets and proprietary information, and in such cases, we could not assert any trade secret rights against such parties. Costly and time-consuming litigation could be necessary to enforce and determine the scope of our proprietary rights, and failure to obtain or maintain trade secret protection could adversely affect our competitive business position.

Our use of open source software could negatively affect our ability to sell our service and subject us to possible litigation.

We use open source software in our navigation services platform and client applications and may use more open source software in the future. Use of open source software may subject our navigation services platform and client applications to general release or require us to re-engineer our navigation services platform and client applications, which may cause harm to our business. From time to time, there have been claims challenging the ownership of open source software against companies that incorporate open source software into their products. As a result, we could be subject to suits by parties claiming ownership of what we believe to be open source software. Some open source licenses contain requirements that we make available source code for modifications or derivative works we create based upon the open source software and that we license such modifications or derivative works under the terms of a particular open source license or other license granting third parties certain rights of further use. If we combine our proprietary software products with open source software in a certain manner, we could, under certain of the open source licenses, be required to release our proprietary source code. In addition to risks related

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to license requirements, usage of open source software can lead to greater risks than use of third-party commercial software, as open source licensors generally do not provide warranties or controls on origin of the software. Open source license terms may be ambiguous and many of the risks associated with usage of open source cannot be eliminated, and could, if not properly addressed, negatively affect our business. If we were found to have inappropriately used open source software, we may be required to release our proprietary source code, re-engineer our navigation services platform and client applications, discontinue the sale of our service in the event re-engineering cannot be accomplished on a timely basis or take other remedial action that may divert resources away from our development efforts, any of which could adversely affect our business, operating results and financial condition.

Risks related to being a publicly traded company and holding our common stock

As a public company, we are obligated to develop and maintain effective internal control over financial reporting. We may not always complete our assessment of the effectiveness of our internal control over financial reporting in a timely manner, or such internal control may not be determined to be effective, which may adversely affect investor confidence in our company and, as a result, the value of our common stock.

The Sarbanes-Oxley Act requires that we test our internal control over financial reporting and disclosure controls and procedures annually. For example, as of June 30, 2019, we performed system and process evaluation and testing of our internal control over financial reporting to allow management and our independent registered public accounting firm to report on the effectiveness of our internal control over financial reporting, as required by Section 404 of the Sarbanes-Oxley Act. Our compliance with Section 404 requires that we incur substantial expense and expend significant management time on compliance-related issues.

During the three months ended December 31, 2018, we identified certain errors related to our implementation of ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) due to our internal control over financial reporting relating to supervision and review of the financial models supporting our revenue recognition accounting and disclosures not operating effectively. We concluded that, because this deficiency created a more than remote likelihood of a material misstatement not being prevented or detected on a timely basis, this deficiency constituted a material weakness in internal control over financial reporting. While the original remediation plan adopted shortly after the discovery of the errors relating to our adoption of ASC 606 was fully implemented during the third quarter of fiscal 2019, during the fourth quarter of fiscal 2019, we decided to implement additional remediation measures to further address that control deficiency. The material weakness will not be deemed remediated until the affected internal controls have been tested and determined to be operating effectively.

As further described in Part I, Item 4 of this Quarterly Report on Form 10-Q, we have taken specific steps to remediate the material weakness by implementing and enhancing our internal controls. The material weakness will not be deemed remediated until all of those steps have been implemented and the affected internal controls have been tested and determined to be operating effectively. In addition, we may need to modify these steps or implement additional remediation measures to address the material weakness, and we cannot be certain that the measures we have taken, and expect to take, will be sufficient to address the issues identified, to ensure that our internal controls are effective, or to ensure that the identified material weakness will not result in a future material misstatement of our annual or interim consolidated financial statements.

If we are unable to remediate this material weakness in a timely manner and otherwise comply with the requirements of Section 404 in the future, or if we or our independent registered public accounting firm identify additional deficiencies in our internal control over financial reporting that are deemed to be material weaknesses, the market price and trading liquidity of our stock may decline, investors may lose confidence in our reported financial information, we could be subject to civil and criminal investigations and penalties by the NASDAQ Global Market, the SEC or other regulatory authorities, and our business and financial condition could otherwise be materially and adversely impacted.

We will continue to incur high costs and demands upon management as a result of complying with the laws and regulations affecting public companies, which could harm our operating results.

As a public company, we incur significant legal, accounting, investor relations and other expenses, including costs associated with public company reporting requirements. We also have incurred and will continue to incur costs associated with current corporate governance requirements, including requirements under Section 404 and other provisions of the Sarbanes-Oxley Act, as well as rules implemented by the SEC and the stock exchange on which our common stock is traded. We are generally not eligible to report under reduced disclosure requirements or benefit from longer phase in periods for “emerging growth companies” as such term is defined in the Jumpstart Our Business Act of 2012. The expenses incurred by public companies for reporting and corporate governance purposes have increased dramatically over the past several years. We expect these rules and regulations to continue to impact our legal and financial compliance costs substantially and to make some activities more time consuming and costly. We are unable currently to estimate these costs with any degree of certainty. We also expect that, over time, it may be more expensive for us to obtain director and officer liability insurance. As a result, it may be

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more difficult for us to attract and retain qualified individuals to serve on our board of directors or as our executive officers if we cannot provide a level of insurance coverage that they believe is adequate.

Regulations relating to investments in offshore companies by Chinese residents may subject our Chinese-resident beneficial owners or our Chinese subsidiaries to liability or penalties, limit our ability to inject capital into our Chinese subsidiaries, limit our Chinese subsidiaries’ ability to increase their registered capital or limit their ability to distribute profits to us.

On July 4, 2014, the State Administration of Foreign Exchange of the People’s Republic of China, or SAFE, promulgated the Circular on Relevant Issues Concerning Foreign Exchange Control on Domestic Residents’ Offshore Investment and Financing and Roundtrip Investment through Special Purpose Vehicles, or Circular 37, which replaced the former Circular on Issues Relating to the Administration of Foreign Exchange in Fund-Raising and Round Trip Investment Activities of Domestic Residents Conducted via Offshore Special Purpose Vehicles (commonly known as “SAFE Circular 75”) promulgated by SAFE on October 21, 2005. Circular 37 requires Chinese residents to register with local branches of SAFE in connection with their direct establishment or indirect control of an offshore entity, for the purpose of overseas investment and financing, with such Chinese residents’ legally owned assets or equity interests in domestic enterprises or offshore assets or interests, referred to in Circular 37 as a “special purpose vehicle.” Circular 37 further requires amendment to the registration in the event of any significant changes with respect to the special purpose vehicle, such as increase or decrease of capital contributed by Chinese individuals, share transfer or exchange, merger, division or other material event. In the event that a Chinese shareholder holding interests in a special purpose vehicle fails to fulfill the required SAFE registration, the Chinese subsidiaries of that special purpose vehicle may be prohibited from making profit distributions to the offshore parent and from carrying out all subsequent cross-border foreign exchange activities in worst scenario, and the special purpose vehicle may be restricted in its ability to contribute additional capital into its Chinese subsidiary. Furthermore, failure to comply with the various SAFE registration requirements described above could result in liability under Chinese law for evasion of foreign exchange controls. On February 13, 2015, SAFE promulgated a Notice on Further Simplifying and Improving Foreign Exchange Administration Policy on Direct Investment, or Circular 13, which became effective on June 1, 2015. Pursuant to Circular 13, entities and individuals are required to apply for foreign exchange registration of overseas direct investment, including those required under Circular 37, with qualified banks, instead of SAFE. The qualified banks, under the supervision of SAFE, will directly review the applications and conduct the registration.

We attempt to comply, and attempt to ensure that our stockholders who are subject to Circular 37 and other related rules, comply with the relevant requirements under Circular 37. However, we cannot provide any assurances that all of our stockholders who are Chinese residents have complied or will comply with our request to make or obtain any applicable registrations or comply with other requirements required by Circular 37 or other related rules. Any failure or inability of any of our stockholders who is a Chinese resident to comply with relevant requirements under Circular 37 could subject such stockholders or our Chinese subsidiaries to fines and legal sanctions imposed by the Chinese government and may also limit our ability to contribute additional capital into our Chinese subsidiaries or receive dividends or other distributions from our Chinese subsidiaries. As a result, these risks may have a material adverse effect on our business, financial condition and results of operations.

If securities analysts do not publish research or reports about our business or if they publish negative evaluations of our stock, the price of our stock could decline.

We expect that the trading price for our common stock will be affected by any research or reports that industry or financial analysts publish about us or our business. As of September 30, 2019, only three research analysts regularly publish reports regarding our company. If one or more of these analysts cease coverage of our company, our stock may lose visibility in the market, which in turn could cause its price to decline. In addition, if any analysts who may elect to cover us downgrade their evaluations us issues an adverse or misleading opinion regarding our stock, the price of our stock could decline. For example, following the GM announcement on September 5, 2019 that it intended to utilize GAS solutions on certain models beginning with GM’s model year 2022, several financial analysts published research reports lowering their price targets of our stock. After this announcement and publication of these reports, our stock price fell significantly. If one or more of these analysts cease coverage of our company, our stock may lose visibility in the market, which in turn could cause its price to decline. During portions of fiscal 2019 and in fiscal 2020, our stock has traded at prices below $5.00 per share. If our stock continues to trade at prices below $5.00 per share for an extended period of time, financial analysts might terminate coverage of our company due to internal policies within their investment banks, which could result in further stock price declines.

Our stock price has fluctuated significantly and may continue to fluctuate in the future.

Our common stock was sold in our initial public offering at $8.00 per share. Although our common stock has traded at prices as high as $22.07 per share, it has also traded at prices as low as $3.35 per share and has tended to have significant downward and upward price movements in a relatively short time period. For example, GM announced on September 5, 2019

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that it intended to utilize GAS solutions on certain models beginning with GM’s model year 2022. The price per share of our common stock fell significantly following this announcement. Future fluctuations or declines in the trading price of our common stock may result from a number of events or factors, including those discussed in the preceding risk factors relating to our operations, as well as:


•	actual or anticipated fluctuations in our operating results;


•	changes in the financial projections we may provide to the public or our failure to meet these projections;


•	announcements by us or our competitors of significant technical innovations, relationship changes with key customers, acquisitions, strategic partnerships, joint ventures, capital raising activities or capital commitments;


•	announcements by automobile manufacturers regarding use of free, third-party navigation platforms in their vehicles;


•	the public’s response to our press releases or other public announcements, including our filings with the SEC;


•	lawsuits threatened or filed against us; and


•	large distributions of our common stock by significant stockholders to limited partners or others who immediately resell the shares.

General market conditions and domestic or international macroeconomic factors unrelated to our performance, such as the continuing unprecedented volatility in the financial markets, may also affect our stock price. For these reasons, investors should not rely on recent trends to predict future stock prices or financial results. Investors in our common stock may not be able to dispose of the shares they purchased at prices above the initial public offering price, or, depending on market conditions, at all.

In addition, during portions of fiscal 2019 and fiscal 2020, our stock traded at prices below $5.00 per share. If the market price of our common stock were to stay below $5.00 per share for an extended period of time, under stock exchange rules, our stockholders would not be able to use such shares as collateral for borrowing in margin accounts. Further, certain institutional investors are restricted from investing in shares priced below $5.00 per share. This inability to use shares of our common stock as collateral and the inability of certain institutional investors to invest in our shares may depress demand and lead to sales of such shares creating downward pressure on and increased volatility in the market price of our common stock.

In the past, the market price for our common stock has traded only slightly above the cash value of our common stock. If investors do not value our company as an ongoing business and only value it for the cash on our balance sheet, our stock price may decline if we continue to incur net losses and use our cash to fund operations. We may also attract investors who are looking for short-term gains in our shares rather than being interested in our long-term outlook. As a result, the price of our common stock may be volatile.

The concentration of ownership of our capital stock limits your ability to influence corporate matters.

Our executive officers and directors and entities affiliated with them beneficially owned (as determined in accordance with the rules of the SEC) approximately 31.9% of our common stock outstanding as of September 30, 2019, which includes approximately 15.1% of our common stock held by Digital Mobile Venture Ltd., 9.9% of our common stock held by Nokomis Capital, each of which is an entity represented by a member of our board of directors, and 4.7% held by our chief executive officer. These stockholders, acting together, may be able to control our management and affairs and matters requiring stockholder approval, including the election of directors and the approval of significant corporate transactions, such as mergers, consolidations or the sale of substantially all of our assets. Consequently, this concentration of ownership may have the effect of delaying or preventing a change of control, including a merger, consolidation or other business combination involving us, or discouraging a potential acquirer from making a tender offer or otherwise attempting to obtain control, even if that change of control would benefit our other stockholders.

The average daily trading volume in our stock is limited and any sales of our common stock by any of these stockholders (or, in the case where such stockholders are investment funds, distribution of our stock to their investors and their subsequent sale), could significantly increase trading volatility in and significantly lower the market price of our common stock, regardless of our actual operating performance.

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Anti-takeover provisions contained in our amended and restated certificate of incorporation and amended and restated bylaws, as well as provisions of Delaware law, could impair a takeover attempt.

Our amended and restated certificate of incorporation, amended and restated bylaws and Delaware law contain provisions which could have the effect of rendering more difficult, delaying or preventing an acquisition deemed undesirable by our board of directors. These provisions could also make it more difficult for stockholders to elect directors and take other corporate actions. Among other things, our amended and restated certificate of incorporation and amended and restated bylaws include provisions:


•	providing for a classified board of directors whose members serve staggered three-year terms;


•	authorizing “blank check” preferred stock, which could be issued by our board of directors without stockholder approval and may contain voting, liquidation, dividend and other rights superior to the rights of our common stock;


•	limiting the liability of, and providing indemnification to, our directors and officers;


•	limiting the ability of our stockholders to call and bring business before special meetings;


•	requiring advance notice of stockholder proposals for business to be conducted at meetings of our stockholders and for nominations of candidates for election to our board of directors;


•	prohibiting stockholder action by written consent; and


•	providing that certain provisions of our amended and restated certificate of incorporation and amended and restated bylaws can be amended only by supermajority vote (a 66 2/3 % majority) of the outstanding shares. In addition, our board of directors can amend our amended and restated bylaws by majority vote of the members of our board of directors.

These provisions, alone or together, could delay or prevent hostile takeovers and changes in control or changes in our management.

As a Delaware corporation, we are also subject to provisions of Delaware law, including Section 203 of the Delaware General Corporation Law, which prevents certain stockholders holding more than 15% of our outstanding capital stock from engaging in certain business combinations without approval of the holders of at least two-thirds of our outstanding common stock not held by such stockholder.

Any provision of our amended and restated certificate of incorporation, amended and restated bylaws or Delaware law that has the effect of delaying, preventing or deterring a change in control could limit the opportunity for our stockholders to receive a premium for their shares of our capital stock, and could also affect the price that some investors are willing to pay for our common stock.

Certain provisions in our charter documents and under Delaware law could limit attempts by our stockholders to replace or remove members of our board of directors or current management and may adversely affect the market price of our common stock.

Provisions in our certificate of incorporation and bylaws may have the effect of delaying or preventing a change of control or changes in our board of directors or management. These provisions include the following:


•	our Board has the right to elect directors to fill a vacancy created by the expansion of the Board or the resignation, death or removal of a director, which prevents stockholders from being able to fill vacancies on our Board;


•	our stockholders may not act by written consent or call special stockholders’ meetings; as a result, a holder or holders controlling a majority of our common stock would not be able to take certain actions other than at annual stockholders’ meetings or special stockholders’ meetings called by the Board, the chair of the Board, the chief executive officer or the president;


•	our directors may only be removed for cause, which would delay the replacement of a majority of our Board;


•	our Board is staggered in three tiers, with directors in each tier separately serving staggered three-year terms, which could impede an acquiror from rapidly replacing our existing directors with its own slate of directors;


•	our certificate of incorporation prohibits cumulative voting in the election of directors, which limits the ability of minority stockholders to elect director candidates;

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•

our stockholders must provide advance notice and additional disclosures in order to nominate individuals for election to our Board or to propose matters that can be acted upon at a stockholders’ meeting, which may discourage or deter a potential acquiror from conducting a solicitation of proxies to elect the acquiror’s own slate of directors or otherwise attempting to obtain control of our company; and


•	our Board may issue, without stockholder approval, shares of undesignated preferred stock; the ability to issue undesignated preferred stock makes it possible for our Board to issue preferred stock with voting or other rights or preferences that could impede the success of any attempt to acquire us.

As a Delaware corporation, we are also subject to certain Delaware anti-takeover provisions. For example, under Delaware law, a corporation may not engage in a business combination with any holder of 15% or more of its capital stock unless the holder has held the stock for three years or, among other things, the Board has approved the transaction. Our Board could rely on Delaware law to prevent or delay an acquisition of us.

Our directors are entitled upon a change of control of our company to accelerated vesting of their equity awards pursuant to the terms of their service arrangements, and our executive officers and certain employees may also receive certain benefits, including vesting acceleration, in the event their employment is actually or constructively terminated in the context of a change of control. In addition to the arrangements currently in place with some of our executive officers, we may enter into similar arrangements in the future.

Our ability to use our net operating losses to offset future taxable income may be subject to certain limitations.

As of June 30, 2019, we had federal and state net operating loss carryforwards (“NOLs”) of $250.2 million and $14.3 million, respectively, due to current and prior period losses. In general, under Section 382 of the Internal Revenue Code of 1986, as amended (the "Code"), a corporation that undergoes an “ownership change” (generally defined as a greater than 50-percentage-point cumulative change (by value) is subject to limitations on its ability to utilize its pre-change NOLs to offset post-change taxable income. Our existing NOLs may be subject to limitations arising from previous ownership changes, and if we undergo an ownership change in the future, our ability to utilize NOLs could be further limited by Section 382 of the Code. Future changes in our stock ownership, some of which may be outside of our control, could result in an ownership change under Section 382 of the Code.

On December 22, 2017, the U.S. government enacted new tax legislation commonly referred to as The Tax Cuts and Jobs Act (TCJA). The TCJA makes broad and complex changes to the U.S. tax code including changes to the uses and limitations of net operating losses. Specifically, the TCJA imposes an 80% limitation on the use of net operating losses that were generated in tax years beginning after December 31, 2017. As such, we may not be able to utilize a material portion of the NOLs.

We have a share repurchase program, but we cannot guarantee that in fact that our repurchase of shares will enhance long-term stockholder value. Our share repurchases could also increase the volatility of the price of our common stock and could diminish our cash reserves.

In February 2019, our board of directors authorized a stock repurchase program. Currently, under the program, we are authorized to repurchase shares of our common stock for an aggregate purchase price of up to $20.0 million. The program currently extends through July 2020. Under the program, we may purchase shares of our stock from time to time, in the open market or through private transactions, subject to market conditions and in compliance with applicable state and federal securities laws. However, the timing and number of our share repurchases, if any, will depend upon several factors, including market and business conditions, the trading price of our common stock and the nature of other investment opportunities available to us. We may also choose to defer or limit repurchases given other uses of our cash or our desire to preserve cash balances. As of September 30, 2019, we had repurchased under this program 221,333 shares of our common stock at a total price of $1.3 million and average purchase price of $5.89 per share of our common stock.

Although our board of directors authorized the program, we are not obligated to repurchase any minimum or specific number or dollar amount of shares. In addition, we may suspend or terminate the program at any time before its expiration. Our repurchases of common stock could affect the market price of our common stock or increase its volatility. For example, the existence of a share repurchase program could cause our share price to be higher than it would be in the absence of such a program and could potentially reduce the market liquidity for our stock. Additionally, our repurchase program could diminish our cash reserves, which may impact our ability to finance future growth and to pursue possible future strategic opportunities and acquisitions. We also cannot assure that any share repurchases will enhance stockholder value because the market price of our common stock may decline below the levels at which we repurchase our stock, and short-term stock price fluctuations could reduce the program’s effectiveness.

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Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds.

Unregistered Sales of Equity Securities

None.

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Item 6.	Exhibits.



Exhibit Number	Description	Incorporated by Reference From Form	Incorporated by Reference From Exhibit Number	Date Filed
2.1	Asset Purchase Agreement, dated August 8, 2019, by and among Telenav, Inc., Thinknear, Inc. and inMarket Media, LLC	8-K	2.1	8/8/2019
10.4.6	Form of 2009 Equity Incentive Plan Restricted Stock Unit Award Agreement	Filed Herewith
10.4.7	Form of 2009 Equity Incentive Plan Restricted Stock Unit Award Agreement — Performance Grant	Filed Herewith
10.27.2++	Services Agreement, dated June 13, 2014, by and between General Motors Holdings LLC and Telenav, Inc.	8-K	10.27.2	8/5/2019
10.44	Offer letter between the Company and Adeel Manzoor, dated May 16, 2019	8-K	10.1	7/8/2019
10.45	Change in Control and Severance Agreement between the Company and Adeel Manzoor, effective as of July 1, 2019	8-K	10.2	7/8/2019
10.46	Letter Agreement by and among Telenav, Inc. and Nokomis Capital, LLC and its affiliates dated August 21, 2019	8-K	10.46	8/22/2019
10.47	Offer letter between the Company and Steve Debenham, dated May 24, 2019	Filed Herewith
10.47.1	Change in Control and Severance Agreement between the Company and Steve Debenham, effective as of August 15, 2019	Filed Herewith
10.48	Consulting Agreement by and among Telenav, Inc. and Karen Francis dated October 25, 2019	Filed Herewith
31.1	Certification Pursuant to Exchange Act Rules 13a-14(a) and 15d-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 of President and Chief Executive Officer	Filed herewith
31.2	Certification Pursuant to Exchange Act Rules 13a-14(a) and 15d-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 of Chief Financial Officer	Filed herewith
32.1~	Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 of President and Chief Executive Officer	Furnished herewith
32.2~	Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 of Chief Financial Officer	Furnished herewith
101.INS	Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH	Inline XBRL Taxonomy Extension Schema Document	Filed herewith
101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document	Filed herewith
101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document	Filed herewith
101.LAB	Inline XBRL Taxonomy Extension Label Linkbase Document	Filed herewith
101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase Document	Filed herewith
104	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

+ Portions of the exhibit have been omitted by means of marking such portions with an asterisk because the identified portions are not material and would likely cause competitive harm to the Company if publicly disclosed.

++ Portions of the exhibit have been omitted pursuant to a request for confidential treatment filed with the Securities and Exchange Commission.

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~ In accordance with Item 601(b)(32)(ii) of Regulation S-K and SEC Release No. 33-8238 and 34-47986, Final Rule: Management’s Reports on Internal Control Over Financial Reporting and Certification of Disclosure in Exchange Act Periodic Reports, the certifications furnished in Exhibits 32.1 and 32.2 hereto are deemed to accompany this Form 10-Q and will not be deemed “filed” for purposes of Section 18 of the Exchange Act. Such certifications will not be deemed to be incorporated by reference into any filings under the Securities Act or the Exchange Act, except to the extent that the registrant specifically incorporates it by reference.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.



		TELENAV, INC.

Dated:	November 8, 2019	By:	/s/ Dr. HP JIN
			Dr. HP Jin
			President and Chief Executive Officer

Dated:	November 8, 2019	By:	/s/ ADEEL MANZOOR
			Adeel Manzoor
			Chief Financial Officer
			(Principal Financial and Accounting Officer)

Exhibit 10.4.6

Global Form of RSU Agreement

TELENAV, INC.

2009 EQUITY INCENTIVE PLAN

RESTRICTED STOCK UNIT AWARD AGREEMENT

Unless otherwise defined herein, the terms defined in the Telenav, Inc. 2009 Equity Incentive Plan (the “Plan”) will have the same defined meanings in this Restricted Stock Unit Award Agreement, which includes the Notice of Restricted Stock Unit Grant (the “Notice of Grant”), the Terms and Conditions of Restricted Stock Unit Grant, attached hereto as Exhibit A, and all other exhibits, addenda, and appendices attached hereto (all together, the “Award Agreement”).

I.NOTICE OF RESTRICTED STOCK UNIT GRANT

Participant Name: %%FIRST_NAME%-% %%LAST_NAME%-%

Address: %%ADDRESS_LINE_1%-%

%%ADDRESS_LINE_2%-%

%%CITY%-%, %%STATE%-% %%ZIPCODE%-%

%%COUNTRY%-%

You have been granted an Award of Restricted Stock Units, subject to the terms and conditions of the Plan and this Award Agreement, as follows:

Grant Number %%OPTION_NUMBER%-%

Date of Grant %%OPTION_DATE,’Month DD, YYYY’%-%

Vesting Commencement Date %%VEST_BASE_DATE,’Month DD, YYYY’%-%

Number of Restricted Stock Units %%TOTAL_SHARES_GRANTED,’999,999,999’%-%


Price of Restricted Stock Units:	$0.00 (Shares to be issued to the Participants for no consideration)

Vesting Schedule:

Subject to any acceleration provisions contained in the Plan or set forth below, the Restricted Stock Units will be scheduled to vest in accordance with the following schedule:

[__________________________________________________________________]

In the event Participant ceases to be a Service Provider for any or no reason before Participant vests in the Restricted Stock Units, the Restricted Stock Units and Participant’s right to acquire any Shares hereunder will terminate immediately.

Telenav – RSU Template (5-2019)

By Participant’s signature and the signature of the representative of Telenav, Inc. (the “Company”) below, Participant and the Company agree that this Award of Restricted Stock Units is granted under and governed by the terms and conditions of the Plan and this Award Agreement, including the Terms and Conditions of Restricted Stock Unit Grant, attached hereto as Exhibit A, and all other exhibits, addenda, and appendices attached hereto, all of which are made a part of this document. Participant acknowledges receipt of a copy of the Plan. Participant has reviewed the Plan and this Award Agreement in their entirety, has had an opportunity to obtain the advice of counsel prior to executing this Award Agreement and fully understands all provisions of the Plan and this Award Agreement. Participant hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Administrator upon any questions relating to the Plan and Award Agreement. Participant further agrees to notify the Company upon any change in the residence address indicated below.

PARTICIPANT: TELENAV, INC.

Signature By: Dave Ritenour

General Counsel

Print Name

Residence Address:

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EXHIBIT A

TERMS AND CONDITIONS OF RESTRICTED STOCK UNIT GRANT

1. Grant. The Company hereby grants, to the individual named in the Notice of Grant to which these Terms and Conditions of Restricted Stock Unit Grant is attached (the “Participant”), under the Plan an Award of Restricted Stock Units, subject to all of the terms and conditions in this Award Agreement and the Plan, which is incorporated herein by reference.

2. Company’s Obligation to Pay. Each Restricted Stock Unit represents the right to receive a Share on the date it vests. Unless and until the Restricted Stock Units will have vested in the manner set forth in Section 3, Participant will have no right to payment of any such Restricted Stock Units. Prior to actual payment of any vested Restricted Stock Units, such Restricted Stock Unit will represent an unsecured obligation of the Company, payable (if at all) only from the general assets of the Company. Any Restricted Stock Units that vest in accordance with Sections 3 or 4 will be paid to Participant (or in the event of Participant’s death, to his or her estate) in whole Shares, subject to Participant satisfying any applicable Tax Obligations (as defined in Section 8) as set forth in Section 8. Subject to the provisions of Section 4, such vested Restricted Stock Units will be paid in whole Shares as soon as practicable after vesting, but in each such case within sixty (60) days following the vesting date. In no event will Participant be permitted, directly or indirectly, to specify the taxable year of payment of any Restricted Stock Units payable under this Award Agreement.

3. Vesting Schedule. Except as provided in Section 4, and subject to Section 5, the Restricted Stock Units awarded by this Award Agreement will vest in accordance with the vesting provisions set forth in the Notice of Grant. Except as may be explicitly stated otherwise in this Award Agreement, Restricted Stock Units scheduled to vest on a certain date or upon the occurrence of a certain condition will not vest in Participant in accordance with any of the provisions of this Award Agreement, unless Participant will have been continuously a Service Provider from the Date of Grant until the date such vesting occurs.

4. Administrator Discretion. The Administrator, in its discretion, may accelerate the vesting of the balance, or some lesser portion of the balance, of the unvested Restricted Stock Units at any time, subject to the terms of the Plan. If so accelerated, such Restricted Stock Units will be considered as having vested as of the date specified by the Administrator. If Participant is a U.S. taxpayer, the payment of Shares vesting pursuant to this Section 4 will in all cases be paid at a time or in a manner that is exempt from, or complies with, Section 409A. The prior sentence may be superseded in a future agreement or amendment to this Award Agreement only by direct and specific reference to such sentence.

5. Section 409A. It is the intent of this Award Agreement that it and all payments and benefits to any U.S. taxpayer hereunder be exempt from, or comply with, the requirements of Section 409A so that none of the Restricted Stock Units provided under this Award Agreement or Shares issuable thereunder will be subject to the additional tax imposed under Section 409A, and any ambiguities or ambiguous terms herein will be interpreted to be so exempt or so comply. Each payment payable under this Award Agreement is intended to constitute a separate payment for purposes of Treasury Regulation Section 1.409A-2(b)(2). To the extent required to be exempt from

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or comply with Section 409A, references to termination of Participant’s status as a Service Provider, termination of employment, or similar phrases will be references to Participant’s “separation from service” within the meaning of Section 409A. In no event will the Company or any of its Subsidiaries or Parent reimburse, indemnify, or hold harmless Participant or any other person for any taxes, penalties and interest that may be imposed, or other costs that may be incurred, as a result of Section 409A. For purposes of this Award Agreement, “Section 409A” means Section 409A of the Code, and any proposed or final Treasury Regulations and Internal Revenue Service guidance thereunder, as each may be amended from time to time.

Notwithstanding anything in the Plan or this Award Agreement to the contrary, if the vesting of the balance, or some lesser portion of the balance, of the Restricted Stock Units is accelerated in connection with the termination of Participant’s status as an employee or other Service Provider, other than due to death, and if (x) Participant is a “specified employee” within the meaning of Section 409A at the time of such termination, and (y) the payment of such accelerated Restricted Stock Units would result in the imposition of additional tax under Section 409A if paid to Participant during the six (6) month period following Participant’s “separation from service” within the meaning of Section 409A, then the payment of such accelerated Restricted Stock Units will not be made until the date six (6) months and one (1) day following the date of Participant’s separation from service, except in the event of Participant’s death following termination of his or her status as an employee or other Service Provider, in which case, the Restricted Stock Units will be paid in Shares to the Participant’s estate as soon as practicable following his or her death.

6. Forfeiture Upon Termination of Status as a Service Provider. Except as may be explicitly stated otherwise in this Award Agreement, the balance of the Restricted Stock Units that have not vested as of the time of Participant’s termination as a Service Provider for any or no reason and Participant’s right to acquire any Shares hereunder will terminate immediately.

7. Death of Participant. Any distribution or delivery to be made to Participant under this Award Agreement will, if Participant is then deceased, be made to Participant’s designated beneficiary, or if no beneficiary survives Participant, the administrator or executor of Participant’s estate. Any such transferee must furnish the Company with (a) written notice of his or her status as transferee, and (b) evidence satisfactory to the Company to establish the validity of the transfer and compliance with any laws or regulations pertaining to said transfer.

8. Tax Obligations.

(a)Tax Consequences. Participant has reviewed with his or her own tax advisors the U.S. federal, state, local and non-U.S. tax consequences of this investment and the transactions contemplated by this Award Agreement. With respect to such matters, Participant relies solely on such advisors and not on any statements or representations of the Company or any of its agents, written or oral. Participant understands that Participant (and not the Company) will be solely responsible for Participant’s own tax liability that may arise as a result of this investment or the transactions contemplated by this Award Agreement.

(b)Responsibility for Taxes. Participant acknowledges that, regardless of any action taken by the Company or, if different, Participant’s employer (the “Employer”) or any Parent

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or Subsidiary to which Participant is providing services (together, the “Service Recipients”), the ultimate liability for any tax and/or social insurance liability obligations and requirements in connection with the Restricted Stock Units, including, without limitation, (i) all federal, state, and local taxes (including the Participant’s Federal Insurance Contributions Act (FICA) obligations) that are required to be withheld by any Service Recipient or other payment of tax-related items related to Participant’s participation in the Plan and legally applicable to Participant, (ii) the Participant’s and, to the extent required by any Service Recipient, the Service Recipient’s fringe benefit tax liability, if any, associated with the grant, vesting, or settlement of the Restricted Stock Units or sale of Shares, and (iii) any other Service Recipient taxes the responsibility for which the Participant has, or has agreed to bear, with respect to the Restricted Stock Units (or settlement thereof or issuance of Shares thereunder) (collectively, the “Tax Obligations”), is and remains Participant’s sole responsibility and may exceed the amount actually withheld by the applicable Service Recipient(s). Participant further acknowledges that no Service Recipient (A) makes any representations or undertakings regarding the treatment of any Tax Obligations in connection with any aspect of the Restricted Stock Units, including, but not limited to, the grant, vesting or settlement of the Restricted Stock Units, the subsequent sale of Shares acquired pursuant to such settlement and the receipt of any dividends or other distributions, or (B) makes any commitment to or is under any obligation to structure the terms of the grant or any aspect of the Restricted Stock Units to reduce or eliminate Participant’s liability for Tax Obligations or achieve any particular tax result. Further, if Participant is subject to Tax Obligations in more than one jurisdiction between the Date of Grant and the date of any relevant taxable or tax withholding event, as applicable, Participant acknowledges that the applicable Service Recipient(s) (or former employer, as applicable) may be required to withhold or account for Tax Obligations in more than one jurisdiction. If Participant fails to make satisfactory arrangements for the payment of any required Tax Obligations hereunder at the time of the applicable taxable event, Participant acknowledges and agrees that the Company may refuse to issue or deliver the Shares.

(c)Tax Withholding and Method of Withholding. The Administrator, in its sole discretion and pursuant to such procedures as it may specify from time to time, may permit Participant to satisfy such tax withholding obligation, in whole or in part (without limitation) by (i) paying cash, (ii) electing to have the Company withhold otherwise deliverable Shares having a Fair Market Value equal to the minimum amount required to be withheld, (iii) delivering to the Company already vested and owned Shares having a Fair Market Value equal to the amount required to be withheld, or (iv) selling a sufficient number of such Shares otherwise deliverable to Participant through such means as the Company may determine in its sole discretion (whether through a broker or otherwise) equal to the amount required to be withheld. To the extent determined appropriate by the Company in its discretion, it will have the right (but not the obligation) to satisfy any tax withholding obligations by reducing the number of Shares otherwise deliverable to Participant. If Participant fails to make satisfactory arrangements for the payment of any required Tax Obligations hereunder at the time any applicable Restricted Stock Units otherwise are scheduled to vest pursuant to Sections 3 or 4 or Participant’s Tax Obligations otherwise become due, Participant will permanently forfeit such Restricted Stock Units to which Participant’s Tax Obligation relates and any right to receive Shares thereunder and the Restricted Stock Units will be returned to the Company at no cost to the Company.

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9. Rights as Stockholder. Neither Participant nor any person claiming under or through Participant will have any of the rights or privileges of a stockholder of the Company in respect of any Shares deliverable hereunder unless and until certificates representing such Shares (which may be in book entry form) will have been issued, recorded on the records of the Company or its transfer agents or registrars, and delivered to Participant (including through electronic delivery to a brokerage account). After such issuance, recordation and delivery, Participant will have all the rights of a stockholder of the Company with respect to voting such Shares and receipt of dividends and distributions on such Shares.

10. No Guarantee of Continued Service. PARTICIPANT ACKNOWLEDGES AND AGREES THAT THE VESTING OF THE RESTRICTED STOCK UNITS PURSUANT TO THE VESTING SCHEDULE HEREOF IS EARNED ONLY BY CONTINUING AS A SERVICE PROVIDER, WHICH UNLESS PROVIDED OTHERWISE UNDER APPLICABLE LAW IS AT THE WILL OF THE APPLICABLE SERVICE RECIPIENT AND NOT THROUGH THE ACT OF BEING HIRED, BEING GRANTED THIS RESTRICTED STOCK UNIT AWARD OR ACQUIRING SHARES HEREUNDER. PARTICIPANT FURTHER ACKNOWLEDGES AND AGREES THAT THIS AWARD AGREEMENT, THE TRANSACTIONS CONTEMPLATED HEREUNDER AND THE VESTING SCHEDULE SET FORTH HEREIN DO NOT CONSTITUTE AN EXPRESS OR IMPLIED PROMISE OF CONTINUED ENGAGEMENT AS A SERVICE PROVIDER FOR THE VESTING PERIOD, FOR ANY PERIOD, OR AT ALL, AND WILL NOT INTERFERE IN ANY WAY WITH PARTICIPANT’S RIGHT OR THE RIGHT OF ANY SERVICE RECIPIENT TO TERMINATE PARTICIPANT’S RELATIONSHIP AS A SERVICE PROVIDER, SUBJECT TO APPLICABLE LAW, WHICH TERMINATION, UNLESS PROVIDED OTHERWISE UNDER APPLICABLE LAW, MAY BE AT ANY TIME, WITH OR WITHOUT CAUSE.

11. Address for Notices. Any notice to be given to the Company under the terms of this Award Agreement will be addressed to the Company, in care of Stock Administration at Telenav, Inc., at 4655 Great America Parkway, Santa Clara, CA 95054, or at such other address as the Company may hereafter designate in writing.

12. Nature of Grant. In accepting this Award of Restricted Stock Units, Participant acknowledges, understands and agrees that:

(a) the grant of the Restricted Stock Units is voluntary and occasional and does not create any contractual or other right to receive future grants of Restricted Stock Units, or benefits in lieu of Restricted Stock Units, even if Restricted Stock Units have been granted in the past;

(b) all decisions with respect to future Restricted Stock Units or other grants, if any, will be at the sole discretion of the Administrator;

(d) the Restricted Stock Units and the Shares subject to the Restricted Stock Units are not intended to replace any pension rights or compensation;

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(e) the Restricted Stock Units and the Shares subject to the Restricted Stock Units, and the income and value of same, are not part of normal or expected compensation for purposes of calculating any severance, resignation, termination, redundancy, dismissal, end-of-service payments, bonuses, long-service awards, pension or retirement or welfare benefits or similar payments;

(f) the future value of the Shares underlying the Restricted Stock Units is unknown, indeterminable and cannot be predicted with certainty;

(g) for purposes of the Restricted Stock Units, Participant’s status as a Service Provider will be considered terminated as of the date Participant no longer is actively providing services to the Company or any Parent or Subsidiary (regardless of the reason for such termination and whether or not later found to be invalid or in breach of employment laws in the jurisdiction where Participant is a Service Provider or the terms of Participant’s employment or service agreement, if any), and unless otherwise expressly provided in this Award Agreement (including by reference in the Notice of Grant to other arrangements or contracts) or determined by the Administrator, Participant’s right to vest in the Restricted Stock Units under the Plan, if any, will terminate as of such date and will not be extended by any notice period (e.g., Participant’s period of service would not include any contractual notice period or any period of “garden leave” or similar period mandated under employment laws in the jurisdiction where Participant is a Service Provider or the terms of Participant’s employment or service agreement, if any, unless Participant is providing bona fide services during such time); the Administrator will have the exclusive discretion to determine when Participant no longer is actively providing services for purposes of the Restricted Stock Units grant (including whether Participant may still be considered to be providing services while on a leave of absence and consistent with local law);

(h) unless otherwise provided in the Plan or by the Administrator in its discretion, the Restricted Stock Units and the benefits evidenced by this Award Agreement do not create any entitlement to have the Restricted Stock Units or any such benefits transferred to, or assumed by, another company nor to be exchanged, cashed out or substituted for, in connection with any corporate transaction affecting the Shares; and

(i) the following provisions apply only if Participant is providing services outside the United States:

(i) the Restricted Stock Units and the Shares subject to the Restricted Stock Units are not part of normal or expected compensation or salary for any purpose;

(ii) Participant acknowledges and agrees that no Service Recipient will be liable for any foreign exchange rate fluctuation between Participant’s local currency and the United States Dollar that may affect the value of the Restricted Stock Units or of any amounts due to Participant pursuant to the settlement of the Restricted Stock Units or the subsequent sale of any Shares acquired upon settlement; and

(iii) no claim or entitlement to compensation or damages will arise from forfeiture of the Restricted Stock Units resulting from the termination of Participant’s status as a

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Service Provider (for any reason whatsoever, whether or not later found to be invalid or in breach of employment laws in the jurisdiction where Participant is a Service Provider or the terms of Participant’s employment or service agreement, if any), and in consideration of the grant of the Restricted Stock Units to which Participant otherwise is not entitled, Participant irrevocably agrees never to institute any claim against any Service Recipient, waives his or her ability, if any, to bring any such claim, and releases each Service Recipient from any such claim; if, notwithstanding the foregoing, any such claim is allowed by a court of competent jurisdiction, then, by participating in the Plan, Participant will be deemed irrevocably to have agreed not to pursue such claim and agrees to execute any and all documents necessary to request dismissal or withdrawal of such claim.

13. No Advice Regarding Grant. The Company is not providing any tax, legal or financial advice, nor is the Company making any recommendations regarding Participant’s participation in the Plan, or Participant’s acquisition or sale of the Shares underlying the Restricted Stock Units. Participant is hereby advised to consult with his or her own personal tax, legal and financial advisors regarding his or her participation in the Plan before taking any action related to the Plan.

14. Data Privacy. Participant hereby explicitly and unambiguously consents to the collection, use and transfer, in electronic or other form, of Participant’s personal data as described in this Award Agreement and any other Restricted Stock Unit grant materials by and among, as applicable, the Service Recipients for the exclusive purpose of implementing, administering and managing Participant’s participation in the Plan.

Participant understands that the Company and the Service Recipient may hold certain personal information about Participant, including, but not limited to, Participant’s name, home address and telephone number, date of birth, social insurance number or other identification number, salary, nationality, job title, any Shares or directorships held in the Company, details of all Restricted Stock Units or any other entitlement to Shares awarded, canceled, exercised, vested, unvested or outstanding in Participant’s favor (“Data”), for the exclusive purpose of implementing, administering and managing the Plan.

Participant understands that Data may be transferred to a stock plan service provider, as may be selected by the Company in the future, assisting the Company with the implementation, administration and management of the Plan. Participant understands that the recipients of the Data may be located in the United States or elsewhere, and that the recipient’s country of operation (e.g., the United States) may have different data privacy laws and protections than Participant’s country. Participant understands that if he or she resides outside the United States, he or she may request a list with the names and addresses of any potential recipients of the Data by contacting his or her local human resources representative. Participant authorizes the Company, any stock plan service provider selected by the Company and any other possible recipients which may assist the Company (presently or in the future) with implementing, administering and managing the Plan to receive, possess, use, retain and transfer the Data, in electronic or other form, for the sole purpose of implementing, administering and managing Participant’s participation in the Plan. Participant understands that Data will be held only as long as is necessary to implement, administer and manage Participant’s participation in the Plan. Participant understands that if he or she resides outside the United States, he or she may, at any

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time, view Data, request additional information about the storage and processing of Data, require any necessary amendments to Data or refuse or withdraw the consents herein, in any case without cost, by contacting in writing his or her local human resources representative. Further, Participant understands that he or she is providing the consents herein on a purely voluntary basis. If Participant does not consent, or if Participant later seeks to revoke his or her consent, his or her status as a Service Provider and career with the Service Recipient will not be adversely affected. The only adverse consequence of refusing or withdrawing Participant’s consent is that the Company would not be able to grant Participant Restricted Stock Units or other equity awards or administer or maintain such awards. Therefore, Participant understands that refusing or withdrawing his or her consent may affect Participant’s ability to participate in the Plan. For more information on the consequences of Participant’s refusal to consent or withdrawal of consent, Participant understands that he or she may contact his or her local human resources representative.

15. Grant is Not Transferable. Except to the limited extent provided in Section 7, this grant and the rights and privileges conferred hereby will not be transferred, assigned, pledged or hypothecated in any way (whether by operation of law or otherwise) and will not be subject to sale under execution, attachment or similar process. Upon any attempt to transfer, assign, pledge, hypothecate or otherwise dispose of this grant, or any right or privilege conferred hereby, or upon any attempted sale under any execution, attachment or similar process, this grant and the rights and privileges conferred hereby immediately will become null and void.

16. Successors and Assigns. The Company may assign any of its rights under this Award Agreement to single or multiple assignees, and this Award Agreement will inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on transfer herein set forth, this Award Agreement will be binding upon Participant and his or her heirs, executors, administrators, successors and assigns. The rights and obligations of Participant under this Award Agreement may only be assigned with the prior written consent of the Company.

17. Additional Conditions to Issuance of Stock. If at any time the Company will determine, in its discretion, that the listing, registration, qualification or rule compliance of the Shares upon any securities exchange or under any state, federal or non-U.S. law, the tax code and related regulations or under the rulings or regulations of the United States Securities and Exchange Commission or any other governmental regulatory body, or the clearance, consent or approval of the United States Securities and Exchange Commission or any other governmental regulatory authority is necessary or desirable as a condition to the issuance of Shares to Participant (or his or her estate) hereunder, then such issuance will not occur unless and until such listing, registration, qualification, rule compliance, clearance, consent or approval will have been completed, effected or obtained, free of any conditions not acceptable to the Company. Subject to the terms of the Award Agreement and the Plan, the Company will not be required to issue any certificate or certificates for Shares hereunder prior to the lapse of such reasonable period of time following the date of vesting of the Restricted Stock Units as the Administrator may establish from time to time for reasons of administrative convenience. The Company will make all reasonable efforts to meet the requirements of any such state or federal law or securities exchange and to obtain any such listing,

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registration, qualification, rule compliance, clearance, consent or approval of any such governmental authority.

18. Language. If Participant has received this Award Agreement or any other document related to the Plan translated into a language other than English and if the meaning of the translated version is different than the English version, the English version will control.

19. Plan Governs. This Award Agreement is subject to all terms and provisions of the Plan. Subject to Section 21 of the Plan, in the event of a conflict between one or more provisions of this Award Agreement and one or more provisions of the Plan, the provisions of the Plan will govern. Capitalized terms used and not defined in this Award Agreement will have the meaning set forth in the Plan.

20. Interpretation. The Administrator will have the power to interpret the Plan and this Award Agreement and to adopt such rules for the administration, interpretation and application of the Plan as are consistent therewith and to interpret or revoke any such rules (including, but not limited to, the determination of whether or not any Restricted Stock Units have vested). All actions taken and all interpretations and determinations made by the Administrator in good faith will be final and binding upon Participant, the Company and all other interested persons, to the maximum extent permitted by Applicable Laws. Neither the Administrator nor any person acting on behalf of the Administrator will be personally liable for any action, determination or interpretation made in good faith with respect to the Plan or this Award Agreement.

21. Electronic Delivery. The Company may, in its sole discretion, decide to deliver any documents related to Restricted Stock Units awarded under the Plan or future Restricted Stock Units that may be awarded under the Plan by electronic means or request Participant’s consent to participate in the Plan by electronic means. Participant hereby consents to receive such documents by electronic delivery and agrees to participate in the Plan through any on-line or electronic system established and maintained by the Company or another third party designated by the Company.

22. Captions. Captions provided herein are for convenience only and are not to serve as a basis for interpretation or construction of this Award Agreement.

23. Agreement Severable. In the event that any provision in this Award Agreement will be held invalid or unenforceable, such provision will be severable from, and such invalidity or unenforceability will not be construed to have any effect on, the remaining provisions of this Award Agreement.

24. Country Addendum. Notwithstanding any provisions in this Award Agreement, the Restricted Stock Unit grant will be subject to any special terms and conditions set forth in an appendix or addendum (if any) to this Award Agreement for any country whose laws are applicable to Participant and this Award of Restricted Stock Units (as determined by the Administrator in its sole discretion) (the “Country Addendum”). Moreover, if Participant relocates to one of the countries included in the Country Addendum (if any), the special terms and conditions for such country will apply to Participant, to the extent the Company determines that the application of such terms and

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conditions is necessary or advisable for legal or administrative reasons. The Country Addendum constitutes part of this Award Agreement.

25. Entire Agreement; Modifications to the Award Agreement. This Award Agreement, together with the Plan, constitutes the entire understanding of the parties on the subjects covered and supersede in their entirety all prior undertakings and agreements of the Company and Participant with respect to the subject matter hereof. Participant expressly warrants that he or she is not accepting this Award Agreement in reliance on any promises, representations, or inducements other than those contained herein. Modifications to this Award Agreement can be made only in an express written contract executed by a duly authorized officer of the Company. Notwithstanding anything to the contrary in the Plan or this Award Agreement, the Company reserves the right to revise this Award Agreement as it deems necessary or advisable, in its sole discretion and without the consent of Participant, to comply with Section 409A or to otherwise avoid imposition of any additional tax or income recognition under Section 409A in connection with this Award of Restricted Stock Units.

26. Amendment, Suspension or Termination of the Plan. By accepting this Award, Participant expressly warrants that he or she has received an Award of Restricted Stock Units under the Plan, and has received, read and understood a description of the Plan. Participant understands that the Plan is discretionary in nature and may be amended, suspended or terminated by the Company at any time.

27. Governing Law. This Award Agreement and the Restricted Stock Units will be governed by the laws of the State of California, without giving effect to the conflict of law principles thereof. For purposes of litigating any dispute that arises under this Award of Restricted Stock Units or this Award Agreement, the parties hereby submit to and consent to the jurisdiction of the State of California, and agree that such litigation will be conducted in the courts of Santa Clara County, California, or the federal courts for the United States for the Northern District of California, and no other courts, where this Award of Restricted Stock Units is made and/or to be performed.

28. No Waiver. Either party’s failure to enforce any provision or provisions of this Award Agreement will not in any way be construed as a waiver of any such provision or provisions, nor prevent that party from thereafter enforcing each and every other provision of this Award Agreement. The rights granted both parties herein are cumulative and will not constitute a waiver of either party’s right to assert all other legal remedies available to it under the circumstances.

* * *

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ADDENDUM

TELENAV, INC.
2009 EQUITY INCENTIVE PLAN
RESTRICTED STOCK UNIT AWARD AGREEMENT
COUNTRY ADDENDUM

Terms and Conditions

This Country Addendum includes additional terms and conditions that govern the Award of Restricted Stock Units granted pursuant to the terms and conditions of the Telenav, Inc. 2009 Equity Incentive Plan (the “Plan”) and the Restricted Stock Unit Award Agreement to which this Country Addendum is attached (the “Award Agreement”) to the extent the individual to whom the Restricted Stock Units were granted (“Participant”) resides in one of the countries listed below.

Notifications

This Country Addendum also includes information regarding exchange controls and certain other issues of which Participant should be aware with respect to his or her participation in the Plan. The information is based on the securities, exchange control and other laws in effect in the respective countries as of May 2019. Such laws often are complex and change frequently. As a result, the Company strongly recommends that Participant not rely on the information in this Country Addendum as the only source of information relating to the consequences of Participant’s participation in the Plan because the information may be out of date at the time Participant vest in or receives or sells the Shares covered by the Restricted Stock Units.

In addition, the information contained herein is general in nature and may not apply to Participant’s particular situation and the Company is not in a position to assure Participant of any particular result. Accordingly, Participant is advised to seek appropriate professional advice as to how the relevant laws of Participant’s country may apply to his or her situation.

Further, if Participant is a citizen or resident of a country other than the one in which Participant is currently working or transfers to another country after the grant of the Restricted Stock Units, or is considered a resident of another country for local law purposes, the information contained herein may not be applicable to Participant in the same manner. The Company, in its discretion, will determine to what extent the terms and conditions contained herein will apply to Participant under these circumstances.

CHINA

With respect to any Participants of the Company’s China Subsidiary, the following additional terms will apply.

I.Vesting Schedule. The following language will be added to the end of Section 3 of the Terms and Conditions of Restricted Stock Unit Grant of the Award Agreement:

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“Vesting of the Restricted Stock Units is subject to completion of foreign exchange registration of the Plan and Restricted Stock Unit granting with competent State Administration of Foreign Exchange (“SAFE”). If any vesting date as provided in this Award Agreement is prior to the above-mentioned SAFE registration completion date, unless the Administrator decides otherwise, such vesting date will be postponed till such SAFE registration is completed.”

II.Forfeiture Upon Termination of Status as a Service Provider. The following language will replace in its entirety Section 6 of the Terms and Conditions of the Restricted Stock Unit Grant of the Award Agreement:

“Notwithstanding any contrary provision of this Award Agreement, the balance of the Restricted Stock Units that have not vested (including the unvested Restricted Stock Units whose vesting date is postponed pursuant to Section 3) as of the time of Participant’s termination as a Service Provider for any or no reason and Participant’s right to acquire any Shares hereunder will immediately terminate and be forfeited. Within six (6) months after Participant’s termination as a Service Provider for any or no reason, Participant will sell all of the Shares acquired by Participant upon settlement of Restricted Stock Units which are vested before or on the date of termination. If Participant fails to sell such Shares within such period of time, Participant hereby irrevocably authorizes the Company to deliver an instruction to a broker to sell all such Shares on the first trading date immediately following the said six (6) month period.”

III.Withholding of Taxes. The following language will be added to the end of Section 8 of the Terms and Conditions of the Restricted Stock Unit Grant of the Award Agreement:

“As for the Participant who is subject to PRC taxation obligations, in accordance with The Circular On Individual Income Taxes Payable Arising From Share Option Incomes, Issued by the PRC Ministry of Finance and the State Tax Administration (Cai Shui [2005] No.35), Notice of the State Administration of Taxation on Relevant Issues of Individual Income Tax Relating to Equity Incentive (Guo Shui Han [2009] No. 461) and other related tax laws and regulations, the PRC subsidiaries of the Company, as the Participant’s employer and the party with the obligation to withhold the individual income taxes payable by such Participant, will submit documents including the Plan, Award Agreements and authorization letters to competent taxation authorities, and withhold the individual income taxes in accordance with tax laws and regulations.”

The following language will be added as a new Section 29 to the Terms and Conditions of the Restricted Stock Unit Grant of the Award Agreement:

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“Participant will entrust a PRC Subsidiary of the Company participating in the Plan or other domestic agency that the Company or its PRC Subsidiary designates from time to time to handle all matters with respect to foreign exchange under the Plan, including without limitation, foreign exchange registration, account opening, funds transfer and remittance, and entrust an overseas institution designated by the Company to handle related matters, including without limitation, purchase and sale of related stocks or equity, funds transfer. Participant will comply with all applicable PRC foreign exchange rules and regulations (including without limitation the Notice of the State Foreign Exchange Administration on Issues Concerning Foreign Exchange Administration of Domestic Individuals' Participation in Equity Incentive Plans of Companies Listed Overseas (Hui Fa [2012] No. 7)), and will assist the entrusted agencies to complete all relevant registration proceeding, including without limitation, submitting registration forms as requested and providing necessary information. Failure to comply with these rules may result in sanctions on not only Participant, but also the Company and/or its PRC Subsidiaries under the PRC laws. Participant will indemnify the Company, its PRC Subsidiaries or affiliates, and their respective officers, directors, agents, employees, successors and assigns (“Indemnified Parties”), in the event that any of the Indemnified Parties suffer any losses, costs, expenses, fees, damages or penalties arising out of or relating to such Participant’s failure to comply with applicable PRC foreign exchange rules.”

The following language will be added to Section 14 of the Restricted Stock Unit Grant of the Award Agreement:

“Participant understands that the Data may be transferred out of the territory of China, and will assist the PRC Subsidiary of the Company participating in the Plan to complete all required proceedings for such purpose, including without limitation, the safety assessment (if applicable).

Participant understands that Participant may, at any time, review the Data and request that any necessary amendment or withdrawal be made to the Data by contacting the Company in writing.”

ROMANIA

With respect to any Participants of the Company’s Romania Subsidiary, the following additional terms will apply.

I.Withholding of Taxes. The following language will be added to the end of Section 8 of the Terms and Conditions of Restricted Stock Unit Grant of the Award Agreement:

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“For any Participant of the Company’s Romanian Subsidiary, Telenav Software SRL, the Company will deliver to the Participant the certain Number of Restricted Stock Units set forth in the Notice of Restricted Stock Unit Grant of the Award Agreement (or applicable portion thereof), without having withheld any tax or social security withholding obligations, as under the Romanian applicable law no income tax or social security is due on the grant date and on the share delivery date.

There is no employer withholding and no employer reporting related to salary income, as there is no income tax or social security due related to salary income. In case of obtaining (i) dividend income while holding the shares and/or (ii) capital gains from the future sales of shares, taxation occurs and the following reporting obligations apply to the employees:


•	Income from investments shall be declared yearly by the individual in the annual income tax return;


•	The above annual income tax return shall be submitted until the 15th of March of the year following the year in which the income was obtained;


•	The same deadline applies for performing the payment of the income tax due.

•

Health Fund contribution: In case the cumulated yearly income from other sources than salaries exceeds the threshold of 12 x minimum wages, such income is subject to a fixed health fund contribution. The contribution is calculated as 10% x minimum wage x 12. The current minimum wage for 2019 is 2080 RON (approx. 445 EUR). The minimum wage is in principle subject to yearly amendment (exemplification: in 2019 dividend income and capital gains would be subject to a health fund contribution of 2.496 RON, approx. 534 EUR, in case their total amount would exceed 24.960 RON, approx. 5340 EUR).


•	Special provisions have to be observed additionally in case of individuals who need to benefit from tax credit in order to avoid double taxation.

Dividends paid, if any, to employees while they hold shares are treated as income from investments. The amount subject to income tax should be the gross dividend income, the applicable tax rate in Romania, according to the Romanian Fiscal Code (RFC) is 5%. Income from investments could be subject to health fund contribution in case of exceeding a particular threshold.

Capital gains from the future sale of shares are treated as income from investments and will be subject to a tax rate of 10%. The amount subject to capital gain tax should be the sales price of the shares on the date of sale less the purchase price (which is null, in the case at hand). Income from investments

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could be subject to health fund contribution as well, in case of exceeding the above mentioned threshold.

Any changes of the tax treatment applicable to the Shares received by the Participant under the Plan according to the applicable law, which contravene to the aforementioned described mechanism, will be applied by the Company, respectively by its Romanian Subsidiary with immediate effect, whereas the Participant will be informed about any such changes.”

II.Exchange Control Information. If you deposit the proceeds from the sale of shares issued to you at vesting in a bank account in Romania, you may be required to provide the Romanian bank with appropriate documentation explaining the source of the funds. You should consult your personal advisor to determine whether you will be required to submit such documentation to the Romanian bank.

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Exhibit 10.4.7

Global Form of RSU Agreement – Performance Grant

TELENAV, INC.

2009 EQUITY INCENTIVE PLAN

RESTRICTED STOCK UNIT AWARD AGREEMENT

I.NOTICE OF RESTRICTED STOCK UNIT GRANT

Participant Name: %%FIRST_NAME%-% %%LAST_NAME%-%

Address: %%ADDRESS_LINE_1%-%

%%ADDRESS_LINE_2%-%

%%CITY%-%, %%STATE%-% %%ZIPCODE%-%

%%COUNTRY%-%

You have been granted an Award of Restricted Stock Units (the “Award”), subject to the terms and conditions of the Plan and this Award Agreement, as follows:

Grant Number %%OPTION_NUMBER%-%

Date of Grant %%OPTION_DATE,’Month DD, YYYY’%-%

Vesting Commencement Date %%VEST_BASE_DATE,’Month DD, YYYY’%-%

Number of Restricted Stock Units %%TOTAL_SHARES_GRANTED,’999,999,999’%-%


Price of Restricted Stock Units:	$0.00 (Shares to be issued to the Participants for no consideration)

II.PERFORMANCE-BASED VESTING SCHEDULE

Subject to any acceleration provisions contained in the Plan or otherwise as set forth below, vesting under the Award shall be subject to the following terms and conditions, as well as those set forth in the accompanying exhibits.

a. Performance Targets. The Performance Goals that will be used to determine the Eligible Units under this Award will consist of achievement of specified Stock Price hurdles (the “Stock Price Hurdles”). The following table sets forth the percentage of the Target Number of Restricted Stock Units that will become Eligible Units depending on whether the Stock Price during the Performance Period satisfies the Stock Price Hurdle specified opposite such percentage:

Telenav – RSU Template – Performance Grant (5-2019)



Stock Price Hurdles	Percent of Target Number of Market-based Restricted Stock Units that Become Eligible Units
Equal to or greater than $____	25	%
Equal to or greater than $____	25	%
Equal to or greater than $____	25	%
Equal to or greater than $____	25	%

For the avoidance of doubt, more than one Stock Price Hurdle may be achieved concurrently during the Performance Period. Further for the avoidance of doubt, if a particular Stock Price Hurdle is achieved more than once during the Performance Period, Restricted Stock Units will become Eligible Units only in connection with the first occurrence of achievement of that Stock Price Hurdle during the Performance Period, and thereafter, no additional Restricted Stock Units will become Eligible Units upon subsequent achievements of the Stock Price Hurdle. The maximum number of Restricted Stock Units that may become eligible to vest under this Award is equal to one hundred percent (100%) of the Target Number of Restricted Stock Units.

b. Stock Price. For purposes of this Award, “Stock Price” means the trailing, 30-trading day average closing sales price (or the closing bid, if no sales were reported) of a Share as quoted on the Nasdaq Global Market (or such other established stock exchange or national market system on which the Common Stock is regularly and primarily traded). A trading day for purposes of this definition refers to a day on which the primary stock exchange on which the Common Stock is listed and regularly trades (i.e., the Nasdaq Global Market) is open for trading.

c. Performance Period. For purposes of this Award, “Performance Period” means the period beginning on the Grant Effective Date and ending on (and inclusive of) the three (3) year anniversary of the Date of Grant.

d. Change in Control Adjustments. If a Change in Control occurs during the Performance Period, then the Performance Period will be shortened to end on a date, as determined by the Administrator in its sole discretion, that occurs no earlier than ten (10) business days prior to the Change in Control and no later than the date of the Change in Control (but prior to the completion of the Change in Control). Upon completion of the shortened Performance Period, and if any Restricted Stock Units have not yet become Eligible Units, then on or before the date of the Change in Control (but prior to the completion of the Change in Control), the Administrator will make a final measurement of the Stock Price performance against the Stock Price Hurdles, which measurement will be based on a Stock Price determined as the amount of any cash consideration and value of any other consideration to be paid to holders of Common Stock in connection with the Change in Control, as determined by the Administrator, in its sole discretion (the “CIC Measurement”). Upon the CIC Measurement, if none of the Restricted Stock Units have become Eligible Units with respect to the shortened Performance Period (including on any previous Certification Dates), then a total of twenty percent (20%) of the Target Number of Restricted Stock Units will become Eligible Units. Any Restricted Stock Units that have not become Eligible Units upon the CIC Measurement will be forfeited immediately (without regard to whether any awards will be assumed or substituted for in connection with the Change in Control) and Participant will have no further rights with respect to those Restricted Stock Units or any of the underlying Shares.

Page 2 of 18

e. Service-based Requirements. In addition to the Market-based Requirements set forth in Section 1 above, the Restricted Stock Units are subject to the service-based vesting requirements described in this Section 2 if and when the Restricted Stock Units become Eligible Units.

Service-based Vesting. If Restricted Stock Units become Eligible Units on a Certification Date (other than as a result of a CIC Measurement), then 50% of the Restricted Stock Units that are deemed to become Eligible Units on that Certification Date will vest on that Certification Date or, if later, November 1, 2020, and the remaining 50% of the Eligible Units will be scheduled to vest on the one (1) year anniversary of the Achievement Date applicable to those Eligible Units, in each case subject to Participant remaining a Service Provider through the applicable vesting date.

ii.

Post-Change in Control Vesting. In the event of a Change in Control, (i) any Restricted Stock Units that have become Eligible Units pursuant to the CIC Measurement will be scheduled to vest on the one (1) year anniversary of the date of the Change in Control, subject to Participant remaining a Service Provider through that date, and (ii) any Restricted Stock Units that have become Eligible Units pursuant to a Certification Date other than as a result of the CIC Measurement will remain subject to the same service-based vesting schedule set forth in subsection a. above.

f.Change in Control Vesting Acceleration. Vesting of the Restricted Stock Units will be subject to any vesting acceleration provisions under respective Participant’s employment agreement entered into with the Company in conjunction with commencement of employment (or otherwise, the “Employment Agreement”), or any other applicable written agreement between Participant and the Company, as applicable, providing for the acceleration of rights under existing equity awards in conjunction with a change of control of the Company.

g.Forfeiture. As of the date ninety (90) days following the last day of the Performance Period, or if earlier, the Final Certification Date, any Restricted Stock Units that have not become Eligible Units by such date automatically will be forfeited and Participant’s right to acquire any Shares subject thereto will terminate immediately.

Page 3 of 18

Plan and this Award Agreement in their entirety, has had an opportunity to obtain the advice of counsel prior to executing this Award Agreement and fully understands all provisions of the Plan and this Award Agreement. Participant hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Administrator upon any questions relating to the Plan and Award Agreement. Participant further agrees to notify the Company upon any change in the residence address indicated below.

PARTICIPANT: TELENAV, INC.

Signature By: Dave Ritenour

General Counsel

Print Name

Residence Address:

Page 4 of 18

EXHIBIT A

TERMS AND CONDITIONS OF RESTRICTED STOCK UNIT GRANT

Page 5 of 18

8. Tax Obligations.

(b)Responsibility for Taxes. Participant acknowledges that, regardless of any action taken by the Company or, if different, Participant’s employer (the “Employer”) or any Parent

Page 6 of 18

Page 7 of 18

12. Nature of Grant. In accepting this Award of Restricted Stock Units, Participant acknowledges, understands and agrees that:

(b) all decisions with respect to future Restricted Stock Units or other grants, if any, will be at the sole discretion of the Administrator;

(d) the Restricted Stock Units and the Shares subject to the Restricted Stock Units are not intended to replace any pension rights or compensation;

Page 8 of 18

(f) the future value of the Shares underlying the Restricted Stock Units is unknown, indeterminable and cannot be predicted with certainty;

(i) the following provisions apply only if Participant is providing services outside the United States:

(i) the Restricted Stock Units and the Shares subject to the Restricted Stock Units are not part of normal or expected compensation or salary for any purpose;

(iii) no claim or entitlement to compensation or damages will arise from forfeiture of the Restricted Stock Units resulting from the termination of Participant’s status as a

Page 9 of 18

Page 10 of 18

Page 11 of 18

registration, qualification, rule compliance, clearance, consent or approval of any such governmental authority.

22. Captions. Captions provided herein are for convenience only and are not to serve as a basis for interpretation or construction of this Award Agreement.

Page 12 of 18

conditions is necessary or advisable for legal or administrative reasons. The Country Addendum constitutes part of this Award Agreement.

* * *

Page 13 of 18

ADDENDUM

TELENAV, INC.
2009 EQUITY INCENTIVE PLAN
RESTRICTED STOCK UNIT AWARD AGREEMENT
COUNTRY ADDENDUM

Terms and Conditions

Notifications

CHINA

With respect to any Participants of the Company’s China Subsidiary, the following additional terms will apply.

I.Vesting Schedule. The following language will be added to the end of Section 3 of the Terms and Conditions of Restricted Stock Unit Grant of the Award Agreement:

Page 14 of 18

III.Withholding of Taxes. The following language will be added to the end of Section 8 of the Terms and Conditions of the Restricted Stock Unit Grant of the Award Agreement:

The following language will be added as a new Section 29 to the Terms and Conditions of the Restricted Stock Unit Grant of the Award Agreement:

Page 15 of 18

The following language will be added to Section 14 of the Restricted Stock Unit Grant of the Award Agreement:

Participant understands that Participant may, at any time, review the Data and request that any necessary amendment or withdrawal be made to the Data by contacting the Company in writing.”

ROMANIA

With respect to any Participants of the Company’s Romania Subsidiary, the following additional terms will apply.

I.Withholding of Taxes. The following language will be added to the end of Section 8 of the Terms and Conditions of Restricted Stock Unit Grant of the Award Agreement:

Page 16 of 18


•	Income from investments shall be declared yearly by the individual in the annual income tax return;


•	The above annual income tax return shall be submitted until the 15th of March of the year following the year in which the income was obtained;


•	The same deadline applies for performing the payment of the income tax due.

•


•	Special provisions have to be observed additionally in case of individuals who need to benefit from tax credit in order to avoid double taxation.

Page 17 of 18

could be subject to health fund contribution as well, in case of exceeding the above mentioned threshold.

Page 18 of 18

Exhibit 10.47

May 24, 2019

Steve Debenham

Re: Offer of Employment

Dear Steve,

Telenav, Inc. (the “Company” or “Telenav”) is very pleased to offer you the position of General Counsel and Secretary on the following terms. You will report to the Company’s Chief Executive Officer (“CEO”). Your duties will be consistent with your title and position and any other duties reasonably assigned or requested by the CEO or from time to time by members of the Board of Directors of the Company (the “Board”).

Your initial base salary compensation shall be $26,250.00 per month (which is equivalent to an annual salary of $315,000.00), and will be subject to payroll deductions and all required withholdings. You will be paid semi-monthly and you will be eligible for Company benefits per our standard plans and policies, which currently include among other benefits, medical insurance, dental and vision insurance, flexible spending account participation, 401(k) plan participation with Company match, vacation, sick leave, and holidays. Details about Telenav’s benefit plans are available for your review.

Your annual target bonus opportunity for the Company’s fiscal year ending June 30, 2020, will be equal to 55% of your base salary earned from the later to occur of (i) the date of your employment commencement or (ii) July 1, 2019 through June 30, 2020. The bonus will be based upon achievement of Company financial objectives, Business Unit objectives and personal goals (if applicable), as determined by the Board or its Compensation Committee (“Committee”), as applicable. Your bonus will be subject to the terms and conditions of the Telenav Executive Bonus Plan, including without limitation a requirement that you be an employee in good standing at the time the bonus is paid.

As equity compensation, we will recommend that the Board or Committee, as applicable, approve a grant to you of Restricted Stock Units (RSUs) for 122,500 shares of the Company’s common stock (such number of shares calculated on the basis of the average closing price of the common stock of $6.53 of the last 30 days), which will be scheduled to vest in four, equal, annual amounts on or around the tenth day of the second month of the first fiscal quarter following each of the one, two, three and four year anniversaries of your employment commencement date, subject to your continued service with the Company through the applicable vesting date.

Exhibit 10.47

We anticipate that you will enter into an irrevocable election relating to the units to permit the payment of required taxes upon vesting of the RSUs. Your RSUs will be subject to the terms and conditions of the Telenav 2009 Equity Incentive Plan and applicable award agreements thereunder.

As a Telenav employee, you will be expected to abide by Company rules and regulations, acknowledge in writing that you have read the Company’s Employee Handbook, and sign and comply with a Proprietary Information Agreement, which prohibits unauthorized use or disclosure of Telenav proprietary information. A copy of that agreement is included with this letter as Exhibit A. Please note that we must receive your signed Proprietary Information Agreement before your first day of employment.

In addition to the terms of this Letter, following the execution of this Letter, and upon your execution of the Change in Control Severance Agreement attached as Exhibit B, you shall be eligible to receive certain severance payments and benefits upon certain qualifying terminations of your employment with the Company in accordance with the terms and conditions set forth therein.

As a result of the senior level nature of your role, you will be offered a Company standard Indemnification Agreement that reflects your role and will be expected to comply with all reporting and regulatory requirements related to the Company’s status as a publicly traded company. You acknowledge that upon your appointment as General Counsel, you will become subject to Section 16 of the Securities Exchange Act of 1934, as amended. From time to time, you may be appointed to act as an officer or director of the Company’s subsidiaries. You agree that, in the event of termination of your employment with the Company for any reason, you will be deemed to have resigned from all officer and director positions of the Company and any of its subsidiaries without any further action required by you, provided that you agree that you will execute any documents as may be requested by the Company in order to reflect such resignations.

As a full-time, exempt, salaried employee, you will be expected to work hours as required by the nature of your work assignments. During the period of your employment, you will not, without the express written consent of the Company, engage in any other employment or business activity, including, without limitation, consulting of any kind, which may interfere with your work for the Company. Notwithstanding anything to the contrary, you may perform services for friends, family, etc. on a limited basis outside of work hours, so long as you warrant that such activities will be minor in nature and will not interfere with or compromise your duties of good faith, loyalty or fair dealing.

We also ask that, if you have not already done so, you disclose to the Company any and all agreements relating to your prior employment that may affect your eligibility to be employed by the Company or limit the manner in which you may be employed. It is the Company’s understanding that any such agreements will not prevent you from performing the duties of your position and you represent that such is the case.

Exhibit 10.47

As part of the interview process, we may undertake a background investigation and reference check in accordance with applicable law. This investigation and reference check may include a consumer report, as defined by the Fair Credit Reporting Act (“FCRA”), 15 U.S.C. 1681a, and/or an investigative consumer report, as defined by FCRA, 15 U.S.C. 1681a, and California Civil Code 1786.2(c). This investigation also may include a consumer credit report, as defined by California Civil Code 1785.3(c), which is being requested because this position is managerial and you will have access to confidential or proprietary information of the type described in California Labor Code § 1024.5(a)(7). This job offer is contingent upon a clearance of such a background investigation and/or reference check, and upon your written authorization to obtain a consumer report, consumer credit report and/or investigative consumer report. Your offer of employment is also contingent upon confirmation of a lack of conflict in connection with and approval of your appointment by Grant Thornton LLP, the Company’s independent auditors.

You may terminate your employment with Telenav at any time for any reason by notifying the Company. Likewise, Telenav may terminate your employment at any time for any reason, with or without cause or advance notice. Telenav also retains the sole discretion to make all other decisions regarding your employment (e.g., transfers, demotions, job assignments, and the like) with or without cause. Your compensation will be subject to periodic review by the Board or Committee, and the Board or Committee may make adjustments from time to time, in its sole discretion. The Company also reserves the right, in its sole discretion, to establish, modify, suspend or terminate its benefit programs and arrangements from time to time as necessary or appropriate. The at-will relationship cannot be changed except in writing signed by the CEO.

All payments and benefits provided to you pursuant to this Letter will be subject to any applicable tax or other required withholdings or deductions.

Please note that, in compliance with the Immigration Reform Act of 1986, all new employees are required to submit proof of U.S. Citizenship or legal alien status within three business days of employment. Enclosed is an I-9 form that lists the document that you may present to fulfill this requirement. Please bring your documentation, along with the completed I-9 Form, on your first day of employment.

The validity, interpretation, construction and performance of this Letter will be governed by the laws of the State of California (with the exception of its conflict of laws provisions.

(remainder of page left blank intentionally)

Exhibit 10.47

If you wish to accept employment at Telenav under the terms described above, please sign and date this letter, and return it to the Company by the close of business, Tuesday, May 28, 2019. Your first day of employment with Telenav will be determined upon acceptance of this offer.

We look forward to your favorable reply and to a productive and enjoyable work relationship.

Sincerely,

By /s/ Fiona Ow Giuffre

Fiona Ow Giuffre

Vice President, Human Resources Telenav, Inc

Accepted: /s/ Steve Debenham

Steve Debenham

Dated: May 29, 2019

Exhibit 10.47

Exhibit A

TELENAV, INC.

PROPRIETARY INFORMATION AGREEMENT

The following confirms an agreement between me and Telenav, Inc., a Delaware corporation (the "Company," which term includes the Company's affiliates, successors and assigns), which is a material part of the consideration for my employment or continued employment by the Company:

1.“Proprietary Information” is information that was or is developed by, became or becomes known by, or was or is assigned or otherwise conveyed or made known to, the Company, and which has commercial value in the Company's business. Proprietary Information includes, without limitation, trade secrets; financial information; product plans; lists, databases and other information concerning vendors, licensees and customers (including information which discloses the identity of such parties) and the Company’s relationship with those parties; pricing information and policies; employee compensation records; business and marketing plans and strategies; forecasts and any other business information; inventions; discoveries; formulas; product and other ideas; works of authorship; processes; technology; computer programs; source and object codes; techniques; processes; prototypes; algorithms; schematics; research; know-how and data, disclosed to me by the Company, either directly or indirectly, in writing, orally or by drawings or inspection of materials. I understand that my employment creates a relationship of confidence and trust between me and the Company with respect to Proprietary Information of the Company and its customers, vendors and other parties contracting with the Company, which may be learned by me during my employment.

2.As used in this Agreement, any reference to “employment” by the Company includes any time during which I may be retained by the Company as a consultant, in addition to any time during which I am an employee of the Company.

3.In consideration of my employment or continued employment and the compensation received by me from the Company from time to time, I hereby agree as follows:

(a) All Proprietary Information and all patents, copyrights, trade dress, mask work and other intellectual property rights, including, without limitation, any extensions, renewals, continuations or divisions of any of the foregoing (collectively, the "Legal Rights") associated with Proprietary Information shall be the sole property of the Company. I hereby assign to the Company any rights I may have or acquire in any Proprietary Information and any Legal Rights associated therewith. At all times, both during my employment and after its termination, I will keep in confidence and trust and will not use or disclose any Proprietary Information or anything relating to it without the written consent of the Company, except that I may disclose such Proprietary Information to employees and consultants of the Company as necessary in the ordinary course of performing my duties on behalf of the Company. I agree to notify the Company in writing immediately upon discovery of any unauthorized use or disclosure of

Exhibit 10.47

any Proprietary Information received hereunder, or any other breach of the Agreement, and to assist and cooperate with the Company in every reasonable way to regain possession of such Proprietary Information and/or prevent its further unauthorized disclosure and/or use. Notwithstanding the foregoing, I have no obligation under this Agreement to maintain in confidence any information that: (i) is in the public domain at the time of disclosure; (ii) though originally Proprietary Information, subsequently enters the public domain other than by breach of my confidentiality obligation, as of the date of its entering the public domain or (iii) that I can show I knew of prior to disclosure to me by the Company.

(b) In the event of the termination of my employment by me or by the Company for any reason, or upon the Company’s request at any time, I shall immediately return all documents, records, apparatus, computer files, equipment and other physical property, or any reproduction of such property, whether or not pertaining to Proprietary Information furnished to me by the Company or produced by myself or others in connection with my employment, to the Company.

(c) I will promptly disclose to the Company, or any persons designated by it, all "Inventions," which include all improvements, inventions, discoveries, formulas, ideas, circuits, mask works, works of authorship, processes, computer programs, algorithms, techniques, schematics, know-how and data, whether or not patentable, made or conceived or reduced to practice or developed by me, either alone or jointly with others, during the term of my employment. To the extent the Company does not have rights therein hereunder, such disclosure shall be received by the Company in confidence and does not extend the assignment made in paragraph (e) of this Section 3.

(d) I agree that all Inventions which I make, conceive, reduce to practice or develop (in whole or in part, either alone or jointly with others) during my employment shall be the sole property of the Company to the maximum extent permitted by Section 2870 of the California Labor Code, a copy of which is attached to this Agreement as Exhibit A, and to the extent permitted by law shall be "works made for hire." The Company shall be the sole owner of all Legal Rights associated with the Inventions. I hereby assign to the Company any Legal Rights I may have or acquire in the Inventions. I agree to perform, during and after my employment, all acts deemed necessary or desirable by the Company to permit and assist it, at the Company's expense, in obtaining and enforcing any Legal Rights for the foregoing Inventions and/or any other Inventions I have or may at any time assign to the Company in any and all countries. These acts may include, but are not limited to, execution of documents and assistance or cooperation in legal proceedings. I hereby irrevocably designate and appoint the Company and its duly authorized officers and agents as my agents and attorneys-in-fact to act for and on my behalf and instead of me, to execute and file any applications or related filings and to do all other lawfully permitted acts to further the prosecution and issuance of all Legal Rights associated with any Inventions with the same legal force and effect as if executed by me.

(e) A complete list of all Inventions to which I claim ownership and that I desire to remove from the operation of this Agreement is attached as

Exhibit 10.47

Exhibit B, and I covenant that this list is complete. If no list is attached to this Agreement, I represent that I have no Inventions to which I claim ownership and that I desire to remove from the operation of this Agreement at the time of signing this Agreement.

(f) I represent that my performance of all the terms of this Agreement will not breach any agreement or obligation to keep in confidence proprietary information acquired by me in confidence or trust prior to my employment with the Company. I have not entered into, and I agree I will not enter into, any agreement either written or oral in conflict with this Agreement or in conflict with my employment with the Company.

4.I acknowledge and agree that a breach of any of my promises or covenants contained herein will result in irreparable and continuing damage to the Company for which there will be no adequate remedy at law, and in the event of such breach the Company shall be entitled to injunctive relief and/or a decree for specific performance, and such other and further relief as may be proper (including monetary damages, if appropriate).

5.I understand that nothing in this Agreement limits or prohibits me from filing and/or pursuing a charge or complaint with, or otherwise communicating or cooperating with or participating in any investigation or proceeding that may be conducted by, any federal, state or local government agency or commission, including the Securities and Exchange Commission, the Equal Employment Opportunity Commission, the Occupational Safety and Health Administration, and the National Labor Relations Board (“Government Agencies”), including disclosing documents or other information as permitted by law, without giving notice to, or receiving authorization from, the Company. Notwithstanding, in making any such disclosures or communications, I agree to take all reasonable precautions to prevent any unauthorized use or disclosure of any information that may constitute Company Proprietary Information to any parties other than the Government Agencies. I further understand that I am not permitted to disclose the Company’s attorney-client privileged communications or attorney work product. In addition, I hereby acknowledge that the Company has provided me with notice in compliance with the Defend Trade Secrets Act of 2016 regarding immunity from liability for limited disclosures of trade secrets. The full text of the notice is attached in Exhibit A.

6.I acknowledge that I have no reasonable expectation of privacy in any Company Electronic Media Equipment or Company Electronic Media Systems. All information, data, and messages created, received, sent, or stored in Company Electronic Media Equipment or Company Electronic Media Systems are, at all times, the property of the Company. As such, the Company has the right to audit and search all such items and systems, without further notice to me, to ensure that the Company is licensed to use the software on the Company’s devices in compliance with the Company’s software licensing policies, to ensure compliance with the Company’s policies, and for any other business- related purposes in the Company’s sole discretion. I understand that I am not permitted to add any unlicensed, unauthorized, or non-compliant applications to the Company’s

Exhibit 10.47

technology systems, including, without limitation, open source or free software not authorized by the Company, and that I shall refrain from copying unlicensed software onto the Company’s technology systems or using non-licensed software or websites. I understand that it is my responsibility to comply with the Company’s policies governing use of the Company’s documents and the internet, email, telephone, and technology systems to which I will have access in connection with my employment. In addition, as to any personal Electronic Media Equipment or personal Electronic Media Systems or other personal property that I have used for Company purposes, I agree that the Company may have reasonable access to such personal Electronic Media Equipment or personal Electronic Media Systems or other personal property to review, retrieve, destroy, or ensure the permanent deletion of Company information from such equipment or systems or property or take such other actions that are needed to protect the Company or Company property, as determined by the Company reasonably and in good faith.

I am aware that the Company has or may acquire software and systems that are capable of monitoring and recording all Company network traffic to and from any Company Electronic Media Equipment or Company Electronic Media Systems. The Company reserves the right to access, review, copy, and delete any of the information, data, or messages accessed through Company Electronic Media Equipment or Company Electronic Media Systems, with or without notice to me and/or in my absence. This includes, but is not limited to, all e-mail messages sent or received, all website visits, all chat sessions, all news group activity (including groups visited, messages read, and postings by me), and all file transfers into and out of the Company’s internal networks. The Company further reserves the right to retrieve previously deleted messages from e-mail or voicemail and monitor usage of the Internet, including websites visited and any information I have downloaded. In addition, the Company may review Internet and technology systems activity and analyze usage patterns, and may choose to publicize this data to assure that technology systems are devoted to legitimate business purposes.

7.This Agreement shall be effective as of the first day of my employment, and shall be binding upon me, my heirs, executors, assigns and administrators and shall inure to the benefit of the Company, its subsidiaries, successors and assigns.

8.This Agreement may not be modified except by written agreement signed by me and the Company. This Agreement shall be governed by and construed in accordance with the laws of the State of California, excluding that body of law relating to choice of law.

Dated: May 29, 2019

Employee: /s/ Steve Debenham

Exhibit 10.47

Exhibit A

§ 2870. Application of provision that employee shall assign or offer to assign rights in invention to employer

(a)Any provision in an employment agreement which provides that an employee shall assign, or offer to assign, any of his or her rights in an invention to his or her employer shall not apply to an invention that the employee developed entirely on his or her own time without using the employer’s equipment, supplies, facilities, or trade secret information except for those invention that either:

(1) Relate at the time of conception or reduction to practice of the invention to the employer’s business, or actual or demonstrably anticipated research or development of the employer; or


(2)	Result from any work performed by the employee for the employer.

(b)To the extent a provision in an employment agreement purports to require an employee to assign an invention otherwise excluded from being required to be assigned under subdivision (a), the provision is against the public policy of this state and is unenforceable.

SECTION 7 OF THE DEFEND TRADE SECRETS ACT OF 2016

“ . . . An individual shall not be held criminally or civilly liable under any Federal or State trade secret law for the disclosure of a trade secret that—(A) is made—(i) in confidence to a Federal, State, or local government official, either directly or indirectly, or to an attorney; and (ii) solely for the purpose of reporting or investigating a suspected violation of law; or (B) is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal An individual who

files a lawsuit for retaliation by an employer for reporting a suspected violation of law may disclose the trade secret to the attorney of the individual and use the trade secret information in the court proceeding, if the individual—(A) files any document containing the trade secret under seal; and (B) does not disclose the trade secret, except pursuant to court order.”

Exhibit 10.47

Exhibit B

Telenav, Inc.

4655 Great America Parkway, Suite 300 Santa Clara, CA 95054

Ladies and Gentlemen:

1. The following is a complete list of all Inventions relevant to the subject matter of my employment by the Company that have been made or conceived or first reduced to practice by me alone or jointly with others prior to my employment by the Company and that I desire to remove from the operation of the Company’s Proprietary Information and Inventions Agreement.

x No inventions or improvements.

x See below:

no Additional sheets attached.

/s/ Steve Debenham May 29, 2019

Employee Date

Exhibit 10.47.1

TELENAV, INC.

STEVE DEBENHAM CHANGE IN CONTROL AND SEVERANCE AGREEMENT

This Change in Control and Severance Agreement (the “Agreement”) is made and entered into by and between Steve Debenham (“Executive”) and TeleNav, Inc. (the “Company”), effective as of August 15, 2019 (the “Effective Date”).

This Agreement provides certain protections to Executive upon a termination of Executive’s employment under certain circumstances, including without limitation in connection with a change in control of the Company, as described in this Agreement. Certain capitalized terms used in this Agreement are defined in Section 7 below.

The Company and Executive agree as follows:

1.Term of Agreement. This Agreement will have an initial term of three (3) years from the Effective Date (the “Initial Term”), unless terminated earlier under this Agreement’s provisions. On the three (3) year anniversary of the Effective Date, this Agreement will renew automatically for additional, one (1) year terms, unless either party provides the other party with written notice of non-renewal at least sixty (60) days prior to the date of automatic renewal. Notwithstanding the foregoing provisions of this Section, in the event of a Change in Control, the term of this Agreement will extend automatically through the date eighteen (18) months after the Change in Control (or, if later, the last day of the Initial Term) (the “Extended Date”). Additionally, on the Extended Date and each annual anniversary thereafter, this Agreement will renew automatically for additional one (1) year terms unless either party provides the other party with written notice of non‑renewal at least sixty (60) days prior to such anniversary. If Executive becomes entitled to severance payments and benefits pursuant to Section 3 hereof, this Agreement will not terminate until all of the obligations under this Agreement have been satisfied.

2.At-Will Employment. The parties agree that Executive’s employment with the Company is and will continue to be “at-will” and may be terminated at any time with or without cause or notice. Executive understands and agrees that neither Executive’s job performance nor promotions, commendations, bonuses or the like from the Company give rise to or in any way serve as the basis for modification, amendment, or extension, by implication or otherwise, of Executive’s employment with the Company. However, as described in this Agreement, Executive may be entitled to severance payments and benefits depending on the circumstances of the termination of Executive’s employment.

3.Severance.

(a) Termination for Other than Cause, Death or Disability or Resignation for Good Reason, Other than During the Change in Control Period. If, other than during the period beginning on the date two (2) months prior to a Change in Control through the one (1) year anniversary of the Change in Control (the “Change in Control Period”), Executive’s employment with the Company (or its successor entity, as applicable) (“Employment”) is terminated by the Company (or its successor entity, as applicable) other than for Cause, death or Disability, then, subject to Sections 5 and 6 below, Executive will receive certain severance payments and benefits, subject to the terms and conditions of this Agreement, as follows:

Exhibit 10.47.1

(i) Cash Severance. A single, lump sum cash payment equal to six (6) months of Executive’s base salary as in effect immediately prior to the termination of Executive’s Employment; and

(ii) Prorated Bonus Severance. A single, lump sum, cash payment, if any, equal to the cash bonus Executive otherwise would have received based on Executive’s bonus opportunity in effect for the year in which the date of the termination of Executive’s Employment (the “Termination Date”) occurs, to the extent the performance objectives applicable to Executive’s bonus opportunity are achieved in accordance with the terms of the applicable incentive program, as determined in the sole and absolute discretion of the Board or its Compensation Committee (the “Committee”) acting in good faith, and provided further that any such amount of bonus will be prorated to reflect the portion of the applicable performance period during which Executive was employed with the Company (the “Prorated Bonus Amount”).

(iii) Continued Employee Benefits. Subject to Executive timely electing continuation coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”), Executive will receive Company-paid group health, dental and vision coverage for Executive and any eligible dependents of Executive, as applicable (“COBRA Severance”), until the earliest of: (A) six (6) months following the Termination Date; (B) the date upon which Executive and Executive’s eligible dependents (as applicable) become covered under similar plans; or (C) the expiration of Executive’s (and any eligible dependents’, as applicable) eligibility for continuation coverage under COBRA.

(b) Termination for Other than Cause, Death or Disability or Resignation for Good Reason, During the Change in Control Period. If, during the Change in Control Period, Executive’s Employment is terminated by (x) the Company (or its successor entity, as applicable) other than for Cause, death or Disability, or (y) by Executive for Good Reason (a “Pre‑CIC Qualifying Termination”), then, subject to Sections 5 and 6 below, Executive will receive certain severance payments and benefits, subject to the terms and conditions of this Agreement, as follows:

(i) Change in Control Within One Year Following Employment Commencement. If the Change in Control occurs on or before the one (1) year anniversary of the first day of Executive’s Employment (“Start Date”), then Executive’s severance payments and benefits will consist of the following:

(1) Salary Severance. A single, lump sum cash payment equal to six (6) months of Executive’s base salary as in effect immediately prior to the termination of Executive’s Employment;

(2) Prorated Bonus Severance. A single, lump sum, cash payment, if any, equal to the Prorated Bonus Amount.

(3) Continued Employee Benefits. Executive will receive COBRA Severance until the earliest of: (A) six (6) months following the Termination Date; (B) the date upon which Executive and Executive’s eligible dependents (as applicable) become covered under similar plans; or (C) the expiration of Executive’s (and any eligible dependents’, as applicable) eligibility for continuation coverage under COBRA; and

Exhibit 10.47.1

(4) Accelerated Vesting. Accelerated vesting as to fifty percent (50%) of Executive’s equity awards covering shares of common stock of the Company (or its successor entity, as applicable) that are subject to vesting based on continued employment or other service, but not any performance-based objectives (“Time‑based Awards”) that are then‑unvested and outstanding as of the Termination Date. Any of Executive’s stock options or similar type of equity award covering shares of common stock of the Company outstanding as of the Termination Date will remain exercisable following the Termination Date (to the extent the equity award is vested or vests pursuant to this Section 3(b)(i)(4)) for the period prescribed in the applicable equity plan and award agreement governing the terms of the equity award.

(ii) Change in Control After 1 Year of Continued Employment. If the Change in Control occurs after the one (1) year anniversary of the Start Date, then Executive’s severance payments and benefits will consist of the following:

(1) Salary Severance. A single, lump sum cash payment equal to twelve (12) months of Executive’s base salary as in effect immediately prior to the termination of Executive’s Employment;

(2) Prorated Bonus Severance. A single, lump sum, cash payment, if any, equal to Prorated Bonus Amount.

(3) Continued Employee Benefits. Executive will receive COBRA Severance until the earliest of: (A) twelve (12) months following the Termination Date; (B) the date upon which Executive and Executive’s eligible dependents (as applicable) become covered under similar plans; or (C) the expiration of Executive’s (and any eligible dependents’, as applicable) eligibility for continuation coverage under COBRA; and

(4) Accelerated Vesting. Accelerated vesting as to one hundred percent (100%) of the Time‑based Awards that are then‑unvested and outstanding as of the Termination Date. Any of Executive’s stock options or similar type of equity award covering shares of common stock of the Company outstanding as of the Termination Date will remain exercisable following the Termination Date (to the extent the equity award is vested or vests pursuant to this Section 3(b)(ii)(4)) for the period prescribed in the applicable equity plan and award agreement governing the terms of the equity award.

For the avoidance of doubt, in the event of a Pre‑CIC Qualifying Termination, the applicable portion of Executive’s then‑outstanding and unvested Time‑based Awards will remain outstanding until the earlier of (x) two (2) months following the Termination Date, or (y) the occurrence of a Change in Control, solely so that any applicable vesting acceleration can be provided if a Change in Control occurs within two (2) months following the Termination Date (provided that in no event will any Time‑based Awards that are stock options or similar type of equity award remain outstanding beyond the equity award’s maximum term to expiration). If no Change in Control occurs within two (2) months following the Termination Date, then such unvested portion of Executive’s Time‑based Awards (otherwise not yet terminated) will be forfeited automatically and permanently on the date two (2) months following the Termination Date, without having vested.

Exhibit 10.47.1

(c) Other Terminations. If Executive’s Employment is terminated (i) other than during the Change in Control Period by Executive for any reason; (ii) during the Change in Control Period by Executive for other than Good Reason, (iii) by the Company for Cause, or (iv) due to Executive’s death or Disability, then (A) all vesting will terminate immediately with respect to Executive’s outstanding Time‑based Awards, (B) all payments of compensation by the Company to Executive will terminate immediately (except as to amounts already earned), and (C) Executive will be eligible for severance payments and benefits only in accordance with the Company’s established policies, if any, as then in effect.

(d) Non-duplication of Payments and Benefits. For purposes of clarity, in the event of a Pre‑CIC Qualifying Termination, any severance payments and benefits to be provided to Executive under Section 3(b) will be reduced by any amounts that already were provided to Executive under Section 3(a). Notwithstanding any provision of this Agreement to the contrary, if Executive is entitled to any cash severance, continued health coverage benefits, or vesting acceleration of any Time‑based Awards, by operation of applicable law or under a plan, policy, contract, or arrangement sponsored by or to which the Company is a party other than this Agreement (“Other Benefits”), then the corresponding severance payments and benefits under this Agreement will be reduced by the amount of Other Benefits paid or provided to Executive.

4. Accrued Compensation. On any Employment termination, Executive will be entitled to receive all accrued but unpaid vacation, expense reimbursements, wages, and other benefits due to Executive under any Company-provided plans, policies, and arrangements.

5. Conditions to Receipt of Severance; No Duty to Mitigate.

(a) Separation Agreement and Release of Claims. Executive’s receipt of any severance payments or benefits pursuant to Section 3 will be subject to Executive signing and not revoking a separation agreement and release of claims in a form reasonably satisfactory to the Company (the “Release”) and provided that such Release becomes effective and irrevocable no later than sixty (60) days following the Termination Date (such deadline, the “Release Deadline Date”). If the Release does not become effective and irrevocable by the Release Deadline Date, Executive will forfeit any rights to severance or benefits under this Agreement. In no event will severance payments or benefits be paid or provided until the Release becomes effective and irrevocable. Subject to Section 5(d) below, (i) any lump sum cash severance payment under Section 3(a)(i) of this Agreement will be paid on the first regularly scheduled payroll date of the Company following the date that the Release becomes effective and irrevocable (the “Release Effectiveness Date”), and any lump sum cash severance payment under Sections 3(b)(i)(1) or 3(b)(ii)(1) of this Agreement will be paid on the later of (A) the Release Effectiveness Date or (B) the date of the Change in Control; (ii) any Prorated Bonus Amount will be paid in the calendar year in which occurs the last day of the Company’s fiscal year during which the Terminate Date occurs, but no later than the fifteenth (15^th) day of the third month following the last day of such Company fiscal year; (iii) any taxable installments under Section 5(c) otherwise payable to Executive on or before the Release Effectiveness Date will be paid on the Release Effectiveness Date, and any remaining installments will be paid as specified in this Agreement; and (iv) any Time‑based Awards that are restricted stock units, performance shares, performance units, and similar full value awards that accelerate vesting under Section 3(b)(i)(4) or 3(b)(ii)(4) will be settled within ten (10) days following the date the Release becomes effective and irrevocable or if later, on the date of the Change in Control.

Exhibit 10.47.1

(b) Proprietary Information Agreement. Executive’s receipt of any payments or benefits under Section 3 will be subject to Executive continuing to comply with the terms of the Proprietary Information Agreement (as defined in Section 11).

(c) COBRA Severance Limitations. If the Company determines in its sole discretion that it cannot provide the COBRA Severance without potentially violating, or being subject to an excise tax under, applicable law (including, without limitation, Section 2716 of the Public Health Service Act), then in lieu of such COBRA Severance, the Company will provide to Executive a taxable monthly payment payable on the last day of a given month (except as provided by the immediately following sentence), in an amount equal to the monthly COBRA premium that Executive would be required to pay to continue Executive’s group health coverage in effect on the date of Employment termination (which amount will be based on the premium rates applicable for the first month of COBRA Severance for Executive and any of eligible dependents of Executive) (each, a “COBRA Replacement Payment”), which COBRA Replacement Payments will be made regardless of whether Executive elects COBRA continuation coverage and will end on the earlier of (x) the date upon which Executive obtains other employment, or (y) the date the Company has paid an amount totaling the number of COBRA Replacement Payments equal to the number of months in the applicable COBRA Severance period set forth in Section 3(a)(iii)(A), 3(b)(i)(3)(A) or 3(b)(ii)(3)(A), as applicable. For the avoidance of doubt, the COBRA Replacement Payments may be used for any purpose, including, but not limited to continuation coverage under COBRA, and will be subject to any applicable withholdings. Notwithstanding anything to the contrary under this Agreement, if the Company determines in its sole discretion at any time that it cannot provide the COBRA Replacement Payments without violating applicable law (including, without limitation, Section 2716 of the Public Health Service Act), Executive will not receive the COBRA Replacement Payments or any further COBRA Severance.

(d) Section 409A.

(i) Notwithstanding anything to the contrary in this Agreement, no severance pay or benefits to be paid or provided to Executive, if any, pursuant to this Agreement that, when considered together with any other severance payments or separation benefits, are considered deferred compensation under Code Section 409A, and the final regulations and any guidance promulgated thereunder (“Section 409A”) (together, the “Deferred Payments”) will be paid or otherwise provided until Executive has a “separation from service” within the meaning of Section 409A. Similarly, no severance payable to Executive, if any, pursuant to this Agreement that otherwise would be exempt from Section 409A pursuant to Treasury Regulation Section 1.409A-1(b)(9) will be payable until Executive has a “separation from service” within the meaning of Section 409A. To the extent necessary to be exempt from or comply with Section 409A, references to Termination Date, termination of Employment, or similar phrases used in this Agreement will mean Executive’s “separation from service” within the meaning of Section 409A.

(ii) Any severance payments or benefits under this Agreement that would be considered Deferred Payments will be paid on, or, in the case of installments, will not commence until, the sixty‑fifth (65^th) day following Executive’s separation from service, or, if later, at such time as required by subsection (iii) below, with the exception that any Prorated Bonus Amount payable under this Agreement will be paid as provided in Section 5(a)(ii), or, if later, at such time as required by subsection (iii) below. Except as required by subsection (iii) below, any Deferred Payments that are installment payments that would have been made to Executive during the sixty-five (65) day period immediately following Executive’s separation from service but for the preceding sentence will be paid to Executive on the sixtieth-fifth (65^th)

Exhibit 10.47.1

day following Executive’s separation from service and the remaining payments shall be made as provided in this Agreement.

(iii) Notwithstanding anything to the contrary in this Agreement, if Executive is a “specified employee” within the meaning of Section 409A at the time of Employment termination (other than due to death), then the Deferred Payments that are payable within the first six (6) months following Executive’s separation from service, will become payable on the first payroll date that occurs on or after the date six (6) months and one (1) day following the date of Executive’s separation from service. All subsequent Deferred Payments, if any, will be payable in accordance with the payment schedule applicable to each payment or benefit. Notwithstanding anything herein to the contrary, if Executive dies following Executive’s separation from service, but prior to the six (6) month anniversary of the separation from service, then any payments delayed in accordance with this subsection (iii) will be payable in a lump sum as soon as administratively practicable after the date of Executive’s death and all other Deferred Payments will be payable in accordance with the payment schedule applicable to each payment or benefit. Each payment and benefit payable under this Agreement is intended to constitute a separate payment for purposes of Section 1.409A-2(b)(2) of the Treasury Regulations.

(iv) Any amount paid under this Agreement that satisfies the requirements of the “short-term deferral” rule set forth in Section 1.409A-1(b)(4) of the Treasury Regulations will not constitute Deferred Payments for purposes of subsection (i) above.

(v) Any amount paid under this Agreement that qualifies as a payment made as a result of an involuntary separation from service pursuant to Section 1.409A-1(b)(9)(iii) of the Treasury Regulations that does not exceed the Section 409A Limit (as defined below) will not constitute Deferred Payments for purposes of subsection (i) above.

(vi) The foregoing provisions are intended to comply with the requirements of Section 409A so that none of the severance payments and benefits to be provided hereunder will be subject to the additional tax imposed under Section 409A, and any ambiguities or ambiguous terms herein will be interpreted to so comply. The Company and Executive agree to work together in good faith to consider amendments to this Agreement and to take such reasonable actions which are necessary, appropriate or desirable to avoid imposition of any additional tax or income recognition prior to actual payment to Executive under Section 409A. In no event will the Company have any liability or obligation to reimburse, indemnify, or hold harmless Executive for any taxes, penalties, or fees imposed, or other costs incurred, as a result of Section 409A.

(e) No Duty to Mitigate. Executive will not be required to mitigate the amount of any payment contemplated by this Agreement, nor will any earnings that Executive may receive from any other source reduce any such payment.

6. Limitation on Payments.

(a) Reduction of Payments and Benefits. In the event that the payments and benefits provided for in this Agreement or otherwise payable to Executive (i) constitute “parachute payments” within the meaning of Section 280G of the Code and (ii) but for this Section 6, would be subject to the excise tax

Exhibit 10.47.1

imposed by Section 4999 of the Code (the “Excise Tax”), then Executive’s payments and benefits hereunder will be either:

(x) delivered in full, or

(y) delivered as to such lesser extent which would result in no portion of such payments and benefits being subject to the Excise Tax,

whichever of the foregoing amounts, taking into account the applicable federal, state and local income taxes and the Excise Tax, results in the receipt by Executive on an after-tax basis, of the greatest amount of payments and benefits, notwithstanding that all or some portion of such payments and benefits may be subject to the Excise Tax. If a reduction in the payments and benefits constituting “parachute payments” is necessary so that no portion of such payments and benefits is subject to the Excise Tax, the reduction shall occur in the following order: (A) reduction of cash payments in reverse chronological order (that is, the cash payment owed on the latest date following the occurrence of the event triggering the Excise Tax will be the first cash payment to be reduced); (B) cancellation of equity awards that were granted “contingent on a change in ownership or control” within the meaning of Section 280G of the Code in the reverse order of date of grant of the equity awards (that is, the most recently granted equity awards will be cancelled first); (C) reduction of the accelerated vesting of equity awards in the reverse order of date of grant of the equity awards (that is, the vesting of the most recently granted equity awards will be cancelled first); and (D) reduction of employee benefits in reverse chronological order (that is, the benefit owed on the latest date following the occurrence of the event triggering the Excise Tax will be the first benefit to be reduced). In no event will Executive have any discretion with respect to the ordering of any reductions of payments and benefits.

(b) Determination of Excise Tax Liability. Unless the Company and Executive otherwise agree in writing, any determination required under this Section 6 will be made in writing by a nationally recognized accounting or valuation firm (the “Firm”) selected by the Company, whose determinations will be conclusive and binding upon Executive and the Company for all purposes. For purposes of making the calculations required by this Section 6, the Firm may make reasonable assumptions and approximations concerning applicable taxes and may rely on reasonable, good faith interpretations concerning the application of Sections 280G and 4999 of the Code. The Company and Executive will furnish to the Firm such information and documents as the Firm may reasonably request in order to make a determination under this Section 6. The Company will bear the costs and make all payments for the Firm’s services in connection with any calculations contemplated by this Section 6. The Company will have no liability to Executive for the determinations of the Firm. Executive will be solely responsible for the payment of all personal tax liability that is incurred as a result of the payments and benefits received under this Agreement, and Executive will not be reimbursed, indemnified, or held harmless by the Company for any of those payments of personal tax liability.

7. Definition of Terms. The following terms referred to in this Agreement will have the following meanings:

(a) Cause. For purposes of this Agreement, “Cause” is defined as:

Exhibit 10.47.1

(i) any material act of personal dishonesty made by Executive in connection with Executive’s responsibilities as an employee;

(ii) Executive’s conviction of, or plea of nolo contendere to, a felony or any crime involving fraud, embezzlement or any other act of moral turpitude;

(iii) Executive’s gross misconduct;

(iv) Executive’s unauthorized use or disclosure of any proprietary information or trade secrets of the Company or any other party to whom Executive owes an obligation of nondisclosure as a result of Executive’s relationship with the Company;

(v) Executive’s willful breach of any obligations under any written agreement or covenant with the Company; or

(vi) Executive’s continued failure to perform Executive’s employment duties after Executive has received a written demand of performance from the Company which specifically sets forth the factual basis for the Company’s belief that Executive has not substantially performed his or her duties and has failed to cure such non-performance to the Company’s satisfaction within ten (10) business days after receiving such notice.

(b) Change in Control. For purposes of this Agreement, “Change in Control” means the first occurrence of any of the following events on or after the Effective Date:

(i) A change in the ownership of the Company which occurs on the date that any one person, or more than one person acting as a group (“Person”), acquires ownership of the stock of the Company that, together with the stock held by such Person, constitutes more than fifty percent (50%) of the total voting power of the stock of the Company; provided, however, that for purposes of this subsection (i), the acquisition of additional stock by any one Person, who is considered to own more than 50% of the total voting power of the stock of the Company will not be considered a Change in Control; or

(ii) A change in the effective control of the Company which occurs on the date that a majority of members of the Company’s Board of Directors (the “Board”) is replaced during any twelve (12) month period by Directors whose appointment or election is not endorsed by a majority of the members of the Board prior to the date of the appointment or election. For purposes of this clause (ii), if any Person is considered to be in effective control of the Company, the acquisition of additional control of the Company by the same Person will not be considered a Change in Control; or

(iii) A change in the ownership of a substantial portion of the Company’s assets which occurs on the date that any Person acquires (or has acquired during the twelve (12) month period ending on the date of the most recent acquisition by such person or persons) assets from the Company that have a total gross fair market value equal to or more than fifty percent (50%) of the total gross fair market value of all of the assets of the Company immediately prior to such acquisition or acquisitions; provided, however, that for purposes of this subsection (iii), the following will not constitute a change in the ownership of a substantial portion of the Company’s assets: (A) a transfer to an entity that is controlled by the Company’s stockholders immediately after the transfer, or (B) a transfer of assets by the Company to: (1) a stockholder

Exhibit 10.47.1

of the Company (immediately before the asset transfer) in exchange for or with respect to the Company’s stock, (2) an entity, fifty percent (50%) or more of the total value or voting power of which is owned, directly or indirectly, by the Company, (3) a Person, that owns, directly or indirectly, fifty percent (50%) or more of the total value or voting power of all the outstanding stock of the Company, or (4) an entity, at least fifty percent (50%) of the total value or voting power of which is owned, directly or indirectly, by a Person described in this subsection (iii)(B)(3). For purposes of this subsection (iii), gross fair market value means the value of the assets of the Company, or the value of the assets being disposed of, determined without regard to any liabilities associated with such assets.

For purposes of this Section 7(b), persons will be considered to be acting as a group if they are owners of a corporation that enters into a merger, consolidation, purchase or acquisition of stock, or similar business transaction with the Company.

Notwithstanding the foregoing, a transaction will not constitute a Change in Control unless the transaction qualifies as a “change in control event” within the meaning of Section 409A.

(d) Disability. For purposes of this Agreement, “Disability” means total and permanent disability as defined in Section 22(e)(3) of the Code.

(e) Good Reason. For purposes of this Agreement, “Good Reason” means Executive’s resignation within thirty (30) days following the expiration of any Company cure period (discussed below) following the occurrence of one or more of the following, without Executive’s express written consent:

(i) the assignment to Executive of any duties, the reduction of Executive’s duties or the removal of Executive from his or her position and responsibilities, either of which must result in a material diminution of Executive’s authority, duties, or responsibilities with the Company in effect immediately prior to such assignment, unless Executive is provided with a comparable position (i.e., general counsel of the parent company of the combined entity);

(ii) A material reduction in Executive’s base salary, unless the Company also similarly reduces the base salaries of all other similarly situated employees of the Company (and, if applicable, its successor) (for these purposes, a reduction of Executive’s base salary by ten percent (10%) or more will be considered material, provided that a reduction of less than ten percent (10%) still may be material based on the facts and circumstances relating to the reduction);

(iii) a material change in the geographic location of Executive’s primary work facility or location; provided, however, that a relocation of less than thirty‑five (35) miles from Executive’s then‑present location will not be considered a material change in geographic location; or

(iv) the failure of the Company to obtain assumption of this Agreement by any successor, which shall be deemed a material breach by the Company of this Agreement.

Executive will not resign for Good Reason without first providing the Company with written notice of the acts or omissions constituting the grounds for “Good Reason” within ninety (90) days of the initial

Exhibit 10.47.1

existence of the grounds for “Good Reason” and a reasonable cure period of not less than thirty (30) days following the date of such notice.

(f) Section 409A Limit. For purposes of this Agreement, “Section 409A Limit” will mean two (2) times the lesser of: (i) Executive’s annualized compensation based upon the annual rate of pay paid to Executive during the Executive’s taxable year preceding the Executive’s taxable year of his or her separation from service as determined under Treasury Regulation Section 1.409A‑1(b)(9)(iii)(A)(1) and any Internal Revenue Service guidance issued with respect thereto; or (ii) the maximum amount that may be taken into account under a qualified plan pursuant to Section 401(a)(17) of the Internal Revenue Code for the year in which Executive’s separation from service occurred.

8. Assignment. This Agreement will be binding upon and inure to the benefit of (a) the heirs, executors and legal representatives of Executive upon Executive's death and (b) any successor of the Company. Any such successor of the Company will be deemed substituted for the Company under the terms of this Agreement for all purposes. For this purpose, “successor” means any person, firm, corporation or other business entity which at any time, whether by purchase, merger or otherwise, directly or indirectly acquires all or substantially all of the assets or business of the Company. None of the rights of Executive to receive any form of compensation payable pursuant to this Agreement may be assigned or transferred except by will or the laws of descent and distribution. Any other attempted assignment, transfer, conveyance or other disposition of Executive’s right to compensation or other benefits will be null and void.

9. Notice. All notices, requests, demands and other communications called for hereunder will be in writing and will be deemed given (a) on the date of delivery if delivered personally, (b) one (1) day after being sent by a well‑established commercial overnight service, or (c) four (4) days after being mailed by registered or certified mail, return receipt requested, prepaid and addressed to the parties or their successors at the following addresses, or at such other addresses as the parties may later designate in writing.

If to the Company:

Telenav, Inc.

4655 Great America Parkway, Suite 300

Santa Clara, California 95054

Attn: General Counsel

If to Executive:

at the last residential address known by the Company.

10. Arbitration.

A. Arbitration. IN CONSIDERATION OF EXECUTIVE’S EMPLOYMENT WITH THE COMPANY, ITS PROMISE TO ARBITRATE ALL EMPLOYMENT-RELATED DISPUTES WITH EXECUTIVE, AND EXECUTIVE’S RECEIPT OF COMPENSATION AND OTHER COMPANY BENEFITS, AT PRESENT AND IN THE FUTURE, EXECUTIVE AGREES THAT ANY AND ALL CONTROVERSIES, CLAIMS, OR DISPUTES THAT EXECUTIVE MAY HAVE WITH THE COMPANY (INCLUDING ANY COMPANY EMPLOYEE, OFFICER, DIRECTOR, TRUSTEE, OR BENEFIT PLAN OF THE COMPANY, IN THEIR CAPACITY AS SUCH OR OTHERWISE), IN

Exhibit 10.47.1

CONNECTION WITH, ARISING OUT OF, RELATING TO, OR RESULTING FROM EXECUTIVE’S EMPLOYMENT OR RELATIONSHIP WITH THE COMPANY OR THE TERMINATION OF EXECUTIVE’S EMPLOYMENT OR RELATIONSHIP WITH THE COMPANY, INCLUDING ANY BREACH OF THIS AGREEMENT, SHALL BE SUBJECT TO BINDING ARBITRATION UNDER THE FEDERAL ARBITRATION ACT (THE “FAA”). THE FAA’S SUBSTANTIVE AND PROCEDURAL RULES SHALL GOVERN AND APPLY TO THIS ARBITRATION AGREEMENT WITH FULL FORCE AND EFFECT, AND ANY STATE COURT OF COMPETENT JURISDICTION MAY STAY PROCEEDINGS PENDING ARBITRATION OR COMPEL ARBITRATION IN THE SAME MANNER AS A FEDERAL COURT UNDER THE FAA. EXECUTIVE FURTHER AGREES THAT, TO THE FULLEST EXTENT PERMITTED BY LAW, EXECUTIVE MAY BRING ANY ARBITRATION PROCEEDING ONLY IN EXECUTIVE’S INDIVIDUAL CAPACITY, AND NOT AS A PLAINTIFF, REPRESENTATIVE, OR CLASS MEMBER IN ANY PURPORTED CLASS, COLLECTIVE, OR REPRESENTATIVE LAWSUIT OR PROCEEDING. EXECUTIVE UNDERSTANDS, HOWEVER, THAT NOTHING IN THIS AGREEMENT PREVENTS EXECUTIVE FROM BRINGING A REPRESENTATIVE LAWSUIT OR PROCEEDING AS PERMITTED BY THE CALIFORNIA LABOR CODE’S PRIVATE ATTORNEYS GENERAL ACT OF 2004. TO THE FULLEST EXTENT PERMITTED BY LAW, EXECUTIVE AGREES TO ARBITRATE ANY AND ALL COMMON LAW AND/OR STATUTORY CLAIMS UNDER LOCAL, STATE, OR FEDERAL LAW, INCLUDING, BUT NOT LIMITED TO, CLAIMS UNDER TITLE VII OF THE CIVIL RIGHTS ACT OF 1964, THE AMERICANS WITH DISABILITIES ACT OF 1990, THE AGE DISCRIMINATION IN EMPLOYMENT ACT OF 1967, THE OLDER WORKERS BENEFIT PROTECTION ACT, THE WORKER ADJUSTMENT AND RETRAINING NOTIFICATION ACT, THE FAIR LABOR STANDARDS ACT, THE CALIFORNIA FAIR EMPLOYMENT AND HOUSING ACT, THE FAMILY AND MEDICAL LEAVE ACT, THE CALIFORNIA FAMILY RIGHTS ACT, THE CALIFORNIA LABOR CODE, CLAIMS RELATING TO EMPLOYMENT STATUS, CLAIMS RELATING TO COMPENSATION (CASH, EQUITY, BONUS, OR OTHERWISE), CLAIMS RELATING TO CLASSIFICATION, AND CLAIMS OF HARASSMENT, DISCRIMINATION, WRONGFUL TERMINATION, AND BREACH OF CONTRACT. TO THE FULLEST EXTENT PERMITTED BY LAW, EXECUTIVE ALSO AGREES TO ARBITRATE ANY AND ALL DISPUTES ARISING OUT OF OR RELATING TO THE INTERPRETATION OR APPLICATION OF THIS AGREEMENT TO ARBITRATE, BUT NOT DISPUTES ABOUT THE ENFORCEABILITY, REVOCABILITY, OR VALIDITY OF THIS AGREEMENT TO ARBITRATE OR THE CLASS, COLLECTIVE, AND REPRESENTATIVE PROCEEDING WAIVER HEREIN. WITH RESPECT TO ALL SUCH CLAIMS AND DISPUTES THAT EXECUTIVE AGREES TO ARBITRATE, EXECUTIVE HEREBY EXPRESSLY AGREES TO WAIVE, AND DOES WAIVE, ANY RIGHT TO A TRIAL BY JURY. EXECUTIVE FURTHER UNDERSTANDS THAT THIS AGREEMENT TO ARBITRATE ALSO APPLIES TO ANY DISPUTES THAT THE COMPANY MAY HAVE WITH EXECUTIVE. EXECUTIVE UNDERSTANDS THAT NOTHING IN THIS AGREEMENT REQUIRES EXECUTIVE TO ARBITRATE CLAIMS THAT CANNOT BE ARBITRATED UNDER APPLICABLE LAW, SUCH AS CLAIMS UNDER THE SARBANES-OXLEY ACT.

B. Procedure. EXECUTIVE AGREES THAT ANY ARBITRATION WILL BE ADMINISTERED BY JAMS PURSUANT TO ITS EMPLOYMENT ARBITRATION RULES & PROCEDURES (THE “JAMS RULES”), WHICH ARE AVAILABLE AT http://www.jamsadr.com/rules-employment-arbitration/. IF THE JAMS RULES CANNOT BE ENFORCED AS TO THE ARBITRATION,

Exhibit 10.47.1

THEN THE PARTIES AGREE THAT THEY WILL ARBITRATE THIS DISPUTE UNDER THE CALIFORNIA ARBITRATION ACT (CALIFORNIA CODE CIV. PROC. § 1280 ET. SEQ. (THE “CAA”)). EXECUTIVE AGREES THAT THE ARBITRATOR SHALL HAVE THE POWER TO DECIDE ANY MOTIONS BROUGHT BY ANY PARTY TO THE ARBITRATION, INCLUDING MOTIONS FOR SUMMARY JUDGMENT AND/OR ADJUDICATION, AND MOTIONS TO DISMISS AND DEMURRERS, APPLYING THE STANDARDS SET FORTH UNDER THE CALIFORNIA CODE OF CIVIL PROCEDURE. EXECUTIVE AGREES THAT THE ARBITRATOR SHALL ISSUE A WRITTEN DECISION ON THE MERITS. EXECUTIVE ALSO AGREES THAT THE ARBITRATOR SHALL HAVE THE POWER TO AWARD ANY REMEDIES AVAILABLE UNDER APPLICABLE LAW, AND THAT THE ARBITRATOR MAY AWARD ATTORNEYS’ FEES AND COSTS TO THE PREVAILING PARTY, WHERE PERMITTED BY APPLICABLE LAW. EXECUTIVE AGREES THAT THE DECREE OR AWARD RENDERED BY THE ARBITRATOR MAY BE ENTERED AS A FINAL AND BINDING JUDGMENT IN ANY COURT HAVING JURISDICTION THEREOF. EXECUTIVE UNDERSTANDS THAT THE COMPANY WILL PAY FOR ANY ADMINISTRATIVE OR HEARING FEES CHARGED BY THE ARBITRATOR OR JAMS EXCEPT THAT EXECUTIVE SHALL PAY ANY FILING FEES ASSOCIATED WITH ANY ARBITRATION THAT EXECUTIVE INITIATES, BUT ONLY SO MUCH OF THE FILING FEES AS EXECUTIVE WOULD HAVE INSTEAD PAID HAD EXECUTIVE FILED A COMPLAINT IN A COURT OF LAW THAT WOULD HAVE HAD JURISDICTION OVER SUCH COMPLAINT. EXECUTIVE AGREES THAT THE ARBITRATOR SHALL ADMINISTER AND CONDUCT ANY ARBITRATION IN ACCORDANCE WITH CALIFORNIA LAW, INCLUDING THE CALIFORNIA CODE OF CIVIL PROCEDURE AND THE CALIFORNIA EVIDENCE CODE, AND THAT THE ARBITRATOR SHALL APPLY SUBSTANTIVE AND PROCEDURAL CALIFORNIA LAW TO ANY DISPUTE OR CLAIM, WITHOUT REFERENCE TO RULES OF CONFLICT-OF-LAW. TO THE EXTENT THAT THE JAMS RULES CONFLICT WITH CALIFORNIA LAW, CALIFORNIA LAW SHALL TAKE PRECEDENCE. EXECUTIVE AGREES THAT ANY ARBITRATION UNDER THIS AGREEMENT SHALL BE CONDUCTED IN SANTA CLARA COUNTY, CALIFORNIA.

C. Remedy. EXCEPT FOR THE PURSUIT OF ANY PROVISIONAL REMEDY PERMITTED BY THE CAA OR OTHERWISE PROVIDED BY THIS AGREEMENT, EXECUTIVE AGREES THAT ARBITRATION SHALL BE THE SOLE, EXCLUSIVE, AND FINAL REMEDY FOR ANY DISPUTE BETWEEN THE COMPANY AND EXECUTIVE.

D. Administrative Relief. EXECUTIVE UNDERSTANDS THAT THIS AGREEMENT DOES NOT PROHIBIT EXECUTIVE FROM PURSUING AN ADMINISTRATIVE CLAIM WITH A LOCAL, STATE, OR FEDERAL ADMINISTRATIVE BODY OR GOVERNMENT AGENCY THAT IS AUTHORIZED TO ENFORCE OR ADMINISTER LAWS RELATED TO EMPLOYMENT, INCLUDING, BUT NOT LIMITED TO, THE DEPARTMENT OF FAIR EMPLOYMENT AND HOUSING, THE EQUAL EMPLOYMENT OPPORTUNITY COMMISSION, THE NATIONAL LABOR RELATIONS BOARD, THE SECURITIES AND EXCHANGE COMMISSION, OR THE WORKERS’ COMPENSATION BOARD. THIS AGREEMENT DOES, HOWEVER, PRECLUDE EXECUTIVE FROM PURSUING A COURT ACTION REGARDING ANY SUCH CLAIM, EXCEPT AS PERMITTED BY LAW.

E. Voluntary Nature of Agreement. EXECUTIVE ACKNOWLEDGES AND AGREES THAT EXECUTIVE IS EXECUTING THIS AGREEMENT VOLUNTARILY AND WITHOUT ANY DURESS OR UNDUE INFLUENCE BY THE COMPANY OR ANYONE ELSE. EXECUTIVE FURTHER

Exhibit 10.47.1

ACKNOWLEDGES AND AGREES THAT EXECUTIVE HAS CAREFULLY READ THIS AGREEMENT AND THAT EXECUTIVE HAS ASKED ANY QUESTIONS NEEDED FOR EXECUTIVE TO UNDERSTAND THE TERMS, CONSEQUENCES, AND BINDING EFFECT OF THIS AGREEMENT AND FULLY UNDERSTAND IT, INCLUDING THAT EXECUTIVE IS WAIVING EXECUTIVE’S RIGHT TO A JURY TRIAL. FINALLY, EXECUTIVE AGREES THAT EXECUTIVE HAS BEEN PROVIDED AN OPPORTUNITY TO SEEK THE ADVICE OF AN ATTORNEY OF EXECUTIVE’S CHOICE BEFORE SIGNING THIS AGREEMENT.

11. Proprietary Information. Executive agrees to continue to be bound by the Telenav, Inc. Proprietary Information Agreement (the “Proprietary Information Agreement”) attached to Executive’s Offer Letter dated May 29, 2019 (the “Offer Letter”). Executive understands and agrees that nothing in this Agreement or the Proprietary Information Agreement or any other agreement Executive signs with the Company is intended to limit Executive’s rights to discuss the terms, wages, and working conditions of Executive’s employment, nor to deny Executive the right to disclose information pertaining to sexual harassment or any unlawful or potentially unlawful conduct, as protected by applicable law.

12. Miscellaneous Provisions.

(a) Amendment. No provision of this Agreement will be modified, waived or discharged unless the modification, waiver or discharge is agreed to in writing and signed by Executive and by an authorized officer of the Company (other than Executive) that is expressly designated as an amendment to this Agreement.

(b) Waiver. No waiver by either party of any breach of, or of compliance with, any condition or provision of this Agreement by the other party will be considered a waiver of any other condition or provision or of the same condition or provision at another time.

(c) Headings. All captions and section headings used in this Agreement are for convenient reference only and do not form a part of this Agreement.

(d) Entire Agreement. This Agreement, together with the Proprietary Information Agreement and [Offer Letter], represents the entire agreement and understanding between the parties as to the subject matter herein and supersedes all prior or contemporaneous agreements whether written or oral. With respect to Company equity awards granted to Executive on or after the date of this Agreement, the acceleration of vesting provisions provided herein will apply to such Company equity awards except to the extent otherwise explicitly provided in the applicable award agreement. This Agreement may be modified only by agreement of the parties by a written instrument executed by the parties that is designated as an amendment to this Agreement.

(e) Governing Law. With the exception of the arbitration requirements set forth in Section 10 (to which the FAA will apply as set forth in Section 10), this Agreement will be governed by the laws of the State of California without regard to California’s conflicts-of-law rules that may result in the application of the laws of any jurisdiction other than California.

Exhibit 10.47.1

(f) Severability. The invalidity or unenforceability of any provision or provisions of this Agreement will not affect the validity or enforceability of any other provision hereof, which will remain in full force and effect.

(g) Withholding. All payments made pursuant to this Agreement will be subject to all applicable withholdings, including all applicable income and employment tax withholdings, as determined in the Company’s reasonable judgment.

(h) Acknowledgment. Executive acknowledges that Executive has had the opportunity to discuss this matter with and obtain advice from Executive’s private attorney, has had sufficient time to, and has carefully read and fully understands all the provisions of this Agreement, and is knowingly and voluntarily entering into this Agreement.

(i) Counterparts. This Agreement may be executed in counterparts, and each counterpart will have the same force and effect as an original and will constitute an effective, binding agreement on the part of each of the undersigned.

[Signature Page Follows]

Exhibit 10.47.1

IN WITNESS WHEREOF, each of the parties has executed this Agreement, in the case of the Company by its duly authorized officer, as of the day and year set forth below.

COMPANY TELENAV, INC.

By: /s/ HP Jin

Title: CEO

EXECUTIVE By: /s/ Steve Debenham 8/13/19

Steve Debenham

Exhibit 10.48

Advisor Agreement

This Advisor Agreement (“Agreement”) is made by and between Telenav, Inc. , a Delaware corporation with its principal offices located at 4655 Great America Parkway, Suite 300, Santa Clara, California 95054 (which, together with its parent or subsidiary entities shall be hereinafter referred to as, "Telenav" or the “Company”), and

Name: Karen C. Francis

Principal Address: P.O. Box 7211, Menlo Park, CA 94025

Place of Organization: N/A

(hereinafter, "Advisor"). The term “Advisor” shall refer to and include, collectively, any employees, members, agents, affiliates, Advisors or contractors of or directly engaged by Advisor performing services for Telenav hereunder.

By signing this Agreement, the parties agree to the terms and conditions set forth on this page and on the attached Terms and Conditions. This Agreement is effective as of the date of the Company’s 2019 Annual Meeting of Stockholders and in conjunction with the end of Advisor’s service as a member of the Company’s Board of Directors (“Effective Date”), and will automatically terminate on November 20, 2021 (“Termination Date”), unless renewed, extended or earlier terminated pursuant to Section 5 of the attached Terms and Conditions. Each person signing this Agreement represents and warrants that such person is fully authorized to execute and enter into this Agreement on behalf of the company or entity named above and below with respect to her signature.



Karen C. Francis	TELENAV, INC.

/s/ Karen Francis	/s/ HP Jin
Name: Karen Francis	Name: HP Jin
Title: Advisor	Title: CEO
Dated: 10/25/2019	Dated: 10/24/2019

Non-Disclosure Agreement entered into on October 17, 2019 (the “NDA”).

___________________________________________________________________________________________________________________________________________________________
TELENAV Advisor AGT (10-2019) Confidential Page 1 of 10

________ Advisor’s Initials

Exhibit 10.48

Terms and Conditions

In consideration of the promises contained and consideration provided in this Agreement, Telenav agrees to retain Advisor to perform certain services subject to the terms and conditions set forth below and in the Statement of Work attached as Exhibit A (which Exhibit A, together with the other exhibits attached hereto, are incorporated into this Agreement in full by reference as material parts hereof).

1. Statement of Work. The services that Advisor is to perform and/or deliverables that Advisor is to provide under this Agreement are identified in the attached Statement of Work (the “Services”).

2. Compensation. The compensation to be paid Advisor pursuant to this Agreement shall be in consideration for all Services rendered. Payment will be made in the amount and manner specifically provided in the payment schedule attached hereto as Exhibit B, and the total amount due or owing Advisor for Services performed hereunder shall not exceed the specified identified vesting benefit, unless and to the extent Telenav and Advisor agree in writing to a greater amount in the form of an amendment to Exhibit B. Advisor hereby waives, as a material inducement to Telenav’s agreement to enter this Agreement, any right to assert a claim or cause against Telenav based on an oral or other modification or amendment of the terms and conditions of this Agreement, the scope of Services or right to payment hereunder, and Advisor agrees that it will not assert any such claim or cause against Telenav (whether under the law of contract, quasi-contract or otherwise) or introduce into evidence any such oral or other modification or amendment, unless and to the extent such modification or amendment is agreed to in writing by Telenav. Advisor may not rely on any oral or other modification or amendment of or to the terms and conditions of this Agreement, the scope of Services or right to payment hereunder, unless and to the extent agreed to in writing by Telenav.

3. Travel and Other Expenses. All expenses shall be preapproved by Telenav in writing, and reimbursed as provided in Exhibit B.

4. Term. The term of this Agreement will begin on the Effective Date and will run until the Termination Date, unless renewed, extended or earlier terminated by the parties as provided herein.

5. Termination. Either party may terminate this Agreement or any of the Services to be provided hereunder without cause at any time, and for any or no reason, by giving the other party written notice of termination as provided on Exhibit A (“Termination for Convenience and Notice Period”), and either party may immediately terminate this Agreement or any of the Services to be provided with cause at any time by giving the other written notice of such cause. The effective date of such termination for convenience by either party will occur upon expiration of the indicated Termination for Convenience and Notice Period. The effective date of such termination for cause by either party will occur immediately upon delivery of such written notice.


(a)	After giving or receiving such notice, Advisor will consult with Telenav to determine what further work, if any, will be performed prior to the effective date of such termination (which such further work, if any, the parties will confirm in writing).


(b)	Termination with cause is appropriate in the event (i) of a breach by the other party of a material obligation hereunder or the NDA, (ii) the death or disability of Advisor, or (iii) the insolvency or bankruptcy or a reasonably apparent inability or unwillingness of or by the other party to perform its material obligations hereunder.

________ Advisor’s Initials

Exhibit 10.48

(c)

Upon the termination or expiration of a Statement of Work or of this Agreement, with or without cause and for any or for no reason, the terminating party will not be liable to the other party because of the fact or act of such termination for damages on account of the loss of prospective profits, expected business, good will, or on account of expenditures, leases or commitments in connection with the business of Telenav or of Advisor, or for any other reason whatsoever flowing from the fact or act of such expiration or termination.

(d)

Telenav’s sole obligation and liability to Advisor arising from the fact or act of termination or expiration shall be payment for: (a) Services actually and reasonably performed up to the effective date of termination or expiration (on the part of Telenav), and (b) reasonable completion of Services actually requested up to the effective date of termination or expiration (on the part of Advisor, provided that Telenav has made or is capable of making payment due and owing with respect to such Services) and (c) such other benefits or provisions, if any, as identified on Exhibit A with respect to the Termination for Convenience and Notice Period. However, the fact or act of termination or expiration shall not otherwise relieve either party from any other obligation, liability or duty to the other, whether expressly provided herein, under the NDA or under law.

6. Survival of Obligations. The following obligations will survive termination or expiration of this Agreement for any reason, except as provided in this Agreement:


(a)	Obligations relating to non-use and non-disclosure of Confidential Information, as provided in the NDA;


(b)	Obligations to make payments of amounts that are due prior to termination or expiration; and


(c)	Obligations specifically set forth in Sections 5, 6, 12, 13, and 17 through 30.

7. Inspection and Acceptance. N/A

8. Warranty and Standards for Performance of Work. N/A.

9. Independent Status. It is the express intention of the parties to this Agreement that Advisor is and shall continue to act throughout the Term and in conjunction with the performance of any Services hereunder: (a) as an independent contractor, and (b) not as an employee, agent, joint venturer, or partner of Telenav. Nothing in this Agreement shall be interpreted or construed as creating or establishing an employment relationship between Telenav and Advisor, or any reasonable expectation or basis for reliance on the part of Advisor of such a relationship existing or developing during the term hereof. Both parties understand and agree that Advisor may perform services for others during the term of this Agreement.

10. Performance of Services/Use of Telenav Resources. The parties understand and agree that Advisor will have the sole discretion to determine the method, means, and location of performing the Services, and that Telenav has no right to, and will not, control or determine the method, means, or place of the performance of the Services, except for such Services which, by their nature, require performance at Telenav’s facilities and in conjunction or cooperation with Telenav’s employees. In the event Advisor is authorized to use Telenav resources to perform Services or provide products hereunder, Advisor agrees to use such resources exclusively in connection with such Services and/or products, and for no other purpose.

11.Employment of Assistants/Insurance/Safety.

________ Advisor’s Initials

Exhibit 10.48

(a)

If Advisor employs assistants to help perform the Services or provide deliverables, Advisor will carry throughout the Term statutory Worker's Compensation and General and Contractual Liability and Professional Liability (if applicable) insurance in amounts satisfactory to Telenav and commercially reasonable in light of Advisor’s business and operations. Advisor alone has responsibility for such coverage. Upon reasonable request, Advisor shall furnish certificates of insurance as evidence of such coverage and naming Telenav as additional insured and allowing Telenav to assert rights and make claims thereunder.

(b)

Advisor agrees to comply strictly with all local, municipal, regional and country safety and health laws, orders and regulations applicable to the performance of the Services provided hereunder. While on the Telenav site, or that of its customers or other third party, Advisor and its employees, contractors and agents will be required to observe at all times all procedures and policies of Telenav concerning safety and proper workplace conduct (including all requirements stated within Telenav’s injury and illness prevention program and the applicable environmental health and safety policies of Telenav and any third party site at which the Services are being performed). Failure to observe such procedures and policies shall be a basis for immediate termination of this Agreement by Telenav.

12. Obligations of Advisor.


(a)	Advisor is solely responsible for all taxes, withholdings, and other similar statutory obligations with respect to itself and its employees, agents or affiliates.

(b)

Advisor agrees and understands with respect to itself and its employees, agents or affiliates. that it is not entitled to and will not be eligible to receive any of the benefits which Telenav may make available to its employees, such as group insurance, workers' compensation, disability insurance, vacation, sick pay, profit-sharing, incentive compensation, bonus or commission programs, stock purchase programs, or retirement benefits. Except and only to the extent expressly provided in Exhibit B, this shall also prohibit participation in any stock award programs.

13. Confidential Information.

(a)

Advisor understands that during the course of performing the Services hereunder, it may receive or have or obtain access to Confidential Information of Telenav or its clients. Accordingly, Advisor understands and agrees that any such Confidential Information disclosed to Advisor, intentionally by Telenav or otherwise, shall be subject to the terms and conditions of the NDA entered by the parties and identified above, and deemed incorporated in full as a material part hereof.

(b)

Advisor will not, during the Term, improperly use or disclose any proprietary information or trade secrets of any former or current employer or other person or entity with which Advisor has a duty to keep in confidence, and that Advisor will not bring onto the premises of Telenav any unpublished document or proprietary information belonging to such employer, person or entity unless consented to in writing by such employer, person or entity.


(c)	Advisor recognizes that Telenav has received and in the future will receive from clients and third parties confidential or proprietary information which is subject to a duty on Telenav's

________ Advisor’s Initials

Exhibit 10.48

part to maintain in strict confidence and to use only for certain limited purposes. Advisor agrees that Advisor owes Telenav and such third parties, during the Term and thereafter, a duty to hold all such confidential or proprietary information in the strictest confidence and not to disclose it to any person, firm or corporation or to use it except and to the specific extent necessary to carry out the Services for Telenav expressly provided hereunder. Advisor acknowledges, understands and agrees that its improper disclosure of such confidential or proprietary information, intentional or otherwise, will cause immediate, serious and irreparable injury to Telenav, its clients and third parties, for which inadequate remedy exists at law.


(d)	Advisor represents that performance of all the terms of this Agreement, including the performance of Services hereunder, will not breach any agreement to keep in confidence confidential information acquired by Advisor prior to the execution of this Agreement or otherwise, to Advisor’s knowledge, the trade secret, patent, copyright or other intellectual property right of a third party.


(e)	Upon the termination of this Agreement, or upon Telenav's earlier request, Advisor will deliver to Telenav all of Telenav's property or Confidential Information that Advisor may have in Advisor's possession or control.


(f)	In the event Advisor employs assistants Advisor will assure that such employees are bound by confidentiality terms at least as stringent as those set forth herein and in the NDA.

14. Inventions. N/A

15. Employment Eligibility. Advisor represents and warrants that: Advisor and all persons it employs to perform Services hereunder are citizens of the United States or holders of a valid and current Alien Registration Receipt Card and eligible to hold employment and perform the Services, under the laws of the United States and the State of California (or are otherwise legally fully able and authorized to perform the Services in the country or geographic area in which such Services are to be provided).

16. Gratuities/Business Dealings. Advisor represents and warrants that it has not offered or given, and shall not offer or give, to Telenav or any its employees, agents or affiliates, any gratuity, payment or benefit (other than the performance of Services expressly provided hereunder) in order to secure any favor or business from Telenav, or to influence Telenav with respect to this transaction or business generally between the parties. Advisor shall promptly disclose to Telenav in writing any separately existing or previous employment or other work relationship or investment interest of any manner, involving Advisor and Telenav, and their respective employees, agents or affiliates. Advisor acknowledges receipt of or an opportunity to review Telenav’s Code of Business Conduct (“Code”), and agrees to abide in all material respects by its terms and conditions during the term of this Agreement. The Code is also available for review via Telenav’s website at www.Telenav.com.

17. Stock Trading Policy. All Telenav contractors and Advisors, including Advisor, are prohibited from trading in Telenav stock at any time when in the possession of Material, Non-public Information about Telenav or our business. Material, Non-public Information is any information concerning Telenav’s business, prospects, strategic decisions or direction, financial condition, major sales or customer developments, or significant operational or legal information, developments or liabilities that an investor might consider important in deciding whether to buy or sell Telenav stock, or which could affect the market price for Telenav stock. Examples of Material, Non-public Information include, but are not limited to: actual or estimated quarter-end or year-end financial results or changes in condition; possible mergers, acquisitions or divestitures; purchases or sales of investments in companies; significant customer contract “wins” or losses; significant product

________ Advisor’s Initials

Exhibit 10.48

discoveries or developments; threatened or actual major litigation or developments in pending cases, for or against Telenav; threatened or actual actions against Telenav by regulatory entities or reporting of financial errors or irregularities; and major events relating to Telenav’s business or changes in business strategies, or key executive departures. Advisor agrees to abide by this policy.

18. Solicitation of Employment. Advisor agrees, during the Term and for the period of 12 months thereafter, (a) not to recruit, solicit or inquire for employment, directly or indirectly, or to advise or assist others in recruiting, soliciting or inquiring for employment, any then-current Company employee, or (b) to advise or assist others, directly or indirectly, in soliciting or transferring Company business to any other party. For purposes of clarification, response to public job postings by Company employees are not deemed to be solicitation of employment under this section.

19. Compliance with Laws; FCPA Compliance. Advisor agrees to comply, at all times during the Term, with all applicable governmental laws, statutes, ordinances, rules, regulations and other requirements, including such pertaining to environmental protection, wage, equal employment, non-discrimination, and workplace health and safety. Advisor and each of its employees, agents or Affiliates, shall at all times when performing Services, fully comply, in all material respects, with the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT ACT) Act of 2001. No part of the proceeds of any compensation, commission or retainer fee, as applicable paid to Advisor under this Agreement, will be used, directly or indirectly, for any payments to any governmental official or employee, political party, official of a political party, candidate for political office, or anyone else acting in an official capacity, in order to obtain, retain or direct business or obtain any improper advantage, in violation of the United States Foreign Corrupt Practices Act of 1977, as amended.

Upon Telenav’s reasonable request, Advisor agrees to provide prompt assurance and evidence of Advisor’s active compliance with any and all such governmental requirements.

20. Enforceability of Agreement/Venue and Jurisdiction. The parties agree that any dispute in the meaning, effect, or validity of this Agreement, and any cause, claim or action arising from this Agreement (and any Services or products provided hereunder), shall be governed by, enforceable under and resolved in accordance with the laws of the State of California, without regard to the conflict of laws provisions. The parties further agree that if one or more provisions of this Agreement are held to be unenforceable under applicable California law, such provision(s) shall be excluded from this Agreement and the balance of the Agreement shall be interpreted and given effect as if such provision were so excluded. The parties consent to Santa Clara County, California, and any United States District Court or Superior Court of competent jurisdiction located within its boundaries, as the exclusive venue and jurisdiction of any litigation or other dispute resolution modality; except that either party may take action in any jurisdiction to prevent disclosure of Confidential Information, or to enforce a judgment or other decision.

21. Assignment. Neither party may assign this Agreement without the express written consent of the other party; provided, however, that Telenav may assign its rights and obligations hereunder to a subsidiary or affiliated entity, or to a successor entity in the event of corporate merger, acquisition or other form of corporate reorganization, or acquisition of substantially all of Telenav’s assets or common stock.

22. Arbitration. The parties agree that any and all disputes that either party may have with the other party which arise out of this Agreement, or any right or obligation hereunder, shall be resolved through final, binding and non-appealable arbitration in Santa Clara County, California in accordance with the rules and regulations of the American Arbitration Association then in-effect. Both parties understand and agree that the arbitration shall be instead of any civil litigation and that the arbitrator’s decision shall be final, binding and, upon entry

________ Advisor’s Initials

Exhibit 10.48

by a court of competent jurisdiction, non-appealable to the fullest extent permitted by law and enforceable by any court having jurisdiction thereof. If the parties cannot agree on an arbitrator, the Superior Court of the county of venue shall appoint the arbitrator. The arbitrator shall be empowered and authorized to award any equitable remedy, including specific performance. The arbitrator is not empowered and is without jurisdiction to award either party: (a) special, exemplary, indirect, consequential, incidental or punitive damages, or (b) its attorneys’ fees and/or costs and expenses incurred in the arbitration (whether such party is the prevailing party).

Filing a judicial action or recording a notice of pending action, order of attachment, receivership, injunction, or other provisional remedies shall not waive arbitration rights nor is recourse to such judicial relief precluded by the existence or availability of arbitration hereunder. The parties shall split equally the arbitrator’s fees.

23. Intellectual Property; Specific Indemnity. N/A.

24. General Indemnity. N/A.

25. Liability Limitation. EXCEPT AS PROVIDED IN SECTIONS 13, 23 AND 24, NOTWITHSTANDING ANYTHING OTHERWISE TO THE CONTRARY, IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER FOR ANY SPECIAL, EXEMPLARY, INDIRECT, CONSEQUENTIAL, INCIDENTAL OR PUNITIVE DAMAGES.

26. Waiver of Jury/Limitations of Actions; Attorney’s Fees. Telenav and Advisor hereby agree, to the fullest extent permitted by law, to waive any right or claim to adjudication by jury of any claim or cause asserted against the other and arising hereunder. In any judicial proceeding arising out of this Agreement, or Services or products performed or provided hereunder, neither party is entitled to recover its attorneys’ fees or costs incurred pertaining to such proceeding (whether such party is the prevailing party).

27. Entire Understanding. This Agreement contains the entire understanding of the parties regarding its subject matter, and supersedes any and all prior communications, representations and agreements, whether written or oral. This Agreement can only be modified to the extent by a subsequent written agreement executed by the designated Advisor and Telenav Notice Contact identified above.

28. No Obligation to Proceed with Additional Services or Business Relationship. Except as expressly provided herein, neither party has any obligation by virtue of this Agreement to proceed with any transaction between them, and any proposal, design or similar item presented to either party by the other shall be without obligation or restriction on the party.

29. Notices. All notices required or given herewith shall be addressed to Telenav or Advisor at the designated addresses and to the attention of the designated Notice Contact identified above, by registered mail, special delivery, or by certified courier service.

30. Waiver. Failure by a party to take affirmative action with respect to any breach of these terms and conditions by the other party shall not be construed as a waiver of that breach or of future breaches.

/ / /

________ Advisor’s Initials

Exhibit 10.48

EXHIBIT A

Statement of Work

The scope of services to be performed under this Agreement is specifically restricted to the advice and/or specific advisory services described below (the “Services”):

Such services as may reasonably be requested by Telenav, including through its C.E.O., or Board of Directors, to assist and advise the Company and the Board in support of the Company’s continuing business initiatives and outreach to the automotive industry; provided, however, that such requested services may not unduly interfere with Advisor’s services during the Term to any new employer.

Commencement Date: the date of the Company’s 2019 Annual Meeting of Stockholders and in conjunction with the end of Advisor’s service as a member of the Company’s Board of Directors

Completion Date: November 20, 2021

Termination for Convenience and Notice Period

Either party may terminate this Agreement providing 60 days advance written notice to the other party.

Notwithstanding the foregoing, Telenav agrees not to terminate the Advisor Agreement for convenience at any time prior to the first six (6) months of the Term.

________ Advisor’s Initials

Exhibit 10.48

EXHIBIT B

As full and complete compensation for performing the Services, Advisor will be entitled to the following compensation and benefits:

Status of Existing TNAV Equity

To the extent Advisor holds existing equity awards as a result of Advisor’s previous employment with or services as a director to Telenav, Telenav shall deem, as part of the compensation for Services, that Advisor’s performance of the Services hereunder and during the Term shall not be considered a break in service of Advisor, from (a) the termination of Advisor’s prior employment with or services as a director to the Company to (b) the commencement of the continuing service relationship pursuant to this Agreement. For this reason, any rights Advisor may hold as of the Effective Date with respect to equity awards which existed as of the date of termination of Advisor’s employment relationship withor sewrvices as a director to the Company, shall be deemed in full force and effect and continuing through the Term.

Additional Equity Grant

An equity award to be effective as of the 2019 Annual Meeting of Stockholders, and upon and subject to approval at such meeting by the Company’s stockholders of the proposed 2019 Equity Incentive Plan (the “2019 Plan”), in the form of restricted stock units (“RSUs”), each of which represents the right to receive upon vesting one share of the Company’s Common Stock (the “RSU Award”):


•	The number of shares subject to the RSU Award will be twice the number of shares represented by the Annual Award each continuing director of the Company will automatically receive as of the 2019 Annual Meeting of Stockholders pursuant to the terms of the Company’s 2019 Plan


•	The RSU Award will vest in equal quarterly installments over the two-year term of the Advisor Agreement, as of the 10^th day of the last month of such quarter; and


•	The RSU Award is subject to vesting acceleration as follows:


◦	Equity Vesting Acceleration upon Termination for Convenience:

In the event of any termination by Telenav at any time for convenience, shares under the RSU Award that would have otherwise vested over the six-month period following the effective date of such termination by Telenav for convenience will be deemed to and shall be accelerated to the effective date of such termination.


◦	Equity Vesting Acceleration upon Change of Control:

In the event of a Change of Control, as that term is understood and defined in the Company’s 2019 Plan, that occurs during the Term and prior to the first year anniversary of the Effective Date, then the shares under the RSU Award that would have otherwise vested during the Term and prior to or as of such first year anniversary will be deemed to and shall be accelerated to the effective date of such Change of Control

________ Advisor’s Initials

Exhibit 10.48

In the event of a Change of Control, as that term is understood and defined in the Company’s 2019 Plan, that occurs during the Term and after the first year anniversary of the Effective Date, then the shares under the RSU Award that would have otherwise vested during the Term but after such first year anniversary will be deemed to and shall be accelerated to the effective date of such Change of Control


•	The RSU Award is subject to approval by the Company’s stockholders of the 2019 Plan, which the Company is submitting to its our stockholders for approval at the 2019 Annual Meeting of Stockholders

Cash Compensation: The Company will pay to Advisor during the Term quarterly cash fees equivalent in amount to the quarterly cash retainer fee a member of the Company’s Board of Directors receives over the same period under the Company’s compensation policy for non-management members of its Board.

Taxes

Advisor is fully and solely responsible and liable for reporting and payment of taxes, including personal or entity taxes, assessable on any income payable to Advisor hereunder (including with respect to any equity vesting during and as of the term of the Services).

Payment for Services

Advisor understands and agrees that the total amount due or owing Advisor for any and all Services performed hereunder by Advisor and/or its employees shall be limited to the compensation and benefits provided above, unless and to the extent Telenav and Advisor agree in writing to a greater amount in the form of an amendment to this Exhibit B.

Payment for Expenses

The compensation and benefits provided above shall not include costs and expenses in the event and to the extent Telenav expressly agrees above to reimburse Advisor for such costs and expenses. However, other than such actual, reasonable and reimbursable costs and expenses, the compensation and benefits provided above shall be Advisor’s sole and complete compensation and benefit due and owing for the Services or any other right or expectation under the Agreement, and along with payment of such actual, reasonable and reimbursable costs and expenses shall be Telenav’s sole and complete liability to Advisor for the Services rendered and any and all costs and expenses reimbursed to Advisor under the Agreement.

With respect to any properly and timely submitted expenses payment terms will be net forty-five (45) days from receipt of invoice. The preprinted terms and conditions of any invoice, PO or other ordering document, confirmation or other business form issued by Advisor in connection with this Agreement shall not be binding on Telenav and shall not be deemed to modify this Agreement.

________ Advisor’s Initials

Exhibit 31.1

CERTIFICATION OF THE PRESIDENT AND CHIEF EXECUTIVE OFFICER

PURSUANT TO SECURITIES EXCHANGE ACT RULES 13a-14(a) AND 15d-14(a),

AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Dr. HP Jin, certify that:


1.	I have reviewed this quarterly report on Form 10-Q of Telenav, Inc.;


2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;


3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;


4.	The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:


a.	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;


b.	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;


c.	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and


d.	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and


5.	The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):


a.	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and


b.	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.



Date:	November 8, 2019	By:	/s/ Dr. HP JIN
			Dr. HP Jin
			President and Chief Executive Officer

Exhibit 31.2

CERTIFICATION OF THE CHIEF FINANCIAL OFFICER

PURSUANT TO SECURITIES EXCHANGE ACT RULES 13a-14(a) AND 15d-14(a),

AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Adeel Manzoor, certify that:


1.	I have reviewed this quarterly report on Form 10-Q of Telenav, Inc.;


2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;


3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;


4.	The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:


a.	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;


b.	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;


c.	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and


d.	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and


5.	The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):


a.	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and


b.	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.



Date:	November 8, 2019	By:	/s/ ADEEL MANZOOR
			Adeel Manzoor
			Chief Financial Officer

Exhibit 32.1

CERTIFICATION OF PRESIDENT AND CHIEF EXECUTIVE OFFICER

PURSUANT TO 18 U.S.C. § 1350, AS ADOPTED PURSUANT TO SECTION 906

OF THE SARBANES-OXLEY ACT OF 2002

I, Dr. HP Jin, the president and chief executive officer of Telenav, Inc. (the “Company”), certify for the purposes of 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge,

(i)the Quarterly Report of the Company on Form 10-Q for the three months ended September 30, 2019 (the “Report”), fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(ii)the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.



Date:	November 8, 2019	By:	/s/ Dr. HP JIN
			Dr. HP Jin
			President and Chief Executive Officer

Exhibit 32.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER

PURSUANT TO 18 U.S.C. § 1350, AS ADOPTED PURSUANT TO SECTION 906

OF THE SARBANES-OXLEY ACT OF 2002

I, Adeel Manzoor, the chief financial officer of Telenav, Inc. (the “Company”), certify for the purposes of 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge,

(ii)the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.



Date:	November 8, 2019	By:	/s/ ADEEL MANZOOR
			Adeel Manzoor
			Chief Financial Officer