UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549



Amendment No.
1

to

Form 10-K



(Mark One)

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



For the fiscal year ended December 31,
2018



☐ 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: 001-37862



PHUNWARE, INC.

(Exact name of registrant as specified
in its charter)



|Delaware                                                               |  | 26-4413774                                     
|---------------------------------------------------------------------- |  | -----------------------------------------------
|(State or other jurisdiction of
        incorporation or organization) |  | (I.R.S. Employer
        Identification Number)



|7800 Shoal Creek Blvd, Suite
        230-S
        Austin, TX |  | 78757         
|------------------------------------------------------------- |  | --------------
|(Address
    of principal executive offices)                  |  | (Zip
    Code)



Registrant’s telephone number: 512-693-4199



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



|Title
    of Each Class:                                                |  | Name
    of Each Exchange on Which Registered:
|----------------------------------------------------------------------- |  | ----------------------------------------------
|Common
    Stock, par value $0.0001 per share                           |  | The
    NASDAQ Capital Market                 
|Warrants
    to purchase one share of Common Stock                      |  | The
    NASDAQ Capital Market                 
|Units,
    each consisting of one share of Common Stock and one Warrant |  | The
    NASDAQ Capital Market                 



Securities registered pursuant to Section
12(g) of the Act: None



Indicate by check mark if the registrant
is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☒



Indicate by check mark if the registrant
is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act. Yes ☐ No ☒



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 if disclosure of
delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s
knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment
to this Form 10-K. ☒



Indicate by check mark whether the registrant
is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth
company. See definition 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 ☒



DOCUMENTS INCORPORATED
BY REFERENCE



The following documents (or parts thereof) are incorporated
by reference into the following parts of this Form 10-K: None


















EXPLANATORY NOTE



This Amendment No. 1 to Form 10-K (this
“Amendment”) amends the Annual Report on Form 10-K for the fiscal year ended December 31, 2018 (the “2018 Form
10-K”) originally filed on March 20, 2019 (the “Original Filing”) by Phunware, Inc. (“Phunware”,
the “Company”, “we”, or “us”), a Delaware corporation. We are filing this Amendment to present
the information required by Part III of Form 10-K as we will not file our definitive proxy statement within 120 days of the end
of our fiscal year ended December 31, 2018.



The certifications of the Company’s principal
executive officer and principal financial officer are filed with this Amendment as Exhibits 31.3 and 31.4 hereto. Because no financial
statements have been included with this Amendment and this Amendment does not contain or amend any disclosure with respect to
Items 307 and 308 of Regulation S-K, paragraphs 3, 4, and 5 of the certifications have been omitted. The Company is not including
the certification under Section 906 of the Sarbanes-Oxley Act of 2002 as no financial statements are being filed with this Amendment.



Except as described above, no other changes
have been made to the 2018 Form 10-K. Accordingly, this Amendment should be read in conjunction with the 2018 Form 10-K and with
our filings with the SEC subsequent to the 2018 Form 10-K.











TABLE OF CONTENTS



|            |                                                                                                    | PAGE
|----------- | -------------------------------------------------------------------------------------------------- | ----
|            |                                                                                                    |     
|PART III    |                                                                                                    | 1   
|Item 10.    | Directors,
    Executive Officers and Corporate Governance                                         | 1   
|Item 11.    | Executive
    Compensation                                                                         | 8   
|Item 12.    | Security
    Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters | 19  
|Item 13.    | Certain
    Relationships and Related Transactions, and Director Independence                      | 21  
|Item 14.    | Principal
    Accounting Fees and Services                                                         | 24  
|            |                                                                                                    |     
|PART
    IV | 25                                                                                                
|Item 15.    | Exhibits
    and Financial Statement Schedules                                                     | 25  



i







PART
III



Item 10. Directors, Executive Officers
and Corporate Governance.



Executive Officers and Directors



The following table sets forth the names,
ages and positions of our executive officers and directors as of April 23, 2018:



|Name                              |  | Age |  |  | Position                                         
|--------------------------------- |  | --- |  |  | -------------------------------------------------
|Executive Officers                |  |     |  |  |                                                  
|Alan S. Knitowski                 |  | 49  |  |  | Chief Executive Officer and
    Director         
|Luan Dang                         |  | 47  |  |  | Chief Technical Officer                          
|Matt Aune                         |  | 43  |  |  | Chief Financial Officer                          
|Randall Crowder                   |  | 38  |  |  | Chief Operating Officer and Director             
|Significant Employees             |  |     |  |  |                                                  
|Barbary Brunner(4)                |  | 54  |  |  | Chief Marketing Officer                          
|Matthew Lindenberger              |  | 40  |  |  | Executive Vice President of Engineering          
|Tushar Patel                      |  | 52  |  |  | Executive Vice President of Corporate Development
|Non-Employee Directors            |  |     |  |  |                                                  
|Prokopios (Akis) Tsirigakis(1)(2) |  | 64  |  |  | Chair                                            
|George Syllantavos(2)             |  | 54  |  |  | Director                                         
|Lori Tauber Marcus(2)(3)          |  | 56  |  |  | Director                                         
|Keith Cowan(1)(3)                 |  | 62  |  |  | Director                                         
|Kathy Tan Mayor(1)(3)             |  | 42  |  |  | Director                                         



| | (1) | Member
                                         of the Audit Committee
| | --- | ----------------------------------------------------------------------



| | (2) | Member
                                         of the Compensation Committee
| | --- | -----------------------------------------------------------------------------



| | (3) | Member
                                         of the Nominating and Corporate Governance Committee
| | --- | ----------------------------------------------------------------------------------------------------



| | (4) | On
                                         March 6, 2019, Barbary Brunner, notified Phunware of her intention to resign to pursue
                                         other opportunities. Ms. Brunner assisted in the transitions of her responsibilities
                                         through her departure date of March 15, 2019.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



EXECUTIVE OFFICERS



Alan Knitowski co-founded
Phunware and has served as its Chief Executive Officer and a member of the board of directors since February 2009. Prior to co-founding
Phunware, Mr. Knitowski served as President of Strategic Investments and Managing Director for Trymetris Capital Management, LLC,
or Trymetris, a hedge fund sponsor, from April 2004 to February 2009. Mr. Knitowski holds a B.S. in Industrial Engineering from
The University of Miami, an M.S. in Industrial Engineering from the Georgia Institute of Technology and an M.B.A from the Haas
School of Business at the University of California, Berkeley.



We believe Mr. Knitowski is qualified to
serve as a member of our board of directors because as co-founder he has extensive knowledge of our company and his comprehensive
background in information technology.



Luan Dang co-founded our
Phunware and has served as its Chief Technology Officer since February 2009. Prior to co-founding Phunware, he served as President
of Alternative Investments for Trymetris from April 2004 to February 2009. Mr. Dang holds a B.S. in Computer Engineering from
the University of California at San Diego and an M.S. in Computer Science from Stanford University.





1







Matt Aune has served as Phunware’s
Chief Financial Officer since August 2013. Mr. Aune previously served as its Director of Finance and Accounting from August 2011
to August 2013. Prior to joining Phunware, Mr. Aune was employed by Sony Computer Entertainment America as Senior Business Finance
and Operations Analyst from July 2010 to August 2011. From 2003 to 2009, Mr. Aune served in a variety of roles at Midway Games,
a video game developer and publisher, with his final role as the Senior Manager of Financial Planning and Analysis for Worldwide
Product Development. Mr. Aune holds a B.A. in Economics from the University of California, San Diego and an M.B.A. from San Diego
State University.



Randall Crowder has served
as Phunware’s Chief Operating Officer since February 2018. In September 2017, he founded and continues to serve as the Managing
Partner at Nove Ventures, a venture capital firm, which focuses on investing in established companies like Phunware that are looking
to leverage blockchain technology to complement their core business model. Since August 2009, Mr. Crowder has also been a co-founder
and Managing Partner at TEXO Ventures, which focuses primarily on tech-enabled health services. Mr. Crowder holds a B.S. in General
Management from the United States Military Academy at West Point and an M.B.A. from the McCombs School of Business at the University
of Texas at Austin.



We believe Mr. Crowder is qualified to
serve as a member of our board of directors because of his extensive knowledge and background in cryptosecurities and cryptocurrencies,
as well as his experience in information technology.



SIGNIFICANT EMPLOYEES



Matthew Lindenberger has
been our Executive Vice President of Engineering since April 2018. Prior to that, he was our Vice President of Engineering since
the Simplikate acquisition in June 2014. While at Simplikate, Mr. Lindenberger was their President and Chief Technology Officer
from June 2003 to June 2014.



Tushar Patel has been our
Executive Vice President of Corporate Development since the acquisition of Simplikate in June 2014. Prior to that, Mr. Patel was
founder and CEO of Simplikate since Feb 2002. Mr. Patel holds a B.B.A in Management from the University of Texas at Austin.



NON-EMPLOYEE DIRECTORS



Prokopios (Akis) Tsirigakis
served as Stellar’s Chairman of the Board of Directors, President and co-Chief Executive Officer since December 2015. From
May 2011 until October 2013, Mr. Tsirigakis co-founded and served as Chairman and Co-CEO of Nautilus Marine, a special purpose
acquisition company that completed an initial public offering on July 16, 2011 and was listed on Nasdaq. Mr. Tsirigakis has served
as the CEO of Nautilus Offshore Services Inc., an offshore service vessel owner and the successor of Nautilus Marine, since October
2013 and as a Vice President of Dryships, Inc. (Nasdaq: DRYS), which acquired Nautilus Offshore Services Inc., since December
2015. From May 2005 to November 2007, he co-founded and served as Chairman of the Board, Chief Executive Officer and President
of, Star Maritime (AMEX:SEA), a blank check company. From November 2007 until February 2011, he was the President and Chief Executive
Officer of, Star Bulk Carriers Corp., a dry-bulk ship-owning company and the successor of Star Maritime. From November 2003 until
November 2007, he served as Managing Director of Oceanbulk Maritime S.A., a company that operated and managed dry bulk vessels.
From November 1998 to November 2007, Mr. Tsirigakis established and served as the Managing Director of Combine Marine Inc., a
company providing ship management services to third parties. From 1991 to 1998, Mr. Tsirigakis was the Vice-President and Technical
Director of Konkar Shipping Agencies S.A. of Athens, after having served as Konkar’s Technical Director from 1984 to 1991.
From 1981 to 1984, Mr. Tsirigakis was the Technical Manager of Konkar’s affiliate, Arkon Shipping Agencies Inc. of New York.
From 2011 to 2015, Mr. Tsirigakis served as a director of Ocean Rig UDW Inc. (Nasdaq: ORIG). Mr. Tsirigakis received his Master’s
Degree (1979) and B.Sc. in Naval Architecture from The University of Michigan, Ann Arbor, USA. We believe Mr. Tsirigakis is well-qualified
to serve as a member of the Board due to his public company experience, business leadership, operational experience and experience
in a prior blank check offering, such as Star Maritime and Nautilus Marine.



We believe Mr. Tsirigakis is qualified
to serve as a member of our board of directors because of his extensive leadership experience in serving as an executive officer
of several public companies and experience serving on the boards of directors and audit committees of several public companies.
We believe Mr. Tsirigakis’ experience on several audit committees over the years will help us implement sound corporate
governance policies and streamlined corporate processes that will optimize our internal processes both in terms of efficiency
and implementing checks and balances.





2







George Syllantavosserved
as Stellar’s co-Chief Executive Officer, Chief Financial Officer, Secretary and Director since December 2015. Mr. Syllantavos
co-founded in February 2013 and is Chief Executive Officer of, Nautilus Energy Management Corp. (not affiliated with Nautilus
Offshore Services Inc.), a maritime energy services company involved in maritime project business development and ship management
focusing on the offshore supply and gas sectors. From September 2009 to December 2016, he was the President, Secretary, Treasurer
and sole director of BTHC X, Inc. (OTCBB: BTXI) and has been serving on the company’s board of directors since its merger
with iOra Software Ltd. From May 2011 until February 2013, Mr. Syllantavos co-founded and served as Co-CEO and CFO of Nautilus
Marine, a special purpose acquisition company that completed an initial public offering on July 16, 2011 and was listed on Nasdaq.
He served as the CFO of Nautilus Offshore Services Inc., an offshore service vessel owner and the successor of Nautilus Marine,
from February 2013 until April 2014. From November 2007 to August 2011, he served as Chief Financial Officer, Secretary and Director
of Star Bulk Carriers Corp., a dry-bulk ship-owning company. From May 2005 to November 2007, he served as the Chief Financial
Officer, Secretary and Director of Star Maritime (AMEX:SEA), its predecessor, which was a blank check company. From May 1999 to
December 2007, he was the President and General Manager of Vortex Ltd., an aviation consulting firm specializing in strategic
analysis, fleet planning and asset management. From January 1998 to April 1999, he served as a financial advisor to Hellenic Telecommunications
Organization S.A., where, on behalf of the Chief Executive Officer, he coordinated and led the company’s listing on the
New York Stock Exchange (NYSE:OTE) and where he had responsibilities for the strategic planning and implementation of multiple
acquisitions of fixed-line telecommunications companies. Mr. Syllantavos served as a financial and strategic advisor to both the
Greek Ministry of Industry & Energy (from June 1995 to May 1996) and the Greek Ministry of Health (from May 1996 to January
1998), where, in 1997 and 1998, he helped structure the equivalent of a US$700 million bond issuance for the payment of outstanding
debts to the suppliers of the Greek National Health System. From 1998 to 2004, he served as a member of the Investment Committee
of a merchant banking firm, where he reviewed and analyzed many acquisition targets of small or medium sized privately-held manufacturing
firms in the U.S. and internationally, of which he assisted in negotiating, structuring and implementing the acquisition of several
such firms. Before that, he served for almost 5 years as an aviation consultant specializing in strategic planning and fleet asset
management. Mr. Syllantavos has a B.Sc. in Industrial Engineering from Roosevelt University in Chicago and an MBA in Operations
Management, International Finance and Transportation Management from the Kellogg Graduate School of Management at Northwestern
University (USA).



We believe Mr. Syllantavos is well-qualified
to serve as a member of the Board due to his public company experience, business leadership, operational experience and experience
in a prior blank check offering, such as Star Maritime and Nautilus Marine. We believe Mr. Syllantavos is qualified to serve as
a member of our board of directors because of his experience serving as a chief financial officer of a public company and on the
board of directors of a public company, as well as his experience developing and implementing from inception several SarbOx systems.
Mr. Syllantavos’ experience will contribute towards implementing sound corporate governance policies and streamlined corporate
processes that will also optimize the internal processes both in terms of efficiency and implementing checks and balances.



Lori Tauber Marcus combines
strategic vision, strong business and general management acumen with direct-to-consumer expertise in e-commerce, digital marketing
and social media to grow consumer-facing businesses worldwide. In 2018, Ms. Marcus joined the board of Golub Corporation, a large
privately-held regional grocer. Since 2017, Ms. Marcus has served on the advisory board of Meural, Inc., a VC-backed, early stage
digital art technology company. Since 2016, Ms. Marcus has served as on the board of DNA Diagnostics Center, a private equity
backed leader in private DNA testing services, and she is currently the Chair of the board of directors. Since 2016, Ms. Marcus
has served as a director for SHARE, a women’s cancer support organization. Since 2012, she served as an advisor to the CEO
and CMO of Carrington Farms. As Vice Chair of the board of directors of the Multiple Myeloma Research Foundation (MMRF), she serves
as an ex officio member of the Audit, Board Development, Programming, and HR Committees. She has served on the MMRF board since
2004. Ms. Marcus founded Courtyard Connections, LLC in 2015 and since 2017 she has worked with the Harvard Business School’s
Kraft Precision Medicine Accelerator as Chair of the Direct-to-Patient Initiative. From 2015 to 2017, she was a member of the
CMO Advisory Board for VentureBeat. In 2016, she served as Interim CMO for Peloton Interactive, where she was the leader of brand
strategy, integrated marketing, public relations, acquisition marketing, loyalty, retention/engagement and email marketing, social
media, creative services and advanced analytics. From 2013 to 2015, Ms. Marcus was the Executive Vice President and Chief Global
Brand and Product Officer at Keurig Green Mountain, Inc (NASDAQ: GMCR). From 2011 to 2012, she was CMO at The Children’s
Place (NASDAQ: PLCE). Ms. Marcus had a 24-year career with PepsiCo, from 1987 to 2011 that included holding national and global
Senior Vice President and general management roles (2004 – 2011). Ms. Marcus holds a BSE from The Wharton School, University
of Pennsylvania.





3







We believe Ms. Marcus is qualified to serve
as a member of our board of directors due to her experience in capital market activities, as well as her current and former experience
on the boards of directors of other companies.



Kathy Tan Mayorhas held
numerous leadership positions in business development, retail marketing, loyalty marketing, and digital marketing technology.
She is currently the Chief Marketing Officer of BoxyCharm, a beauty subscription service company located in South Florida. From
2016 to 2018, Ms. Mayor was the Chief Digital Officer across the 10 portfolio brands of Carnival Corporation and the Chief Marketing
Officer of Carnival Cruise Line. From 2008 to 2016, Ms. Mayor held a number of positions at Las Vegas Sands Corporation including
a number of vice president and senior vice president roles in strategy and marketing. From 2005 to 2008, she held multiple director
positions with Caesar Entertainment Corporation. Prior to that Ms. Mayor worked for McKinsey& Company and Proctor & Gamble
in Southeast Asia. Ms. Mayor has a B.S. in Management Engineering from Ateneo de Manila University and an MBA from Harvard Business
School.



We believe Ms. Mayor is qualified to serve
as a member of our board of directors due to her marketing and digital and information technology experience.



Keith Cowanis an experienced
executive officer, board member, advisor and investor. Since 2013, he has been CEO of Cowan Consulting Corporation that provides
strategic advisory services to various companies in multiple industries. From 2007 to 2013, Mr. Cowan was President of Strategic
Planning and Corporate Initiatives for Sprint Corporation. From 1996 to 2006, he served in multiple roles at BellSouth Corporation,
including Chief Development Officer, President of Marketing & Product Management, and Chief Network Field Officer. From 1982
to 1996, Mr. Cowan was partner at Alston & Bird LLP. He has served as a board member for Globalstar (NYSE: GSAT) since December
2018, Vice Chairman of Fox Theatre in Atlanta since 2006, Chairman of the Morehead-Cain Scholarship Fund since 2009, and a Trustee
of the Loomis Chaffee School since 2014. He also served as a board member of the YMCA of Metro Atlanta from 1999 to 2018. Mr.
Cowan holds a BA in Economics and Political Science from the University of North Carolina at Chapel Hill and a JD, Law from the
University of Virginia School of Law.



We believe Mr. Cowan is qualified to serve
as a member of our board of directors due to his legal and regulatory experience.



Board Composition



Our business affairs are managed under
the direction of our board of directors. Our board of directors consists of seven members, five of whom qualify as independent
within the meaning of the independent director guidelines of Nasdaq. Messrs. Crowder and Knitowski are not considered independent.



Our board of directors is divided into
three staggered classes of directors. At each annual meeting of stockholders, a class of directors will be elected for a three-year
term to succeed the same class whose term is then expiring, as follows:



| | ● | the Class I directors will be Keith Cowan and
    Prokopios (Akis) Tsirigakis, and their terms will expire at the annual meeting of stockholders to be held in 2019;
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ● | the Class II directors will be Lori Tauber Marcus
    and Kathy Tan Mayor, and their terms will expire at the annual meeting of stockholders to be held in 2020; and
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ● | the Class III directors will be Alan S. Knitowski,
    Randall Crowder and George Syllantavos, and their terms will expire at the annual meeting of stockholders to be held in 2021.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





4







Our certificate of incorporation and bylaws
provide that the number of directors shall consist of one or more members, and may be increased or decreased from time to time
by a resolution of our board of directors. Each director’s term continues until the election and qualification of his successor,
or his earlier death, resignation, or removal. Any increase or decrease in the number of directors will be distributed among the
three classes so that, as nearly as possible, each class will consist of one-third of the total number of directors. This classification
of our board of directors may have the effect of delaying or preventing changes in control of our company.



Each of our executive officers serves at
the discretion of our board of directors and will hold office until his or her successor is duly appointed and qualified or until
his or her earlier resignation or removal. There are no family relationships among any of our directors or executive officers.



Committees of the Board of Directors



Our board of directors has the authority
to appoint committees to perform certain management and administrative functions. Our board of directors has an audit committee,
a compensation committee, and a nominating and corporate governance committee, each of which has the composition and responsibilities
described below. Members serve on these committees until their resignation or until otherwise determined by our board of directors.



Audit Committee



Messrs. Cowan and Tsirigakis and Ms. Mayor,
each of whom is a non-employee member of our board of directors, comprise our audit committee. Mr. Tsirigakis is the Chair of
our audit committee. We have determined that each of the members of our audit committee satisfies the requirements for independence
and financial literacy under the rules of Nasdaq and the SEC. We have also determined that Mr. Tsirigakis qualifies as an “audit
committee financial expert” as defined in the SEC rules and satisfies the financial sophistication requirements of Nasdaq.
The audit committee is responsible for, among other things:



| | ● | selecting a qualified firm to serve as the independent
    registered public accounting firm to audit the Successor’s financial statements;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------



| | ● | helping to ensure the independence and performance
    of the independent registered public accounting firm;
| | - | ------------------------------------------------------------------------------------------------------------



| | ● | discussing the scope and results of the audit
    with the independent registered public accounting firm and reviewing, with management and the independent registered public
    accounting firm, the Successor’s interim and year-end financial statements;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ● | developing procedures for employees to submit
    concerns anonymously about questionable accounting or audit matters;
| | - | ----------------------------------------------------------------------------------------------------------------------



| | ● | reviewing the Successor’s policies on
    and oversees risk assessment and risk management, including enterprise risk management;
| | - | ---------------------------------------------------------------------------------------------------------------------------------



| | ● | reviewing the adequacy and effectiveness of
    our internal control policies and procedures and the Successor’s disclosure controls and procedures;
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------



| | ● | reviewing related person transactions; and
| | - | ------------------------------------------



| | ● | approving or, as required, pre-approving, all
    audit and all permissible non-audit services, other than de minimis non-audit services, to be performed by the independent
    registered public accounting firm.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Our
                                         board of directors has adopted a written charter for the audit committee that satisfies
                                         the applicable rules and regulations of the SEC and the listing standards of Nasdaq.





5







Compensation Committee



Ms. Marcus and Messrs. Syllantavos and
Tsirigakis, each of whom is a non-employee member of our board of directors, comprise our compensation committee. Ms. Marcus is
the Chair of our compensation committee. We have determined that each member of our compensation committee meets the requirements
for independence under the rules of Nasdaq and SEC rules and regulations. The compensation committee is responsible for, among
other things:



| | ● | reviewing, approving and determining the compensation
    of the Successor’s executive officers and key employees;
| | - | ------------------------------------------------------------------------------------------------------------------



| | ● | reviewing, approving and determining compensation
    and benefits, including equity awards, to directors for service on the board of directors or any committee thereof;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ● | administering the Successor’s equity compensation
    plans;
| | - | ------------------------------------------------------------



| | ● | reviewing, approving and making recommendations
    to the Successor’s board of directors regarding incentive compensation and equity compensation plans; and
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ● | establishing and reviewing general policies
    relating to compensation and benefits of the Successor’s employees.
| | - | -------------------------------------------------------------------------------------------------------------------



Our board of directors has adopted a written
charter for the compensation committee that satisfies the applicable rules and regulations of the SEC and the listing standards
of Nasdaq.



Nominating and Corporate Governance
Committee



Mr. Cowan and Mses. Marcus and Mayor, each
of whom is a non-employee member of our board of directors, comprise our nominating and corporate governance committee. Mr. Cowan
is the Chair of our nominating and corporate governance committee. We have determined that each member of our nominating and corporate
governance committee meets the requirements for independence under the rules of Nasdaq. The nominating and corporate governance
committee is responsible for, among other things:



| | ● | identifying, evaluating
    and selecting, or making recommendations to our board of directors regarding, nominees for election to our board of directors
    and its committees;
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ● | evaluating the performance of our board of directors
    and of individual directors;
| | - | -------------------------------------------------------------------------------------



| | ● | considering, and making
    recommendations to our board of directors regarding, the composition of our board of directors and its committees;
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------



| | ● | reviewing developments in corporate governance
    practices;
| | - | -------------------------------------------------------------



| | ● | evaluating the adequacy of our corporate governance
    practices and reporting; and
| | - | ------------------------------------------------------------------------------------



| | ● | developing, and making
    recommendations to our board of directors regarding, corporate governance guidelines and matters.
| | - | ----------------------------------------------------------------------------------------------------------------------------



Our board of directors has adopted a written
charter for the nominating and corporate governance committee that satisfies the applicable rules and regulations of the SEC and
the listing standards of Nasdaq.





6







Compensation Committee Interlocks and Insider Participation



None of the members of our compensation
committee is or has been an officer or employee of our company. None of our executive officers currently serves, or in the past
year has served, as a member of the compensation committee or director (or other board committee performing equivalent functions
or, in the absence of any such committee, the entire board of directors) of any entity that has one or more executive officers
serving on our compensation committee or board of directors.



Non-Employee Director Compensation



We do not currently have a policy or plan
to make equity award grants or pay cash retainers to our non-employee directors at a particular time, of a particular value or
of a particular amount. After the completion of this offering, we intend to implement a formal policy pursuant to which our non-employee
directors would be eligible to receive equity awards and cash retainers as compensation for service on our board of directors
and committees of our board of directors.



Director Compensation Table



The following table presents for each of
Phunware’s directors serving during 2018 and 2017, other than those who are Named Executive Officers, information regarding
their compensation paid to them for their services as directors for the years ended December 31, 2018 and 2017. Other than as
set forth in the table, we did not pay any compensation, make any equity awards or non-equity awards to or pay any other compensation
to any of our non-employee directors in 2018 and 2017.



|                     |  | Fiscal year ended December
    31, 2018 |        |  | Fiscal year ended December
    31, 2017 | 
|-------------------- |  | --------------------------------------- | ------ |  | --------------------------------------- | 
|                     |  | Fees Earned or                          |        |  | Stock Option                            | 
|                     |  | Paid in Cash                            |        |  | Awards                                  | 
|Name                 |  | ($)                                     |        |  | ($)(1)                                  | 
|Winston Damarillo    |  |                                         | —      |  |                                         | 
|Chase Fraser         |  |                                         | —      |  |                                         | 
|John Kahan
    (2)   |  |                                         | 28,000 |  |                                         | 
|Eric Manlunas        |  |                                         | —      |  |                                         | 
|Kevin Landis (3)     |  |                                         | —      |  |                                         | 
|Sundhiraj Sharma (3) |  |                                         | —      |  |                                         | 



| | (1) | This
                                         column reflects the aggregate grant date fair value of stock options granted during 2018
                                         and 2017 computed in accordance with the provisions of ASC 718, Compensation—Stock
                                         Compensation. The assumptions that we used to calculate these amounts are discussed
                                         in the notes to Phunware’s audited consolidated financial statements for the year
                                         ended December 31, 2018 and 2017. These amounts do not reflect the actual economic value
                                         that will be realized by the director upon the vesting of the stock options, the exercise
                                         of the stock options, or the sale of the common stock underlying such stock options.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (2) | As
                                         of December 31, 2018, Mr. Kahan held options to purchase a total of 175,000 shares of
                                         Phunware common stock. The option is subject to an early exercise provision and is immediately
                                         exercisable. Shares subject to the option vest in 48 equal monthly installments beginning
                                         on June 1, 2017. As a result of the Business Combination, vesting of Mr. Kahan’s
                                         grant accelerated, and all 175,000 shares are vested and exercisable.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (3) | Messrs.
                                         Landis and Sharma resigned from our board of directors on February 26, 2018 on February
                                         7, 2018, respectively.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Cash Compensation



Mr. Kahan received a fee of $28,000 and
$16,846 in cash for serving on our board of directors during 2018 and 2017, respectively. We also reimbursed our directors for
reasonable travel expenses associated with attending meetings of our board and meetings of committees of our board.



We expect to adopt an outside director
compensation policy in connection with the consummation of the business combination.





7







Section 16(a) Beneficial Ownership Reporting Compliance



Section 16(a) of the Securities Exchange
Act of 1934 (the “Exchange Act”) requires the Company’s directors, executive officers and persons who beneficially
own more than 10% of the Company’s common stock (collectively, “Reporting Persons”) to file with the SEC reports
regarding their ownership and changes in our ownership of our securities. We believe that, during 2018, our directors,, executive
officers and 10% stockholders complied with all Section 16(a) filing requirements, with the exceptions noted below:



| | · | An
                                         amendment to Form 4 was filed for Prokopios (Akis) Tsirigakis on February 13, 2019 to
                                         correct the number of warrants acquired to 2,714,724 from 4,354,873 originally reported
                                         on a Form 4 filed December 28, 2018.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | An
                                         amendment to Form 4 was filed for George Syllantavos on February 13, 2019 to correct
                                         the number of warrants acquired to 2,996,850 from 5,532,092 originally reported on a
                                         Form 4 filed December 28, 2018.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Corporate Governance Guidelines and Code of Business Conduct



Our board of directors has adopted Corporate
Governance Guidelines that address items such as the qualifications and responsibilities of our directors and director candidates
and corporate governance policies and standards applicable to us in general. In addition, our board of directors has adopted a
Code of Business Conduct and Ethics that applies to all of our employees, officers and directors, including our Chief Executive
Officer, Chief Financial Officer, and other executive and senior financial officers. The full text of our Corporate Governance
Guidelines and Code of Business Conduct and Ethics is posted on the Governance portion of the investor relations page of our website
at www.investors.phunware.com. We will post amendments to our Code of Business Conduct and Ethics or waivers of our Code of Business
Conduct and Ethics for directors and executive officers on the same website, that are required to be disclosed by the rules of
the SEC or the Nasdaq Stock Market.



Item 11. Executive Compensation.



Phunware’s named executive officers
for 2018, which consist of the person who served as our principal executive officer during 2018 and the next two most highly compensated
executive officers who served as executive officers in 2018, are as follows:



Alan Knitowski, our Chief Executive Officer;



Luan Dang, our Chief Technology Officer;
and



Randall Crowder, our Chief Operating Officer.



Summary Compensation Table



The following table sets forth information
regarding the total compensation of our named executive officers for the year ended December 31, 2018:



|Name and Principal Position             |  | Year |  | Salary |         |  | Non-Equity
    
Incentive Plan
 Compensation(1) |   |         | All Other 
Compensation |  |   | Total  |    
|--------------------------------------- |  | ---- |  | ------ | ------- |  | ----------------------------------------------- | - | ------- | ----------------------- |  | - | ------ | ---
|Alan Knitowski Chief Executive Officer  |  | 2018 |  | $      | 310,000 |  |                                                 | $ | 186,000 |                         |  | $ | 14,040 | (2)
|Luan Dang Chief Technology Officer      |  | 2018 |  | $      | 200,000 |  |                                                 | $ | 100,000 |                         |  | $ | 31,659 | (3)
|Randall Crowder Chief Operating Officer |  | 2018 |  | $      | 218,182 |  |                                                 | $ | 107,562 |                         |  | $ | 5,512  | (4)



| | (1) | The
                                         reported amounts represent payments earned under the 2018 Senior Staff Bonus Plan which
                                         were paid as discussed under the section titled “Executive Bonus Plan.”
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|(2) | The amount disclosed reflects the aggregate
    incremental costs of perquisites and other personal benefits, including, among other things, $14,040 paid by Phunware to Mr.
    Knitowski with respect to Phunware’s medical benefits policy.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(3) | The amount disclosed reflects the aggregate
    incremental costs of perquisites and other personal benefits, including, among other things, $31,659 paid by Phunware to Mr.
    Dang with respect to Phunware’s medical benefits policy.     
|(4) | The amount disclosed reflects the aggregate
    incremental costs of perquisites and other personal benefits, including, among other things, $5,512 paid by Phunware to Mr.
    Crowder with respect to Phunware’s medical benefits policy.   





8







The following table sets forth information
regarding the total compensation of our named executive officers for the year ended December 31, 2017:



|Name and Principal Position                 |  | Year |  | Salary |         |  | Non-Equity
    
Incentive Plan 
Compensation(5) |   |         | All Other 
Compensation |  |   | Total  |    
|------------------------------------------- |  | ---- |  | ------ | ------- |  | ----------------------------------------------- | - | ------- | ----------------------- |  | - | ------ | ---
|Alan Knitowski Chief Executive Officer      |  | 2017 |  | $      | 310,000 |  |                                                 | $ | 123,644 |                         |  | $ | 19,051 | (6)
|Luan Dang Chief Technology Officer          |  | 2017 |  | $      | 200,000 |  |                                                 | $ | 66,475  |                         |  | $ | 25,358 | (7)
|Scott Kenyon Former Chief Operating Officer |  | 2017 |  | $      | 250,000 |  |                                                 | $ | 83,094  |                         |  | $ | 14,749 | (8)



| | (5) | The
                                         reported amounts represent payments earned under the 2018 Senior Staff Bonus Plan which
                                         were paid as discussed under the section titled “Executive Bonus Plan.”
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|(6) | The amount disclosed reflects the aggregate
    incremental costs of perquisites and other personal benefits, including, among other things, $16,818 paid by Phunware to Mr.
    Knitowski with respect to Phunware’s medical benefits policy.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(7) | The amount disclosed reflects the aggregate
    incremental costs of perquisites and other personal benefits, including, among other things, $23,125 paid by Phunware to Mr.
    Dang with respect to Phunware’s medical benefits policy.     
|(8) | The amount disclosed reflects the aggregate incremental
costs of perquisites and other personal benefits, including, among other things, $12,516 paid by Phunware to Mr. Kenyon with respect
to Phunware’s medical benefits policy.           



Mr. Kenyon served as the Company’s Chief Operating
        Officer in 2017 thru February 2, 2018



Outstanding Equity Awards at Fiscal Year-End



The following table sets forth information
regarding outstanding stock options and other equity awards held by each of our named executive officers as of December 31, 2018,
and gives effect to the exchange conversion as a result of the Business Combination:



|                |  | Option Awards
|--------------- |  | -------------
|                |  | Grant        
|Name            |  | Date         
|Alan Knitowski  |  | 2/24/2013    
|                |  | 1/8/2018     
|Luan Dang       |  | 1/8/2018     
|Randall Crowder |  | 2/14/2018    



|(1) | Shares subject to the option are fully vested
    and immediately exercisable.                                                                                                                                                                        
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | These option grants are subject to an early
    exercise provision and is immediately exercisable. These grants vest 25% at the one-year anniversary of the grant date, and
    then 1/48 monthly thereafter for a total vesting period of four years.





9







Executive Employment Agreements



Phunware has entered into employment agreements
with each executive officer and significant employee noted in the section titled “Executive Officers and Directors”
above. Phunware did not have an employment agreement or offer letter in place with Scott Kenyon, whose at-will employment with
Phunware terminated as of February 2, 2018.



Executive Bonus Plan



Each of our named executive officers participated
in our 2018 Senior Staff Bonus Plan. The 2018 Senior Staff Bonus Plan provided for bonus payments to eligible employees determined
based upon our achievement of annual performance objectives. Funding of the 2018 Senior Staff Bonus Plan was based upon our achievement
of performance targets that measured revenue, gross margin percentage, subscription and services bookings, and Adjusted EBITDA,
as well as the achievement by the employee of his or her performance goals or objectives, adjusted upward or downward to the extent
that the Company exceeded or did not meet these targets. Bonus payments were conditioned on the Company achieving a minimum percentage
threshold of these targets, and funding of the 2018 Senior Staff Bonus Plan scaled upward to the extent the Company exceeded these
minimum percentages. Payments were made annually for the 2018 Senior Staff Bonus Plan. The target bonuses at 100% funding for
each named executive officer under the 2018 Senior Staff Bonus Plan were: Mr. Knitowski: $186,000; Mr. Dang: $100,000; and Mr.
Crowder: $107,562. The annual payments made under the 2018 Senior Staff Bonus Plan to each named executive officer are reflected
above under “— Summary Compensation Table.”



Employee Benefit and Stock Plans



2018 Equity Incentive Plan



In connection with the consummation of
the Business Combination, our board of directors adopted, and our stockholders approved, the 2018 Equity Incentive Plan (the “2018
Plan”). The purposes of the 2018 Plan are to attract and retain the best available personnel for positions of substantial
responsibility, to provide additional incentives to employees, directors and consultants who perform services to the Successor
or any parent or subsidiary, and to promote the success of our business. These incentives are provided through the grant of stock
options, stock appreciation rights, restricted stock, restricted stock units, performance units and performance shares.



Authorized Shares. A
total of 2,729,416 shares of common stock are reserved for issuance pursuant to the 2018 Plan. In addition, the shares of common
stock reserved for issuance under the 2018 Plan also will include any shares of common stock subject to stock options, restricted
stock units or similar awards granted under the 2009 Equity Incentive Plan (the “2009 Plan”), that, on or after the
Business Combination (otherwise known as the “Reverse Merger and Recapitalization”), are assumed in connection with
the Reverse Merger and Recapitalization, expire or otherwise terminate without having been exercised in full and shares of common
stock issued pursuant to awards granted under the 2009 Plan that, on or after the Reverse Merger and Recapitalization, are forfeited
to or repurchased by us, with the maximum number of shares of common stock that may be added to the 2018 Plan pursuant to the
foregoing equal to 2,372,893. Currently, no awards have been granted under the 2018 Plan.



The number of shares of common stock available
for issuance under the 2018 Plan will also include an annual increase on the first day of each fiscal year beginning in fiscal
2019, equal to the least of:



| | ● | 10% of the post-closing outstanding shares of
    common stock;
| | - | ---------------------------------------------------------------



| | ● | 5% of the outstanding shares of common stock
    on the last day of the immediately preceding fiscal year; or
| | - | -------------------------------------------------------------------------------------------------------------



| | ● | such other amount as our board of directors
    may determine.
| | - | --------------------------------------------------------------





10







If an award expires or becomes unexercisable
without having been exercised in full, is surrendered pursuant to an exchange program, or, with respect to restricted stock, restricted
stock units, performance units or performance shares, is forfeited to, or repurchased by, the Successor due to failure to vest,
then the unpurchased shares (or for awards other than stock options or stock appreciation rights, the forfeited or repurchased
shares) will become available for future grant or sale under the 2018 Plan (unless the 2018 Plan has terminated). With respect
to stock appreciation rights, the net shares issued will cease to be available under the 2018 Plan and all remaining shares will
remain available for future grant or sale under the 2018 Plan. Shares used to pay the exercise price of an award or to satisfy
the tax withholding obligations related to an award will become available for future grant or sale under the 2018 Plan. To the
extent an award is paid out in cash rather than shares, such cash payment will not result in a reduction in the number of shares
available for issuance under the 2018 Plan.



Adjustments to Shares Subject to
the 2018 Plan. In the event of any dividend or other distribution (whether in the form of cash, shares, other securities,
or other property), recapitalization, stock split, reverse stock split, reorganization, merger, consolidation, split-up, spin-off,
combination, repurchase, or exchange of shares or other securities of the Successor, or other change in the corporate structure
affecting the common stock occurs, the administrator (as defined below), in order to prevent diminution or enlargement of the
benefits or potential benefits intended to be made available under the 2018 Plan, will adjust the number and class of shares that
may be delivered under the 2018 Plan, and/or the number, class and price of shares covered by outstanding awards, and the numerical
share limitations in the 2018 Plan.



Administration. Our board
of directors or one or more committees appointed by our board of directors administers the 2018 Plan (referred to as the “administrator”).
If the administrator determines it is desirable to qualify transactions under the 2018 Plan as exempt under Rule 16b-3 of the
Exchange Act, such transactions will be structured to satisfy the requirements for exemption under Rule 16b-3. Subject to the
provisions of the 2018 Plan, the administrator has the power to administer the 2018 Plan, including but not limited to, the power
to interpret the terms of the 2018 Plan and awards granted under it, to prescribed, amend and rescind rules relating to the 2018
Plan, including creating sub-plans, and to determine the terms of the awards, including the exercise price, the number of shares
of common stock subject to each such award, the exercisability of the awards and the form of consideration, if any, payable upon
exercise. The administrator also has the authority to amend existing awards to reduce or increase their exercise prices, to allow
participants the opportunity to transfer outstanding awards to a financial institution or other person or entity selected by the
administrator and to institute an exchange program by which outstanding awards may be surrendered or cancelled in exchange for
awards of the same type which may have a higher or lower exercise price or different terms, awards of a different type and/or
cash.



Eligibility. Awards may be
granted to employees, directors and consultants of the Company and employees and consultants of any parent or subsidiary corporation
of the Company. Incentive stock options may be granted only to employees who, as of the time of grant, are employees of the Successor
or any parent or subsidiary corporation of the Company.



Stock Options. Stock options
in the form of nonstatutory stock options or incentive stock options may be granted under the 2018 Plan. The administrator determines
the number of shares subject to each option. The administrator determines the exercise price of options granted under the 2018
Plan, provided that the exercise price must at least be equal to the fair market value of the Successor’s common stock on
the date of grant. The term of an incentive stock option may not exceed ten years, except that with respect to any participant
who owns more than 10% of the voting power of all classes of the outstanding stock, the term must not exceed five years and the
exercise price must equal at least 110% of the fair market value on the grant date. The administrator will determine the methods
of payment of the exercise price of an option, which may include cash, shares or other property acceptable to the administrator,
as well as other types of consideration permitted by applicable law. After the termination of service of an employee, director
or consultant, he or she may exercise his or her option for the period of time stated in his or her option agreement. Generally,
if termination is due to death or disability, the option will remain exercisable for 12 months. In all other cases, the option
generally will remain exercisable for three months following the termination of service. An option may not be exercised later
than the expiration of its term. Subject to the provisions of the 2018 Plan, the administrator determines the other terms of options.





11







Stock Appreciation Rights.
Stock appreciation rights may be granted under the 2018 Plan. Stock appreciation rights allow the recipient to receive the appreciation
in the fair market value of common stock between the exercise date and the date of grant. Stock appreciation rights may not have
a term exceeding ten years. After the termination of service of an employee, director or consultant, he or she may exercise his
or her stock appreciation right for the period of time stated in his or her stock appreciation rights agreement. Generally, the
terms and conditions relating to the period of post-termination exercise with respect to options described above also apply to
stock appreciation rights, however, in no event may a stock appreciation right be exercised later than the expiration of its term.
Subject to the provisions of the 2018 Plan, the administrator determines the other terms of stock appreciation rights, including
when such rights become exercisable and whether to pay any increased appreciation in cash or with shares of common stock, or a
combination thereof, except that the per share exercise price for the shares to be issued pursuant to the exercise of a stock
appreciation right will be no less than 100% of the fair market value per share on the date of grant.



Restricted Stock Awards.
Restricted stock may be granted under the 2018 Plan. Restricted stock awards are grants of shares of common stock that vest in
accordance with terms and conditions established by the administrator. The administrator will determine the number of shares of
restricted stock granted to any employee, director or consultant and, subject to the provisions of the 2018 Plan, will determine
the terms and conditions of such awards. The administrator may impose whatever conditions to vesting it determines to be appropriate
(for example, the administrator may set restrictions based on the achievement of specific performance goals or continued service
to the Company); provided, however, that the administrator, in its sole discretion, may accelerate the time at which any restrictions
will lapse or be removed. Recipients of restricted stock awards generally will have voting and dividend rights with respect to
such shares upon grant without regard to vesting, unless the administrator provides otherwise. Shares of restricted stock that
do not vest are subject to our right of repurchase or forfeiture.



Restricted Stock Units. Restricted
stock units may be granted under the 2018 Plan. Restricted stock units are bookkeeping entries representing an amount equal to
the fair market value of one share of common stock. Subject to the provisions of the 2018 Plan, the administrator determines the
terms and conditions of restricted stock units, including the vesting criteria (which may include accomplishing specified performance
criteria or continued service to the Company) and the form and timing of payment. Notwithstanding the foregoing, the administrator,
in its sole discretion, may reduce or waive any vesting criteria that must be met to receive a payout.



Performance Units and Performance
Shares. Performance units and performance shares may be granted under the 2018 Plan. Performance units and performance
shares are awards that will result in a payment to a participant only if performance goals established by the administrator are
achieved or the awards otherwise vest. The administrator will establish organizational or individual performance goals or other
vesting criteria in its discretion, which, depending on the extent to which they are met, will determine the number and/or the
value of performance units and performance shares to be paid out to participants. After the grant of a performance unit or performance
share, the administrator, in its sole discretion, may reduce or waive any performance criteria or other vesting provisions for
such performance units or performance shares. Performance units shall have an initial dollar value established by the administrator
on or prior to the grant date. Performance shares shall have an initial value equal to the fair market value of common stock on
the grant date. The administrator, in its sole discretion, may pay earned performance units or performance shares in the form
of cash, in shares of common stock or in some combination thereof.



Transferability of Awards.
Unless the administrator provides otherwise, the 2018 Plan generally does not allow for the transfer of awards and only the recipient
of an award may exercise an award during his or her lifetime.



Dissolution or Liquidation.
In the event of a proposed liquidation or dissolution of the Company, the administrator will notify participants as soon as practicable
prior to the effective date of such proposed transaction, and, to the extent not exercised, all awards will terminate immediately
prior to the consummation of such proposed transaction.



Merger or Change in Control.
The 2018 Plan provides that in the event of a merger or change in control, as defined under the 2018 Plan, each outstanding award
will be treated as the administrator determines, except that if a successor corporation or its parent or subsidiary does not assume
or substitute an equivalent award for any outstanding award, then such award will fully vest, all restrictions on such award will
lapse, all performance goals or other vesting criteria applicable to such award will be deemed achieved at 100% of target levels.
In addition, if an option or stock appreciation right is not assumed or substituted, the administrator will notify the participant
in writing or electronically that the option or stock appreciation right will become fully exercisable, for a specified period
prior to the transaction, and will then terminate upon the expiration of the specified period of time. Upon a change in control,
awards granted to an outside director will vest fully and become immediately exercisable, all restrictions on his or her restricted
stock and restricted stock units will lapse, and with respect to awards with performance-based vesting, all performance goals
or other vesting criteria will be deemed achieved at 100% of target levels, and all other terms and conditions met.





12







Amendment; Termination. The
administrator has the authority to amend, alter, suspend, or terminate the 2018 Plan provided such action does not impair the
existing rights of any participant. The 2018 Plan automatically will terminate in 2028, unless it is terminated sooner.



2018 Employee Stock Purchase Plan



In connection with the consummation of
the Business Combination, our board of directors adopted, and our stockholders approved, the 2018 Employee Stock Purchase Plan
(the “2018 ESPP”). The purpose of the 2018 ESPP is to provide eligible employees with an opportunity to purchase shares
of our common stock through accumulated contributions, which generally will be made through payroll deductions. The 2018 ESPP
permits the administrator (as discussed below) to grant purchase rights that qualify for preferential tax treatment under Code
Section 423. In addition, the 2018 ESPP authorizes the grant of purchase rights that do not qualify under Code Section 423 pursuant
to rules, procedures or sub-plans adopted by the administrator that are designed to achieve desired tax or other objectives.



Authorized Shares. 1,228,237
shares of common stock are available for sale under the 2018 ESPP. The number of shares of common stock that may be made available
for sale under the 2018 ESPP also includes an annual increase on the first day of each fiscal year beginning for the fiscal year
following the fiscal year in which the first enrollment date (if any) occurs equal to the least of:



| | ● | 3% of the expected post-closing outstanding
    shares of common stock;
| | - | -----------------------------------------------------------------------



| | ● | 1.5% of the outstanding shares of common stock
    on the last day of the immediately preceding fiscal year; or
| | - | ---------------------------------------------------------------------------------------------------------------



| | ● | such other amount as the administrator may determine.
| | - | -----------------------------------------------------



2018 ESPP Administration.
The 2018 ESPP will be administered by our board of directors or a committee appointed by the board (the “administrator”).
The administrator has full and exclusive discretionary authority to construe, interpret, and apply the terms of the 2018 ESPP,
to designate separate offerings under the 2018 ESPP, to adjudicate disputed claims under the 2018 ESPP, and to establish such
procedures that it deems necessary for the administration of the 2018 ESPP. The administrator is specifically authorized to adopt
rules and procedures regarding eligibility to participate, the definition of “compensation,” handling of contributions,
and making of contributions to the 2018 ESPP, among other responsibilities. Every finding, decision and determination made by
the administrator will, to the full extent permitted by law, be final and binding upon all parties.



Eligibility. Any eligible
employee on a given enrollment date will be eligible to participate in the 2018 ESPP. Generally, all of our employees will be
eligible to participate if they are employed by the Company, or any participating subsidiary, for at least 20 hours per week and
more than five months in any calendar year. However, an employee may not be granted rights to purchase shares of common stock
under the 2018 ESPP if such employee:



| | ● | immediately after the grant would own capital
    stock and/or hold outstanding options to purchase 5% or more of the total combined voting power or value of all classes of
    capital stock; or
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ● | hold rights to purchase shares of common stock
    under all of our employee stock purchase plans that accrue at a rate that exceeds $25,000 worth of shares of common stock
    for each calendar year.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





13







Offering Periods. The offering
periods under the 2018 ESPP will begin on such date as determined by the administrator and expire on the earliest to occur of
(a) the completion of the purchase of shares on the last exercise date occurring within 27 months of the applicable enrollment
date of the offering period on which the purchase right was granted, or (b) a shorter period established by the administrator
prior to an enrollment date for all options to be granted on such enrollment date.



An eligible employee may participate in
the 2018 ESPP by timely submitting a properly completed subscription agreement or following an electronic or other enrollment
procedure determined by the administrator. On the enrollment date of each offering period, each participant automatically is granted
a right to purchase shares of common stock. This purchase right is exercised on each purchase date during an offering period to
the extent of the contributions made during such offering period, unless the purchase right has expired (upon termination of a
participant’s employment) or the participant has withdrawn from the 2018 ESPP, as described in further detail below.



Once an employee becomes a participant
in the 2018 ESPP, the employee automatically will participate in each successive offering period until the employee withdraws
from the 2018 ESPP or the employee’s employment with the Company or one of our designated subsidiaries terminates.



Contributions. The 2018 ESPP
permits participants to purchase shares of common stock through contributions (generally in the form of payroll deductions) of
up to an amount of their eligible compensation determined by the administrator. Eligible compensation includes a participant’s
base straight time gross earnings, but exclusive of payments for incentive compensation, bonuses, payments for overtime and shift
premium, equity compensation income and other similar compensation. Unless otherwise determined by the administrator, a participant
may purchase a maximum of 2,000 shares of common stock during a purchase period.



Exercise of Purchase Right.Amounts deducted and accumulated by the participant are used to purchase shares of common stock on each exercise date. The
purchase price of the shares will determined by the administrator but in no event will be less than 85% of the lower of the fair
market value of common stock on the enrollment date or on the exercise date. Participants may end their participation at any time
during an offering period and will be paid their accrued contributions that have not yet been used to purchase shares of common
stock. Participation ends automatically upon termination of employment with the Company.



Non-Transferability. Neither
contributions credited to a participant’s account nor any rights with regard to the exercise of a purchase right or to receive
shares under the 2018 ESPP may be assigned, transferred, pledged or otherwise disposed of in any way, other than by will, the
laws of descent and distribution or as otherwise provided under the 2018 ESPP.



Changes in Capitalization.
If there is any dividend or other distribution (whether in the form of cash, common stock, other securities, or other property),
recapitalization, stock split, reverse stock split, reorganization, merger, consolidation, split-up, spin-off, combination, repurchase,
or exchange of common stock or other securities of the Successor, or other change in the corporate structure of the Company affecting
common stock such that an adjustment is appropriate in order to prevent dilution or enlargement of the benefits or potential benefits
intended to be made available under the 2018 ESPP, then the administrator will adjust the number and class of common stock that
may be delivered under the 2018 ESPP, the purchase price per share, the number of shares of common stock covered by each right
to purchase shares under the 2018 ESPP that has not yet been exercised, and the numerical limitations set forth in the 2018 ESPP.



Dissolution or Liquidation.
In the event of the proposed dissolution or liquidation of the Company, any offering period then in progress will be shortened
by setting a new purchase date and any offering periods will end on the new purchase date. The new purchase date will be prior
to the proposed dissolution or liquidation. The administrator will notify each participant in writing or electronically prior
to the new purchase date that the purchase date has been changed to the new purchase date and that the right to purchase shares
under the 2018 ESPP will be exercised automatically on the new purchase date, unless the participant has already withdrawn from
the offering period prior to such date.





14







Change in Control. If there
is a merger or “change in control,” as defined in the 2018 ESPP, each right to purchase shares under the 2018 ESPP
will be assumed or an equivalent right to purchase shares will be substituted by the successor corporation or a parent or subsidiary
of such successor corporation. If the successor corporation refuses to assume or substitute for the 2018 ESPP purchase rights,
the offering period covered by such 2018 ESPP purchase right by setting a new purchase date on which such offering period will
end. The new purchase date will be before the proposed merger or change in control. The administrator will notify each participant
in writing or electronically prior to the new purchase date that the purchase date has been changed to the new purchase date and
that the right to purchase shares under the 2018 ESPP will be exercised automatically on the new purchase date, unless the participant
has already withdrawn from the offering period prior to such date.



Amendment; Termination. The
administrator, in its sole discretion, may amend, suspend or terminate the 2018 ESPP, subject to its terms. The 2018 ESPP automatically
will terminate in 2038, unless we terminate it sooner.



2009 Equity Incentive Plan



In February 2009, the Phunware board of
directors adopted, and the Phunware stockholders approved, the 2009 Plan. The 2009 Plan was most recently amended in December
2017. The 2009 Plan permits the grant of incentive stock options, within the meaning of Section 422 of the Code, to Phunware employees
and any parent and subsidiary corporations’ employees, and for the grant of nonstatutory stock options, stock appreciation
rights, restricted stock, and restricted stock units to Phunware employees, directors and consultants and Phunware’s parent
and subsidiary corporations’ employees and consultants. In addition, the 2009 Plan permits the grant of EMI stock options,
which are options granted under the 2009 Plan to an eligible employee which is a qualifying option as defined in paragraph 1(2)
of Schedule 5 (“Schedule 5”), to the United Kingdom Income Tax (Earnings and Pensions) Act 2003 (“ITEPA 2003”).
EMI stock options (“EMI Options”), may only be granted to Phunware employees and any parent and subsidiary corporations’
employees whose time the employee is required to spend on Phunware business or that of any subsidiary (including any time which
the employee would have been so required to spend but for permitted absence (as such term is defined in the 2009 Plan)) is not
less than twenty-five (25) hours per week, or, if less, 75% of this working time and who does not have a material interest (as
such term is defined in the 2009 Plan) in Phunware or any subsidiary corporation.



Authorized Shares.The
2009 Plan terminated in connection with the consummation of the Business Combination, and accordingly, no shares will be available
for issuance under the 2009 Plan following the consummation of the Business Combination. The 2009 Plan will continue to govern
outstanding awards granted thereunder. As of December 31, 2018, options to purchase 2,364,823 shares of our common stock remained
outstanding under the 2009 Plan.



Plan Administration.
Phunware’s board of directors or one or more committees appointed by the Phunware board of directors administers the 2009
Plan (the “administrator”). Subject to the provisions of the 2009 Plan, the administrator has the power to administer
the 2009 Plan, including but not limited to, the power to interpret the terms of the 2009 Plan and awards granted under it, to
prescribe, amend and rescind rules relating to the 2009 Plan, including creating sub-plans, and to determine the terms of the
awards, including the exercise price, the number of shares of Phunware’s common stock subject to each such award, the exercisability
of the awards, any conditions attaching to the shares under an award which makes the shares “restricted securities”
or “restricted interest in securities” within the meaning of ITEPA 2003 (if applicable), and the form of consideration,
if any, payable upon exercise. The administrator also has the authority to amend existing awards, including the power to extend
the post-termination exercisability period of awards and to extend the maximum term of an option and to allow participants to
defer the receipt of the payment of cash or the delivery of shares that otherwise would be due to such participant under an award.
The administrator also has the authority to amend existing awards to reduce or increase their exercise prices, to allow participants
the opportunity to transfer outstanding awards to a financial institution or other person or entity selected by the administrator
and to institute an exchange program by which outstanding awards may be surrendered or cancelled in exchange for awards of the
same type which may have a higher or lower exercise price or different terms, awards of a different type and/or cash and to make
all other determinations the administrator deems necessary or advisable for administering the 2009 Plan.





15







Options (other than EMI Options).
Stock options may be granted under the 2009 Plan. The exercise price of options granted under the 2009 Plan must at least be equal
to the fair market value of Phunware’s common stock on the date of grant. The term of an option may not exceed ten years,
except that with respect to incentive stock options, any participant who owns more than 10% of the voting power of all classes
of Phunware’s outstanding stock, the term must not exceed five years and the exercise price must equal at least 110% of
the fair market value on the grant date. The administrator will determine the methods of payment of the exercise price of an option,
which may include cash, shares or other property acceptable to the administrator, as well as other types of consideration permitted
by applicable law. After termination of an employee, director or consultant, he or she may exercise his or her option for the
period of time as specified in the applicable option agreement. If termination is due to death or disability, the option generally
will remain exercisable for at least 12 months. In all other cases, the option will generally remain exercisable for at least
three months. However, in no event may an option be exercised later than the expiration of its term. Subject to the provisions
of the 2009 Plan, the administrator determines the other terms of options.



EMI Options. EMI Options
may be granted under the 2009 Plan. An option may only be an EMI Option if Phunware was a qualifying company, within the meaning
of Schedule 5, on the date of grant and if the option is granted for commercial reasons in order to recruit or retain an eligible
employee (as such term is defined in the 2009 Plan) and not as part of a scheme or arrangement for the main purpose (or one of
the main purposes) of which is the avoidance of tax. In addition, certain limitations, as described in the 2009 Plan, with respect
to the total value of shares that may be treated as EMI Options apply. If an option does not comply with the requirements of Schedule
5 and as a result, the option is not an EMI Option, or the extent the limits described in the 2009 Plan are not met, the option
will be a nonstatutory stock option. Except as noted herein, the provisions applicable to nonstatutory stock options described
above will also apply to EMI Options.



Stock Appreciation Rights.
Stock appreciation rights may be granted under the 2009 Plan. Stock appreciation rights allow the recipient to receive the appreciation
in the fair market value of Phunware common stock between the exercise date and the date of grant. Stock appreciation rights may
not have a term exceeding ten years. After the termination of service of an employee, director or consultant, he or she may exercise
his or her stock appreciation right for the period of time stated in his or her award agreement. However, in no event may a stock
appreciation right be exercised later than the expiration of its term. Subject to the provisions of the 2009 Plan, the administrator
determines the other terms of stock appreciation rights, including when such rights become exercisable and whether to pay any
increased appreciation in cash or with shares of Phunware common stock, or a combination thereof, except that the per share exercise
price for the shares of Phunware common stock to be issued pursuant to the exercise of a stock appreciation right will be no less
than 100% of the fair market value per share on the date of grant.



Restricted Stock. Restricted
stock may be granted under the 2009 Plan. Restricted stock awards are grants of shares of Phunware common stock that vest in accordance
with terms and conditions established by the administrator. The administrator will determine the number of shares of restricted
stock granted to any employee, director or consultant and, subject to the provisions of the 2009 Plan, will determine the terms
and conditions of such awards. The administrator may impose whatever conditions for lapse of the restriction on the shares it
determines to be appropriate (for example, the administrator may set restrictions based on the achievement of specific performance
goals or continued service); provided, however, that the administrator, in its discretion, may accelerate the time at which any
restrictions will lapse or be removed. Recipients of restricted stock awards generally will have voting and dividend rights with
respect to such shares upon grant without regard to the restriction, unless the administrator provides otherwise. Shares of restricted
stock as to which the restrictions have not lapsed are subject to Phunware’s right of repurchase or forfeiture.



Restricted Stock Units.Restricted stock units may be granted under the 2009 Plan. Restricted stock units are bookkeeping entries representing an
amount equal to the fair market value of one share Phunware’s common stock. Subject to the provisions of the 2009, the administrator
will determine the terms and conditions of restricted stock units, including the vesting criteria (which may include accomplishing
specified performance criteria or continued service) and the form and timing of payment. Notwithstanding the foregoing, the administrator,
in its sole discretion, may reduce or waive any vesting criteria that must be met to receive a payout.





16







Non-Transferability of Awards.Unless the administrator provides otherwise (excluding EMI Options), the 2009 Plan generally does not allow for the transfer
of awards and only the recipient of an award may exercise an award during his or her lifetime. An EMI Option is personal to the
participant and may not be transferred and only the recipient of an EMI Option may exercise such award during his or her lifetime.



Certain Adjustments.
In the event of certain changes in Phunware’s capitalization, to prevent diminution or enlargement of the benefits or potential
benefits available under the 2009 Plan, the administrator will adjust the number and class of shares that may be delivered under
the 2009 Plan and/or the number, class and price of shares covered by each outstanding award.



Dissolution or Liquidation.
In the event of Phunware’s proposed liquidation or dissolution, the administrator will notify participants as soon as practicable
prior to the date of such proposed action and, to the extent not exercised, all awards will terminate immediately prior to the
consummation of such proposed transaction.



Merger or Change in Control.The 2009 Plan provides that in the event of a merger or change in control, as defined under the 2009 Plan, each outstanding
award will be treated as the administrator determines If a successor corporation or its parent or subsidiary does not assume or
substitute an equivalent award for any outstanding award, then such award will fully vest, all restrictions on the shares subject
to such award will lapse, all performance goals or other vesting criteria applicable to the shares subject to such award will
be deemed achieved at 100% of target levels and all of the shares subject to such award will become fully exercisable, if applicable,
for a specified period prior to the transaction. The award will then terminate upon the expiration of the specified period of
time. If an option or stock appreciation right becomes fully vested and exercisable in connection with a change in control due
to the successor corporation’s refusal to assume the award, the administrator will notify the applicable participant in
writing or electronically that the award will be exercisable for a period of time determined by the administrator, and the option
or stock appreciation right will terminate upon the expiration of such period. The Business Combination was not deemed a change
in control as prescribed by the plan, and the Successor assumed all outstanding awards at the exchange ratio of 0.459.



Amendment; Termination.The Phunware board of directors has the authority to amend, alter, suspend or terminate the 2009 Plan, provided such action
will not impair the existing rights of any participant, unless mutually agreed to in writing between the participant and the administrator.
As noted above, upon the consummation of the Business Combination, the 2009 Plan terminated and no further awards will be granted
thereunder. All outstanding awards will continue to be governed by their existing terms.



Executive Incentive Compensation Plan



The Phunware board of directors intends
to adopt an Executive Incentive Compensation Plan (the “Incentive Compensation Plan”). The Incentive Compensation
Plan allows a committee appointed by the board of directors to provide cash incentive awards to employees selected by the committee,
including the named executive officers, based upon performance goals established by the committee.



Under the Incentive Compensation Plan,
the committee determines the performance goals applicable to any award, which goals may include, without limitation, the attainment
of research and development milestones, sales bookings, business divestitures and acquisitions, cash flow, cash position, earnings
(which may include any calculation of earnings, including but not limited to earnings before interest and taxes, earnings before
taxes, earnings before interest, taxes, depreciation and amortization and net earnings), earnings per share, net income, net profit,
net sales, operating cash flow, operating expenses, operating income, operating margin, overhead or other expense reduction, product
defect measures, product release timelines, productivity, profit, return on assets, return on capital, return on equity, return
on investment, return on sales, revenue, revenue growth, sales results, sales growth, stock price, time to market, total stockholder
return, working capital and individual objectives such as peer reviews or other subjective or objective criteria. The performance
goals may differ from participant to participant and from award to award.





17







Our compensation committee is expected
to administer the Incentive Compensation Plan. The administrator of the Incentive Compensation Plan may, in its sole discretion
and at any time, increase, reduce or eliminate a participant’s actual award, and/or increase, reduce or eliminate the amount
allocated to the bonus pool for a particular performance period. The actual award may be below, at or above a participant’s
target award, in the discretion of the administrator. The administrator may determine the amount of any reduction on the basis
of such factors as it deems relevant, and it is not required to establish any allocation or weighting with respect to the factors
it considers.



Actual awards are paid in cash only after
they are earned, which usually requires continued employment through the last day of the performance period. Payment of awards
occurs as soon as practicable after the performance period during which the award is earned, but no later than the dates set forth
in the Incentive Compensation Plan.



The board of directors has the authority
to amend or terminate the Incentive Compensation Plan, provided such action does not impair the existing rights of any participant
with respect to any earned awards.



Limitation on Liability and Indemnification Matters



As permitted under Delaware law, our amended
and restated certificate of incorporation and amended and restated bylaws provide that we will indemnify our directors and officers
and may indemnify our employees and other agents, to the fullest extent permitted by Delaware law. Delaware law prohibits our
amended and restated certificate of incorporation from limiting the liability of our directors for any of the following:



| | ● | any breach of a director’s duty of loyalty
    to us or to our stockholders;
| | - | ----------------------------------------------------------------------------



| | ● | acts or omissions not in good faith or that
    involve intentional misconduct or a knowing violation of law;
| | - | -------------------------------------------------------------------------------------------------------------



| | ● | unlawful payment of dividends or unlawful stock
    repurchases or redemptions; and
| | - | -----------------------------------------------------------------------------------



| | ● | any transaction from which a director derived
    an improper personal benefit.
| | - | -------------------------------------------------------------------------------



If Delaware law is amended to authorize
corporate action further eliminating or limiting the personal liability of a director, then the liability of our directors will
be eliminated or limited to the fullest extent permitted by Delaware law, as so amended. Our amended and restated certificate
of incorporation will not eliminate a director’s duty of care and, in appropriate circumstances, equitable remedies, such
as injunctive or other forms of non-monetary relief, remain available under Delaware law. This provision also will not affect
a director’s responsibilities under any other laws, such as the federal securities laws or other state or federal laws.
Under our amended and restated bylaws, we will also be empowered to purchase insurance on behalf of any person whom we are required
or permitted to indemnify.



In addition to the indemnification required
in our amended and restated certificate of incorporation and amended and restated bylaws, we have entered into an indemnification
agreement with each member of our board of directors. These agreements provide for the indemnification of our directors, officers
and some employees for certain expenses and liabilities incurred in connection with any action, suit, proceeding or alternative
dispute resolution mechanism, or hearing, inquiry or investigation that may lead to the foregoing, to which they are a party,
or are threatened to be made a party, by reason of the fact that they are or were a director, officer, employee, agent or fiduciary
of our company, or any of our subsidiaries, by reason of any action or inaction by them while serving as a director, officer,
employee, agent or fiduciary, or by reason of the fact that they were serving at our request as a director, officer, employee,
agent or fiduciary of another entity. In the case of an action or proceeding by or in the right of our company or any of our subsidiaries,
no indemnification will be provided for any claim where a court determines that the indemnified party is prohibited from receiving
indemnification. We believe that these charter and bylaw provisions and indemnification agreements are necessary to attract and
retain qualified persons as directors and officers.



The limitation of liability and indemnification
provisions in our amended and restated certificate of incorporation and amended and restated bylaws may discourage stockholders
from bringing a lawsuit against directors for breach of their fiduciary duties. They may also reduce the likelihood of derivative
litigation against directors and officers, even though an action, if successful, might benefit us and our stockholders. Moreover,
a stockholder’s investment may be harmed to the extent we pay the costs of settlement and damage awards against directors
and officers pursuant to these indemnification provisions. Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to our directors, officers and controlling persons pursuant to the foregoing provisions, or otherwise, we
have been advised that, in the opinion of the SEC, such indemnification is against public policy as expressed in the Securities
Act and is, therefore, unenforceable. There is no pending litigation or proceeding naming any of our directors or officers as
to which indemnification is being sought, nor are we aware of any pending or threatened litigation that may result in claims for
indemnification by any director or officer.





18







Item 12. Security Ownership of Certain Beneficial Owners
and Management and Related Stockholder Matters.



Equity Compensation Plan Information



The following table sets forth with respect
to shares of the Company’s common stock that may be issued under the Company’s existing equity compensation plans,
including the 2009 Equity Incentive Plan and the 2018 Equity Incentive Plan. Each of these plans has been approved by the Company’s
shareholders. The Company does not maintain any equity incentive plans that have not been approved by shareholders.





|Plan Category                        |  | Number of securities issued upon the exercise of outstanding options and rights |           |     | Weighted average exercise price |   |      | Number of securities available for future issuances | 
|------------------------------------ |  | ------------------------------------------------------------------------------- | --------- | --- | ------------------------------- | - | ---- | --------------------------------------------------- | 
|2009 Equity Incentive Plan           |  |                                                                                 | 2,364,823 |     |                                 | $ | 0.90 | (1)                                                 | 
|2018 Equity Incentive Plan(2)        |  |                                                                                 | —         | (2) |                                 | $ | —    |                                                     | 
|2018 Employee Stock Purchase Plan(2) |  |                                                                                 | —         | (2) |                                 | $ | —    |                                                     | 



|(1) | The weighted-average exercise price of stock option awards outstanding under the 2009 Equity Incentive Plan (the “2009 Plan”) as of December 31, 2018. In connection with the consummation of the Business Combination, no additional grants will be made under the 2009 Plan
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|(2) | In connection with the consummation of the Business Combination, our board of directors adopted, and our stockholders approved, the 2018 Equity Incentive Plan (the “2018 Plan”), and the 2018 Employee Stock Purchase Plan. As of December 31, 2018, no awards have been granted under either plan.                                                                                                                                                                                                                                                                                                                                                                                      
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|(3) | The shares of common stock reserved for issuance under the 2018 Plan also include any shares of common stock subject to stock options, restricted stock units or similar awards granted under the 2009 Plan, that, were assumed in connection with the Business Combination, expire or otherwise terminate without having been exercised in full and shares of common stock issued pursuant to awards granted under the 2009 Plan that are forfeited to or repurchased by us after the Business Combination, with the maximum number of shares of common stock that may be added to the 2018 Plan pursuant to the foregoing equal to 2,372,893, which is not included in the figure above.





Beneficial Ownership of Principal Shareholders and Management



We have determined beneficial ownership
in accordance with the rules of the SEC and the information is not necessarily indicative of beneficial ownership for any other
purpose. Unless otherwise indicated below, to our knowledge, the persons and entities named in the table have sole voting and
sole investment power with respect to all shares that they beneficially own, subject to community property laws where applicable.
In computing the number of shares of our common stock beneficially owned by a person and the percentage ownership of that person,
we deemed outstanding shares of our common stock subject to options or restricted stock units held by that person that are currently
exercisable or exercisable within 60 days of April 23, 2019. We did not deem these shares outstanding, however, for the purpose
of computing the percentage ownership of any other person. Shares beneficially owned after the offering assumes securities being
offered with this Offering are being sold irrespective that those beneficial holders may be subject to restrictions in selling
or transferring.



We have based percentage ownership of our
common stock prior to this offering on 38,880,158 shares of our common stock outstanding as of April 23, 2019 unless otherwise
noted.



Unless otherwise indicated, the address
of each beneficial owner listed on the table below is c/o Phunware, Inc., 7800 Shoal Creek Blvd, Suite 230-S, Austin, TX 78757.





19







|Name of Beneficial Owner                                            |  | Shares(1) |           |  | Percentage | 
|------------------------------------------------------------------- |  | --------- | --------- |  | ---------- | 
|Mount
    Raya Investments Limited(2)                               |  |           | 2,205,886 |  |            | 
|Max Fang(3)                                                         |  |           | 2,189,803 |  |            | 
|Firmus Investments(4)                                               |  |           | 1,783,663 |  |            | 
|Astra
    Maritime Corp.(5)                                         |  |           | 1,508,853 |  |            | 
|Magellan
    Investments Corp.(4)                                   |  |           | 1,407,436 |  |            | 
|Dominium
    Investments Inc.(5)                                    |  |           | 1,346,071 |  |            | 
|Named
    Executive Officers and Directors:                         |  |           |           |  |            | 
|Alan Knitowski(6)                                                   |  |           | 868,390   |  |            | 
|Luan Dang(7)                                                        |  |           | 886,681   |  |            | 
|Randall Crowder(8)                                                  |  |           | 127,134   |  |            | 
|Prokopios
    (Akis) Tsirigakis(9)(10)                              |  |           | 2,854,914 |  |            | 
|Keith Cowan(10)                                                     |  |           | —         |  |            | 
|Lori
    Tauber Marcus(10)                                          |  |           | —         |  |            | 
|Kathy
    Tan Mayor(10)                                             |  |           | —         |  |            | 
|George Syllantavos(10)(11)                                          |  |           | 3,191,099 |  |            | 
|All
    executive officers and directors as a group (8 persons)(12) |  |           | 7,928,217 |  |            | 



|(*)  | Represents beneficial ownership of less than
    1%.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1)  | The percentage of beneficial ownership on the
    record date is calculated based on 38,880,158 shares of our common stock as of April 23, 2019, adjusted for each owner’s
    options or restricted stock units held by that person that are currently exercisable or exercisable within 60 days of April
    23, 2019, if any. Unless otherwise indicated, we believe that all persons named in the table have sole voting and investment
    power with respect to all ordinary shares beneficially owned by them.                                                                                                                                                                     
|(2)  | Includes 2,205,886 shares held of record by
    Mount Raya Investments Limited, an entity wholly-controlled by Khazanah Nasional Berhad, a strategic investment fund of the
    Government of Malaysia. The address for this entity is c/o Khazanah Americas Incorporated, 101 California Street, Suite 4550,
    San Francisco, California 94111.                                                                                                                                                                                                                                                                                                                                        
|(3)  | Includes (i) 857,508 shares held of record by
    Maxima Ventures II, Inc., of which Mr. Fang serves as General Manager, (ii) 599,425 shares held of record by Maxima Ventures
    Services II, Inc., of which Mr. Fang serves as a director, (iii) 399,616 shares held of record by TC-1 Culture Fund, of which
    Mr. Fang serves as General Manager, (iv) 181,613 shares held of record by Eagle China Holdings Limited, and (v) 151,641 shares
    held of record by Maxima Ventures Services IV, Inc., of which Mr. Fang serves as a director. The address for these entities
    is No. 16, Lane 66, Sec. 4, Heping East Road, Wenshan Dist., Taipei City 116, Taipei City, Taiwan.
|(4)  | Mr. Syllantavos is the sole shareholder of Firmus
    Investments Inc. and Magellan Investments Corp. As a result, Mr. Syllantavos may be deemed to be beneficial owner of any shares
    deemed to be beneficially owned by Firmus Investments Inc. and Magellan Investments Inc. The address for these entities is
    90 Kifissias Avenue, Maroussi 15125, Athens, Greece.                                                                                                                                                                                                                                                                                                             
|(5)  | Mr. Tsirigakis is the sole shareholder of Astra
    Maritime Corp. and Dominium Investments Inc. As a result, Mr. Tsirigakis may be deemed to be beneficial owner of any shares
    deemed to be beneficially owned by Astra Maritime Corp. and Dominium Investments Inc. The address for these entities is 90
    Kifissias Avenue, Maroussi 15125, Athens, Greece.                                                                                                                                                                                                                                                                                                                      
|(6)  | Includes (i) 537,638 shares held of record by
    Cane Capital, LLC, for which Mr. Knitowski serves as president, (ii) 4,159 shares held of record by Curo Capital Appreciation
    Fund I, LLC (#1), for which Mr. Knitowski serves as president, (iii) 6,871 shares held of record by Curo Capital Appreciation
    Fund I, LLC (Fund 1), for which Mr. Knitowski serves as president, (iv) 27,492 shares held of record by Curo Capital Appreciation
    Fund I, LLC (Fund 2), for which Mr. Knitowski serves as president, and (v) 408,510 shares subject to options exercisable within
    60 days of April 23, 2019, of which 292,230 had vested as of such date.                   
|(7)  | Includes (i) 782,689 shares held of record by
    Mr. Dang and (ii) 172,125 shares subject to options exercisable within 60 days of April 23, 2019, of which 103,992 had vested
    as of such date.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|(8)  | Includes (i) 50,635 shares held of record by
    Mr. Crowder and (ii) 229,500 shares subject to option exercisable within 60 days of April 23, 2019, of which 76,499 had vested
    as of such date.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|(9)  | Includes (i) 1,508,843 shares held of record
    by Astra Maritime Corp., for which Mr. Tsirigakis is the sole shareholder and (ii) 1,346,071 shares held of record by Dominium
    Investments, Inc., for which Mr. Tsirigakis is the sole shareholder.                                                                                                                                                                                                                                                                                                                                                                                                                                  
|(10) | Messrs. Cowan, Syllantavos and Tsirigakis and
    Mses. Marcus and Mayor each joined our board of directors upon consummation of the business combination on December 26, 2018.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|(11) | Includes (i) 1,783,663 shares held of record
    by Firmus Investments, Inc., of which Mr. Syllantavos is the sole shareholder and (ii) 1,407,436 shares held of record by
    Magellan Investments Corp., of which Mr. Syllantavos is the sole shareholder.                                                                                                                                                                                                                                                                                                                                                                                                                              
|(12) | Includes (i) 7,455,497 shares held of record
    by our current directors and executive officers and (ii) 810,135 shares subject to options exercisable within 60 days of April
    23, 2019, of which 472,720 had vested as of such date.                                                                                                                                                                                                                                                                                                                                                                                                                                                





20







Item 13. Certain Relationships and Related Transactions,
and Director Independence.



Phunware Related Person Transactions



In addition to the director and executive
officer compensation arrangements and indemnification arrangements discussed above in the section titled “Executive Compensation,”
the following is a description of transactions and series of similar transactions, during our last three fiscal years, to which
Phunware was a party prior to the consummation of the business combination, in which:



| | ● | the amounts involved exceeded or will exceed
    $120,000; and
| | - | --------------------------------------------------------------



| | ● | any of our directors, executive officers or
    beneficial holders of more than 5% of any class of our capital stock, or any immediate family member of such related person,
    had or will have a direct or indirect material interest
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Other than compensation arrangements with
the Phunware directors and executive officers, the following is a description of certain relationships and transactions during
the last three years involving our directors, executive officers, beneficial holders of more than 5% of our capital stock, or
entities affiliated with them.



Investors’ Rights Agreement



Phunware is party to an investors’
rights agreement that provides, among other things, that holders of Phunware’s preferred stock, including stockholders affiliated
with some of its directors, have the right to demand that Phunware file a registration statement or request that their shares
be covered by a registration statement that it is otherwise filing. For a more detailed description of these registration rights,
see the section titled “Description of Phunware, Inc. Securities — Registration Rights.”



Phunware Related Person Policy



As a privately held company, Phunware was
not required to maintain a Related Person Policy. Following consummation of the business combination, Phunware became subject
to our Policies and Procedures for Related Person Transactions described in this section.



With respect to the consolidated financial
statements of Phunware and subsidiaries contained elsewhere in this prospectus, Phunware was subject to Auditing Standard No.
18 of the Public Company Accounting Oversight Board, which requires auditors to evaluate a company’s identification of,
accounting for and disclosure of related party relationships and transactions.



The information from the section titled
“Description of Securities—Registration Rights” is incorporated by reference herein.



Maxima Capital Management



On August 26, 2015, we entered into a consulting
agreement with Maxima, an investor in the predecessor company’s Series B, C, E and F convertible preferred stock financings.
We owed Maxima $150,000 at December 31, 2016 and this balance was subsequently paid.





21







Stellar Extension Notes



During 2017 and 2018, Stellar issued multiple
promissory notes issued to Firmus Investments, Inc., Astra Maritime, Inc., and Magellan Investments, Corp, affiliates of our Chairman
of our Board of Directors and a member of our Board of Directors. These promissory notes are collectively referred to as the “Sponsor
Extension Notes”. The aggregate amount of Sponsor Extension Notes issued was $1,105,786. The Sponsor Extension Notes bear
no interest and were repayable in full upon consummation of the Company’s initial business combination. The noteholders
had the option to convert any unpaid balance of the Notes into warrants exercisable for shares of the Company’s common stock,
based on a conversion price of $0.50 per warrant. The noteholders chose to receive payment in the form of warrants. At the closing
of the Business Combination, the Sponsors were issued 2,211,572 Private Placement Warrants as repayment in full for the unsecured
promissory notes.



Phunware Extension Notes



From February 2018 through November 2018,
Stellar issued Phunware notes payable in the aggregate of $535,655. The notes to Phunware bears no interest and were repayable
in full upon consummation of Stellar’s initial business combination. The notes Phunware were eliminated with the assumption
of Stellar’s balance sheet as a result of the Business Combination.



Transfer Sponsor Warrant Notes



Merger consideration paid to Phunware stockholders
included an option for each predecessor Phunware shareholder to elect to receive such holder’s pro rata share of up to an
aggregate of 3,985,244 warrants (the “Transfer Sponsor Warrants”) to purchase shares of Successor common stock that
are currently were held by affiliates of our Chairman and member of our board of directors. As consideration for the Transfer
Sponsor Warrants transferred to Phunware shareholders, a promissory note was issued to the Sponsors (the “Transfer Sponsor
Warrant Note”). The amount of the note was approximately $1,993,000, which represented $0.50 per warrant transferred to
former stockholders of Phunware. The Transfer Sponsor Warrant Note bears no interest. The Transfer Sponsor Warrants have an exercise
price of $11.50 per share. The Transfer Sponsor Warrant Note shall mature on December 26, 2019. The Transfer Sponsor Warrant Note
was subsequently waived and forgiven by the noteholders.



Assumed Payables



In conjunction with the Business Combination,
Phunware assumed $255,000 in payables from Stellar for Nautilus Energy Management Corporation, an affiliate of two members of
the Company’s board of directors.



Our Existing Policies and Procedures for Related Person
Transactions



We adopted a formal written policy effective
upon the consummation of the Business Combination providing that our executive officers, directors, nominees for election as directors,
beneficial owners of more than 5% of any class of our capital stock, any member of the immediate family of any of the foregoing
persons and any firm, corporation or other entity in which any of the foregoing persons is employed or is a general partner or
principal or in a similar position or in which such person has a 5% or greater beneficial ownership interest, are not permitted
to enter into a related party transaction with us without the approval of our nominating and corporate governance committee, subject
to the exceptions described below.



A related person transaction is a transaction,
arrangement or relationship, or any series of similar transactions, arrangements or relationships, in which we and any related
person are, were or will be participants in which the amount involves exceeds $120,000. Transactions involving compensation for
services provided to the Successor as an employee or director are not covered by this policy.





22







Under the policy, we will collect information
that we deem reasonably necessary from each director, executive officer and, to the extent feasible, significant stockholder to
enable us to identify any existing or potential related-person transactions and to effectuate the terms of the policy. In addition,
under our Code of Conduct, our employees and directors have an affirmative responsibility to disclose any transaction or relationship
that reasonably could be expected to give rise to a conflict of interest. In considering related person transactions, the Successor’s
nominating and corporate governance committee, or other independent body of our board of directors, will take into account the
relevant available facts and circumstances including, but not limited to:



| | ● | the risks, costs and benefits to us;
| | - | ------------------------------------



| | ● | the impact on a director’s independence
    in the event that the related person is a director, immediate family member of a director or an entity with which a director
    is affiliated;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ● | the availability of other sources for comparable
    services or products; and
| | - | ------------------------------------------------------------------------------



| | ● | the terms available to or from, as the case
    may be, unrelated third parties or to or from employees generally.
| | - | ------------------------------------------------------------------------------------------------------------------



The policy requires that, in determining
whether to approve, ratify or reject a related person transaction, our nominating and corporate governance committee, or other
independent body of our board of directors, must consider, in light of known circumstances, whether the transaction is in, or
is not inconsistent with, our best interests and those of our stockholders, as our nominating and corporate governance committee,
or other independent body of our board of directors, determines in the good faith exercise of its discretion.



Our nominating and corporate governance
committee has determined that certain transactions will not require the approval of the nominating and corporate governance committee,
including certain employment arrangements of executive officers, director compensation, transactions with another company at which
a related party’s only relationship is as a director, non-executive employee or beneficial owner of less than 10% of that
company’s outstanding capital stock, transactions where a related party’s interest arises solely from the ownership
of our common stock and all holders of our common stock received the same benefit on a pro rata basis and transactions available
to all employees generally.



Director Independence



Our common stock and warrants are listed
on Nasdaq. Under the rules of Nasdaq, independent directors must comprise a majority of a listed company’s board of directors.
In addition, the rules of Nasdaq require that, subject to specified exceptions, each member of a listed company’s audit,
compensation, and nominating and corporate governance committees be independent. Under the rules of Nasdaq, a director will only
qualify as an “independent director” if, in the opinion of that company’s board of directors, that person does
not have a relationship that would interfere with the exercise of independent judgment in carrying out the responsibilities of
a director. Audit committee members must also satisfy the independence criteria set forth in Rule 10A-3 under the Exchange
Act. Compensation committee members must also satisfy the independence criteria set forth in Rule 10C-1 under the Exchange
Act.



In order to be considered independent for
purposes of Rule 10A-3 and Rule 10C-1, a member of an audit committee or compensation committee of a listed company
may not, other than in his or her capacity as a member of the committee, the board of directors, or any other board committee:
(1) accept, directly or indirectly, any consulting, advisory, or other compensatory fee from the listed company or any of its
subsidiaries; or (2) be an affiliated person of the listed company or any of its subsidiaries.



We have undertaken a review of the independence
of each director and considered whether each director has a material relationship with us that could compromise his or her ability
to exercise independent judgment in carrying out his or her responsibilities. As a result of this review, we determined that Messrs.
Cowan, Syllantavos and Tsirigakis and Mses. Marcus and Mayor, representing five of PHUN’s seven directors, will be
considered “independent directors” as defined under the applicable rules and regulations of the SEC and the listing
requirements and rules of Nasdaq.





23







Lead Independent Director



We believe that the structure of our board
of directors and committees provides strong overall management. The Chair of our board of directors and our Chief Executive Officer
roles will be separate. Mr. Knitowski will serve as our Chief Executive Officer and Mr. Prokopios (Akis) Tsirigakis will serve
as Chair of our board of directors. This structure will enable each person to focus on different aspects of company leadership.
Our Chief Executive Officer will be responsible for setting the strategic direction of our company, the general management and
operation of the business and the guidance and oversight of senior management. The Chair of our board of directors will monitor
the content, quality and timeliness of information sent to our board of directors and will be available for consultation with
our board of directors regarding the oversight of its business affairs. Our independent directors will bring experience, oversight
and expertise from outside of Phunware, while Mr. Knitowski will bring company-specific experience and expertise. As one of the
founders of Phunware, Mr. Knitowski is best positioned to identify strategic priorities, lead critical discussion and execute
our business plans.



Item 14. Principal Accounting Fees and Services.



Principal Accountant Fees and Services





The following table represents aggregate fees
billed to the Company for professional services by our independent registered public accounting firm, Marcum LLP for the fiscal
year ended December 31, 2018, and WitumSmith+Brown, PC for the fiscal year ended December 31, 2017.



|                      |  | Fiscal Year Ended (In thousands) |    
|--------------------- |  | -------------------------------- | ---
|                      |  | 2018                             |    
|Audit Fees(1)         |  | $                                | 466
|Audit-related Fees(2) |  |                                  | -  
|Tax Fees(3)           |  |                                  | -  
|All Other Fees(4)     |  |                                  | -  
|Total Fees            |  | $                                | 466



| | (1) | “Audit
Fees” consist of fees for professional services rendered in connection with the audit of our annual consolidated financial
statements, including audited financial statements presented in our annual report on Form 10-K, review of our quarterly financial
statements presented in our quarterly report on Form 10-Q and services that are normally provided by our independent registered
public accounting firm in connection with statutory and regulatory filings or engagements for those fiscal years, including audit
services in connection with the Business Combination and the filing of our Form S-4, and amendments thereto.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------







| | (2) | “Audit-related
                                         Fees” consist of fees related to audit and assurance procedures not otherwise included
                                         in Audit Fees, including fees related to the application of GAAP to proposed transactions
                                         and new accounting pronouncements.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (3) | “Tax Fees”
                                         consist of tax return preparation, international and domestic tax studies, consulting
                                         and planning.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (4) | “All Other
                                         Fees” consist of the cost of a subscription to an accounting research tool.
| | --- | -------------------------------------------------------------------------------------------------------------------------------



Audit Committee Pre-Approval



Our Audit Committee pre-approves all auditing
services and permitted non-audit services to be performed for us by our independent auditor, including the fees and terms thereof.
All of the services described above were approved by our Audit Committee.



Change in Registrant’s Certifying Accountant



WitumSmith+Brown, PC (“Withum”)
served as the independent registered public accounting firm for Stellar (and its subsidiary) from its inception thru the Closing
of the Business Combination. The firm of Marcum, LLP (“Marcum”) served as the independent registered public
accounting firm for privately-held Phunware. In connection with our Business Combination, Withum was dismissed, and Marcum
was named as the Company’s independent registered public accounting firm.



24







PART IV



Item 15. Exhibits, Financial Statement Schedules.



|(a) | The following documents
    are filed as part of this Amendment:
|--- | ----------------------------------------------------------------
|    |                                                                 
|(3) | Exhibits                                                        



We hereby file as part of this Report the
exhibits listed in the attached Exhibit Index. Exhibits which are incorporated herein by reference can be inspected and copied
at the public reference facilities maintained by the SEC, 100 F Street, N.E., Room 1580, Washington D.C. 20549. Copies of such
material can also be obtained from the Public Reference Section of the SEC, 100 F Street, N.E., Washington, D.C. 20549, at prescribed
rates or on the SEC website at www.sec.gov.



EXHIBIT INDEX



|Exhibit
    No. |  | Description                                                                                       
|--------------- |  | --------------------------------------------------------------------------------------------------
|31.3*           |  | Certification
    of the Principal Executive Officer required by Rule 13a-14(a) or Rule 15d-14(a)*
|31.4*           |  | Certification
    of the Principal Financial Officer required by Rule 13a-14(a) or Rule 15d-14(a)*



| | * | Filed
                                         herewith
| | - | -------------------------------------------------------



25







SIGNATURES



Pursuant to the requirements
of Section 13 or 15(d) of the Securities Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by
the undersigned, thereunto duly authorized.



|April 30, 2019 | Phunware, Inc.
|-------------- | --------------
|               |               
|               | By:           
|               |               





26