David Hall, the beneficial owner of approximately 52.2% of the outstanding common stock of Velodyne Lidar, Inc. (NASDAQ: VLDR) (“Velodyne Lidar” or the “Company”), today issued the following open letter to the Company’s Board of Directors (the “Board”):
June 3, 2021
Velodyne Lidar, Inc.
5521 Hellyer Avenue
San Jose, California 95138
Attn: The Board of Directors
Dear Members of the Board of Directors:
As I have made clear in recent months, I firmly believe that you have collectively fostered an anti-stockholder culture. I chose to resign from the Board earlier this year because I had numerous concerns about the strategic direction and current leadership of Velodyne Lidar. Today, I am writing to you to urge that the following Board members step down: Chairman Brad Culkin, Chief Executive Officer Anand Gopalan, director Michael Dee, and director Christopher Thomas. I believe that each of these individuals has breached stockholders’ confidence and destroyed significant value in the Company.
In my view, the only way to turn around Velodyne Lidar is to purge the Board of its seemingly self-interested and underqualified members. The Board should know it is not lost on stockholders that the Company’s stock price has plummeted almost 50% since I was unjustifiably stripped of my role as Chairman in February. Pushing aligned and experienced directors off the Board has clearly been a recipe for disaster. At this point, the Company’s failed directors should do the right thing and resign.
Since being installed on the Board via a merger with Graf Industrial, a special purpose acquisition company (“SPAC”), it has become apparent that Mr. Culkin, Dr. Gopalan and the aforementioned directors have not been acting in the best interest of stockholders. From my vantage point, perhaps the greatest offense has been that this Board has allowed Dr. Gopalan’s actions to go unchecked as Chief Executive Officer while he has manipulated the truth to customers and investors alike.
Recently, Dr. Gopalan attempted to re-write history in a September 2020 investor presentation jointly hosted by Graf Industrial and Velodyne Lidar management teams when he stated: “It gives me great pleasure to have the opportunity to tell you about this really exciting story that I’ve been part of for 4.5 years, starting from a couple of guys in the Founder’s boat yard, and building this incredible technology that’s changing society and changing the world in so many different ways.”1
The reality is that Velodyne Lidar did not begin with “two guys” in a boat yard, but was founded in 1983 and took decades to achieve such high-growth and significant technological advancement. In 2016, the year Dr. Gopalan first joined the Company, Velodyne Lidar was profitable, earning its highest revenue to date, and producing and shipping all lidar products from a 60,000 sq. ft. building in Morgan Hill, CA with over 100 engineers. In stark contrast, since Dr. Gopalan has emerged as CEO, the Company’s revenue has steadily declined.
Dr. Gopalan was one of 50 engineers who contributed to important projects and was not central to solving the main challenge facing Velodyne Lidar – achieving technical, cost-effective solutions to product delivery. I believe the Company would be stronger if Dr. Gopalan left and was replaced by a capable successor.
In addition, I am calling on Mr. Culkin to step down because I believe that he has also taken several liberties with the truth and has acted as a rubberstamp on Dr. Gopalan’s actions, including by approving a robust, metric-free Chief Executive Officer compensation package.
I fear that if Messrs. Culkin, Gopalan and their fellow SPAC-appointed directors are left at the helm, significant value destruction will only compound for stockholders. Velodyne Lidar’s customers, employees and stockholders deserve a better Board rather than one that lacks a firm grasp of the truth and a coherent strategic plan. I intend to continue to speak my mind, and to take other actions to return strategic product development and shareholder value to Velodyne Lidar.
Founder of Velodyne Lidar, Inc.