The following constitutes Amendment No. 3 to the Schedule 13D filed by the undersigned
(Amendment No. 3). This Amendment No. 3 amends the Schedule 13D as specifically set forth herein.
Item 3.
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Source and Amount of Funds or Other Consideration.
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Item 3 is amended to incorporate by reference the transactions set forth in Schedule A.
Item 4.
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Purpose of Transaction.
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Item 4 is amended to add the following:
David Hall is the founder of the Issuer, and served as its Chief Executive Officer from the time of its founding up until 2020. Under
Mr. Halls leadership, the Issuer was at the forefront of lidar technology invention and innovation, including selling lidar for automotive purposes. Mr. Hall reinvented the Velodyne Acoustics business and in 2016 officially created
Velodyne Lidar Inc. He led the lidar company through high growth to total revenue of approximately $426 million between 2017 and 2019 and market share of 70% within the lidar market.
Mr. Hall, together with the other Reporting Persons, currently own the largest block of the Issuers common stock, comprised of
59,770,524 Shares owned by Mr. Hall and 5,935,865 Shares owned by Mrs. Hall. Mr. Hall also holds voting proxies for 39,181,017 Shares (which include the Shares held by Mrs. Hall and consist of outstanding Shares and Shares
issuable pursuant to restricted stock units that vest within 60 days of the date hereof based on publicly available information, including the Issuers Proxy Statement). Combined, this represents 52.2% of the outstanding Shares. The Reporting
Persons cannot, and will not, stand idly by and watch the Board squander the Issuers bright future with what the Reporting Persons believe is a lack of strategic focus and poor corporate governance.
Since the merger described in that certain Agreement and Plan of Merger, dated as of July 2, 2020 (the Merger), and amended
on August 20, 2020, by and among the Issuer (formerly known as Graf Industrial Corp.), VL Merger Sub Inc. and Velodyne Lidar USA, Inc., the Reporting Persons have tried to work cooperatively with the other members of the Board and the
management team to strive for the continued success of the Issuer. Unfortunately, their efforts continue to be disregarded by the current Board. The Reporting Persons have repeatedly expressed their grave concerns about the Issuers falling
product sales, stagnation in innovation that has resulted in a lack of new product offerings to meet evolving market demand, overconcentration of limited company resources on executive compensation when focus on investment in research and
development is necessary, departure of key R&D personnel, loss of market share to competitors, the serious risk of theft of the Issuers IP in China, and the Issuers overall poor financial performance. However, the Reporting Persons
believe the Board has failed to adjust the Issuers business strategies or practice or otherwise address these concerns. Other lidar companies are thriving during COVID-19. For example, Luminar
Technologies noted that its revenues for the first quarter of 2021 increased 37% over the first quarter of 2020, and Ouster reported a revenue increase of 187% over the first quarter of 2020.
The Issuer operates in an industry characterized by rapidly changing technology, short product life cycles, evolving industry standards,
changes in customer needs, growing competition, and new product introductions. The Issuers future growth is dependent not only on the continued success of its existing products but also successful introduction of new products. As the Issuer
has disclosed, the average selling price of existing lidar sensors will continue to decline by as much as 20% in 2021. Therefore, the Issuers ability to introduce new products that adapt to changing technology and anticipate future standards
is critical to improve its prospects for growth. This is especially true as the lidar industry is ripe for consolidation. In order for the Issuer to maintain its competitive position and take advantage of
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