David Hall, Founder of Velodyne Lidar, Calls for Chairman Michael Dee and Director Hamid Zarringhalam to Resign from the Board
August 23 2021 - 9:30AM
Business Wire
Believes the Board Should Take Additional Steps
to Enhance Velodyne Lidar’s Corporate Governance and Reverse the
Company’s Anti-Stockholder Culture
David Hall, the largest holder of outstanding common stock of
Velodyne Lidar, Inc. (NASDAQ:VLDR) (“Velodyne Lidar” or the
“Company"), today issued the below open letter to the Company’s
Board of Directors (the “Board”):
Members of the Board,
I am pleased that following my calls for meaningful leadership
changes at Velodyne Lidar, Dr. Anand Gopalan decided to resign as
Chief Executive Officer and a director. Though I believe this
represents a first step in the right direction, the root of poor
business management and the anti-stockholder culture at Velodyne
Lidar remains. This is why today, I am calling on Chairman Michael
Dee and director Hamid Zarringhalam to resign from the Board. I
believe that both of these individuals have breached stockholders’
confidence and destroyed significant value in the Company.
Since being installed on the Board via a merger with Graf
Industrial, a special purpose acquisition company (“SPAC”), Mr. Dee
has spearheaded major business decisions that leave him responsible
for the Company’s nearly 80% stock price decline, in my view.1
Despite this poor performance and Mr. Dee’s lack of relevant
skillsets or public company board experience, the Board recently
elevated Mr. Dee to the position of Chairman.
In addition to Mr. Dee’s lack of relevant skillsets to serve on
the Board, stockholders should be aware that he is currently deeply
embroiled in litigation at PureCycle Technologies, Inc., relating
to his role as Chief Financial Officer following its merger with a
SPAC with disastrous results. Mr. Dee is facing serious accusations
of misleading investors and fraud.
Beyond his unsettling track record, I am deeply concerned that
Mr. Dee and the Board are considering transferring Velodyne Lidar’s
sophisticated Alpha Prime lidar manufacturing know-how and
associated trade secrets, the crown jewels of the Company’s IP
portfolio, to Nikon, which is moving into the lidar space with,
among other things, its recent partnership with Aeva, a Silicon
Valley startup founded to develop lidar technology. I question how
moving the best of the Company’s portfolio of technology to Nikon
benefits Velodyne’s stockholders whatsoever. It seems as if this
move greatly benefits director Hamid Zarringhalam, an executive
employee of Nikon, who is acting within a disabling conflict of
interest in making decisions that seemingly benefit Nikon, when he
should be focused on what is best for Velodyne Lidar and its
stockholders.
We are aware that during a recent conversation discussing the
decline in Velodyne Lidar’s valuation, Mr. Zarringhalam commented,
“I don’t care about the stock decline because I don’t own any.”
This statement reveals a complete lack of professionalism and
alignment with stockholders. Clearly, the Company is in serious
need of ethical directors with public company and high growth tech
experience to help turn around the anti-stockholder culture that
pervades the current Board.
As directors of a public company, Messrs. Dee and Zarringhalam
should be working for the good of Velodyne Lidar and its
stockholders by asking management questions about the cash burn
(which reached an alarming $70 million this quarter), engineering
milestone achievements, new product schedule and customer
satisfaction metrics. As the largest stockholder in Velodyne Lidar,
I have repeatedly requested information from the Company regarding
the facts and circumstances that led to the significant decline in
value. The Company has repeatedly declined to provide critical
reports and information on grounds of “privilege.” I will continue
to act in stockholders’ best interests by requesting documents and
information so that we can get to the bottom of the mismanagement
that is adversely affecting the Company.
Though the Board now has an opportunity to help improve Velodyne
Lidar by identifying an independent, high-integrity Chief Executive
Officer with significant technology and public company board
experience, the reality is that this will not fix the Company’s
broken corporate governance. I am calling for Messrs. Dee and
Zarringhalam to resign from the Board so that new blood can join
the boardroom to help the Company revitalize its culture and return
to its position at the forefront of lidar technology
innovation.
Sincerely,
David Hall Founder of Velodyne Lidar, Inc.
***
1 Velodyne Lidar’s stock price declined from $30 in September
2020 to $6.17 on August 20, 2021.
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MKA Charlotte Kiaie / Bela Kirpalani, 646-386-0091
ckiaie@mkacomms.com / bkirpalani@mkacomms.com
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