Document:

Exhibit 10.1

 

SUPPORT AGREEMENT

 

This Support Agreement
(this “Agreement”), dated as of July 2, 2020, is entered into by and among Graf Industrial Corp., a Delaware
corporation (“Acquiror”), VL Merger Sub Inc., a Delaware corporation and wholly-owned subsidiary of Acquiror
(“Merger Sub”), and certain of the stockholders of Velodyne LiDAR, Inc., a Delaware corporation (the
 “Company”), whose names appear on the signature pages of this Agreement (such stockholders, the “Stockholders”).

 

RECITALS

 

WHEREAS, concurrently
herewith, Acquiror, the Company and Merger Sub are entering into an Agreement and Plan of Merger (as amended, supplemented, restated
or otherwise modified from time to time, the “Merger Agreement”; capitalized terms used but not
otherwise defined in this Agreement shall have the meanings ascribed to them in the Merger Agreement), pursuant to which (and subject
to the terms and conditions set forth therein) Merger Sub will merge with and into the Company, with the Company surviving the
merger (the “Merger”);

 

WHEREAS, as of the
date hereof, each Stockholder is the record and “beneficial owner” (as such term is used herein, within the meaning
of Rule 13d-3 under the Exchange Act) of, and is entitled to dispose of and vote, the number of shares of Company Common Stock
and Company Preferred Stock set forth opposite such Stockholder’s name on Exhibit A hereto (collectively, with respect to
each Stockholder, such Stockholder’s “Owned Shares”; and such Owned Shares, together with (1) any additional
shares of Company Stock (or any securities convertible into or exercisable or exchangeable for Company Stock) in which such Stockholder
acquires record and beneficial ownership after the date hereof, including by purchase, as a result of a stock dividend, stock split,
recapitalization, combination, reclassification, exchange or change of such shares, or upon exercise or conversion of any securities
and (2) any additional shares of Company Stock with respect to which such Stockholder has the right to vote through a proxy, the
 “Covered Shares”);

 

WHEREAS, as a condition
and inducement to the willingness of Acquiror and Merger Sub to enter into the Merger Agreement, the Stockholders are entering
into this Agreement.

 

AGREEMENT

 

NOW, THEREFORE, in
consideration of the foregoing and the mutual covenants and agreements herein contained, and intending to be legally bound hereby,
Acquiror, Merger Sub and each Stockholder hereby agree as follows:

 

1.                  
Agreement to Vote. Each Stockholder, in its capacity as a stockholder of the Company,
agrees that, at any meeting of the stockholders of the Company (whether annual or special and whether or not an adjourned or postponed
meeting, however called and including any adjournment or postponement thereof) and in connection with any written consent of stockholders
of the Company, such Stockholder shall, and shall cause any other holder of record of any of such Stockholder’s Covered Shares
to:

 

(a)               
when such meeting is held, appear at such meeting or otherwise cause such Stockholder’s
Covered Shares to be counted as present thereat for the purpose of establishing a quorum;

 

(b)               
vote (or execute and return an action by written consent), or cause to be voted at such
meeting (or validly execute and return and cause such consent to be granted with respect to), all of such Stockholder’s Covered
Shares owned as of the record date for such meeting (or the date that any written consent is executed by such Stockholder) in favor
of the Merger and the adoption of the Merger Agreement and any other matters necessary or reasonably requested by the Company for
consummation of the Merger and the other transactions contemplated by the Merger Agreement; and

 

     

     

    

(c)               
vote (or execute and return an action by written consent), or cause to be voted at such
meeting (or validly execute and return and cause such consent to be granted with respect to), all of such Stockholder’s Covered
Shares against (i) any Acquisition Proposal and (ii) any other action that would reasonably be expected to (x) materially impede,
interfere with, delay, postpone or adversely affect the Merger or any of the other transactions contemplated by the Merger Agreement,
(y) result in a breach of any covenant, representation or warranty or other obligation or agreement of the Company under the Merger
Agreement or (z) result in a breach of any covenant, representation or warranty or other obligation or agreement of such Stockholder
contained in this Agreement.

 

The obligations of each Stockholder specified
in this Section 1 shall apply whether or not the Merger or any action described above is recommended by the Company Board or the
Company Board has effected a Company Change in Recommendation.

 

2.                  
No Inconsistent Agreements. Each Stockholder hereby covenants and agrees that
such Stockholder shall not (i) enter into any voting agreement or voting trust with respect to any of such Stockholder’s
Covered Shares that is inconsistent with such Stockholder’s obligations pursuant to this Agreement, (ii) grant a proxy or
power of attorney with respect to any of such Stockholder’s Covered Shares that is inconsistent with such Stockholder’s
obligations pursuant to this Agreement or (iii) enter into any agreement or undertaking that is otherwise inconsistent with, or
would interfere with, or prohibit or prevent it from satisfying, its obligations pursuant to this Agreement.

 

3.                  
Termination. This Agreement shall terminate upon the earlier of (i) the Effective
Time and (ii) the valid termination of the Merger Agreement in accordance with its terms (the earlier of such date under clause
(i) and (ii) being referred to herein as the “Termination Date”); provided that the termination of this Agreement
shall not relieve any party hereto from any liability resulting from a breach of this Agreement prior to such termination.

 

4.                  
Representations and Warranties of the Stockholders. Each Stockholder hereby represents
and warrants (severally and not jointly as to itself only) to the Acquiror as follows:

 

(a)               
Such Stockholder owns exclusively of record (and is the sole beneficial owner of), and has
good, valid and marketable title to, such Stockholder’s Covered Shares, free and clear of any Liens (other than as created
by this Agreement). As of the date hereof, other than the Owned Shares set forth opposite such Stockholder’s name on Exhibit
A, such Stockholder does own (of record or beneficially) any shares of Company Stock (or any securities convertible into shares
of capital stock of the Company) or any interest therein.

 

(b)               
Such Stockholder (i) except as provided in this Agreement, has full voting power, full power
of disposition and full power to issue instructions with respect to the matters set forth herein, in each case, with respect to
such Stockholder’s Covered Shares, (ii) has not entered into any voting agreement or voting trust with respect to any of
such Stockholder’s Covered Shares that is inconsistent with such Stockholder’s obligations pursuant to this Agreement,
(iii) has not granted a proxy or power of attorney with respect to any of such Stockholder’s Covered Shares that is inconsistent
with such Stockholder’s obligations pursuant to this Agreement and (iv) has not entered into any agreement or undertaking
that is otherwise inconsistent with, or would interfere with, or prohibit or prevent it from satisfying, its obligations pursuant
to this Agreement.

 

(c)               
Such Stockholder (i) is a legal entity duly organized, validly existing and, to the extent
such concept is applicable, in good standing under the Laws of the jurisdiction of its organization, and (ii) has all requisite
corporate or other power and authority and has taken all corporate or other action necessary in order to, execute, deliver and
perform its obligations under this Agreement and to consummate the transactions contemplated hereby. This Agreement has been duly
executed and delivered by such Stockholder and constitutes a legally valid and binding agreement of such Stockholder, enforceable
against such Stockholder in accordance with the terms hereof (except as enforceability may be limited by bankruptcy Laws other
similar Laws affecting creditors’ rights and general principles of equity affecting the availability of specific performance
and other equitable remedies).

 

    	 	2	 

     

    

 

(d)               
Other than the filings, notices and reports pursuant to, in compliance with or required
to be made under the Exchange Act, no filings, notices, reports, consents, registrations, approvals, permits, waivers, expirations
of waiting periods or authorizations are required to be obtained by such Stockholder from, or to be given by such Stockholder to,
or be made by such Stockholder with, any Governmental Authority in connection with the execution, delivery and performance by such
Stockholder of this Agreement, the consummation of the transactions contemplated hereby or the Merger or the other transactions
contemplated by the Merger Agreement.

 

(e)               
The execution, delivery and performance of this Agreement by such Stockholder does not,
and the consummation of the transactions contemplated hereby and the Merger and the other transactions contemplated by the Merger
Agreement will not (i) constitute or result in a breach or violation of, or a default under, the governing documents of such Stockholder,
(ii) with or without notice, lapse of time or both, constitute or result in a breach or violation of, a termination (or right of
termination) of or a default under, the loss of any benefit under, or the creation, modification or acceleration of any obligations
under, any Contract binding upon such Stockholder, in each case in a manner that could reasonably be expected to prevent or materially
delay or impair such Stockholder’s ability to perform its obligations hereunder or to consummate the transactions contemplated
by the Merger Agreement and this Agreement, (iii) conflict with or violate any Law to which such Stockholder is subject, (iv) require
any consent, approval or authorization of, declaration, filing or registration with, or notice to, any Person, or (iv) constitute
or result in the creation of any Lien on such Stockholder’s Covered Shares.

 

(f)                
There are no Actions pending against such Stockholder or, to the knowledge of such Stockholder,
threatened against such Stockholder that, in any manner, question the beneficial or record ownership of such Stockholder’s
Covered Shares or challenge or seek to prevent, enjoin or materially delay the performance by such Stockholder of its obligations
under this Agreement.

 

(g)               
Such Stockholder understands and acknowledges that Acquiror is entering into the Merger
Agreement in reliance upon such Stockholder’s execution and delivery of this Agreement and the representations, warranties,
covenants and other agreements of such Stockholder contained herein.

 

(h)               
No investment banker, broker, finder or other intermediary is entitled to any broker’s,
finder’s, financial advisor’s or other similar fee or commission for which Acquiror or the Company is or could be liable
in connection with the Merger Agreement or this Agreement or any of the respective transactions contemplated hereby or thereby,
in each case based upon arrangements made by or on behalf of such Stockholder.

 

5.                  
Certain Covenants of the Stockholders. Except in accordance with the terms of this
Agreement, each Stockholder hereby covenants and agrees as follows:

 

(a)               
No Solicitation. Such Stockholder shall not, and shall cause its Affiliates and subsidiaries
not to, and shall use its reasonable best efforts to cause its and their respective Representatives not to, directly or
indirectly, (i) initiate, solicit or knowingly encourage or knowingly facilitate any inquiries or requests for information with
respect to, or the making of, any inquiry regarding, or any proposal or offer that constitutes, or could reasonably be expected
to result in or lead to, any Acquisition Proposal, (ii) engage in, continue or otherwise participate in any negotiations or discussions
concerning, or provide access to its properties, books and records or any confidential information or data to, any Person relating
to any proposal, offer, inquiry or request for information that constitutes, or could reasonably be expected to result in or lead
to, any Acquisition Proposal, (iii) approve, endorse or recommend, or propose publicly to approve, endorse or recommend, any Acquisition
Proposal, (iv) execute or enter into, any letter of intent, memorandum of understanding, agreement in principle, confidentiality
agreement, merger agreement, acquisition agreement, exchange agreement, joint venture agreement, partnership agreement, option
agreement or other similar agreement for or relating to any Acquisition Proposal or (v) resolve or agree to do any of the foregoing.
Such Stockholder also agrees that immediately following the execution of this Agreement it shall, and shall cause each of its Affiliates
and subsidiaries to, and shall use its reasonable best efforts to cause its and their Representatives to, cease any solicitations,
discussions or negotiations with any Person (other than the Parties and their respective Representatives) conducted heretofore
in connection with an Acquisition Proposal or any inquiry or request for information that could reasonably be expected to lead
to, or result in, an Acquisition Proposal. Such Stockholder shall promptly (and in any event within
one Business Day) notify, in writing, Acquiror of the receipt of any inquiry, proposal, offer or request for information received
after the date hereof that constitutes, or could reasonably be expected to result in or lead to, any Acquisition Proposal, which
notice shall include a summary of the material terms of, and the identity of the Person or group of Persons making, such inquiry,
proposal, offer or request for information (provided, that, solely with respect to the identity of the Person or group of Persons
making, such inquiry, proposal, offer or request for information, such disclosure is not restricted by confidentiality obligations
in existence as of the date of this Agreement) and an unredacted copy of any Acquisition Proposal or inquiry, proposal or offer
made in writing or, if not in writing, a written description of the material terms and conditions of such inquiry, proposal or
offer (and shall include any other documents evidencing or specifying the terms of such proposal, offer, inquiry or request).

 

    	 	3	 

     

    

 

Such Stockholder shall
promptly (and in any event within twenty-four (24) hours) keep Acquiror reasonably informed of any material developments with respect
to any such inquiry, proposal, offer, request for information or Acquisition Proposal (including any material changes thereto and
copies of any additional written materials received by such Stockholder, the Company, its subsidiaries or their respective Affiliates
or Representatives).

 

Notwithstanding anything
in this Agreement to the contrary, (i) such Stockholder shall not be responsible for the actions of the Company or the Company
Board (or any Committee thereof), any Subsidiary of the Company, or any officers, directors (in their capacity as such), employees
and professional advisors of any of the foregoing (collectively, the “Company Related Parties”), (ii) such Stockholder
makes no representations or warranties with respect to the actions of any of the Company Related Parties and (iii) any breach by
the Company of its obligations under Section 6.07(a) of the Merger Agreement shall not be considered a breach of this Section 5(a)
(it being understood that, for the avoidance of doubt, such Stockholder shall remain responsible for any breach by it or its Representatives
of this Section 5(a)).

 

(b)               
Each Stockholder agrees that it shall not, directly or indirectly, (a) Transfer any of it
Covered Shares, except to an Affiliate of such Stockholder that executes this Agreement or (b) deposit any of its Covered Shares
into a voting trust or enter into a voting agreement or arrangement or grant any proxy or power of attorney with respect thereto
that is inconsistent with this Agreement.

 

(c)               
As used herein, the term “Transfer” shall mean the (x) sale of, offer to sell,
contract or agreement to sell, hypothecate, pledge, grant of any option to purchase or otherwise dispose of or agreement to dispose
of, directly or indirectly, or establishment or increase of a put equivalent position or liquidation with respect to or decrease
of a call equivalent position within the meaning of Section 16 of the Exchange Act and the rules and regulations of the Commission
promulgated thereunder with respect to, any security, (y) entry into any swap or other arrangement that transfers to another, in
whole or in part, any of the economic consequences of ownership of any security, whether any such transaction is to be settled
by delivery of such securities, in cash or otherwise, or (z) public announcement of any intention to effect any transaction
specified in clause (x) or (y).

 

    	 	4	 

     

    

 

6.                  
Further Assurances. From time to time, at Acquiror’s request and without further
consideration, each Stockholder shall execute and deliver such additional documents and take all such further action as may be
reasonably necessary or reasonably requested to effect the actions and consummate the transactions contemplated by the Merger Agreement
and this Agreement. Each Stockholder further agrees not to commence or participate in, and to take all actions necessary to opt
out of any class in any class action with respect to, any action or claim, derivative or otherwise, against Acquiror, Acquiror’s
Affiliates, the Sponsor, the Company or any of their respective successors and assigns relating to the negotiation, execution or
delivery of this Agreement, the Merger Agreement (including the Merger Consideration) or the consummation of the transactions contemplated
hereby and thereby.

 

7.                  
Disclosure. Such Stockholder hereby authorizes the Company and Acquiror to publish
and disclose in any announcement or disclosure required by the SEC such Stockholder’s identity and ownership of the Covered
Shares and the nature of such Stockholder’s obligations under this Agreement.

 

8.                  
Changes in Capital Stock. In the event of a stock split, stock dividend or
distribution, or any change in the Company’s capital stock by reason of any split-up, reverse stock split, recapitalization,
combination, reclassification, exchange of shares or the like, the terms “Owned Shares” and “Covered Shares”
shall be deemed to refer to and include such shares as well as all such stock dividends and distributions and any securities into
which or for which any or all of such shares may be changed or exchanged or which are received in such transaction.

 

9.                  
Amendment and Modification. This Agreement may not be amended, modified or supplemented
in any manner, whether by course of conduct or otherwise, except by an instrument in writing signed by Acquiror, Merger Sub and
the applicable Stockholder.

 

10.              
Waiver. No failure or delay by any party hereto exercising any right, power or privilege
hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise
thereof or the exercise of any other right, power or privilege. The rights and remedies of the parties hereto hereunder are cumulative
and are not exclusive of any rights or remedies which they would otherwise have hereunder. Any agreement on the part of a party
hereto to any such waiver shall be valid only if set forth in a written instrument executed and delivered by such party.

 

11.              
Notices. All notices and other communications hereunder shall be in writing and shall
be deemed given if delivered personally, by email (with confirmation of receipt) or sent by a nationally recognized overnight courier
service, such as Federal Express, to the parties hereto at the following addresses (or at such other address for a party as shall
be specified by like notice made pursuant to this Section 11):

 

If to Acquiror or Merger
Sub, to:

 

Graf Acquisition Corp.

118 Vintage Park Blvd.,
Suite W-222

Houston, Texas 77070

Attn:James A. Graf

E-mail:james@grafacq.com

 

with a copy to:

 

White & Case LLP

1221 Avenue of the
Americas

New York, NY 10020-1095

Attn:Joel L. Rubinstein

E-mail: joel.rubinstein@whitecase.com

 

    	 	5	 

     

    

 

and

 

White & Case LLP

3000 El Camino Real

2 Palo Alto Square,
Suite 900

Palo Alto, California
94306-2109

Attn:Tali Sealman

E-mail: tali.sealman@whitecase.com

  

If to the Company to:

 

Velodyne Lidar, Inc.

5521 Hellyer Ave

San Jose, California
95138

Attn:Anand Gopalan

E-mail:agopalan@velodyne.com

  

with a copy to:

 

Gunderson Dettmer Stough
Villeneuve Franklin & Hachigian, LLP

550 Allerton Street

Redwood City, CA 94063

Attn:Trevor S.
Knapp, Jeffrey Vetter and John H. Olson

E-mail:tknapp@gunder.com,
jvetter@gunder.com, jolson@gunder.com

 

If to a Stockholder,
to the address or email address set forth opposite such Stockholder’s name on Exhibit A.

 

12.              
Entire Agreement. This Agreement and the Merger Agreement constitute the entire
agreement, and supersede all prior agreements and understandings, both written and oral, between the parties hereto with respect
to the subject matter hereof and thereof.

 

13.              
No Third-Party Beneficiaries. Such Stockholder hereby agrees that its representations,
warranties and covenants set forth herein are solely for the benefit of Acquiror in accordance with and subject to the terms of
this Agreement, and this Agreement is not intended to, and does not, confer upon any Person, other than the parties hereto, any
rights or remedies hereunder, including the right to rely upon the representations and warranties set forth herein, and the parties
hereto hereby further agree that this Agreement may only be enforced against, and any Action that may be based upon, arise out
of or relate to this Agreement, or the negotiation, execution or performance of this Agreement may only be made against, the Persons
expressly named as parties hereto; provided that the Company shall be an express third party beneficiary with respect to Section
4 and Section 5(b).

 

14.              
Governing Law and Venue; Service of Process; Waiver of Jury Trial.

 

(a)               
This Agreement, and all claims or causes of action based upon, arising out of, or related
to this Agreement or the transactions contemplated hereby, shall be governed by, and construed in accordance with, the Laws of
the State of Delaware, without giving effect to principles or rules of conflict of laws to the extent such principles or rules
would require or permit the application of Laws of another jurisdiction..

 

    	 	6	 

     

    

 

(b)               
Any Action based upon, arising out of or related to this Agreement, or the transactions contemplated hereby, shall be brought
in the Court of Chancery of the State of Delaware or, if such court declines to exercise jurisdiction, the U.S. District Court
for the Northern District of California or any state court located in Santa Clara County, California, and each of the parties irrevocably
submits to the exclusive jurisdiction of each such court in any such Action, waives any objection it may now or hereafter have
to personal jurisdiction, venue or to convenience of forum, agrees that all claims in respect of the Action shall be heard and
determined only in any such court, and agrees not to bring any Action arising out of or relating to this Agreement or the transactions
contemplated hereby in any other court. Nothing herein contained shall be deemed to affect the right of any party to serve process
in any manner permitted by Law, or to commence legal proceedings or otherwise proceed against any other party in any other jurisdiction,
in each case, to enforce judgments obtained in any Action brought pursuant to this Section 14. EACH OF THE PARTIES HERETO
HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY ACTION BASED UPON, ARISING
OUT OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

 

15.              
Assignment; Successors. Neither this Agreement nor any of the rights, interests or
obligations hereunder shall (a) be assigned by any of the Stockholders in whole or in part (whether by operation of Law or otherwise)
without the prior written consent of the Acquiror and the Company or (b) be assigned by the Acquiror or the Company in whole or
in part (whether by operation of Law or otherwise) without the prior written consent of (i) the Company or the Acquiror, respectively,
and (ii) the applicable Stockholder. Any such assignment without such consent shall be null and void. This Agreement shall be binding
upon, inure to the benefit of and be enforceable by the parties hereto and their respective successors and permitted assigns.

 

16.              
Enforcement. The rights and remedies of the parties shall be cumulative with and
not exclusive of any other remedy conferred hereby. The parties agree that irreparable damage would occur and that the parties
would not have any adequate remedy at law in the event that any of the provisions of this Agreement were not performed in accordance
with their specific terms or were otherwise breached. It is accordingly agreed that the parties shall be entitled to an injunction
or injunctions to prevent breaches or threatened breaches of this Agreement and to enforce specifically the terms and provisions
of this Agreement, including each Stockholder’s obligations to vote its Covered Shares as provided in this Agreement (and
each party hereby waives any requirement for the securing or posting of any bond in connection with such remedy), this being in
addition to any other remedy to which they are entitled at law or in equity.

 

17.              
Severability. If any term or other provision of this Agreement is held by a court
of competent jurisdiction or other authority to be invalid, void, unenforceable or against its regulatory policy, the remainder
of the terms and provisions of this Agreement shall remain in full force and effect and shall in no way be affected, impaired or
invalidated, so long as the economic and legal substance of the transactions contemplated hereby, taken as a whole, are not affected
in a manner materially adverse to any party hereto. Upon such a determination, the parties hereto shall negotiate in good faith
to modify this Agreement so as to effect the original intent of the parties hereto as closely as possible in an acceptable manner
in order that the transactions contemplated hereby be consummated as originally contemplated to the fullest extent possible.

 

18.              
Counterparts. This Agreement may be executed in one or more counterparts, all of
which shall be considered one and the same agreement, it being understood that each party need not sign the same counterpart. This
Agreement shall become effective when each party shall have received a counterpart hereof signed by all of the other parties. Signatures
delivered electronically or by facsimile shall be deemed to be original signatures.

 

[The remainder of this page is intentionally
left blank.]

 

    	 	7	 

     

    

 

IN WITNESS WHEREOF,
the parties have executed this Agreement as of the date first written above.

 

	 	GRAF INDUSTRIAL CORP.
	 	 
	 	By: 	 /s/ James A. Graf
	 	 	Name: James A. Graf
	 	 	Title: Chief Executive Officer
	 	 
	 	VL MERGER SUB INC. 
	 	 
	 	By:  	/s/ James A. Graf
	 	 	Name: James A. Graf
	 	 	Title: President
	 	 
	 	STOCKHOLDERS:
	 	 
	 	DAVID HALL
	 	 
	 	/s/ David

 

 

 

    [Signature Page to Support Agreement]

     

    

 

Exhibit AExhibit
10.2

 

July 2, 2020

 

	Velodyne Lidar, Inc.	 	 
	5521 Hellyer Ave	 	 
	San Jose, California 95138	 	 
	 	 	 
	Graf Industrial Corp.	 	 
	118 Vintage Park Blvd, Suite W-222	 	 
	Houston, Texas 77070	 	 
	 	 	 
	 	Re: Sponsor Agreement	 	 

 

Ladies and Gentlemen:

 

This letter (this “Sponsor Agreement”)
is being delivered by Graf Acquisition LLC, a Delaware limited liability company (the “Sponsor”), to Velodyne
Lidar, Inc., a Delaware corporation (the “Company”), and Graf Industrial Corp., a Delaware corporation (the
 “Acquiror”), in accordance with that Agreement and Plan of Merger, dated as of the date hereof, by and among
Acquiror, the Company and the other parties thereto (the “Merger Agreement”), and hereby amends and restates
in its entirety with respect to the Sponsor that certain letter, dated October 15, 2018, from, inter alia, Sponsor to the Acquiror
(the “Prior Letter Agreement”) (provided that, as set forth in Section 17, this Sponsor Agreement shall
automatically terminate and revert to the Prior Letter Agreement if the Merger Agreement is validly terminated in accordance with
its terms). Certain capitalized terms used herein are defined in paragraph 10 hereof. Capitalized terms used but not otherwise
defined herein shall have the respective meanings ascribed to such terms in the Merger Agreement. As used herein, the term “Section”
shall, unless otherwise specified, refer to the specified Section of this Sponsor Agreement.

 

The Sponsor is currently, and as of immediately
prior to the Closing will be, the record owner of 6,026,128 Founder Shares (which may be referred to herein as the “Sponsor’s
Founder Shares”), which do not include the 68,000 Founder Share owned by independent directors of the Acquiror who are
not party to this Sponsor Agreement, and 14,150,605 Private Placement Warrants.

 

In order to induce the Company and Acquiror
to enter into the Merger Agreement and for other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Sponsor hereby agrees with the Acquiror and the Company as follows:

 

1.                  
Voting Agreements. The Sponsor, in its capacity as an Acquiror Stockholder, agrees that, at the Special Meeting,
at any other meeting of the Acquiror Stockholders (whether annual or special and whether or not an adjourned or postponed meeting,
however called and including any adjournment or postponement thereof) and in connection with any written consent of the Acquiror
Stockholders, the Sponsor shall, and shall cause any other holder of record of any of the Sponsor’s Founder Shares to:

 

		a.	when such meeting is held, appear at such meeting or otherwise cause the Sponsor’s Founder
Shares to be counted as present thereat for the purpose of establishing a quorum;

 

		b.	vote (or execute and return an action by written consent), or cause to be voted at such meeting
(or validly execute and return and cause such consent to be granted with respect to), all of the Sponsor’s Founder Shares
in favor of each of the Proposals and any other matters necessary or reasonably requested by the Company for consummation of the
Merger and the other transactions contemplated by the Merger Agreement; and

 

     

     

    

 

		c.	vote (or execute and return an action by written consent), or cause to be voted at such meeting
(or validly execute and return and cause such consent to be granted with respect to), all of the Sponsor’s Founder Shares
against (i) any Business Combination Proposal other than with the Company, its stockholders and their respective Affiliates and
Representatives and (ii) any other action that would reasonably be expected to (x) materially impede, interfere with, delay, postpone
or adversely affect the Merger or any of the other transactions contemplated by the Merger Agreement, (y) result in a breach of
any covenant, representation or warranty or other obligation or agreement of Acquiror under the Merger Agreement or (z) result
in a breach of any covenant, representation or warranty or other obligation or agreement of the Sponsor contained in this Sponsor
Agreement.

 

2.                   
No Redemption. The Sponsor agrees not to redeem any of its Founder Shares in the Offer.

 

3.                   
No Responsibility for Acquiror Related Parties. Notwithstanding anything in this Sponsor Agreement to the contrary,
(i) the Sponsor shall not be responsible for the actions of Acquiror or the Acquiror Board (or any committee thereof), any Subsidiary
of Acquiror, or any officers, directors, employees or professional advisors of any of the foregoing (collectively, the “Acquiror
Related Parties”), (ii) the Sponsor makes no representations or warranties with respect to the actions of any of the
Acquiror Related Parties, and (iii) any breach by Acquiror of its obligations under the Merger Agreement shall not, for the avoidance
of doubt, be considered a breach of this Sponsor Agreement.

 

4.                   
Stop Transfers; Certificates. The Sponsor agrees that (a) it shall not request that the Acquiror register the Transfer
(book entry or otherwise) of any of the Sponsor’s Founder Shares if such Transfer is not permitted by this Sponsor Agreement
and (b) promptly following the date of this Sponsor Agreement, it shall advise the Acquiror’s transfer agent in writing that
the Sponsor’s Founder Shares are subject to the restrictions set forth herein and, in connection therewith, provide such
transfer agent with such information as is reasonable to ensure compliance with such restrictions.

 

5.                   
Damages; Remedies. The Sponsor hereby agrees and acknowledges that (i) the Underwriters, the Acquiror and the Company
would be irreparably injured in the event of a breach by the Sponsor of its obligations under Section 1 (Voting Agreement)
or Section 7 (Transfer Restrictions) (with respect to the Underwriters, only to the extent such provisions as were contained
in the Prior Letter Agreement), (ii) monetary damages may not be an adequate remedy for such breach and (iii) the non-breaching
party shall be entitled to injunctive relief, in addition to any other remedy that such party may have in law or in equity, in
the event of such breach. Notwithstanding the foregoing, or anything herein to the contrary, under no circumstances shall the Acquiror
or the Sponsor be liable for any costs or damages, including any special, incidental, consequential, exemplary or punitive damages,
to any Person, including the Company, in respect of this Sponsor Agreement, including any breach hereof, and the Company hereby
waives any claim it may have now or in the future for monetary costs or damages against the Acquiror or the Sponsor in respect
of this Sponsor Agreement, including any breach hereof.

 

6.                   
Forfeiture of Founder Shares and Private Placement Warrants. The Sponsor agrees that, immediately prior to the Effective
Time, and conditioned and effective upon the Closing, 3,519,128 Founder Shares and all of the Private Placement Warrants, in each
case held by the Sponsor immediately prior to the Closing, shall be automatically cancelled, for no consideration, and shall no
longer be outstanding (the “Sponsor’s Equity Cancellation”). As a result of the Sponsor’s Equity
Cancellation, the Sponsor shall, as of the Effective Time, be the record owner of 2,507,000 Founder Shares, of which 275,000 shares
shall be deemed “Earnout Founder Shares” and shall be subject to Section 8 (Earnout Founder Shares).

 

7.                   
Transfer Restrictions.

 

		a.	The Sponsor agrees that it shall not Transfer any of its Founder Shares until the earlier of (i)
one (1) year after the Closing and (ii) subsequent to the Closing, either (x) the achievement of a $12.00 Stock Price Level (as
defined below) (provided that the applicable thirty (30) Trading Day period commences at least 150 days after the Closing) or (y)
the date on which the Acquiror completes a liquidation, merger, capital stock exchange, reorganization or other similar transaction
that results in all of the Acquiror Stockholders having the right to exchange their shares of Acquiror Common Stock for cash, securities
or other property (such period, the “Lock-up Period”).

 

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		b.	The Sponsor agrees that it shall not Transfer any Private Placement Warrants (or any shares of
Acquiror Common Stock issued or issuable upon the exercise thereof).

 

		c.	Notwithstanding the provisions set forth in Sections 7(a) and (b), Transfers of the
Founder Shares and the Private Placement Warrants (and any shares of Acquiror Common Stock issued or issuable upon the exercise
or conversion of the Private Placement Warrants) that are held by the Sponsor or any of its permitted transferees (that have complied
with this Section 7(c)) are permitted: (i) to the Acquiror’s officers or directors, any Affiliates or family members
of any of the Acquiror’s officers or directors, any members of the Sponsor, or any Affiliates of the Sponsor; (ii) in the
case of an individual, by gift to a member of the individual’s immediate family, to a trust (the beneficiary of which is
a member of such individual’s immediate family or an Affiliate of such person) or to a charitable organization; (iii) in
the case of an individual, by virtue of Laws of descent and distribution upon death of such individual; (iv) in the case of an
individual, pursuant to a qualified domestic relations order; (v) by virtue of the Laws of the State of Delaware or the Sponsor’s
limited liability company agreement upon dissolution of the Sponsor; and/or (vi) in the event of the Acquiror’s liquidation,
merger, capital stock exchange, reorganization or other similar transaction which results in all of the Acquiror Stockholders having
the right to exchange their shares of Acquiror Common Stock for cash, securities or other property subsequent to the Closing (including
the entry into an agreement in connection with such liquidation, merger, share exchange, reorganization or other similar transaction);
provided, however, that in the case of clauses (i) through (iv), these permitted transferees must enter into a written
agreement with the Acquiror agreeing to be bound by the transfer restrictions herein.

 

		8.	Earnout Founder Shares.

 

		a.	Unvested Earnout Founder Shares. The Sponsor agrees that, as of the Closing, all of the
Earnout Founder Shares shall be unvested and shall be subject to the vesting and forfeiture provisions set forth in Section
8(b). The Sponsor agrees that it shall not Transfer any unvested Earnout Founder Shares prior to the date such Earnout Founder
Shares become vested pursuant to Section 8(b), except to the extent permitted by Section 7(c).

 

		b.	Vesting; Forfeiture. 100% of the unvested Earnout Founder Shares owned by the Sponsor as
of the Closing shall vest at such time as a $15.00 Stock Price Level is achieved on or before the date that is six (6) months after
the Closing Date. For the avoidance of doubt, if a $15.00 Stock Price Level is not achieved on or prior to the date that is six
(6) months after the Closing Date, the Earnout Founder Shares shall not vest and shall be automatically cancelled for no consideration.
For clarity, the applicable Trading Day period for such Stock Price Level shall commence on the date hereof.

 

		c.	Stock Price Level. For purposes of this Sponsor Agreement, the applicable “Stock
Price Level” will be considered achieved only when the closing price of Acquiror Common Stock on the NYSE is greater
than or equal to the applicable threshold for any twenty (20) Trading Days within any thirty (30) Trading Day period. The Stock
Price Levels will be equitably adjusted for any stock dividend, subdivision, reclassification, recapitalization, split, combination
or exchange of shares, or any similar event affecting the Acquiror Common Stock after the date of the Merger Agreement.

 

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9.                   
Fees; Loan Repayments. Except as disclosed in the Prospectus, neither the Sponsor nor any Affiliate of the Sponsor,
nor any director or officer of the Acquiror, shall receive from the Acquiror any finder’s fee, reimbursement, consulting
fee, non-cash payments, monies in respect of any repayment of a loan or other compensation prior to, or in connection with any
services rendered in order to effectuate, the consummation of the Acquiror’s initial Business Combination (regardless of
the type of transaction that it is, but including, for the avoidance of doubt, the Merger), other than the following, none of which
will be made from the proceeds held in the Trust Account prior to the consummation of the Merger: (a) repayment of a loan and advances
of up to an aggregate of $150,000 made to the Acquiror by the Sponsor; (b) reimbursement to an Affiliate of the Sponsor for certain
office space, utilities and secretarial and administrative support as may be reasonably required by the Company for a total of
up to $5,000 per month; (c) reimbursement for any reasonable out-of-pocket expenses related to identifying, investigating and consummating
an initial Business Combination; and (d) repayment of loans, if any, and on such terms as to be determined by the Acquiror from
time to time, made by the Sponsor or any of the Acquiror’s officers or directors to finance transaction costs in connection
with an intended initial Business Combination (including, for the avoidance of doubt, loans made by the Sponsor to the Acquiror
to fund costs and expenses required in connection with the Merger and the other transactions contemplated by the Merger Agreement).
Up to $1,500,000 of such loans may be convertible, at the option of the Sponsor or such other lender, into warrants at a price
of $0.75 per warrant (such warrants, the “Working Capital Warrants”). The Working Capital Warrants (if any)
would be identical to the Private Placement Warrants, including as to exercise price, exercisability and exercise period; provided
that, for the avoidance of doubt, the Working Capital Warrants (if any) shall not be forfeited or otherwise cancelled in connection
with the Closing.

 

10.                
Certain Defined Terms: As used herein, (i) “Beneficially Own” has the meaning ascribed to it in
Section 13(d) of the Exchange Act; (ii) “Business Combination” shall mean a merger, capital stock exchange,
asset acquisition, stock purchase, reorganization or similar business combination, involving the Acquiror and one or more businesses;
(iii) “Founder Shares” shall mean the 6,468,750 shares of Acquiror Common Stock initially issued to the Sponsor
(up to 843,750 shares of which were subject to complete or partial forfeiture by the Sponsor if the over-allotment option was not
exercised by the Underwriters) for an aggregate purchase price of $25,000, or $0.004 per share, prior to the consummation of the
Public Offering; (iv) “Private Placement Warrants” shall mean the 14,150,605 warrants to purchase 10,612,953.75
shares of Acquiror Common Stock underlying the Units that the Sponsor purchased simultaneously with the consummation of the Public
Offering; (v) “Prospectus” shall mean the registration statement on Form S-1 and prospectus filed by Acquiror
with the U.S. Securities and Exchange Commission (the “Commission”) in connection with the Public Offering;
(vi) “Public Offering” shall mean the underwritten initial public offering of 25,875,000 of Acquiror’s
units (including up to 3,375,000 units that were available to be purchased to cover over-allotments, if any) (the “Units”),
each comprised of one share of Acquiror Common Stock and one redeemable warrant; (vii) “Trust Account” shall
mean the trust fund into which a portion of the net proceeds of the Public Offering was deposited; (viii) “Transfer”
shall mean the (a) sale of, offer to sell, contract or agreement to sell, hypothecate, pledge, grant of any option to purchase
or otherwise dispose of or agreement to dispose of, directly or indirectly, or establishment or increase of a put equivalent position
or liquidation with respect to or decrease of a call equivalent position within the meaning of Section 16 of the Exchange Act and
the rules and regulations of the Commission promulgated thereunder with respect to, any security, (b) entry into any swap or other
arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of any security, whether
any such transaction is to be settled by delivery of such securities, in cash or otherwise, or (c) public announcement of any intention
to effect any transaction specified in clause (a) or (b); and (ix) “Underwriter” shall have the meaning ascribed
to such term in the Prior Letter Agreement.

 

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11.                
Entire Agreement; Amendment. This Sponsor Agreement and the other agreements referenced herein constitute the entire
agreement and understanding of the parties hereto in respect of the subject matter hereof and supersede all prior understandings,
agreements or representations by or among the parties hereto, written or oral, to the extent they relate in any way to the subject
matter hereof or the transactions contemplated hereby, including, with respect to the Sponsor, the Prior Letter Agreement. This
Sponsor Agreement may not be changed, amended, modified or waived (other than to correct a typographical error) as to any particular
provision, except by a written instrument executed by all parties hereto.

 

12.                
Assignment. No party hereto may, except as set forth herein, assign either this Sponsor Agreement or any of its rights,
interests, or obligations hereunder without the prior written consent of the other parties. Any purported assignment in violation
of this paragraph shall be void and ineffectual and shall not operate to transfer or assign any interest or title to the purported
assignee. This Sponsor Agreement shall be binding on the Sponsor, the Acquiror and the Company and each of their respective successors,
heirs, personal representatives and assigns and permitted transferees.

 

13.                
Counterparts. This Sponsor Agreement may be executed in any number of original, electronic or facsimile counterparts
and each of such counterparts shall for all purposes be deemed to be an original, and all such counterparts shall together constitute
but one and the same instrument.

 

14.                 
Severability. This Sponsor Agreement shall be deemed severable, and the invalidity or unenforceability of any term
or provision hereof shall not affect the validity or enforceability of this Sponsor Agreement or of any other term or provision
hereof. Furthermore, in lieu of any such invalid or unenforceable term or provision, the parties hereto intend that there shall
be added as a part of this Sponsor Agreement a provision as similar in terms to such invalid or unenforceable provision as may
be possible and be valid and enforceable.

 

15.                 
Governing Law; Jurisdiction; Jury Trial Waiver. This Sponsor Agreement, and all claims or causes of action based
upon, arising out of, or related to this Sponsor Agreement or the transactions contemplated hereby, shall be governed by, and construed
in accordance with, the Laws of the State of New York, without giving effect to principles or rules of conflict of laws to the
extent such principles or rules would require or permit the application of Laws of another jurisdiction. Any Action based upon,
arising out of or related to this Sponsor Agreement or the transactions contemplated hereby shall be brought in the federal or
state courts located in New York City in the State of New York, and each of the parties irrevocably submits to the exclusive jurisdiction
of each such court in any such Action, waives any objection it may now or hereafter have to personal jurisdiction, venue or to
convenience of forum, agrees that all claims in respect of the Action shall be heard and determined only in any such court, and
agrees not to bring any Action arising out of or relating to this Sponsor Agreement or the transactions contemplated hereby in
any other court. Nothing herein contained shall be deemed to affect the right of any party to serve process in any manner permitted
by Law or to commence legal proceedings or otherwise proceed against any other party in any other jurisdiction, in each case, to
enforce judgments obtained in any Action brought pursuant to this Section 15. The prevailing party in any such Action (as
determined by a court of competent jurisdiction) shall be entitled to be reimbursed by the non-prevailing party for its reasonable
and documented out-of-pocket expenses, including reasonable attorneys’ fees, incurred with respect to such Action. EACH OF
THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY ACTION BASED UPON, ARISING OUT OF OR RELATED
TO THIS SPONSOR AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

 

16.                 
Notice. Any notice, consent or request to be given in connection with any of the terms or provisions of this Sponsor
Agreement shall be in writing and shall be sent or given in accordance with the terms of Section 11.02 of the Merger Agreement
to the applicable party at its principal place of business.

 

    5 

     

    

 

17.                 
Termination. This Sponsor Agreement shall terminate on the expiration of the Lock-up Period; provided, however, that
if the Merger Agreement is validly terminated in accordance with the terms thereof, this Sponsor Agreement shall automatically
terminate and be of no force and effect and, with respect to the Sponsor, shall revert to the Prior Letter Agreement (it being
understood that, for the avoidance of doubt, the Company shall have no rights, interests or obligations hereunder (or under the
Prior Letter Agreement) following such reversion). No such termination or reversion shall relieve the Sponsor, the Acquiror or
the Company from any liability resulting from a breach of this Sponsor Agreement occurring prior to such termination or reversion.

 

18.                 
Sponsor Representations: The Sponsor represents and warrants to the Acquiror and the Company, as of the date hereof,
that:

 

		a.	it has never been suspended or expelled from membership in any securities or commodities exchange
or association or had a securities or commodities license or registration denied, suspended or revoked;

 

		b.	it has full right and power, without violating any agreement to which it is bound (including, without
limitation, any non-competition or non-solicitation agreement with any employer or former employer), to enter into this Sponsor
Agreement;

 

		c.	it is duly organized, validly existing and in good standing under the Laws of the jurisdiction
in which it is organized, and the execution, delivery and performance of this Sponsor Agreement and the consummation of the transactions
contemplated hereby are within the Sponsor’s limited liability company powers and have been duly authorized by all necessary
limited liability company actions on the part of the Sponsor;

 

		d.	this Sponsor Agreement has been duly executed and delivered by the Sponsor and, assuming due authorization,
execution and delivery by the other parties to this Sponsor Agreement, this Sponsor Agreement constitutes a legally valid and binding
obligation of the Sponsor, enforceable against the Sponsor in accordance with the terms hereof (except as enforceability may be
limited by bankruptcy Laws, other similar Laws affecting creditors’ rights and general principles of equity affecting the
availability of specific performance and other equitable remedies);

 

		e.	the execution and delivery of this Sponsor Agreement by the Sponsor does not, and the performance
by the Sponsor of its obligations hereunder will not, (i) conflict with or result in a violation of the organizational documents
of the Sponsor, or (ii) require any consent or approval from any third party that has not been given or other action that has not
been taken by any third party, in each case, to the extent such consent, approval or other action would prevent, enjoin or materially
delay the performance by the Sponsor of its obligations under this Sponsor Agreement;

 

		f.	there are no Actions pending against the Sponsor or, to the knowledge of the Sponsor, threatened
against the Sponsor, before (or, in the case of threatened Actions, that would be before) any arbitrator or any Governmental Authority,
which in any manner challenges or seeks to prevent, enjoin or materially delay the performance by the Sponsor of its obligations
under this Sponsor Agreement;

 

		g.	except for fees described on Schedule 5.09 of the Merger Agreement, no broker, finder, investment
banker or other Person is entitled to any brokerage fee, finders’ fee or other commission in connection with the Merger Agreement
or this Sponsor Agreement or any of the respective transactions contemplated thereby and hereby, in each case, based upon arrangements
made by the Sponsor or, to the knowledge of the Sponsor, by the Acquiror or the Merger Sub;

 

    6 

     

    

 

		h.	the Sponsor has had the opportunity to read the Merger Agreement and this Sponsor Agreement and
has had the opportunity to consult with its tax and legal advisors;

 

		i.	the Sponsor has not entered into, and shall not enter into, any agreement that would prevent the
Sponsor from performing any of its obligations hereunder;

 

		j.	the Sponsor has good title to the Sponsor’s Founder Shares and Private Placement Warrants,
free and clear of any Liens other than Permitted Liens, and the Sponsor has the sole power to vote or cause to be voted such Founder
Shares and Private Placement Warrants; and

 

		k.	the Sponsor’s Founder Shares and the Private Placement Warrants identified in the 2nd
paragraph of this Sponsor Agreement are the only Founder Shares and Private Placement Warrants, respectively, owned of record or
Beneficially Owned by the Sponsor as of the date hereof, and none of such Founder Shares or Private Placement Warrants are subject
to any proxy, voting trust or other agreement or arrangement with respect to the voting of such Founder Shares or Private Placement
Warrants that is inconsistent with the Sponsor’s obligations pursuant to this Sponsor Agreement.

 

19.                 
Adjustment for Stock Split. If, and as often as, there are any changes in the Acquiror, the Founder Shares (including
any Earnout Founder Shares) or the Private Placement Warrants by way of stock split, stock dividend, combination or reclassification,
or through merger, consolidation, reorganization, recapitalization or business combination, or by any other means, equitable adjustment
shall be made to the provisions of this Sponsor Agreement as may be required so that the rights, privileges, duties and obligations
hereunder shall continue with respect to the Sponsor, the Acquiror, the Company, the Founder Shares and Private Placement Warrants,
each as so changed. For avoidance of doubt, such equitable adjustment shall be made to the Stock Price Level targets set forth
in Section 7(a) and Section 8(c).

 

20.                
No Claims Against the Trust Account. Section 6.05 of the Merger Agreement is hereby incorporated into this Sponsor
Agreement, mutatis mutandis.

 

21.                
Further Actions. Each of the parties hereto agrees to execute and deliver hereafter any further document, agreement
or instrument of assignment, transfer or conveyance as may be necessary or desirable to effectuate the purposes hereof and as may
be reasonably requested in writing by another party hereto.

 

[signature page follows]

 

    7 

     

    

 

	 	 	Sincerely,
	 	 	 
	 	 	GRAF ACQUISITION LLC
	 	 	 	 
	 	 	By:	/s/
                                         James A. Graf
	 	 	 	Name: James A. Graf
	 	 	 	Title: Managing Member
	 	 	 	 
	Acknowledged and Agreed:	 	 
	 	 	 	 
	GRAF INDUSTRIAL CORP.	 	 
	 	 	 	 
	By:	/s/ James A. Graf	 	 
	 	Name: James A. Graf	 	 
	 	Title: Chief Executive Officer	 	 
	 	 	 	 
	Acknowledged and Agreed:	 	 
	 	 	 	 
	VELODYNE LIDAR, INC.	 	 
	 	 	 	 
	By:	/s/ Anand Gopalan	 	 
	 	Name: Anand Gopalan	 	 
	 	Title: Chief Executive Officer	 	 

 

[Signature Page to Sponsor Agreement]

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