Paul Ricci

About Paul Ricci

Paul Ricci is Luminar’s Chief Executive Officer and a Class I director, appointed effective on or about May 21, 2025; he is 68 years old and not classified as an independent director under Nasdaq rules . He previously served as Chairman (1999–2018) and CEO (2000–2018) of Nuance Communications, transforming it into a ~$2B provider of conversational AI; he later was CEO of Qualifacts (2020–2023) and held senior roles at Xerox, beginning his career at PARC . Ricci holds bachelor’s and master’s degrees in economics from Stanford University . Since his appointment, he has undertaken a strategic repositioning at Luminar: entered forbearance agreements with secured noteholders, suspended 2025 guidance, paused equity financing programs, and actively evaluated proposals for asset or whole-company transactions while shifting emphasis toward the LSI photonics and non-automotive markets .

Past Roles

External Roles

Fixed Compensation

• As of May 15, 2025, the company disclosed that compensatory arrangements for Ricci as CEO “have not been definitively determined” and would be provided in an amendment; a standard indemnification agreement will be executed .
• The 2025 proxy’s executive compensation section covers 2024 NEOs (Russell, Fennimore, Prescott); Ricci is not included there given his May 2025 appointment .

Implication: Base salary, target bonus, and initial equity grant terms for Ricci were not disclosed in available filings through November 13, 2025 .

Performance Compensation

• Company program context: Luminar emphasizes pay-for-performance with PRSUs for certain executives using annual operating plan metrics; for 2024, performance goals were 50% adjusted operating loss (target −$277M) and 50% cash & liquidity (target $151M) .
• Change-in-control treatment in the 2020 Amended & Restated Equity Incentive Plan permits continuation/assumption/substitution or cash cancellation of awards at fair market value; awards may also be accelerated per award agreements .

Note: No specific performance metrics, weightings, or PRSU structure for Ricci were disclosed in the filings reviewed .

Equity Ownership & Alignment

Alignment takeaways: As of the proxy record date, Ricci did not report share ownership; company policy prohibits hedging/pledging, reducing misalignment risks .

Employment Terms

Non-compete/non-solicit, severance, and change-of-control economics for Ricci specifically were not disclosed in the documents reviewed .

Board Governance

• Structure: Nine directors in three staggered classes; Ricci is Class I (term to 2027) .
• Independence: Seven of nine directors independent; Ricci and founder Austin Russell are non-independent .
• Committees: Audit, Compensation & Human Capital Management, and Nominating & ESG committees are fully independent; Ricci is not listed as a member of these committees .
• Controlled company: Due to Russell’s majority voting control, Luminar is a “controlled company” and eligible for certain Nasdaq governance exemptions (board majority independence and compensation committee independence); the board states it does not currently intend to rely on these exemptions .
• Non-employee director compensation (context): Quarterly cash retainers ($12,500 board; committee chairs: audit $6,250, comp $5,000, nominating $2,500; committee members lower amounts) and annual RSU grants ($200,000), with initial RSU of $400,000 for new non-employee directors; Ricci, as CEO, would not receive non-employee director compensation .

Performance & Track Record

• Strategic repositioning actions under Ricci: noteholder forbearance agreements through Nov 24; suspended 2025 guidance; paused equity finance/credit/preferred programs; evaluating proposals for asset sales or whole-company sale; adding independent directors with restructuring expertise .
• Business focus shifts: Paused certain automotive production commitments (e.g., Volvo IRIS volumes); pursuing non-automotive markets (aerospace/defense, industrial), elevating LSI photonics; cited YTD LSI revenue of ~$18M with multi-year backlog visibility .
• Q3 2025 operating snapshot (context): Revenue $18.7M; GAAP gross loss −$8.1M; non-GAAP OPEX $43M; cash and marketable securities $74M; free cash flow ~−$48.5M; ongoing evaluation of strategic alternatives .

Risk Indicators & Red Flags

• Leadership transition: Ricci’s appointment followed founder Austin Russell’s resignation as CEO and Chair after an Audit Committee Code of Conduct inquiry; Russell remains on the board .
• Liquidity/capital structure: Forbearance agreements with secured noteholders; paused financing programs while exploring longer-term solutions and strategic alternatives .
• Governance safeguards: Clawback provisions apply to all awards under the Amended Plan; no tax gross-ups; no option repricing without shareholder approval .

Investment Implications

• Near-term comp alignment opacity: Ricci’s CEO compensation terms were not yet disclosed at appointment, limiting direct pay-for-performance assessment; monitor for subsequent 8-K/A or proxy disclosures to evaluate fixed/equity mix, performance metrics, and severance/CIC terms .
• Dual-role governance: As a non-independent CEO-director within a controlled company, independence concerns are mitigated by fully independent standing committees and a lead independent director, but ultimate voting control rests with the founder, which can affect compensation and strategic oversight dynamics .
• Execution and retention: Ricci’s restructuring orientation (forbearance, strategic alternatives, shift to LSI/non-auto) suggests focus on liquidity, margin visibility, and asset value realization; retention will hinge on competitive comp terms and clarity on incentives tied to deleveraging, strategic transactions, and segment performance .
• Trading signals: Watch for insider Form 4 filings by Ricci (initial grants, open-market buys), plan amendments, and any change-of-control triggers; observe board and say-on-pay outcomes post-2025 annual meeting for shareholder sentiment on pay structures and governance .