EMPLOYMENT AGREEMENT

Exhibit 10.3

EMPLOYMENT AGREEMENT

EMPLOYMENT AGREEMENT (this " Agreement ") is dated as of October 4, 2007, by and between Lighting Science Group Corporation, a Delaware corporation (the " Company ") and Kevin Furry (" Executive ", and together with the Company, the " Parties ").

W I T N E S S E T H :

1. The Company desires to employ Executive, and Executive desires to be employed by the Company, on the terms and conditions set forth in this Agreement.
2. Executive acknowledges that (i) Executive's employment with the Company will provide Executive with trade secrets of, and confidential information concerning, the "Company Group" (as defined in Section 7(a) below) and (ii) the covenants contained in this Agreement are essential to protect the business and goodwill of the Company Group.

Accordingly, in consideration of the premises and the respective covenants and agreements of the Parties set forth below, and intending to be legally bound hereby, the Parties agree as follows:

Section 1.    Term . Subject to earlier termination in accordance with the provisions of Section 6 of this Agreement, Executive shall be employed by the Company for an initial period commencing on the consummation of the transactions contemplated by the Exchange and Contribution Agreement by and among LED Holdings, LLC (" LED ") and the Company dated as of the date hereof (the " Effective Date ") and ending on the fifth anniversary of the Effective Date (the " Term "); provided , that the Term shall be automatically extended for successive one-year periods thereafter unless, no later than ninety (90) days prior to the expiration of the initial period, or any such successive one-year renewal period, either Party shall provide to the other Party written notice of its or his desire not to extend the Term. Upon Executive's termination of employment with the Company for any reason, Executive shall immediately resign all positions with the Company and any other members of the Company Group.

Section 2.    Position and Duties .

1. During the Term, Executive shall serve as the Company's Co-Chief Technology Officer and shall report to the Company's Chief Executive Officer. Executive shall have such responsibilities and duties as are customarily exercised by a person holding the position in which Executive serves and shall comply with all of the policies and procedures of the Company and its subsidiaries that are applicable to Executive. If reasonably requested by the Company's Board of Directors (the " Board "), Executive hereby agrees to serve (without additional compensation) as an officer and/or director of any member of the Company Group.
2. During the Term and except as otherwise agreed by the Board, Executive shall devote Executive's full employable time, attention and best efforts to the business affairs of the Company (except during vacations or illness) and will not actively engage in outside business activities, whether or not such activity is pursued for gain, profit or other pecuniary advantage unless such activity (and the amount thereof) is approved by the Board. Notwithstanding the

3. foregoing, Executive shall be entitled to devote a reasonable amount of time to civic and community affairs and the management of his personal investments so long as these other activities do not interfere with the performance of Executive's duties hereunder.

Section 3.    Compensation .

1. Base Salary . During the Term, Executive shall receive an annual base salary (the " Base Salary ") of $250,000, payable in regular installments in accordance with the Company's usual payroll practices. The Base Salary shall be reviewed by the Board or the Compensation Committee thereof no less frequently than annually during the Term for discretionary increase, effective each anniversary of the Effective Date, and shall in any event be increased on each anniversary of the Effective Date by a percentage equal to at least the percentage increase in the CPI (All Urban Consumers) for the most recent calendar year that has ended prior to the effective date of such increase.
2. Executive Bonus Plan . Executive shall be eligible to participate in all executive bonus plan(s) in which senior executives of the Company participate as the Board, in its sole direction, may from time to time establish at a level commensurate to his position with the Company, and any bonus payable under any such plan(s) shall be subject to, and contingent upon, the attainment of performance goals established by the Board thereunder.
3. Equity-Based Compensation During the Term, Executive shall be eligible to receive awards under the Company's 2005 Equity-Based Compensation Plan (the " Equity-Based Compensation Plan ").

Section 4.    Expenses . During the Term, Executive shall be entitled to receive prompt reimbursement for all travel and business expenses reasonably incurred and accounted for by Executive (in accordance with the policies and procedures established from time to time by the Company) in performing services hereunder.

Section 5.    Other Benefits .

1. Employee Benefits . During the Term and to the extent permitted by applicable law, Executive shall be able to participate in all employee benefit plans and perquisite and fringe benefit programs on a basis no less favorable than such benefits and perquisites are provided by the Company from time to time to the Company's other senior executives.
2. Vacations . Executive shall be entitled to twenty (20) days of paid vacation during each calendar year during the Term, any or all of which may be carried over into a new calendar year, for a maximum accrual of ten (10) days, and all paid holidays and personal days given by the Company to its senior executives. In accordance with the Company's vacation pay policy, Executive shall also be entitled to cash out earned but unused vacation days in excess of ten (10) days at the end of each such calendar year.

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Section 6.    Termination of Employment . Executive's employment hereunder may be terminated under the following circumstances:

1. Death . The Term and Executive's employment hereunder shall terminate upon Executive's death. Upon any termination of Executive's employment hereunder as a result of this Section 6(a), Executive's estate shall be entitled to receive (i) his Base Salary through the date of termination and (ii) any earned but unpaid annual bonus (collectively, the " Accrued Amounts "). All other benefits, if any, due to Executive's estate following Executive's termination due to death shall be determined in accordance with the plans, policies and practices of the Company; provided , that Executive (or his estate, as the case may be) shall not participate in any severance plan, policy or program of the Company. Executive's estate shall not accrue any additional compensation (including any Base Salary or bonus) or other benefits under this Agreement following such termination of employment, except for any benefits to which Executive (or his estate) is entitled pursuant to the terms of the employee benefit plans of the Company in which Executive is participating immediately prior to such termination.
2. Disability . The Company may terminate the Term and Executive's employment hereunder for Disability. " Disability " shall mean the incapacitation or disability of Executive by accident, sickness or otherwise so as to render Executive mentally or physically incapable of performing the duties required to be performed by such Executive pursuant to the terms of this Agreement, for any period of 90 consecutive days or for an aggregate of 120 days in any period of 365 consecutive days. In conjunction with determining Disability for purposes of this Agreement, Executive hereby (i) consents to any such examinations, at the Company's expense, which are relevant to a determination of whether Executive is mentally and/or physically disabled and (ii) agrees to furnish such medical information as may be reasonably requested. Upon any termination of Executive's employment hereunder pursuant to this Section 6(b), Executive shall be entitled to receive the Accrued Amounts. All other benefits, if any, due to Executive following Executive's termination by the Company for Disability shall be determined in accordance with the plans, policies and practices of the Company; provided , that Executive shall not participate in any severance plan, policy or program of the Company unless such severance plan, policy or program specifically relates to Disability (and only to the extent it so relates). Executive shall not accrue any additional compensation (including any Base Salary or bonus) or other benefits under this Agreement following such termination of employment, except for any benefits to which Executive (or his estate) is entitled pursuant to the terms of the employee benefit plans of the Company in which Executive is participating immediately prior to such termination.
3. Termination for Cause; Voluntary Termination . At any time during the Term, (i) the Company may terminate the Term and Executive's employment hereunder for "Cause" (as defined below) by written notice specifying the grounds for Cause in reasonable detail, and (ii) Executive may terminate the Term and Executive's employment hereunder "voluntarily" (that is, other than by death, Disability or for Good Reason, in accordance with Sections 6(a), 6(b) or 6(d)). " Cause " shall mean Executive's: (A) willful breach of Executive's obligations under this Agreement, which breach Executive fails to cure, if curable, within twenty (20) days after receipt of a written notice of such breach; (B) gross negligence in the performance or intentional non-performance of Executive's material duties to the Company or any of its subsidiaries; (C) commission of a felony or a crime of moral turpitude; (D)

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4. commission of a material act of deceit, fraud, perjury or embezzlement that involves or directly or indirectly causes harm to the Company or any of its subsidiaries; or (E) repeatedly (i.e. on more than one occasion) being under the influence of drugs or alcohol (other than over-the-counter or prescription medicine or other medically-related drugs to the extent they are taken in accordance with their directions or under the supervision of a physician) during the performance of Executive's duties to the Company or any of its subsidiaries, or, while under the influence of such drugs or alcohol, engaging in grossly inappropriate conduct during the performance of Executive's duties to the Company or any of its subsidiaries.

5. Upon the termination of the Term and Executive's employment hereunder pursuant to this Section 6(c) by the Company for Cause, Executive shall be entitled to receive his Base Salary through the date of termination. Upon the termination of the Term and Executive's employment hereunder pursuant to this Section 6(c) due to Executive's voluntary termination, Executive shall be entitled to receive the Accrued Amounts. Executive shall not accrue any additional compensation (including any Base Salary or bonus) or other benefits under this Agreement following such termination of employment. All other benefits, if any, due to Executive following Executive's termination of employment for Cause or due to Executive's voluntary termination pursuant to this Section 6(c) shall be determined in accordance with the plans, policies and practices of the Company; provided , that Executive shall not participate in any severance plan, policy or program of the Company.

6. Termination for Good Reason or without Cause . At any time during the Term, (i) Executive may terminate the Term and Executive's employment hereunder for "Good Reason" (as defined below) and (ii) the Company may terminate the Term and Executive's employment hereunder "without Cause" (that is, other than by death, Disability or for Cause, in accordance with Sections 6(a), 6(b) or 6(c)). " Good Reason " shall mean the occurrence, without Executive's prior written consent, of any of the following events: (A) any material breach by the Company or any of its subsidiaries, as the case may be, of its obligations under this Agreement; (B) a reduction in Executive's Base Salary (other than a reduction made in connection with an across-the-board proportionate reduction in the base salaries of all officers of the Company that is not more than 10%); (C) a material reduction by the Company in the kind or level of employee benefits to which Executive is entitled immediately prior to such reduction that is not generally applicable to all executive level employees of the Company; or (D) a material reduction by the Company of Executive's duties and responsibilities, including a material change in job title or a change of geographic location of Executive's office of more than thirty (30) miles from the Company's present office in Rancho Cordova, California; provided , that any such event described in (A) through (D) above shall not constitute Good Reason unless Executive delivers to the Company a Notice of Termination for Good Reason within ninety (90) days after Executive first learns of the existence of the circumstances giving rise to Good Reason, and within thirty (30) days following the delivery of such Notice of Termination for Good Reason the Company has failed to cure the circumstances giving rise to Good Reason. Executive may also terminate the Term and his employment hereunder for " Good Reason " if the Company's Chief Executive Officer requests that Executive engage in business-related travel for a total of more than sixty (60) days in any calendar year ending during the Term, excluding any one-day business trips that do not require Executive to stay overnight, if Executive, upon receiving a request from the Chief Executive Officer for business-related travel that would result in such 60-day threshold being exceeded, delivers a written notice to the Chief Executive Officer that such

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5. request triggers Executive's right to terminate for "Good Reason" pursuant to this sentence and the Chief Executive Officer does not withdraw the request for such excess travel within five (5) business days of receiving such written notice; provided , that Executive must terminate his employment within ten (10) additional business days of the expiration of such fifth business day if such request is not withdrawn.

6. Upon the termination of Executive's employment hereunder pursuant to this Section 6(d), Executive shall receive (i) the Accrued Amounts and (ii) an amount equal to $62,500 as severance pay (the " Severance Payment "), such amount to be paid in accordance with the Company's usual payroll practices during the three-month period following such termination. All other benefits, if any, due Executive following a termination pursuant to this Section 6(d) shall be determined in accordance with the plans, policies and practices of the Company; provided , that Executive shall not participate in any severance plan, policy or program of the Company. Executive shall not accrue any additional compensation (including any Base Salary or bonus) or other benefits under this Agreement following such termination of employment. Notwithstanding the foregoing, if all or any portion of the Severance Payment or any other payments due under this Agreement following a separation from service are determined to be "nonqualified deferred compensation" subject to Section 409A of the Internal Revenue Code of 1986, as amended (the " Code "), and the Company determines that Executive is a "specified employee" as defined in Section 409A(a)(2)(B)(i) of the Code and the regulations and other guidance issued thereunder, then such payments (or the applicable portion thereof) shall commence no earlier than the first day of the seventh month following the month in which Executive's separation from service occurs (at which time Executive shall be entitled to receive a lump sum payment equal to the aggregate payments that were subject to such six-month payment delay).

7. Termination as a Result of Non-Renewal of the Term . Upon the expiration of the Term, and the termination of Executive's employment upon the date of such expiration, Executive shall be entitled to receive only the Accrued Amounts. All other benefits, if any, due to Executive following Executive's termination of employment upon expiration of the Term pursuant to this Section 6(e) shall be determined in accordance with the plans, policies, and practices of the Company; provided , that Executive shall not participate in any severance plan, policy or program of the Company. Executive shall not accrue any additional compensation (including any Base Salary or bonus) or other benefits under this Agreement following such termination of employment.
8. Execution of Release of All Claims . Notwithstanding any other provision of this Agreement to the contrary, Executive acknowledges and agrees that any and all payments to which Executive or his estate, as applicable, is entitled under this Section 6 are conditional upon, and subject to, Executive or his estate, as applicable, first executing a valid waiver and release of all claims that Executive or his estate, as applicable, may have against the Company and its subsidiaries (which waiver and release of all claims shall contain appropriate carve outs for amounts payable pursuant to this Agreement and any rights Executive or his estate, as applicable, may have under any benefit plans or programs of the Company and its subsidiaries).
9. Notice of Termination . Any purported termination of employment by the Company or Executive shall be communicated by a written Notice of Termination to Executive

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8. or the Company, respectively, delivered in accordance with Section 8(d) hereof. For purposes of this Agreement, a " Notice of Termination " shall mean a notice which shall indicate the specific termination provision in the Agreement relied upon, the date of termination, and shall set forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of employment under the provision so indicated. The date of termination of Executive's empl