Exhibit 10.1

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EMPLOYMENT AGREEMENT

THIS AGREEMENT (the “Agreement”) is entered into this 28th day of March 2014,
and made effective as of the 1st day of March 2014 (the “Effective Date”), by
and between Lighting Science Group Corporation (hereinafter referred to as “LSG”
or “Company”), a Delaware Corporation with a business address of 1227 South
Patrick Drive, Satellite Beach, Florida 32937, and Jennifer Sethre (hereinafter
referred to as “Employee” or “you(r)”), an individual with a residence address
of 7010 Halstead Drive, Minnetrista, MN 55364. (From time to time, Company and
Employee shall be referred to collectively herein as the “Parties,” or,
individually, as the “Party.”)

W I T N E S E T H:

WHEREAS, the Company wishes to retain Employee to serve as its President.

WHEREAS, Employee wishes to be so retained.

NOW THEREFORE, in consideration of the premises, of the mutual covenants herein
contained, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Parties hereby agree that
employee shall be employed by the Company as its President pursuant to the terms
and conditions set forth herein.

1. POSITION AND DUTIES.

Employee will report to LSG’s Chairman of the Board or to his designee, and will
have such duties and responsibilities as customarily appertain to the position
of President, including responsibility for overseeing and managing the Company’s
operations, both domestic and abroad, and/or as the Chairman may specify.

During Employee’s employment with LSG, Employee will devote her full employable
time, attention and best efforts to the fulfillment of her duties and
responsibilities hereunder.

2. AT WILL EMPLOYMENT.

Employee’s employment hereunder is at-will. This means that either party may
terminate Employee’s employment at any time, and for any reason or for no
reason.

 

J Sethre Employment Agreement March 2014 – Rev. March 28, 2014

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3. BASE SALARY.

As of the Effective Date, Employee’s annual base salary (“Base Salary”) will be
Three Hundred Fifty Thousand Dollars ($350,000), less standard payroll
deductions and all required withholdings, payable in accordance with LSG’s usual
payroll practices.

4. RETROACTIVE BASE SALARY PAYMENT.

Within ten (10) business days following the parties’ execution of this
Agreement, the Company shall pay Employee the unpaid amount of Base Salary that
has accrued since the Effective Date.

5. AUTOMOBILE LEASE.

While Employee is employed hereunder, Employee will be entitled to one of the
following, at the Company’s option: (i) the full-time use of an automobile to be
leased by the Company (the “Company Car”), or (ii) a car allowance to be paid by
the Company to Employee in the amount of Eight Hundred Dollars ($800) per month.
In the event, a car allowance is paid by the Company, Employee shall be
responsible for obtaining and paying for automobile insurance; in the event the
Company leases an automobile for Employee, the Company shall obtain and pay for
automobile insurance.

6. BONUS PLAN.

Your annual target incentive will be 100-200% of your Base Salary; payment of
any bonus shall calculated by the Company in the reasonable exercise of its
discretion and shall be dependent on Employee’s satisfaction of pre-determined
milestones; these milestones will be established, on or before April 30, 2014,
by the Compensation Committee of the Board of Directors in consultation with the
Chairman and the Chief Executive Officer. You will not receive any bonus payment
if you voluntarily resign or are terminated for cause prior to the bonus payout.
Your termination shall be deemed to be “for cause” if it is, in whole or in
part, based on: (i) your commission of an act of fraud, recklessness or gross
negligence against the Company or any of its personnel, or in connection with
the performance of your duties of employment hereunder; (ii) your commission of
any act which is materially injurious to the Company, its personnel, its
interests or its reputation; or (iii) your indictment or conviction for, or plea
of no contest to, any felony or any other crime involving moral turpitude; or
(iv) your willful failure to fulfill your duties and/or responsibilities of
employment hereunder.

7. STOCK OPTIONS.

You will be eligible to participate in LSG’s stock option program, the Lighting
Science Group Corporation Amended and Restated Equity-Based Compensation Plan
(the “Plan”). Within thirty (30) days after this Agreement has been signed by
both parties, you will be granted an employee stock option to purchase a number
of shares of LSG’s common stock that is commensurate (in the sole exercise of
the Company’s discretion) with option grants made by the Company to its other
similarly-situated executives, at an exercise price for the full option equal to
$0.50 per share or the closing price-per-share of LSG’s publicly-traded common
stock on the date or grant if such closing price is higher than $0.50 per share.
This grant will vest, and become exercisable, over a 4

 

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year period, with one-fourth of said options vesting on each of the first four
anniversary dates, and will be subject to the terms and conditions of the Plan
and the stock option award agreement, which will be provided to you shortly
after the grant date. This grant is subject to final approval by the
Compensation Committee of LSG’s Board of Directors. In the event that the
Company terminates Employee without Cause (as defined in Section 6, above), or
Employee resigns for Good Reason (as defined in Section 12, below), those of
Employee’s unvested options which were to vest within one year from such
termination or resignation shall fully vest on Employee’s final date of
employment with the Company.

8. LOCK-UP LETTER.

In the event that a request is made by an underwriter in connection with a
proposed underwriting agreement or an offering of securities of the Company
(“Securities”), or otherwise, that the Employee execute a Lock-Up Letter
restricting or prohibiting her offer or sale of Securities, and/or containing
other provisions that are typically included in such Lock-up Letter, he shall
timely comply with such request, provided that it does not impose a lock-up
period that is longer than that imposed on other executive officers of the
Company, without any additional compensation therefor.

9. BENEFITS.

During the Term, Employee (and, as applicable, her eligible dependents) will be
eligible to participate in LSG’s employee benefit plans and fringe benefit
programs, including disability, medical, dental 401k, vision and life insurance
options, on a basis no less favorable than such benefits and perquisites are
provided to LSG’s other senior executives. Employee will be entitled to twenty
(20) days of paid vacation during each full calendar year beginning after the
Effective Date. LSG retains the right to modify, amend or terminate its employee
benefit plans and programs at any time.

10. RELOCATION AND LODGING COSTS.

The Company will reimburse Employee up to the amount of Fifteen Thousand Dollars
($15,000) for household moving expenses that are actually incurred by Employee
within 120 days of the Effective Date of this Agreement, in connection with her
relocation to the Satellite Beach (or surrounding) area. In addition, the
Company will pay the reasonable expense of transporting one vehicle from the
Employee’s current residence to Satellite Beach, Florida. The Company will also
pay up to $4,000 per month (in lieu of paying closing costs on the sale and
purchase of a residence) for the rental cost, actually incurred, for an
appropriate residence in Florida for the employee and her family for up to 24
months from the Effective Date. During such time as the Company continues to
lease a home for use by Employee and her family, the lease payments made
thereunder by the Company shall be in lieu of the aforementioned monthly
payments of $4,000.

 

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11. TAXES.

Employee understands and acknowledges that she will be solely responsible for
any income tax liability that results from her receipt of compensation and
benefits hereunder, including without limitation any automobile lease payments
made by the Company or relocation and lodging expenses paid by the Company.

12. TERMINATION WITHOUT CAUSE; RESIGNATION FOR GOOD REASON.

If, during your first 24 months of employment hereunder, LSG terminates your
employment under without Cause (as defined in Section 6, above) or you resign
for “Good Reason” (as defined below), LSG will continue to pay your Base Salary
for a period of twelve (12) months following your termination or resignation, as
the case may be, in accordance with LSG’s payroll practices, provided that the
payments due within the first fifty-two (52) days after termination may be
accrued and paid on the first payroll date on or after the fifty-second
(52nd) day following your termination. The severance payment will be conditional
upon your first executing and returning (within such time period as LSG may
prescribe) after your termination (and not revoking) a valid waiver and release
of all claims that you may have against LSG and its affiliates (the “Waiver and
Release”), (ii) are further conditioned on your compliance with all
post-termination obligations in this Agreement, and (iii) shall be reduced by
the amount of any other payments for such period paid to you by LSG, if any.

“Good Reason” means the occurrence, without your prior written consent, of any
of the following events: (a) any willful material breach by LSG of its
obligations under this Agreement; (b) a reduction in your Base Salary (c) a
material reduction by LSG in the kind or level of employee benefits to which you
are entitled immediately prior to such reduction (other than a reduction
generally applicable to all senior executives of LSG); provided, that any such
event described in (a) through (c) above will not constitute Good Reason unless
you deliver to LSG a written notice of termination for Good Reason within ninety
(90) days after you first learn of the existence of the circumstances giving
rise to Good Reason, and within thirty (30) days following the delivery of such
notice LSG has failed to cure the circumstances giving rise to Good Reason.

13. CONFIDENTIALITY / NON-DISCLOSURE.

LSG shall provide you with “Confidential Information” (as defined below) in
connection with the performance of your duties hereunder. You agree and
acknowledge that LSG and its affiliates have a legitimate and continuing
proprietary interest in the protection of its Confidential Information and that
it has invested substantial time, money and effort and will continue to invest
substantial time, money and effort to develop, maintain and protect such
Confidential Information. During your employment and at all times thereafter,
you will not, except with LSG’s written consent or in connection with carrying
out your duties and responsibilities for LSG, furnish or make accessible to
anyone or use for your own benefit or the benefit of anyone else any trade
secrets, confidential or proprietary information of LSG and its affiliates,
including but not limited to business plans and/or strategies, sales plans
and/or strategies, marketing plans and/or strategies, systems, programs,
methods, employee lists, computer programs, insurance profiles and client lists
(hereafter referred to as “Confidential Information”); provided, that such

 

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Confidential Information shall not include information which at the time of
disclosure or use, was generally available to the public other than by a breach
of this Agreement. Notwithstanding the foregoing, you may disclose Confidential
Information when required to do so by a court of competent jurisdiction, by any
governmental agency having supervisory authority over the business of LSG or by
any administrative body or legislative body (including a committee thereof) with
jurisdiction to order you to divulge, disclose or make accessible such
information, but you must first (i) promptly notify LSG of such order, (ii) at
LSG’s written request, diligently contest such order at the sole expense of LSG
as expenses occur, and (iii) at LSG’s written request, seek to obtain, at the
sole expense of LSG, such confidential treatment as may be available under
applicable laws for any information disclosed under such order.

14. NON-COMPETITION/ NON-SOLICITATION.

In consideration of LSG’s provision of Confidential Information, and the
payments, benefits and other obligations of LSG to you pursuant to this
Agreement, you hereby covenant and agree that, at all times during which you are
employed by LSG and its affiliates and during the “Restricted Period” (as
defined below), you will not, directly or indirectly, own any interest in,
establish, manage, control, participate in (whether as an officer, director,
manager, employee, partner, equity holder, member, agent, representative or
otherwise), consult with, render services for, or in any other manner engage in
any “Competing Business” (as defined below) anywhere in the “Restricted Area”
(as defined below). “Competing Business” means any person, business or entity
engaged in the research, development, manufacture, or sale of LED lighting
devices, including but not limited to, LED lighting components, LED retrofit
lamps, LED luminaires, LED fixtures and/or LED lighting systems, and any other
business engaged in by LSG or its affiliates (collectively, the “Company Group”)
as conducted, or proposed to be extended or expanded, by the Company Group as of
the date of your termination. Nothing herein shall prohibit you from investing
in stocks, bonds, or other securities in any business if: (i) such stocks,
bonds, or other securities are listed on any United States securities exchange
or are publicly traded in an over the counter market, and such investment does
not exceed, in the case of any capital stock of any one issuer, two percent
(2%) of the issued and outstanding capital stock, or in the case of bonds or
other securities, two percent (2%) of the aggregate principal amount thereof
issued and outstanding, or (ii) such investment is completely passive and no
control or influence over the management or policies of such business is
exercised.

In further consideration of LSG’s provision of Confidential Information, the
payments, benefits and other obligations of LSG to you pursuant to this
Agreement, you hereby covenant and agree that, at all times during which you are
employed by LSG and its affiliates and during the Restricted Period, you will
not, directly or indirectly, solicit or attempt to solicit, from any of LSG’s
customers, customer prospects, vendors, suppliers, and/or consultants, any
business for any entity or individual other than LSG, and you will not otherwise
attempt to persuade any of LSG’s customers, customer prospects, vendors,
suppliers and/or consultants to end or reduce the amount of the business they
conduct with LSG.

 

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In further consideration of LSG’s provision of Confidential Information, the
payments, benefits and other obligations of LSG to you pursuant to this
Agreement, you hereby covenant and agree that, at all times during which you are
employed by LSG or its affiliates and during the Restricted Period, you will not
hire, or assist anyone else to hire, any employee, consultant, or temporary
employee of LSG or seek to persuade any employee, consultant, or temporary
employee of LSG to discontinue employment or to become employed in any business
other than LSG, nor seek to persuade any third party to discontinue a
relationship with LSG.

You agree that, while you are employed, during the Restricted Period and
subsequent to the completion or termination of the Restricted Period, you will,
at LSG’s request and expense, execute all applications for United States and
foreign patents, trademarks, copyrights, or other rights with respect to, and
will otherwise provide assistance (including but not limited to the execution
and delivery of instruments of further assurance or confirmation) to assign (and
immediately upon creation will be deemed to have assigned), all Subject
Intellectual Property to LSG and to permit LSG to enforce any patents,
trademarks, copyrights, or other rights in and to Subject Intellectual Property.
You agree not to file any patent, trademark, or copyright applications relating
to Subject Intellectual Property. “Subject Intellectual Property” means all
right, title, and interest to all patents and patent applications, all
inventions, innovations, improvements, developments, methods, designs, recipes,
formulas, analyses, drawings, reports and all similar or related information (in
each case whether or not patentable), all copyrights and copyrightable works,
all trade secrets, confidential information and know-how, and all other
intellectual property rights that both (a) are or were conceived, reduced to
practice, developed or made by you while employed by LSG and (b) either that
(i) directly or indirectly relate to the actual or anticipated business,
research and development or existing or future products or services of LSG, or
(ii) are or were conceived, reduced to practice, developed or made using any of
the equipment, supplies, facilities, assets or resources of LSG (including any
intellectual property rights).

15. RESTRICTED PERIOD.

For purposes of this Agreement, and except as provided below, the “Restricted
Period” shall mean a period of up to twenty-four (24) months following the date
on which your employment ends (for whatever reason). LSG shall determine, at its
sole option, the length of such period (if any) and shall communicate such
determination to you in writing; After LSG has communicated to you the length of
the Restricted Period, LSG shall have the right, at its sole option, to shorten
such Restricted Period provided that LSG gives you 90-days’ written notice
thereof.

LSG will pay you an amount equal to your Base Salary during the Restricted
Period, which shall be payable to you in substantially equal installments in
accordance with LSG’s payroll practices; provided, however, that such payments
(i) are conditioned upon your executing and returning to LSG (and not revoking)
a Waiver and Release, (ii) are further conditioned on your compliance with all
post-termination obligations in this Agreement, and (iii) shall be reduced by
the amount of any severance or other payments for such period paid to you by
LSG, if any. For purposes of clarification, the “Restricted Period” shall not
include any time period during which LSG is not paying your Base Salary.

 

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16. RESTRICTED AREA.

For purposes of this Agreement, “Restricted Area” means, because LSG is engaged
in business throughout the United States and you have responsibility for and/or
will perform services for or regarding LSG throughout the United States, the
United States, and every country in which LSG conducts business during your
employment with LSG.

17. APPLICATION OF SECTION 409A.

Each payment under this Agreement is intended to be exempt from Section 409A or
in compliance with Section 409A, and the provisions of this Agreement will be
administered, interpreted and construed accordingly. Without limiting the
generality of the foregoing, the term “termination” of employment or any similar
term used herein will be interpreted to mean “separation from service” within
the meaning of Section 409A to the extent necessary to comply with Section 409A.
In addition, notwithstanding any provision of this Agreement to the contrary,
any payment that is subject to the six-month delay under Section 409A(a)(2)(B)
of the Internal Revenue Code for a “specified employee”, if applicable, shall
not be paid or commence until the earliest of: (i) the first day of the seventh
month after your date of termination, (ii) the date of your death, or (iii) such
earlier date as complies with the requirements of Section 409A. Each payment
hereunder subject to Section 409A shall be considered a separate payment for
purposes thereof. All reimbursements or provision of in-kind benefits pursuant
to this Agreement shall be made in accordance with Treas. Reg. §
1.409A-3(i)(1)(iv) such that the reimbursement or provision will be deemed
payable at a specified time or on a fixed schedule relative to a permissible
payment event. Specifically, the amount reimbursed or in-kind benefits provided
under this Agreement during your taxable year may not affect the amounts
reimbursed or provided in any other taxable year (except that total
reimbursements may be limited by a lifetime maximum under a group health plan),
the reimbursement of an eligible expense shall be made on or before the last day
of your taxable year following the taxable year in which the expense was
incurred, and the right to reimbursement or provision of in-kind benefit is not
subject to liquidation or exchange for another benefit.

18. ASSIGNMENT.

You may not transfer, delegate, or assign this Agreement or your obligations
hereunder. LSG may transfer or assign this Agreement to a company or firm that
succeeds to the business of LSG or into which LSG merges.

19. NOTICES.

Any notice or other communication that one party desires to give to the other
under this Agreement shall be in writing, and shall be deemed effectively given
upon (i) receipt by personal delivery, (ii) receipt by transmission by facsimile
or electronic mail or (iii) the third business day following deposit in any
United States mail box, by registered or certified mail, postage prepaid,
addressed to the other party at the address set forth below or at such other
address as a party may designate by 15 days advance notice to the other party
pursuant to the provisions of this section.

 

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If to you:

Jennifer Sethre

c/o Lighting Science Group Corporation

1227 South Patrick Drive

Satellite Beach, FL 32937

If to the Company:

Lighting Science Group Corporation

1227 South Patrick Drive

Satellite Beach, FL 32937

Attention: CEO

20. LSG STANDARD PRACTICE AND PROCEDURES.

All other matters concerning your employment which are not specifically
described in this Agreement will be in accordance with LSG’s standard practices
and procedures.

21. ENTIRE AGREEMENT.

This Agreement contains the entire agreement and understanding between you and
LSG and supersedes any prior or contemporaneous agreements, understandings,
communications, offers, representations, warranties, or commitments by or on
behalf of LSG and its affiliates (either oral or written). The terms of your
employment may, in the future, be amended but only in writing, signed by you and
signed by a duly authorized officer on behalf of LSG.

22. NO WAIVER.

No waiver of any term of this Agreement will be valid unless made in writing and
signed by the party waiving such term. A waiver by any party of a breach of any
provision of this Agreement will not operate or be construed as a waiver of any
subsequent breach by that same party.

23. DISPUTE.

In the event a dispute arises, this Agreement, including the validity,
interpretation, construction and performance of this Agreement, shall be
governed by and construed in accordance with the substantive laws of the State
of Florida. Jurisdiction and venue for the resolution of any disputes hereunder
or relating to Employee’s employment with the Company, or her performance of
duties or responsibilities pursuant thereto, shall be solely in Brevard County,
within the State of Florida.

 

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24. COUNTERPARTS.

This Agreement may be executed in any number of counterparts, each of which
shall be an original, but all of which together shall constitute one instrument.

25. UNENFORCEABLE PROVISIONS.

If any provision hereof shall be declared unenforceable for any reason, such
unenforceability shall not affect the enforceability of the remaining provisions
of this Agreement. Further, such provision shall be reformed and construed to
the extent permitted by law so that it would be valid, legal and enforceable to
the maximum extent possible.

* * * *

 

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IN WITNESS WHEREOF, the Parties have caused this Agreement to be signed and
delivered by their duly authorized representatives, as of the date first above
written.

 

JENNIFER SETHRE     LIGHTING SCIENCE GROUP CORPORATION Signature:   /s/ Jenifer
Sethre     By:   /s/ Rick Davis Date:         Title:   Chief Executive Officer  
    Date:    

 

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