Exhibit 10.2


 


EXECUTIVE
EMPLOYMENT AGREEMENT


 


This
Executive Employment Agreement (“Agreement”) is between SG BLOCKS, INC. (the “Company”)
and Mahesh Shetty (“Executive”) and is effective as of January 1, 2017 (“Effective Date”).
In consideration of the mutual covenants set forth herein, the Company and Executive (collectively, the “Parties”
and each individually, a “Party”) agree as follows:


 


	1.	Executive’s
                                         Employment with the Company. During the Term, the Company agrees to employ Executive
                                         as Chief Financial Officer of the Company or in any other position to which the Parties
                                         subsequently agree. During Executive’s employment with the Company, Executive agrees
                                         to: (i) devote substantially all of Executive’s time, energy, skill and best efforts
                                         to the performance of Executive’s job duties, as assigned by the Company, and to
                                         the business of the Company, and shall perform such duties as assigned by the Company
                                         – which duties may change from time to time – in a diligent, trustworthy,
                                         and business-like manner and in compliance with all applicable laws; (ii) use his reasonable
                                         best efforts to foster the Company’s interests; and (iii) comply with the Company’s
                                         existing and future policies, manuals and procedures as adopted and provided to Executive;
                                         provided that, in the event of any conflict between any such policy, manual or procedure
                                         and the provisions of this Agreement, the provisions of this Agreement shall control.
                                         While frequent travel may be required of Executive in Executive’s performance of
                                         Executive’s job duties for the Company, Executive’s primary work location
                                         shall be located in Dallas, Texas or any other location at which the Company’s
                                         headquarters may be located during the Term (as defined below). Executive shall not at
                                         any time during Executive’s employment with the Company: (a) work on any basis
                                         (including, without limitation, part-time or as an independent contractor) for a Competing
                                         Business (as defined in Section 5(a)); or (b) participate in any way in any other business
                                         that is not a Competing Business to the extent that such participation adversely affects
                                         Executive’s performance of Executive’s job duties for the Company or that
                                         may or does adversely affect the Company in any way.
	 	 	 
	2.	Term
                                         of Agreement. Executive’s employment with the Company pursuant to the terms
                                         of this Agreement will begin on the Effective Date and will remain in effect for a two
                                         (2) year period, unless earlier terminated in accordance with Section 7 (the “Initial
                                         Term”). After the end of the Initial Term, this Agreement shall automatically
                                         renew until either Party provides sixty (60) days’ prior written notice of termination
                                         (“Renewal Term” and, together with the Initial Term, the “Term”).
	 	 
	3.	Compensation
                                         and Benefits.



 


		(a)	As
compensation for all services rendered by Executive to the Company or any of the Company’s subsidiaries or affiliates, the
Company shall pay Executive an annual base salary of $180,000 (“Base Salary”), to be paid in installments
in accordance with the Company’s normal payroll practices and subject to all required and/or authorized withholdings and
deductions.
	 	 	 
		(b)	Executive
                                         shall be eligible to receive a discretionary annual cash bonus on each of the first two
                                         anniversaries of this Agreement based on the achievement of certain financial and personal
                                         and strategic performance metrics established by the Board of Directors of the Company
                                         (the “Board”) in its reasonable discretion (each, a “Discretionary
                                         Bonus”). The terms and conditions of such discretionary annual cash bonus
                                         are set forth on Exhibit A (the “Bonus Plan”).
                                         The Board shall undertake a review of Executive’s Base Salary and Discretionary
                                         Bonus not less often than annually. The principal criteria utilized by the Board in the
                                         conduct of its reviews shall be the extent to which the Company attains its performance
                                         objectives and the extent of Executive’s contributions thereto.



 






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		(c)	As
additional compensation for services rendered, during the Term, Executive shall receive the option to purchase up to 55,838 shares
of the Company’s issued and outstanding common stock, par value $0.01 per share (“Common Stock”),
for an exercise price of $3.00 per share, subject to the terms and conditions of the Company’s stock incentive plan then
in effect (the “Employment Option”). The Employment Option shall vest in eight equal quarterly installments
over two years and shall be subject to the requirement that Executive sign a Stock Option Agreement, in the form attached hereto
as Exhibit B.
	 	 	 
		(d)	In
addition, Executive will be eligible to receive options to purchase 13,200 shares of Common Stock as a bonus in lieu of cash in
connection with his and the Company’s performance and progress since its emergence from bankruptcy in 2016 (the “2016
Option Grant”), subject to the terms and conditions set forth in the Company’s stock incentive plan in effect
as of the Effective Date.
	 	 	 
		(e)	In
connection with the public offering of the Common Stock pursuant to which a registration statement on Form S-1 was filed with
the Securities and Exchange Commission on February 6, 2017, Executive will be eligible to receive options to purchase 132,446
shares of Common Stock (the “Offering Option”). The Offering Option shall vest subject to the Executive
satisfying certain performance thresholds, as described in the Stock Option Agreement in the form attached hereto as Exhibit
C.
	 	 	 
		(f)	Executive
shall be eligible to participate in any Executive benefit plans maintained by the Company subject to the terms and conditions
of such plans as they may be amended from time to time.
	 	 	 
		(g)	The
                                         Company shall provide Executive $800.00 per month during the Term for Executive’s
                                         use in purchasing or leasing an automobile for Executive’s use in Executive’s
                                         performance of Executive’s job duties for the Company. Executive’s use of,
                                         and responsibilities concerning, such automobile are subject to any Company automobile
                                         use policies as they may exist from time to time.
	 	 	 
		(h)	Subject
                                         to Section 16, the Company shall reimburse Executive for reasonable and necessary
                                         travel and other business expenses Executive incurs that are directly related to Executive’s
                                         performance of Executive’s job duties for the Company. Such expenses shall be reimbursed
                                         after Executive presents the Company with documentation acceptable to the Company of
                                         such expenses and in accordance with the Company’s travel and business expense
                                         reimbursement policies as they may exist and be amended from time to time.
	 	 	 
		(i)	Compensation
                                         shall only be required, and Executive’s entitlement to any of the benefits referenced
                                         in this Section 3 shall only be in effect, during the Term and any termination
                                         of Executive’s employment or of this Agreement shall terminate the Company’s
                                         obligation to compensate Executive in any manner or provide any of the benefits referenced
                                         in this Section 3 for any period following the date of Executive’s termination
                                         of employment or of this Agreement, unless otherwise required by applicable law, any
                                         applicable plan documents as they may be amended from time to time, or Section 8.
                                         All payments referenced in this Section 3 are subject to all required and/or authorized
                                         withholdings and deductions.



 






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	4.	Non-Disclosure
                                         of Company Information. Executive acknowledges that during the course of his
                                         employment with the Company, Executive will have access to and acquire knowledge of Confidential
                                         Information (as defined below) relating to the Company, its business, finances, customers
                                         and prospective customers. Executive shall not, during the term of his employment with
                                         the Company or at any time thereafter, divulge Confidential Information belonging to
                                         or relating to the Company except to employees or agents of the Company entitled thereto,
                                         or use such information except to discharge his duties as an employee of the Company.
                                         For purposes of this Agreement, “Confidential Information” includes, but
                                         is not limited to, all scientific information, technical information, patents, copyrights,
                                         trademarks, trade names, trade secrets, intellectual property, research and development,
                                         technologies, inventions, discoveries, designs, methods and processes, know-how, techniques,
                                         procedures, documentation, compositions, concepts, improvements, product specifications,
                                         ideas, samples, business plans, financial information, sales data, vendor information,
                                         sources of supply, customer lists, customer prospect lists, price lists, price quotations,
                                         computer programs and software, corporate books, business plans, training materials,
                                         employee lists, Company strengths and weaknesses, and Company advertising and marketing
                                         information (“Confidential Information”). This includes information
                                         in any form, including original documents, paper copies, electronic copies, computer
                                         disks, computer hard drives, summaries, transcriptions or replications made or acquired
                                         by Executive during his employment with the Company. Confidential Information does not
                                         include information which is available in the public domain and/or which can readily
                                         be obtained from a third party who is not bound by a confidentiality obligation.
	 	 
	5.	Non-Interference
                                         / Non-Solicitation. Executive agrees that, at all times during his employment
                                         with the Company and for a period of two (2) years thereafter (the “Non-Competition
                                         Period”), for any reason whatsoever, Executive shall not, directly or indirectly,
                                         by affirmative act or failure to act, on his own behalf or on behalf of another:



 


		(a)	become
employed by, invest in, finance, advise, endorse, perform services for, or otherwise engage in any capacity with any individual,
entity or business that provides the same or substantially similar services and products as the Company, including, without limitation,
the provision of code-engineered cargo shipping containers for use in the construction industry (each, a “Competing
Business”) anywhere in North America; provided,
however, that (i) Executive shall be allowed to participate in real estate developments during the course of his employment
as long as it does not conflict or interfere with his duties to the Company as set forth in this Agreement; and (ii) the ownership
by Executive of any stock listed on any national securities exchange of any corporation conducting a Competing Business shall
not be deemed a violation of this Agreement if the aggregate amount of such stock owned by Executive does not exceed two percent
(2%) of the total outstanding stock of such corporation;
	 	 	 
		(b)	attempt
                                         to cause, request or induce any client, customer, contractor, agent, supplier or other
                                         business associate of the Company with whom Executive had contact, or any person or entity
                                         who was a prospective client or customer of the Company with whom Executive had contact
                                         within the eighteen (18) month period just prior to the termination of Executive’s
                                         employment with the Company (“Company Customers”), to curtail,
                                         divert or cancel any business with the Company, or otherwise interfere in any way with
                                         the business, business relationships, contracts, business opportunities, or goodwill
                                         of the Company or do anything to adversely affect the business relationship between the
                                         Company and its accounts, suppliers, clients, customers and contractors; or



 






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		(c)	solicit
                                         for employment, employ or otherwise induce or encourage any Company employee, agent or
                                         representative to terminate his/her employment or relationship with the Company, or do
                                         anything to adversely affect the relationship between the Company and any of its employees,
                                         agents or representatives.



 


Executive
acknowledges that the restrictions contained in Sections 4 and 5, in view of the nature of the Company’s business
and the Company’s Confidential Information and business goodwill, are reasonable and necessary to protect the Company’s
legitimate business interests and goodwill. Executive shall be entitled to a 90-day cure period upon written notice by the Company
of Executive’s breach of Sections 4 and 5 of this Agreement. In the event such breach is not cured by Executive
within such 90-day period, Executive agrees that the Company shall be entitled to a temporary restraining order and injunctive
relief, without the posting of bond, restraining Executive from the commission of any breach of Sections 4 and / or 5
and to recover the Company’s attorneys’ fees, witness fees, costs and expenses related to any breach or threatened
breach of this Agreement or any action or proceeding brought relating to this Agreement. Nothing contained
in this Agreement shall be construed as prohibiting the Company from pursuing any other remedies available to it for any breach
or threatened breach, including, without limitation, the recovery of money damages. The existence of any claim or cause
of action by Executive against the Company, whether predicated on this Agreement or otherwise, shall not constitute a defense
to the enforcement by the Company of Sections 4 and / or 5 of this Agreement. If Executive violates any of the restrictions
contained in Section 5, the Non-Competition Period will be tolled and will not run in favor of Executive, and the Company
shall have no further obligations to Executive under this Agreement, until such time that Executive cures the violation to the
satisfaction of the Company. If Executive, in the future, seeks or is offered employment, or any other position with a Competing
Business, Executive agrees to inform the Competing Business, before accepting employment or any other position, of the existence
of the restrictions in Sections 4 and 5. Further, before taking any employment or other position with any Competing
Business during the Non-Competition Period, Executive agrees to give prior written notice to the Company of the name of such Competing
Business. The Company shall be entitled to advise such Competing Business of the provisions of Sections 4 and 5
(including the provision of a copy of this Agreement) and to otherwise deal with such Competing Business to ensure that the provisions
of Sections 4 and 5 are enforced and duly discharged.


 


	6.	Ownership
                                         of Information, Inventions, and Original Works. “Materials”
                                         means all ideas, inventions, works of authorship, concepts, processes, formulas, data,
                                         computer programs, improvements, discoveries, developments, designs, and techniques related
                                         to the Business or any current or planned line of business of the Company that are authored,
                                         conceived, or reduced to practice by Executive, either alone or jointly with others,
                                         during Executive’s employment with the Company. “Intellectual Property
                                         Rights” means patents, copyrights, trademarks, trade secrets, and moral
                                         rights. All Intellectual Property Rights in Materials shall be and shall remain owned
                                         by the Company and shall be Confidential Information. To the extent applicable, the Materials
                                         are to be considered works made for hire, as that term is defined in the United States
                                         Copyright Act (17 U.S.C. § 101). Executive hereby irrevocably assigns and shall
                                         be deemed to have assigned to the Company all of Executive’s right, title and interest
                                         in and to any and all Materials, including any related Intellectual Property Rights,
                                         whether or not patentable or registrable under copyright or similar statutes. Executive
                                         recognizes that this Agreement does not require assignment of any Materials (i) developed
                                         entirely on Executive’s own time; and (ii) developed without equipment, supplies,
                                         facility, trade secrets, or proprietary information of the Company. Executive will promptly
                                         and fully disclose to the Company any and all Materials at the time such Materials are
                                         first reduced to practice or first fixed in a tangible form. Executive will, at the Company’s
                                         expense, assist the Company to obtain and enforce United States and foreign Intellectual
                                         Property Rights relating to Materials. Executive will execute, verify and deliver documents
                                         and perform other acts as the Company may reasonably request for use in applying for,
                                         obtaining, perfecting, evidencing, sustaining and enforcing such Intellectual Property
                                         Rights and the assignment thereof. All inventions and works of authorship, if any, patented
                                         or unpatented, registered or unregistered, that Executive made prior to the Effective
                                         Date that are not owned by the Company are listed on an attachment hereto (hereafter
                                         referred to as the “Prior Materials”). If no such list is attached,
                                         Executive represents that Executive does not own or possess any Prior Materials. Executive
                                         shall not use any Prior Materials in any manner in connection with the Business. If Executive
                                         incorporates Prior Materials owned by Executive, or in which Executive has an interest,
                                         into any Materials, the Company is hereby granted and shall have a nonexclusive, royalty-free,
                                         fully paid-up, irrevocable, perpetual, worldwide, sublicensable (directly or indirectly)
                                         license to make, have made, modify, use, sell, have sold, copy, distribute, create derivative
                                         works of, display, perform, and transmit such Prior Materials.



 



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	7.	Termination
                                         of Employment. The employment relationship between Executive and the Company
                                         shall terminate and the Term shall terminate upon the occurrence of any one of the following
                                         events:



		(a)	Death
                                         or Disability. Executive’s employment with the Company shall be terminated
                                         effective immediately on the death or Disability of Executive. “Disability”
                                         shall mean that Executive is, (i) by reason of any medically determinable physical or
                                         mental impairment, unable to perform the essential functions of Executive’s job
                                         position with the Company, with or without reasonable accommodation, for six (6) months
                                         – whether such six (6) months be continuous or intermittent – within a twelve
                                         (12) month period, (ii) determined to be disabled under the terms of any long-term disability
                                         plan in effect for Company employees at the applicable time, or (iii) determined to be
                                         disabled by the U.S. Social Security Administration. Executive agrees, in the event of
                                         a dispute under this Section 7(a) relating to the Executive’s Disability,
                                         to submit to a physical examination by a licensed physician selected by the Board of
                                         Directors. Any determination of Disability made by such physician shall be final and
                                         conclusive for all purposes of this Agreement.
	 	 	 
		(b)	Termination
                                         for Cause. The Company may terminate Executive’s employment with the Company
                                         for Cause, which termination shall be immediately effective upon written notice to Executive
                                         of such termination. “Cause” means the Company’s termination
                                         of Executive’s employment upon the occurrence of any of the following events during
                                         the Term:



 


		(i)	Any
                                         act of fraud, misappropriation, embezzlement or dishonesty by Executive regarding any
                                         aspect of the Company’s business;
	 	 	 
		(ii)	The
                                         breach by Executive of this Agreement or any other agreement between Executive and the
                                         Company, which breach, if curable, Executive fails to cure within thirty (30) days after
                                         written notice thereof from the Company. If such breach is not curable, the Company need
                                         not provide Executive notice of such breach and wait any cure period before termination
                                         of Executive’s employment;
	 	 	 
		(iii)	Executive
                                         being convicted of, or pleading no contest to, any felony or any crime of moral turpitude
                                         and which conviction or plea could, in the sole judgment of the Company, have an adverse
                                         effect on the Company, the Company’s reputation, and/or Executive’s ability
                                         to perform Executive’s job position with the Company;



 



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		(iv)	The
                                         failure of Executive to reasonably perform in all material respects Executive’s
                                         duties and responsibilities in Executive’s job position with the Company and the
                                         failure of Executive to cure such failure within thirty (30) days after written notice
                                         thereof from the Company;
	 	 	 
		(v)	The
                                         failure or refusal of Executive to follow the reasonable lawful directives of the Company,
                                         which, if curable, Executive fails or refuses to cure within thirty (30) days after written
                                         demand to perform such directives is delivered to Executive;
	 	 	 
		(vi)	Drug
                                         or alcohol dependency as determined by the provisions of the Americans with Disabilities
                                         Act; or
	 	 	 
		(vii)	Any
                                         act by Executive of gross negligence, intentional waste, disloyalty or unfaithfulness
                                         by Executive concerning the Company or any breach by Executive of Executive’s fiduciary
                                         duties to the Company or of Sections 4 or 5 of this Agreement.



		(c)	Termination
                                         by Executive for any Reason. Executive may terminate Executive’s employment
                                         with the Company during the Term for any reason upon provision of sixty (60) days advance
                                         written notice to the Company (the “Notice Period”). If Executive
                                         provides the sixty (60) days advance written notice of termination to the Company, the
                                         Company may elect for Executive to provide no further services to the Company at any
                                         point during the Notice Period. If the Company makes this election, Executive’s
                                         employment with the Company shall be terminated effective immediately on the date upon
                                         which the Company makes such election.
	 	 	 
		(d)	Termination
                                         by the Company Without Cause. The Company may terminate Executive’s employment
                                         with the Company during the Term without Cause immediately upon written notice to Executive
                                         of such termination.
	 	 	 
		(e)	Return
                                         of Company Property. Upon the termination of Executive’s employment with the
                                         Company for any reason whatsoever, Executive shall immediately return to the Company
                                         any and all originals and/or copies of the Company’s Confidential Information and/or
                                         any other information in his possession or control provided by or obtained from the Company,
                                         including information in the form of originals, paper copies, computer hard drives, computer
                                         disks, e-mails or any other similar or related electronic format. Executive acknowledges
                                         and agrees that such information will at all times remain the exclusive property of the
                                         Company and further acknowledges and agrees that he will be responsible for the safekeeping
                                         of any and all such information in his possession or control until it is returned to
                                         the Company.



 


	8.	Compensation
                                         Upon Termination. Upon the termination of Executive’s employment during
                                         the Term:



 


		(a)	Executive
                                         shall be entitled to Executive’s Base Salary before the effective date of termination
                                         of Executive’s employment with the Company (“Termination Date”),
                                         prorated on the basis of the number of full days of service rendered by Executive during
                                         the salary payment period prior to the Termination Date. The Company shall pay Executive
                                         the prorated Base Salary in accordance with applicable law, but no later than the next
                                         regular payday after the Termination Date;



 






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		(b)	subject
                                         to the provisions of Section 16, Executive shall be entitled to any unreimbursed
                                         reasonable business expenses incurred by Executive prior to the Termination Date in accordance
                                         with the Company’s then in effect business expense reimbursement policy and any
                                         amounts to which Executive is entitled to under the Company’s benefit plans in
                                         accordance with the terms of such plans as they may exist from time to time, which any
                                         request for reimbursement and supporting documentation Executive must submit to the Company
                                         within fourteen (14) days of the Termination Date and shall be paid to Executive within
                                         thirty (30) days of the Company’s receipt of Executive’s request for reimbursement
                                         and appropriate supporting documentation.
	 	 	 
		(c)	by
                                         the Company for Cause, death or Disability, by Executive for any reason (including, without
                                         limitation, any actual or alleged constructive discharge), or by the Company for any
                                         reason during the Renewal Term, Executive shall only receive the amounts and/or benefits
                                         listed in Sections 8(a) and (b), and the Company shall not owe Executive
                                         any further compensation.
	 	 	 
		(d)	by
the Company for any reason other than Cause, death or Disability, (i) Executive shall receive: (A) the amounts and/or benefits
listed in Sections 8(a)
and (b); and (B) an amount equivalent to one (1) year of the Base Salary (such amount, the “Severance Payment”),
and (ii) immediate vesting of any of the 104,209 outstanding stock options owned by Mr. Shetty on the date hereof, excluding the
Offering Options, that remain unvested as of the Termination Date. The Company shall pay the amounts and/or benefits listed in
Sections 8(a) and (b) as specified in those Sections. The Company shall pay the Severance Payment to Executive in
twelve equal installments equal to Base Salary in accordance with the Company’s normal payroll practices, subject to all
required and/or authorized withholdings and deductions, with the first payment being made to Executive on the first regular payroll
date of the first month following the sixtieth (60th) day after the Termination Date and the remaining payments being made on
the Company’s regular payroll dates thereafter. The Company’s obligation to make the Severance Payment to Executive
is contingent upon Executive signing and not revoking a separation and release agreement in a form acceptable to the Company and
providing such signed separation and release agreement to the Company no later than fifty (50) days after the Termination Date
and Executive’s compliance with the provisions of Sections 4 and 5 hereof. For the avoidance of doubt, any
expiration of the Term shall not be a termination by the Company that would require any payments to Executive under this Section
8(d). In the event that Executive obtains alternative employment (whether as an employee or an independent contractor) before
the end of the one-year period immediately following the Termination Date, any remaining Severance Payment installments due hereunder
shall be reduced dollar for dollar by the compensation received by Executive during the period in which such installments would
otherwise be due.



 






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	9.	Non-Disparagement.
                                         Executive agrees that the Company’s goodwill and reputation are assets of great
                                         value to the Company which were obtained through great cost, time and effort. Therefore,
                                         Executive agrees that during Executive’s employment with the Company and after
                                         the termination of Executive’s employment for any reason, Executive will not in
                                         any way disparage, libel or defame the Company, its business or business practices, its
                                         products or services, or its current, past or future employees, officers, directors or
                                         owners or interfere in any way with the Company’s operations or any of the Company’s
                                         relationships with the Company’s employees, business partners, investors, vendors
                                         and/or independent contractors. This Section 9 does not prohibit Executive from providing
                                         truthful testimony, providing truthful information as legally required to do so, or participating
                                         in any governmental proceeding.
	 	 
	10.	No
                                         Expectation of Privacy.Executive understands and agrees that Executive has
                                         no expectation of privacy with respect to the Company’s telecommunications, networking,
                                         or information processing systems (including, without limitation, any stored, created
                                         or accessed computer files, information or communications, e-mail messages, text messages,
                                         and voice messages) and that Executive’s activity and any files, information, or
                                         communications on or use of any such systems may be accessed, monitored, copied, disclosed,
                                         used, and saved by the Company at any time without notice to Executive.
	 	 
	11.	Entire
                                         Agreement. This Agreement, together with the Stock Option Agreement to be entered
                                         into between the Parties, is the entire agreement between the Parties with respect to
                                         the subject matter hereof, and supersedes any previous agreements, written or oral, between
                                         Executive and the Company with regard to the subject matter of this Agreement. This Agreement
                                         may not be modified or amended orally, and any amendment or modification must be in writing
                                         and be signed by Executive and an authorized representative of the Company. Executive
                                         represents and acknowledges that, in executing this Agreement, Executive did not rely,
                                         and has not relied, on any representation(s) by the Company or any of its officers, directors,
                                         employees or representatives, except as expressly contained in this Agreement.
	 	 
	12.	Partial
                                         Invalidity and Reformation. In the event any court of competent jurisdiction
                                         holds any provision of this Agreement to be invalid or unenforceable, such invalid or
                                         unenforceable portion(s) shall be limited or excluded from this Agreement to the minimum
                                         extent required, and the remaining provisions shall not be affected and shall remain
                                         in full force and effect. Executive further agrees that in the event any of the covenants
                                         contained in Section 5 are held by any court to be effective in any particular area or
                                         jurisdiction only if said covenant is modified to limit its duration or scope, then the
                                         court shall reform the covenant and the Parties shall consider such covenant(s) and/or
                                         other provisions of Section 5 to be amended with respect to that particular jurisdiction
                                         so as to comply with the order of any such court and, as to all other jurisdictions,
                                         the covenants contained in Section 5 shall remain in full force and effect as originally
                                         written.
	 	 
	13.	Assignment
                                         of Rights. This Agreement shall be binding upon and inure to the benefit of Executive,
                                         the Company and any parents, subsidiaries, affiliated companies, successors or assigns
                                         of the Company. Executive’s obligations under this Agreement shall be binding upon
                                         Executive’s heirs, executors and assigns.
	 	 
	14.	Survival
                                         and Nonwaiver. The obligations under Sections 4 - 6 and 8 - 16 of this Agreement
                                         shall continue in effect after the termination of Executive’s employment, regardless
                                         of the reason(s) for termination. The Company’s waiver of any provision of the
                                         Agreement shall not constitute (a) a continuing waiver of that provision or (b) a waiver
                                         of any other provision of this Agreement.



 






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	15.	Governing
                                         Law. This Agreement and the performance hereof shall be construed and governed
                                         in accordance with the laws of the State of New York, and the Parties waive the application
                                         of conflicts of laws provisions or principles of any state or jurisdiction. Further,
                                         the prevailing Party in any legal proceeding based upon this Agreement shall be entitled
                                         to reasonable attorney’s fees and court costs, in addition to any other recoveries
                                         allowed by law. Concerning any dispute arising out of or relating to this Agreement,
                                         the Parties hereby irrevocably submit to the exclusive jurisdiction of any federal or
                                         state court located within New York County, New York or, if a mandatory venue provision
                                         is applicable, to the jurisdiction of any other federal or state court within the State
                                         of New York required to hear such matter by any such applicable mandatory venue provision.
                                         The Parties hereby irrevocably waive, to the fullest extent permitted by applicable law,
                                         any objection which they may now or hereafter have to the laying of venue of any such
                                         dispute brought in such court or any defense of inconvenient forum for the maintenance
                                         of such dispute. Each of the Parties agrees that a judgment in any such dispute may be
                                         enforced in other jurisdictions by suit on the judgment or in any other manner provided
                                         by law.
	 	 
	16.	Other
                                         Agreements. Each of the Company and Executive represents and warrants that neither
                                         of them is a party to any agreement, contract, or understanding, whether employment or
                                         otherwise, that would restrict or prohibit the Company or the Executive, as the case
                                         may be, from undertaking or performing employment in accordance with the terms and conditions
                                         of this Agreement.
	 	 
	17.	Section
                                         409A. This Agreement is intended to be interpreted and applied so that the payments
                                         and benefits set forth herein shall either be exempt from the requirements of Section
                                         409A of the Internal Revenue Code of 1986, as amended (“Section 409A”),
                                         or shall comply with the requirements of Section 409A. In no event may Executive, directly
                                         or indirectly, designate the calendar year of any payment to be made under this Agreement
                                         or otherwise which constitutes a “deferral of compensation” within the meaning
                                         of Section 409A. Notwithstanding anything in this Agreement or elsewhere to the contrary,
                                         a termination of employment shall not be deemed to have occurred for purposes of any
                                         provision of this Agreement providing for the payment of any amounts or benefits that
                                         constitute “non-qualified deferred compensation” within the meaning of Section
                                         409A upon or following a termination of Executive’s employment unless such termination
                                         is also a “separation from service” within the meaning of Section 409A and,
                                         for purposes of any such provision of this Agreement, references to a “termination,”
                                         “termination of employment” or like terms shall mean “separation from
                                         service” within the meaning of Section 409A. With respect to any expense, reimbursement
                                         or in-kind benefit provided pursuant to this Agreement that constitutes a “deferral
                                         of compensation” within the meaning of Section 409A, (i) the expenses eligible
                                         for reimbursement or in-kind benefits provided to Executive must be incurred during the
                                         Term, (ii) the amount of expenses eligible for reimbursement or in-kind benefits provided
                                         to Executive during any calendar year will not affect the amount of expenses eligible
                                         for reimbursement or in-kind benefits provided to Executive in any other calendar year,
                                         (iii) the reimbursements for expenses for which Executive is entitled to be reimbursed
                                         shall be made on or before the last day of the calendar year following the calendar year
                                         in which the applicable expense is incurred, and (iv) the right to payment or reimbursement
                                         or in-kind benefits may not be liquidated or exchanged for any other benefit. Notwithstanding
                                         any provision in this Agreement or elsewhere to the contrary, if on Executive’s
                                         termination of employment, Executive is deemed to be a “specified employee”
                                         within the meaning of Section 409A, any payments or benefits due upon a termination of
                                         Executive’s employment under any arrangement that constitutes a “deferral
                                         of compensation” within the meaning of Section 409A (whether under this Agreement,
                                         any other plan, program, payroll practice or any equity grant) and which do not otherwise
                                         qualify under the exemptions under Treasury Regulation section 1.409A-1 (including without
                                         limitation, the short-term deferral exemption and the permitted payments under Treasury
                                         Regulation section 1.409A-1(b)(9)(iii)(A)), shall be delayed and paid or provided to
                                         Executive in a lump sum (whether they would have otherwise been payable in a single sum
                                         or in installments in the absence of such delay) on the earlier of (x) the date which
                                         is six months and one day after Executive’s separation from service for any reason
                                         other than death, and (y) the date of Executive’s death, and any remaining payments
                                         and benefits shall be paid or provided in accordance with the normal payment dates specified
                                         for such payment or benefit.
	 	 
	18.	Acknowledgement
                                         of Full Understanding. Executive acknowledges and agrees that Executive has fully
                                         read, understands and voluntarily enters into this agreement and that Executive has had
                                         an opportunity to ask questions and consult with an attorney of Executive’s choice
                                         before signing this Agreement.



 


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IN
WITNESS WHEREOF, the parties hereto have executed this Agreement on the date above first written.


 


	EXECUTIVE:		 	SG BLOCKS, INC.:
	 	 	 	 	 
	Signature:	/s/ Mahesh Shetty	 	Signature:	/s/ Paul Galvin
	Printed Name: 	Mahesh Shetty



	 	Printed Name: 	Paul Galvin
	Date:	3/10/17	 	Title:	Chief Executive Officer


 


[Signature Page to Mahesh Shetty Employment Agreement]