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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 13D

Under the Securities Exchange Act of 1934
(Amendment No. 3 )*

Lighting Science Group Corporation

(Name of Issuer)

Common Stock, par value $.001 per share

&

Series B Preferred Stock, par value $.001 per share

(Title of Class of Securities)

53224G103

(CUSIP Number)

Govi Rao

LED Holdings, LLC

11390 Sunrise Gold Circle #800

Rancho Cordova, CA 95742

(610) 745-9590

(Name, Address and Telephone Number of Person Authorized to

Receive Notices and Communications)

July 25, 2008

(Date of Event Which Requires Filing of this Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box. o

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Rule 13d-7 for other parties to whom copies are to be sent.

* The remainder of this cover page shall be filled out for a reporting person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.

The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

CUSIP No. 53224G103   Page 2  of  13 

1	NAMES OF REPORTING PERSONS LED Holdings, LLC 26-0299414
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
	(a)   o
	(b)   o
3	SEC USE ONLY
4	SOURCE OF FUNDS (SEE INSTRUCTIONS)
	OO
5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)
	o
6	CITIZENSHIP OR PLACE OF ORGANIZATION
	Delaware
		7	SOLE VOTING POWER
NUMBER OF			20,666,856
SHARES		8	SHARED VOTING POWER
BENEFICIALLY
OWNED BY			-0-
EACH		9	SOLE DISPOSITIVE POWER
REPORTING
PERSON			20,666,856
WITH		10	SHARED DISPOSITIVE POWER
			-0-
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
	20,666,856
12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)
	þ
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
	65.7%*
14	TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
	OO

* Based on 28,785,145 shares of common stock outstanding as of May 1, 2008.

2

CUSIP No. 53224G103   Page 3  of  13 

1	NAMES OF REPORTING PERSONS PP IV (AIV) LED, LLC 26-0240524
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
	(a)   o
	(b)   o
3	SEC USE ONLY
4	SOURCE OF FUNDS (SEE INSTRUCTIONS)
	OO
5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)
	o
6	CITIZENSHIP OR PLACE OF ORGANIZATION
	Delaware
		7	SOLE VOTING POWER
NUMBER OF			-0-
SHARES		8	SHARED VOTING POWER
BENEFICIALLY
OWNED BY			20,666,856
EACH		9	SOLE DISPOSITIVE POWER
REPORTING
PERSON			-0-
WITH		10	SHARED DISPOSITIVE POWER
			20,666,856
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
	20,666,856
12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)
	þ
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
	65.7%*
14	TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
	OO

* Based on 28,785,145 shares of common stock outstanding as of May 1, 2008.

3

CUSIP No. 53224G103   Page 4  of  13 

1	NAMES OF REPORTING PERSONS PP IV LED, LLC 26-0196366
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
	(a)   o
	(b)   o
3	SEC USE ONLY
4	SOURCE OF FUNDS (SEE INSTRUCTIONS)
	OO
5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)
	o
6	CITIZENSHIP OR PLACE OF ORGANIZATION
	Delaware
		7	SOLE VOTING POWER
NUMBER OF			-0-
SHARES		8	SHARED VOTING POWER
BENEFICIALLY
OWNED BY			20,666,856
EACH		9	SOLE DISPOSITIVE POWER
REPORTING
PERSON			-0-
WITH		10	SHARED DISPOSITIVE POWER
			20,666,856
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
	20,666,856
12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)
	þ
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
	65.7%*
14	TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
	OO

* Based on 28,785,145 shares of common stock outstanding as of May 1, 2008.

4

CUSIP No. 53224G103   Page 5  of  13 

1	NAMES OF REPORTING PERSONS PEGASUS PARTNERS IV, LP
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
	(a)   o
	(b)   o
3	SEC USE ONLY
4	SOURCE OF FUNDS (SEE INSTRUCTIONS)
	OO
5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)
	o
6	CITIZENSHIP OR PLACE OF ORGANIZATION
	Delaware
		7	SOLE VOTING POWER
NUMBER OF			942,857
SHARES		8	SHARED VOTING POWER
BENEFICIALLY
OWNED BY			20,666,856
EACH		9	SOLE DISPOSITIVE POWER
REPORTING
PERSON			942,857
WITH		10	SHARED DISPOSITIVE POWER
			20,666,856
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
	21,609,713
12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)
	o
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
	66.7%*
14	TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
	PN

* Based on 28,785,145 shares of common stock outstanding as of May 1, 2008.

5

CUSIP No. 53224G103   Page 6  of  13 

1	NAMES OF REPORTING PERSONS PEGASUS INVESTORS IV, LP
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
	(a)   o
	(b)   o
3	SEC USE ONLY
4	SOURCE OF FUNDS (SEE INSTRUCTIONS)
	OO
5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)
	o
6	CITIZENSHIP OR PLACE OF ORGANIZATION
	Delaware
		7	SOLE VOTING POWER
NUMBER OF			942,857
SHARES		8	SHARED VOTING POWER
BENEFICIALLY
OWNED BY			20,666,856
EACH		9	SOLE DISPOSITIVE POWER
REPORTING
PERSON			942,857
WITH		10	SHARED DISPOSITIVE POWER
			20,666,856
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
	21,609,713
12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)
	o
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
	66.7%*
14	TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
	PN

* Based on 28,785,145 shares of common stock outstanding as of May 1, 2008.

6

CUSIP No. 53224G103   Page 7  of  13 

1	NAMES OF REPORTING PERSONS PEGASUS INVESTORS IV GP, LLC
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
	(a)   o
	(b)   o
3	SEC USE ONLY
4	SOURCE OF FUNDS (SEE INSTRUCTIONS)
	OO
5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)
	o
6	CITIZENSHIP OR PLACE OF ORGANIZATION
	Delaware
		7	SOLE VOTING POWER
NUMBER OF			942,857
SHARES		8	SHARED VOTING POWER
BENEFICIALLY
OWNED BY			20,666,856
EACH		9	SOLE DISPOSITIVE POWER
REPORTING
PERSON			942,857
WITH		10	SHARED DISPOSITIVE POWER
			20,666,856
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
	21,609,713
12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)
	o
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
	66.7%*
14	TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
	OO

* Based on 28,785,145 shares of common stock outstanding as of May 1, 2008.

7

CUSIP No. 53224G103   Page 8  of  13 

1	NAMES OF REPORTING PERSONS PEGASUS CAPITAL, LLC
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
	(a)   o
	(b)   o
3	SEC USE ONLY
4	SOURCE OF FUNDS (SEE INSTRUCTIONS)
	OO
5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)
	o
6	CITIZENSHIP OR PLACE OF ORGANIZATION
	Delaware
		7	SOLE VOTING POWER
NUMBER OF			942,857
SHARES		8	SHARED VOTING POWER
BENEFICIALLY
OWNED BY			20,666,856
EACH		9	SOLE DISPOSITIVE POWER
REPORTING
PERSON			942,857
WITH		10	SHARED DISPOSITIVE POWER
			20,666,856
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
	21,609,713
12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)
	o
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
	66.7%*
14	TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
	OO

* Based on 28,785,145 shares of common stock outstanding as of May 1, 2008.

8

CUSIP No. 53224G103   Page 9  of  13 

1	NAMES OF REPORTING PERSONS CRAIG COGUT
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
	(a)   o
	(b)   o
3	SEC USE ONLY
4	SOURCE OF FUNDS (SEE INSTRUCTIONS)
	OO
5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)
	o
6	CITIZENSHIP OR PLACE OF ORGANIZATION
	United States
		7	SOLE VOTING POWER
NUMBER OF			942,857
SHARES		8	SHARED VOTING POWER
BENEFICIALLY
OWNED BY			20,666,856
EACH		9	SOLE DISPOSITIVE POWER
REPORTING
PERSON			942,857
WITH		10	SHARED DISPOSITIVE POWER
			20,666,856
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
	21,609,713
12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)
	o
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
	66.7%*
14	TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
	IN

* Based on 28,785,145 shares of common stock outstanding as of May 1, 2008.

9

CUSIP No. 53224G103   Page 10  of  13 

1	NAMES OF REPORTING PERSONS RICHARD KELSON
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
	(a)   o
	(b)   o
3	SEC USE ONLY
4	SOURCE OF FUNDS (SEE INSTRUCTIONS)
	OO
5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)
	o
6	CITIZENSHIP OR PLACE OF ORGANIZATION
	United States
		7	SOLE VOTING POWER
NUMBER OF			9,570
SHARES		8	SHARED VOTING POWER
BENEFICIALLY
OWNED BY			20,666,856
EACH		9	SOLE DISPOSITIVE POWER
REPORTING
PERSON			9,570
WITH		10	SHARED DISPOSITIVE POWER
			20,666,856
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
	20,676,426
12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)
	þ
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
	65.7%*
14	TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
	IN

* Based on 28,785,145 shares of common stock outstanding as of May 1, 2008.

10

CUSIP No. 53224G103   Page 11  of  13 

1	NAMES OF REPORTING PERSONS LED EFFECTS, INC. 26-0299414
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
	(a)   o
	(b)   o
3	SEC USE ONLY
4	SOURCE OF FUNDS (SEE INSTRUCTIONS)
	OO
5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)
	o
6	CITIZENSHIP OR PLACE OF ORGANIZATION
	Nevada
		7	SOLE VOTING POWER
NUMBER OF			-0-
SHARES		8	SHARED VOTING POWER
BENEFICIALLY
OWNED BY			20,666,856
EACH		9	SOLE DISPOSITIVE POWER
REPORTING
PERSON			-0-
WITH		10	SHARED DISPOSITIVE POWER
			20,666,856
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
	20,666,856
12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)
	þ
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
	65.7%*
14	TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
	CO

* Based on 28,785,145 shares of common stock outstanding as of May 1, 2008.

11

Amendment No. 3 to Schedule 13D

     This Amendment No. 3 relates to the Schedule 13D filed on behalf of LED Holdings, LLC (“LEDH”), PP IV (AIV) LED, LLC (“PPAIV”), PP IV LED, LLC (“PPLED”), Pegasus Partners IV, L.P. (“PPIV”), Richard Kelson (“Mr. Kelson”) and LED Effects, Inc. (“LED”, together with PPAIV, PPLED, PPIV, Mr. Kelson, PIIV (as defined below), PIGP (as defined below), PCLLC (as defined below) and Mr. Cogut (as defined below), the “LEDH Members”), with the Securities and Exchange Commission on October 15, 2007, as amended by Amendment No. 1 filed on April 11, 2008 and as amended by Amendment No. 2 filed on May 1, 2008. Except as otherwise provided herein, this Amendment No. 3 amends and supplements the Schedule 13D with respect to the Common Stock and Series B Preferred Stock of Lighting Science Group Corporation (the “Issuer”) beneficially owned by LEDH and the LEDH Members (the “Reporting Persons”) filed on October 15, 2007, as amended by Amendment No. 1 filed on April 11, 2008 and as amended by Amendment No. 2 filed on May 1, 2008. Except as specifically provided herein, this Amendment does not modify any of the disclosure previously reported in the initial Schedule 13D filed on October 15, 2007, as amended by Amendment No. 1 filed on April 11, 2008 and as amended by Amendment No. 2 filed on May 1, 2008. Each capitalized term used but not defined herein has the meaning ascribed to such terms in the Schedule 13D.

Item 2. Identity and Background

Item 2 of this schedule is hereby supplemented as follows:

     The identity and background of the person filing this statement are as follows:

i.    Pegasus Investors IV, L.P. (“PIIV”), a Delaware partnership, with its principal offices at 99 River Road, Cos Cob, CT 06807. PIIV is engaged in the business of private equity management;

ii.   Pegasus Investors IV GP, L.L.C. (“PIGP”), a Delaware limited liability company, with its principal offices at 99 River Road, Cos Cob, CT 06807. PIGP is engaged in the business of private equity management;

iii.    Pegasus Capital, LLC (“PCLLC”), a Delaware limited liability company, with its principal offices at 99 River Road, Cos Cob, CT 06807. PCLLC is engaged in the business of private equity management; and

iv.    Craig Cogut (“Mr. Cogut”), a United States citizen, with his address care of Pegasus Capital, LLC at 99 River Road, Cos Cob, CT 06807. Mr. Cogut is engaged in the business of private equity management.

     None of the Reporting Persons has during the last five years been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors).

     None of the Reporting Persons has during the last five years been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction nor is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws.

     PIIV is the general partner of PPIV and Pegasus Partners IV (AIV), L.P. (the sole owner of PPAIV). PIGP is the general partner of PIIV. PIGP is wholly owned by PCLLC. PCLLC may be deemed to be directly or indirectly controlled by Mr. Cogut. By virtue of the foregoing, the PPIV, PIIV, PIGP, PCLLC and Mr. Cogut may be deemed to share voting power and power to direct the disposition of the securities held by PPIV. Mr. Cogut disclaims any beneficial ownership of any securities of the Issuer beneficially owned by any of the Reporting Persons.

     The Reporting Persons have agreed to jointly file this Schedule 13D. A Joint Filing Agreement is filed herewith.

     Attached as Appendix A is the information required to be disclosed in response to Item 2 and General Instruction C to Schedule 13D by each applicable Reporting Person.

Item 3. Source and Amount of Funds or Other Consideration

     On July 25, 2008, PPIV provided a guaranty, dated July 25, 2008, (the “Guaranty”) to the Issuer for any and all indebtedness, obligations and liabilities of every kind and nature of the Issuer due to Bank of Montreal (the “Lender”) pursuant to that certain Loan Authorization Agreement, dated July 25, 2008, between the Lender and the Borrower (the “Loan Authorization Agreement”), for up to $20,000,000, in exchange for a warrant exercisable for 942,857 shares of Common Stock of the Issuer (the “Guarantor Warrant”).

Item 4. Purpose of Transaction

     On July 25, 2008, PPIV provided the Guaranty to the Issuer for any and all indebtedness, obligations and liabilities of every kind and nature of the Issuer due to the Lender pursuant to the Loan Authorization Agreement, pursuant to which the Issuer may borrow up to $20,000,000 in a revolving credit facility. In exchange for the Guaranty, PPIV was issued a warrant exercisable for 942,857 shares of Common Stock of the Issuer.

     In addition, on July 25, 2008 PPIV and the Issuer signed a commitment letter (the “Bridge Commitment Letter”) by which the Issuer will, if the demand loan issued pursuant to the Loan Authorization Agreement is called prior to maturity, obtain a bridge loan from PPIV in an aggregate principal amount equal to the aggregate principal amount outstanding under the demand loan at the time it is called plus $2,000,000, not to exceed $20,000,000. In the event that the bridge loan is funded, PPIV will receive warrants exercisable for the number of shares of Common Stock of the Issuer equal to 33% of the quotient of the aggregate principal amount of the Bridge Loan extended on the Closing Date (as such term is defined in the Bridge Commitment Letter), divided by $7.00, the exercise price of such warrants. Such warrants will have the same terms, rights and conditions as the Guarantor Warrant.

     In connection with the Bridge Commitment Letter, PPIV and the Issuer executed a fee letter (the “Fee Letter”) pursuant to which the Issuer agreed to pay PPIV (i) $200,000 on the closing date of the Bridge Loan (as such term is defined in the Bridge Commitment Letter), subject to the initial funding of the Bridge Loan, (ii) a Guaranty transaction fee equal to 1% of the average daily outstanding principal amount and accrued but unpaid interest under the Demand Loan (as such term is defined in the Bridge Commitment Letter) during the period beginning on the date the Demand Loan is extended through the date that the Demand Loan is prepaid or repaid in full or refinanced in full or otherwise terminated or discharged (such period, the “Demand Loan Period”) times the quotient equal to the number of days in the Demand Loan Period divided by 365 days, payable in full on the last day of the Demand Loan Period and (iii) a Bridge Loan transaction fee equal to 1% of the average daily outstanding principal amount and accrued but unpaid interest under the Bridge Loan during the period beginning on the date the Bridge Loan is extended through the date that the Bridge Loan is prepaid or repaid in full or refinanced in full or otherwise terminated or discharged (such period, the “Bridge Loan Period”) times the quotient equal to the number of days in the Bridge Loan Period divided by 365 days, payable in full on the last day of the Bridge Loan Period. Further, in connection with the Guaranty, Pegasus Capital Advisors, L.P., an entity affiliated with PPIV, (“PCA”) and the Issuer executed a side letter (the “Side Letter”) pursuant to which the Issuer agreed to pay PCA (i) a fee of $100,000 and (ii) a nonrefundable transaction fee in the amount of $150,000, both payable upon the closing of the Guaranty and the Loan Authorization Agreement.

     The Reporting Persons continuously assess the Issuer’s business, financial condition, results of operations and prospects, general economic conditions, other developments and additional investment opportunities. Depending on

12

such assessments, the Reporting Persons may acquire additional shares of Common Stock or may determine to purchase, sell or otherwise dispose of all or some of the shares of Common Stock and/or Series B Preferred Stock of the Issuer or the Guarantor Warrant exercisable for shares of Common Stock in the open market, in privately negotiated transactions or otherwise. Such actions will depend upon a variety of factors, including, without limitation, current and anticipated future trading prices, the financial condition, results of operations and prospects of the Issuer, alternative investment opportunities, general economic, financial market and industry conditions and other factors that the Reporting Persons may deem material to its investment decision.

     Except as set forth herein, the Reporting Persons do not have present plans or proposals at this time that relate to or would result in any of the transactions described in subparagraphs (a) through (j) of Item 4 of Schedule 13D.

Item 5. Interest in Securities of the Issuer

     Items 7 through 11 and 13 of each of the cover pages of this Amendment No. 3 is incorporated by reference. Such information is based upon 28,785,145 shares of Common Stock outstanding as of May 1, 2008 as reported in the Issuer’s Form 10-Q for the period ended March 31, 2007 filed on May 14, 2008.

     Other than 942,857 shares of Common Stock beneficially owned by PPIV and the 9,570 shares of Common Stock beneficially owned by Mr. Kelson, the LEDH Members do not directly beneficially own any Common Stock or Series B Preferred Stock of the Issuer. The LEDH Members share voting and dispositive power over the shares of Common Stock and Series B Preferred Stock of the Issuer only as members of LEDH and by virtue of such status may be deemed to be the beneficial owner of the shares of Common Stock and Series B Preferred Stock of the Issuer held by LEDH. The LEDH Members disclaim beneficial ownership of the shares of Common Stock and Series B Preferred Stock held by other LEDH Members, except to the extent of any pecuniary interest, and this statement shall not be deemed to be an admission that they are the beneficial owners of such securities. See Item 3 above, for a discussion of the Issuer’s Common Stock that was purchased during the past sixty days.

Item 6. Contracts, Arrangements, Understandings or Relationships with Respect to the Securities

     In connection with the Guaranty, the Issuer and PPIV entered into a Registration Rights Agreement dated as of July 25, 2008 (the “Registration Rights Agreement”), which provides that the Issuer is required to file a registration statement (the “Registration Statement”) covering the resale of the Common Stock and the shares of Common Stock issuable upon exercise of the Guarantor Warrant within sixty (60) days after the receipt of a request from PPIV that the Issuer file the Registration Statement. Pursuant to the Registration Rights Agreement, the Issuer has the right to defer such demand for up to thirty (30) days if the Issuer furnishes a certificate signed by the Chief Executive Officer or Chairman of the Board stating that, in the good faith judgment of the Board of Directors of the Issuer, it would be materially detrimental to the Issuer and its stockholders for the Registration Statement to be effected at such time.

Item 7. Material to be Filed as Exhibits

Exhibit	Description
4.1	Warrant to Purchase Common Stock, dated July 25, 2008, by and between Pegasus Partners IV, L.P. and Lighting Science Group Corporation (incorporated by reference to Exhibit 4.2 to the Issuer’s Current Report on Form 8-K, filed with the Securities and Exchange Commission on July 29, 2008).
4.2	Guaranty, dated July 25, 2008, by Pegasus Partners IV, L.P. to Bank of Montreal.
4.4	Registration Rights Agreement, dated July 25, 2008, by and between Pegasus Partners IV, L.P. and Lighting Science Group Corporation (incorporated by reference from Exhibit 4.1 to the Issuer’s Current Report on Form 8-K, filed with the Securities and Exchange Commission on July 29, 2008).
4.5	Bridge Commitment Letter, dated July 25, 2008, by and between Pegasus Partners IV, L.P. and Lighting Science Group Corporation (incorporated by reference from Exhibit 10.3 to the Issuer’s Current Report on Form 8-K, filed with the Securities and Exchange Commission on July 29, 2008).
10.1	Fee Letter Agreement, dated July 25, 2008, by and between Pegasus Partners IV, L.P. and Lighting Science Group Corporation (incorporated by reference from Exhibit 10.4 to the Issuer’s Current Report on Form 8-K, filed with the Securities and Exchange Commission on July 29, 2008).
10.2	Side Letter Agreement, dated July 25, 2008, by and between Pegasus Capital Advisors, L.P. and Lighting Science Group Corporation (incorporated by reference from Exhibit 10.2 to the Issuer’s Current Report on Form 8-K, filed with the Securities and Exchange Commission on July 29, 2008).
99.1	Agreement Regarding the Joint Filing of Schedule 13D by and among the Reporting Persons.

13

Signature

     After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.

Date: July 29, 2008

LED HOLDINGS, LLC
By:	/s/ Govi Rao Name: Govi Rao
	Title: President/CEO
PP IV (AIV) LED, LLC
By:	Pegasus Partners IV (AIV), L.P., its sole member
By:	Pegasus Investors IV, L.P., its general partner
By:	Pegasus Investors IV GP, L.L.C., general partner
By:	/s/ Richard Weinberg Name: Richard Weinberg
	Title: Vice President
PP IV LED, LLC
By:	Pegasus Partners, IV, L.P., its sole member
By:	Pegasus Investors IV, L.P., its general partner
By:	Pegasus Investors IV GP, L.L.C., its general partner
By:	/s/ Richard Weinberg Name: Richard Weinberg
	Title: Vice President

PEGASUS PARTNERS IV, L.P.
By:	Pegasus Investors IV, LP its general partner
By:	Pegasus Investors IV GP, L.L.C., its general partner
By:	/s/ Richard Weinberg Name: Richard Weinberg
	Title: Vice President
PEGASUS INVESTORS IV, L.P.
By:	Pegasus Investors IV GP, L.L.C., its general partner
By:	/s/ Richard Weinberg
	Name:   Richard Weinberg
	Title:   Vice President
PEGASUS INVESTORS IV GP, L.L.C.
By:	/s/ Richard Weinberg
	Name:   Richard Weinberg
	Title:   Vice President
PEGASUS CAPITAL, LLC
By:	/s/ Craig Cogut
	Name:   Craig Cogut
	Title:   President & Managing Member

/s/ Craig Cogut
CRAIG COGUT
/s/ Richard Kelson
RICHARD KELSON
LED EFFECTS, INC.
By:	/s/ Kevin Furry
	Name:	Kevin Furry
	Title:	President

Appendix A

BOARD OF MANAGERS AND EXECUTIVE OFFICERS OF LED HOLDINGS, LLC

Name	Position	Address
Govi Rao	President and Chief Executive Officer	37 Davenport Way, 21st Floor, Hillsborough, NJ 08844
Kevin Furry	Manager	100 Meadow Lakes Court, Folsom, CA 95630
Richard Weinberg	Manager	c/o 99 River Road, Cos Cob, CT 06807
Steven Wacaster	Manager	c/o 99 River Road, Cos Cob, CT 06807
Richard Kelson	Manager	c/o Meadwestvaco Corporation, One High Ridge Park, Stamford, CT 06905
Charles H. Sommerville	Manager	c/o 11390 Sunrise Gold Circle #800, Rancho Cordova, CA 95742

EXECUTIVE OFFICERS OF PP IV (AIV) LED, LLC

Name	Position	Address
Richard Weinberg	President	c/o 99 River Road, Cos Cob, CT 06807
Steven Wacaster	Vice President and Secretary	c/o 99 River Road, Cos Cob, CT 06807

EXECUTIVE OFFICERS OF PP IV LED, LLC

Name	Position	Address
Richard Weinberg	President	c/o 99 River Road, Cos Cob, CT 06807
Steven Wacaster	Vice President and Secretary	c/o 99 River Road, Cos Cob, CT 06807

EXECUTIVE OFFICERS OF PEGASUS PARTNERS IV, L.P.

Name	Position	Address
Craig Cogut	President	c/o 99 River Road, Cos Cob, CT 06807
Rodney Cohen	Vice President	c/o 99 River Road, Cos Cob, CT 06807
Eric Gribetz	Vice President	c/o 99 River Road, Cos Cob, CT 06807
David Cunningham	Vice President	c/o 99 River Road, Cos Cob, CT 06807
Alec Machiels	Vice President	c/o 99 River Road, Cos Cob, CT 06807
Steven Wacaster	Vice President	c/o 99 River Road, Cos Cob, CT 06807
Richard Weinberg	Vice President	c/o 99 River Road, Cos Cob, CT 06807
Daniel Stencel	Chief Financial Officer and Treasurer	c/o 99 River Road, Cos Cob, CT 06807

MANAGING MEMBER AND EXECUTIVE OFFICER OF PEGASUS CAPITAL, LLC

Name	Position	Address
Craig Cogut	President and Managing Member	c/o 99 River Road, Cos Cob, CT 06807

DIRECTORS AND EXECUTIVE OFFICERS OF LED EFFECTS, INC

Name	Position	Address
Kevin Furry	Chief Executive Officer and Director	100 Meadow Lakes Court, Folsom, CA 95630
Charles H. Sommerville	Treasurer and Director	c/o 11390 Sunrise Gold Circle #800, Rancho Cordova, CA 95742
Greg Flowers	Director	c/o 11390 Sunrise Gold Circle #800, Rancho Cordova, CA 95742

EX-4.2

EXHIBIT 4.2

Guaranty

     For value received and in consideration of advances made or to be made, or credit given or to be given, or other financial accommodation afforded or to be afforded to Lighting Science Group Corporation, a Delaware corporation (hereinafter designated as “Borrower”), by Bank of Montreal, Chicago, Illinois(hereinafter called the “Lender”), from time to time, Pegasus Partners IV, L.P. (the “Undersigned”) hereby guarantees the full and prompt payment to the Lender at maturity and at all times thereafter of any and all indebtedness, obligations and liabilities of every kind and nature of the Borrower to the Lender, pursuant to that certain Loan Authorization Agreement of even date herewith between the Lender and the Borrower (the “Loan Agreement”), including, without limitation, any reimbursement obligations in connection with letters of credit issued by the Lender on behalf of the Borrower, howsoever evidenced, whether now existing or hereafter created or arising, whether direct or indirect, absolute or contingent, or joint or several, and howsoever owned, held or acquired, whether through discount, overdraft, purchase, direct loan or as collateral, or otherwise (hereinafter all such indebtedness, obligations and liabilities being collectively referred to as the “Indebtedness”); and the Undersigned further agrees to pay all actual and documented expenses, legal and/or otherwise (including court costs and reasonable attorneys’ fees), paid or incurred by the Lender (i) in endeavoring to collect the Indebtedness, or any part thereof, and (ii) in protecting, defending or enforcing this Guaranty in any litigation, bankruptcy or insolvency proceedings or otherwise (collectively with the Indebtedness, the “Guarantied Obligations”). To the extent that funds are not otherwise readily available for payment on the Guarantied Obligations, the Guarantor shall cause its general partner to promptly make, in any event within two (2) business days after written demand is issued by the Lender under the Loan Agreement for payment of loans or cash collateralization of letters of credit, a capital call as permitted under the Guarantor’s Second Amended and Restated Agreement of Limited Partnership dated as of September 28, 2007, as amended, modified or restated from time to time (the “LP Agreement”) in order to satisfy payment of such demand. The Undersigned shall provide a copy of such capital call notice to the Lender immediately after issuance. Notwithstanding anything to the contrary contained herein, prior to the 14th business day following written demand pursuant to the Loan Agreement for payment of the loans and/or cash collateralization of letters of credit thereunder, the Lender shall not exercise any rights or remedies hereunder to collect amounts owing under this Guaranty.

     The Undersigned further acknowledges and agrees with the Lender that:

     1. This Guaranty is a continuing, absolute and unconditional guaranty, and shall remain in full force and effect until written notice of its discontinuance shall be actually received by the Lender, and also until any and all of the Indebtedness created, existing or committed to before receipt of such notice shall be fully paid. The dissolution of the Undersigned shall not terminate this Guaranty until notice of such dissolution shall have been actually received by the Lender, nor until all of the Indebtedness created or existing before receipt of such notice shall be fully paid.

     2. In case of the dissolution, liquidation or insolvency (howsoever evidenced) of, or the institution of bankruptcy or receivership proceedings against the Borrower or the

Undersigned, all of the Indebtedness then existing shall, at the option of the Lender, immediately become due or accrued and payable from the Undersigned. All dividends or other payments received from the Borrower or on account of the Indebtedness from whatsoever source, shall be taken and applied as payment in gross, and this Guaranty shall apply to and secure any ultimate balance that shall remain owing to the Lender.

     3. The liability hereunder shall in no way be affected or impaired by (and the Lender is hereby authorized to make from time to time, without notice to anyone), any sale, pledge, surrender, compromise, settlement, release, renewal, extension, indulgence, alteration, substitution, exchange, change in, modification or other disposition of any of the Indebtedness, either express or implied, or of any contract or contracts evidencing any of the Indebtedness, or of any security or collateral therefor. The liability hereunder shall in no way be affected or impaired by any acceptance by the Lender of any security for or other guarantors upon any of the Indebtedness, or by any failure, neglect or omission on the part of the Lender to realize upon or protect any of the Indebtedness, or any collateral or security therefor, or to exercise any lien upon or right of appropriation of any moneys, credits or property of the Borrower, possessed by the Lender, toward the liquidation of the Indebtedness, or by any application of payments or credits thereon. The Lender shall have the exclusive right to determine how, when and what application of payments and credits, if any, shall be made on the Indebtedness, or any part thereof. In order to hold the Undersigned liable hereunder, there shall be no obligation on the part of the Lender, at any time, to resort for payment to the Borrower or to any other guaranty, or to any other persons or corporations, their properties or estates, or resort to any collateral, security, property, liens or other rights or remedies whatsoever, and the Lender shall have the right to enforce this Guaranty irrespective of whether or not other proceedings or steps seeking resort to or realization upon or from any of the foregoing are pending.

     4. All diligence in collection or protection, and all presentment, demand, protest and/or notice, as to any and everyone, whether or not the Borrower or the Undersigned or others, of dishonor and of default and of non-payment and of the creation and existence of any and all of the Indebtedness, and of any security and collateral therefor, and of the acceptance of this Guaranty, and of any and all extensions of credit and indulgence hereunder, are waived. No act of commission or omission of any kind, or at any time, upon the part of the Lender in respect to any matter whatsoever, shall in any way affect or impair this Guaranty.

     5. The Undersigned will not exercise or enforce any right of exoneration, contribution, reimbursement, recourse or subrogation available to the Undersigned against any person liable for payment of the Indebtedness, or as to any security therefor, unless and until the full amount owing to the Lender on the Indebtedness has been paid and the payment by the Undersigned of any amount pursuant to this Guaranty shall not in any way entitle the Undersigned to any right, title or interest (whether by way of subrogation or otherwise) in and to any of the Indebtedness or any proceeds thereof or any security therefor unless and until the full amount owing to the Lender on the Indebtedness has been paid.

     6. The Lender may, in accordance with, and subject to the terms of, the Loan Agreement, sell, assign or transfer all of the Indebtedness, or any part thereof, or grant participations therein, and in that event each and every immediate and successive assignee,

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transferee, or holder of or participant in all or any part of the Indebtedness, shall have the right to enforce this Guaranty, by suit or otherwise, for the benefit of such assignee, transferee, holder or participant, as fully as if such assignee, transferee, holder or participant were herein by name specifically given such rights, powers and benefits; but the Lender shall have an unimpaired right to enforce this Guaranty for the benefit of the Lender or any such participant, as to so much of the Indebtedness that it has not sold, assigned or transferred.

     7. The Undersigned waives any and all defenses, claims and discharges of the Borrower, or any other obligor, pertaining to the Indebtedness, except the defense of discharge by payment in full. Without limiting the generality of the foregoing, the Undersigned will not assert, plead or enforce against the Lender any defense of waiver, release, discharge in bankruptcy, statute of limitations, res judicata, statute of frauds, anti-deficiency statute, fraud, incapacity, minority, usury, illegality or unenforceability which may be available to the Borrower or any other person liable in respect of any of the Indebtedness, or any setoff available against the Lender to the Borrower or any such other person, whether or not on account of a related transaction.

     8. If any payment applied by the Lender to the Indebtedness is thereafter set aside, recovered, rescinded or required to be returned for any reason (including, without limitation, any payment set aside, recovered, rescinded or required to be returned (i) pursuant to any intercreditor or subordination entered into in connection with the Indebtedness, or (ii) due to the bankruptcy, insolvency or reorganization of the Borrower or any other obligor), the Indebtedness to which such payment was applied shall for the purposes of this Guaranty be deemed to have continued in existence, notwithstanding such application, and this Guaranty shall be enforceable as to such of the Indebtedness as fully as if such application had never been made and whether or not this Guaranty purports to be released.

     9. The liability of the Undersigned under this Guaranty is in addition to and shall be cumulative with all other liabilities of the Undersigned to the Lender as guarantor of the Indebtedness, without any limitation as to amount, unless the instrument or agreement evidencing or creating such other liability specifically provides to the contrary.

     10. Any invalidity or unenforceability of any provision or application of this Guaranty shall not affect other lawful provisions and applications hereof, and to this end the provisions of this Guaranty are declared to be severable. This Guaranty shall be construed according to the law of the State of New York, in which State it shall be performed by the Undersigned and may not be waived, amended, released or otherwise changed except by a writing signed by the Lender.

     11. This Guaranty and every part thereof shall be effective upon delivery to the Lender, without further act, condition or acceptance by the Lender, shall be binding upon the Undersigned, and upon the successors and assigns of the Undersigned, and shall inure to the benefit of the Lender, its successors, legal representatives and assigns. The Undersigned waives notice of the Lender’s acceptance hereof.

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     12. So long as this Guaranty is in effect, the Guarantor agrees to furnish financial information of the Guarantor to the Lender upon reasonable request of the Lender from time to time. Such information shall be furnished as soon as reasonably possible, but in any event within 30 days after request by the Lender (to the extent that such financial information is readily available or can reasonably be prepared within such 30-day period, otherwise as soon as practicable thereafter). Without any such request but only so long as this Guaranty is in effect, the Guarantor shall furnish, or cause to be furnished, to the Lender:

     (a) as soon as available, and in any event (i) each time Borrower requests a Loan (other than a Loan to pay accrued and unpaid interest, unreimbursed draws under a letter of credit or letter of credit fees) or letter of credit from the Lender and (ii) within 30 days after the last day of each quarter, a certificate as of such date in the form, or substantially the form of Exhibit A hereto, properly completed and certified by the Guarantor;

     (b) as soon as available, and in any event within 60 days after the close of each fiscal quarter of the Guarantor (other than the last fiscal quarter of each fiscal year), a copy of the Guarantor’s balance sheet as of the last day of such fiscal quarter and its statements of income and partners’ capital for the fiscal quarter and for the fiscal year-to-date period then ended, prepared by the Guarantor in accordance with GAAP (subject to the absence of footnotes and normal year-end adjustments) and certified to by its chief financial officer or such other officer reasonably acceptable to the Lender; and

     (c) as soon as available, and in any event within 150 days after the close of fiscal year 2008 and within 120 days after the close of each fiscal year of the Guarantor thereafter (or, if later, such date by which such financial statements are reasonably expected to be available, as specified by the Guarantor to the Lender prior to the 120th day after the close of the relevant fiscal year), a copy of the Guarantor’s balance sheet as of the last day of the fiscal year then ended and its statements of income and partners’ capital and cash flows for the fiscal year then ended, and accompanying notes thereto, accompanied by an unqualified (as to going concern) opinion of Deloitte & Touche or another firm of independent public accountants of recognized standing, selected by the Guarantor and reasonably satisfactory to the Lender to the effect that the financial statements have been prepared in accordance with GAAP and present fairly in all material respects in accordance with GAAP the consolidated financial condition of the Guarantor as of the close of such fiscal year and the results of our operations and cash flows for the fiscal year then ended.

     14. So long as this Guaranty is in effect, the Undersigned shall not incur any additional debt or guarantees other than the loans and the guarantees in favor of the Lender except guarantees or other credit support supporting the obligations of its portfolio companies so long as the aggregate amount of outstanding indebtedness and all outstanding guarantees (or other credit support) of the Undersigned does not exceed 80% of the Guarantor’s uncalled Capital Commitments (as defined in the LP Agreement). So long as this Guaranty is in effect, neither the Undersigned nor the general partner of the Undersigned shall grant or permit to exist any lien, security interest, encumbrance on, or an assignment of (a) the Capital Commitments,

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(b) the Undersigned’s or the general partner of the Undersigned’s right to issue Call Notices (as defined in the LP Agreement), or (c) proceeds of any Capital Contributions (as defined in the LP Agreement) to secure any loans or for any other purpose without the prior written approval of the Lender, such approval to be granted at the sole discretion of the Lender; provided, however, that the Undersigned or the general partner of the Undersigned may grant such a security interest so long as the Undersigned’s obligations to the Lender are equally and ratably secured with such security interest and an intercreditor agreement is in place with the other lender that is reasonably satisfactory to the Lender. This provision is subject to amendment upon the written consent of both the Lender and the Undersigned.

[Signature Page Follows]

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     Signed and delivered by the Undersigned, at Chicago, Illinois, this 25th day of July, 2008. The Undersigned acknowledges receipt of a completed copy of this Guaranty as of the time of execution.

Pegasus Partners IV, L.P.
By:	Pegasus Investors IV, L.P., its
	general partner
By:	Pegasus Investors IV GP, L.L.C., its
	general partner
By:	/s/ Richard Weinberg
Printed Name: Richard Weinberg
Its: Vice President

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Solely as to Section 14:
Pegasus Investors IV, L.P.
By:	Pegasus Investors IV GP, L.L.C., its
	general partner
By:	/s/ Richard Weinberg
Printed Name: Richard Weinberg
Its: Vice President

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Certificate of Status
of
Pegasus Partners IV, L.P.

Date: July 25, 2008

     Pegasus Partners IV, L.P., a Delaware limited partnership (the “Guarantor”), does hereby certify that:

     1. Richard Weinberg is Vice President (the “Vice President”) of Pegasus Investors IV GP, L.L.C., a Delaware limited liability company (the “Ultimate GP”), which is the general partner of Pegasus Investors IV, L.P. (the “General Partner”), which is the general partner of the Guarantor.

     2. This Certificate is being delivered to BMO Capital Markets Financing, Inc. and Bank of Montreal (each a “Lender” and together the “Lenders”) in connection with, and may be relied upon by the Lenders in connection with, their extension of credit from time to time to the Guarantor, or any Portfolio Company of the Guarantor and the guaranty of that credit by the Guarantor to the Lenders (the “Guaranty”). This Certificate of Status supersedes any Certificate of Status previously delivered by the Guarantor to the Lenders or any of their affiliates in connection with any loans or other extensions of credit from time to time to the Guarantor or any Portfolio Company of the Guarantor by the Lenders or any affiliate thereof or any Guaranty thereof by the Guarantor.

     3. Richard Weinberg, as the Vice President and authorized signatory of the Ultimate GP (the “Authorized Signatory”), only in his capacity as the Vice President of the Ultimate GP and not in his individual capacity, and the Ultimate GP, in its capacity as general partner of the General Partner, and the General Partner, in its capacity as general partner of the Guarantor, have each secured proper authorization to enter into the Guaranty and to execute all instruments and documents in connection therewith, in compliance with the Guarantor’s Second Amended and Restated Agreement of Limited Partnership, dated as of September 28, 2007 (as amended from time to time, the “Guarantor’s Agreement of Limited Partnership”). The Guarantor has incurred indebtedness and become liable on guarantees, and will continue to incur indebtedness and become liable on guarantees, in each case only to the extent the same can be done in compliance with the Guarantor’s Agreement of Limited Partnership. The Authorized Signatory’s actions on behalf of the Ultimate GP (as the general partner of the general partner of the Guarantor) and the General Partner’s actions on behalf of the Guarantor, have been taken in compliance with the following agreements true and correct copies of which have been previously delivered to the Lenders: (a) the Guarantor’s Agreement of Limited Partnership, (b) the General Partner’s Limited Partnership Agreement, dated as of September 29, 2006 (as amended from time to time, the “General Partner’s Limited Partnership Agreement”) and (c) the Ultimate GP’s Amended and Restated Limited Liability Company Agreement dated as of January 29, 2007 (as amended from time to time, the “Ultimate GP’s Operating Agreement”).

     4. The aggregate amount of outstanding indebtedness of the Guarantor as of the date hereof is $5,783,333.

     5. The aggregate amount of Capital Commitments to the Guarantor as of the date hereof is $750,000,000.

     6. The aggregate amount of outstanding guarantees (after giving effect to the Guaranty) on which the Guarantor is liable as of the date hereof is $30,000,000.

     7. The aggregate amount of uncalled Capital Commitments to the Guarantor as of the date hereof is $452,662,414 (including $1,221,490 of distributions to the Guarantor’s Limited Partners subject to recall pursuant to the Guarantor’s Agreement of Limited Partnership).

     8. The aggregate amount of Capital Contributions made to the Guarantor as of the date hereof is $298,091,147.

     9. (a) The aggregate amount of outstanding investments that the Guarantor has in any one Portfolio Company does not as of the date hereof and will not at any time hereafter exceed the investment limitation on the Guarantor’s aggregate Capital Commitments as set forth in Section 2.1(c) of the Guarantor’s Agreement of Limited Partnership (as in effect from time to time).

     (b) The aggregate amount (without duplication) of outstanding indebtedness of the Guarantor (and together with the aggregate amount of outstanding guarantees of Guarantor) does not as of the date hereof and will not at any time hereafter exceed 80% of the Guarantor’s available uncalled Capital Commitments.

     10. The aggregate amount of Call Notices made on the Guarantor’s Limited Partners since the most recently completed fiscal quarter of the Guarantor is $20,004,012.

     11. Intentionally deleted.

     12. We will promptly notify you upon our becoming aware (i) of the occurrence of any event which would give any one or more of our Limited Partners the right to terminate or suspend its Capital Commitment, whether in whole or in part and whether or not contingent upon the passage of time or the giving of notice or both, (ii) of any event which would permit a Limited Partner to withdraw from the Guarantor, (iii) of the occurrence of a Defaulting Partner as defined in Section 3.1(e) of the Guarantor’s Agreement of Limited Partnership, (iv) of any event or agreement which would excuse or exclude a Limited Partner from participating in any capital call relating to the Guarantor, (v) of the formation of any Parallel Vehicle or Alternative Investment Vehicle or Co-Investment Vehicle or Special Purpose Investment Vehicle or Feeder Fund, (vi) of the occurrence of any event of dissolution as described in Section 9.1 of the Guarantor’s Agreement of Limited Partnership and (vii) of the termination or suspension of the Commitment Period whether in accordance with Guarantor’s Agreement of Limited Partnership or otherwise.

     13. The Lenders may rely conclusively upon the General Partner’s certification that it is acting on behalf of the Guarantor and that its acts are authorized. The Ultimate GP’s signature on behalf of the General Partner’s signature is sufficient to bind the Guarantor for all purposes.

     14. The undersigned is an officer of the Ultimate GP.

     15. We will promptly notify you upon the death, incapacitation or cessation of involvement in the management of Guarantor of Craig M. Cogut and Rodney Cohen.

     16. The Commitment Period shall end on October 24, 2012, unless earlier terminated or extended in accordance with the terms of the Guarantor’s Agreement of Limited Partnership. We will promptly notify you upon such early termination or extension of the Commitment Period.

     17. The Guarantor’s Agreement of Limited Partnership, the General Partner’s Limited Partnership Agreement and the Ultimate GP’s Operating Agreement have not been amended or otherwise modified since June 16, 2008, except by instruments, true and correct copies of which have been previously delivered to the

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Lenders. There are no side letters or other agreements (as referred to in Section 11.6 of the Guarantor’s Agreement of Limited Partnership) which would prohibit the Guarantor from entering into or performing its obligations under the Guaranty or affect the applicable Limited Partners’ obligations to honor capital calls as set forth in such Agreement of Limited Partnership or create obligations on the Guarantor to repurchase partnership interests or redeem the interest of a Limited Partner in the Guarantor, in each case except as provided in such Agreement of Limited Partnership.

     18. So long as the Guaranty is in effect, the Guarantor shall not incur any additional debt or guarantees other than loans from and guarantees in favor of the Lenders, except for guarantees or other credit support supporting the obligations of its Portfolio Companies so long as the aggregate amount of all outstanding indebtedness and outstanding guarantees (or other credit support) of the Guarantor does not exceed 80% of the Guarantor’s aggregate uncalled Capital Commitments. So long as the Guaranty is in effect, neither the Guarantor nor the General Partner shall grant or permit to exist any lien, security interest, encumbrance on, or an assignment of, the Capital Commitments, the Guarantor’s or the General Partner’s right to call capital or to issue Call Notices, or proceeds of any Capital Contributions to secure any loans or for any other purpose without the prior written approval of the Lenders, such approval to be granted at the sole discretion of the Lenders; provided, however, that the Guarantor or the General Partner may grant such a security interest so long as the Guarantor’s obligations to the Lenders are equally and ratably secured with such security interest and an intercreditor agreement is in place with the other lender that is reasonably satisfactory to the Lenders. The requirements set forth in this paragraph #18 are subject to amendment upon the written consent of both the Lenders and the Guarantor.

     19. The General Partner represents and warrants that it will not consent to or act in its discretion to effect an early termination of the Commitment Period or an early dissolution of the Guarantor at any time that the Guarantor has any outstanding indebtedness or guarantees to the Lenders.  If the Guarantor does not have any outstanding indebtedness or guarantees to the Lenders, the General Partner will not consent to or act in its discretion to effect an early dissolution or termination of the Guarantor without first providing the Lenders written notice of its intention to do so.

     20. The General Partner represents and warrants that it will not act in its discretion to reduce the aggregate Capital Commitments if after giving effect thereto the aggregate uncalled Capital Commitments of the Guarantor would not be in compliance with the provisions of this Certificate. If the Guarantor does not have any outstanding indebtedness or guarantees to the Lenders, the General Partner will not act in its discretion to reduce the Capital Commitments without first providing the Lenders written notice of its intention to do so.

     21. The General Partner shall promptly notify the Lenders of any assignments of limited partnership interests in the Guarantor.

     22. No Investment or action has been made by the Guarantor in contravention of the Guarantor’s Agreement of Limited Partnership.

     23. Promptly after receipt, we will provide you with copies of all agreements for capital subscriptions, and upon the Lenders’ reasonable request any other documentation, received in connection with the admission of an additional Limited Partner to the Guarantor (to the extent that such information can be shared without violations of confidentiality provisions binding on us).

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     24. The General Partner has not excused or excluded any Limited Partner from participating in an Investment whether pursuant to Article 4 of the Guarantor’s Agreement of Limited Partnership or otherwise other than those disclosed to the Lenders prior to the date hereof.

     25. No Limited Partner has been required or permitted to withdraw from the Guarantor whether pursuant to Section 3.1(c)(vi) of the Guarantor’s Agreement of Limited Partnership or otherwise other than those disclosed to the Lenders prior to the date hereof.

     26. Within two (2) business days after written demand for payment by the Lenders in connection with the obligations of the Guarantor, the General Partner or the Portfolio Companies under the Loan Documents, to the extent that funds are not otherwise available to the Guarantor to satisfy such obligations, the General Partner shall immediately make a capital call on the Limited Partners of the Guarantor in order to satisfy payment of such demand, provided that the Guarantor shall have fourteen (14) business days to honor any such demand.

     27. The Guarantor hereby agrees to notify the Lenders in the event of any change of which it becomes aware which would reasonably be expected to cause any of the above representations and warranties to cease to be true and correct in any material respect.

[Signature Page to Follow]

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     All capitalized terms used above without definition shall have the same meanings herein as such terms have in the Guarantor’s Agreement of Limited Partnership. This agreement is dated as of the date first written above.

Pegasus Partners IV, L.P.
By:	Pegasus Investors IV, L.P., its
	general partner
By:	Pegasus Investors IV GP, L.L.C., its
	general partner
By:
Printed Name: Richard Weinberg
Its:	Vice President
Solely as to Sections 18, 19, 20, 21, 24 and 26:
Pegasus Investors IV, L.P.
By:	Pegasus Investors IV GP, L.L.C., its
	general partner
By:
Printed Name: Richard Weinberg
Its:	Vice President

Exhibit A

EX-99.1

Exhibit 99.1

AGREEMENT REGARDING THE JOINT FILING OF SCHEDULE 13D

          The undersigned hereby agree as follows:

(i)

Each of them is individually eligible to use the Schedule 13D to which this Exhibit is attached, and such Schedule 13D is filed on behalf of each of them; and

(ii)

Each of them is responsible for the timely filing of such Schedule 13D and any amendments thereto, and for the completeness and accuracy of the information concerning such person contained therein; but none of them is responsible for the completeness or accuracy of the information concerning the other persons making the filing, unless such person knows or has reason to believe that such information is inaccurate.

Date: July 29, 2008

LED HOLDINGS, LLC
By:	/s/ Govi Rao
	Name:	Govi Rao
	Title:	President/CEO
PP IV (AIV) LED, LLC
By:	Pegasus Partners IV (AIV), L.P.,
	its sole member
By:	Pegasus Investors IV, L.P.,
	its general partner
By:	Pegasus Investors IV GP, L.L.C.,
	its general partner
By:	/s/ Richard Weinberg
	Name:	Richard Weinberg
	Title:	Vice President
PP IV LED, LLC
By:	Pegasus Partners, IV, L.P.,
	its sole member
By:	Pegasus Investors IV, L.P.,
	its general partner
By:	Pegasus Investors IV GP, L.L.C.,
	its general partner
By:	/s/ Richard Weinberg
	Name:	Richard Weinberg
	Title:	Vice President
PEGASUS PARTNERS IV, L.P.
By:	Pegasus Investors IV, LP
	its general partner
By:	Pegasus Investors IV GP, L.L.C.,
	its general partner
By:	/s/ Richard Weinberg
	Name:	Richard Weinberg
	Title:	Vice President

PEGASUS INVESTORS IV, L.P.
By:	Pegasus Investors IV GP, L.L.C., its general partner
By:	/s/ Richard Weinberg
	Name:   Richard Weinberg
	Title:   Vice President
PEGASUS INVESTORS IV GP, L.L.C.
By:	/s/ Richard Weinberg
	Name:   Richard Weinberg
	Title:   Vice President
PEGASUS CAPITAL, LLC
By:	/s/ Craig Cogut
	Name:   Craig Cogut
	Title:   President & Managing Member
/s/ Craig Cogut
CRAIG COGUT
/s/ Richard Kelson
RICHARD KELSON
LED EFFECTS, INC.
By:	/s/ Kevin Furry
	Name: Kevin Furry
	Title:  President