On December 10, 2008, Irvine Sensors Corporation (the "Company") entered into a Subscription Agreement (the "Subscription Agreement") with 6 accredited individual investors (each, an "Investor" and collectively, the "Investors"), pursuant to which the Company expanded its private placement that was previously disclosed on November 10, 2008 in a closing (the "Private Placement") of the issuance of secured promissory notes in the original aggregate principal amount of $138,000 (the "Notes") and, as consideration for making the advances under the Notes, agreed to issue to the Investors an aggregate of 86,250 shares of the Company's Common Stock (the "Shares"). Such Shares have not been registered under the Securities Act of 1933 and may not be offered or sold absent registration or an applicable exemption from registration. The number of Shares being issued equals 25% of the principal amount of the Notes divided by $0.40, which was the last closing bid price of the Company's Common Stock as determined in accordance with Nasdaq rules immediately preceding the Company entering into the binding Subscription Agreement to issue the Notes (the "Market Value").

The Notes bear interest at 12.0% per annum and will mature and become payable 18 months following their issuance. All amounts payable under the Notes are accelerated upon the occurrence of certain bankruptcy-related events. The Notes are secured by a security agreement in substantially all of the Company's assets and such security interest is senior to certain obligations of the Company to Longview Fund, LP and Alpha Capital Anstalt pursuant to an intercreditor agreement and collateral agent agreement.

In accordance with the terms of the notes, the Company would be required to issue an additional number of shares of the Company's Common Stock with a value equal to 12.5% of the principal amount of each Note in the event that such Note has not been paid in full on or before the six month anniversary of the issuance date of such Note (the "Six Month Date"), based on the greater of (x) the fair market value of the Company's Common Stock as of the Six Month Date or (y) the fair market value of the Company's Common Stock as of the date of issuance of the Note (the "Six Month Shares"); and an additional number of shares of the Company's Common Stock with a value equal to 12.5% of the principal amount of each Note in the event that such Note has not been paid in full on or before the twelve month anniversary of the issuance date of such Note (the "Twelve Month Date"), based on the greater of (x) the fair market value of the Company's Common Stock as of the Twelve Month Date or (y) the fair market value of the Company's Common Stock as of the date of issuance of the Note (the "Twelve Month Shares"). The Company may at its option expand this Private Placement.

In consideration for services rendered as the lead placement agent in the Private Placement, the Company issued to J.P. Turner & Company, LLC ("JP Turner") a five-year warrant to purchase 44,850 shares of the Company's Common Stock at an exercise price of $0.40 per share (the "JP Warrant"), which represents 13% of the gross proceeds divided by the Market Value. JP Turner also will receive, in consideration for services rendered as lead placement agent,
(i) cash commissions aggregating $11,040, which represents 8% of the gross proceeds, (ii) a management fee of $2,760, which represents 2% of the gross proceeds and (iii) an expense allowance fee of $4,140, which represents 3% of the gross proceeds.

The Company has not granted registration rights with respect to the Shares or the JP Warrant. The proceeds from the Private Placement will be used to finance the working capital needs of the Company. The Company had 5,641,875 shares of Common Stock outstanding immediately prior to the Private Placement.

The information disclosed in Item 1.01 of this Current Report on Form 8-K is incorporated by reference into this Item 2.03.

The information disclosed in Item 1.01 of this Current Report on Form 8-K is incorporated by reference into this Item 3.02. The sale and issuance of the Notes, the Shares and the JP Warrant have been determined to be exempt from registration under the Securities Act of 1933 in reliance on Section 4(2) of the Securities Act and Rule 506 of Regulation D promulgated thereunder as transactions by an issuer not involving a public offering. The Investors and JP Turner have represented that they are accredited investors, as that term is defined in Regulation D, and that they have acquired the securities for investment purposes only and not with a view to or for sale in connection with any distribution thereof.

(a) Financial Statements of Business Acquired.

Not applicable.

(b) Pro Forma Financial Information.

Not applicable.

(c) Shell Company Transactions.

Not applicable.

(d) Exhibits.

    Exhibit No.   Description of Exhibit


    10.1          Form of Subscription Agreement for Secured Promissory Notes
    10.2          Form of Secured Promissory Notes
    10.3          Security Agreement
    10.4          Collateral Agent Agreement
    10.5          Intercreditor Agreement