Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On March 24, 2009, Xenonics Holdings, Inc. (the "Company") granted to each of Alan P. Magerman (the Company's Chairman of the Board) and Jeffery P. Kennedy (the Company's President and Chief Operating Officer) an option to purchase 200,000 shares of the Company's common stock at an exercise price of $0.65 per share.

Each option provides that it will vest only if the Company achieves specified performance criteria during its 2009 fiscal year. On September 22, 2009, the Company's Compensation Committee (which consists solely of independent directors) modified each option to provide that the 2010 fiscal year will replace the 2009 fiscal year for purposes of determining whether the options will vest.

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