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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>UNITED
      STATES</strong></font></div>
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      AND EXCHANGE COMMISSION</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
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      D.C. 20549</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
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      8-K</strong></font></div>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Current
      Report </strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Pursuant
      to Section 13 or 15(d) </strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>of
      the Securities Exchange Act of 1934 </strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Date
      of Report (Date of earliest event reported): January 31,
      2006</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>AURA
      SYSTEMS, INC.</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font>&#160;</div>
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      name of registrant as specified in charter)</strong></font></div>
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              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>(State
                or other</strong></font></div>
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>jurisdiction
                of</strong></font></div>
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>incorporation)</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
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                File</strong></font></div>
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            </td>
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              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>(IRS
                Employer</strong></font></div>
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Identification
                No.)</strong></font></div>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>2335
      Alaska Avenue, El Segundo, California 90245</strong></font></div>
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      of principal executive offices) (Zip Code)</strong></font></div>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Registrant&#8217;s
      telephone number, including area code: (310) 643-5300</strong></font></div>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Not
      Applicable</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>(Former
      name or former address, if changed since last report)</strong></font><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">&#160;</div>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Check
      the
      appropriate box below if the Form 8-K filing is intended to simultaneously
      satisfy the filing obligation of the registrant under any of the following
      provisions (see General Instruction A.2. below): </font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
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                communications pursuant to Rule 425 under the Securities Act (17
                CFR
                230.425) </font></div>
            </td>
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            <td align="left" valign="top" width="3%">
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                material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
                240.14a-12) </font></div>
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          <tr>
            <td align="left" valign="top" width="3%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Wingdings">&#168;</font></div>
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                communications pursuant to Rule 13e-4(c) under the Exchange Act (17
                CFR
                240.13e-4(c)) </font></div>
            </td>
          </tr>

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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
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          <hr style="COLOR: black" noshade size="2">
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Item
      1.01.</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Entry
      into a Material Definitive Agreement</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On
      January 18, 2006, the United States Bankruptcy Court, Central District of
      California, Los Angeles Division (the &#8220;Court&#8221;), entered an order (the
&#8220;Confirmation Order&#8221;) confirming Aura Systems, Inc. (the &#8220;Company&#8221;) First
      Amended Plan of Reorganization (the &#8220;Plan&#8221;), as modified</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">,</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
      under
      Chapter 11 of the United States Bankruptcy Code (the &#8220;Bankruptcy Code&#8221;). The
      Company filed a voluntary petition for relief with the Court under Chapter
      11 of
      the Bankruptcy Code on June 24, 2005. On January 31, 2006, the Plan became
      effective (the &#8220;Effective Date&#8221;).</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Prior
      to
      the Effective Date, the Company owed Koyah Leverage Partners, L.P., Koyah
      Partners, L.P., Koyah Ventures, LLC, Raven Partners, L.P. and Koyah Microcap
      Partners Master Fund, L.P. (collectively, the &#8220;Koyah Entities&#8221;) approximately
      $5,500,000 of secured debt. In consideration for full settlement and
      satisfaction of all of their claims against the Company, the Koyah Entities
      received a restated promissory note from the Company (the "Koyah Entities
      Promissory Note") on the Effective Date. The Koyah Entities Promissory Note
      has,
      among others, the following terms: (a) a principal balance of $2,600,000, (b)
      a
      term of five years, (c) an annual interest rate of 7%, (d) provides for the
      Company to make an initial payment of $75,000 to the Koyah Entities on the
      Effective Date (which reduced the principal amount owing under the Koyah
      Entities Promissory Note on the Effective Date to $2,525,000), (e) beginning
      with the twelfth full calendar month following the Effective Date, provides
      for
      the Company to repay the balance of the Koyah Entities Promissory Note over
      the
      following forty-eight months by making equal monthly payments to the Koyah
      Entities, (f) provides for the Company to pay to the Koyah Entities by the
      date
      which is five years following the Effective Date all outstanding principal
      and
      interest which remain outstanding on that date, and (g) provides for the Company
      to have the right to prepay all or any portion of the outstanding obligations
      owing under the Koyah Entities Promissory Note at any time with no prepayment
      penalty. The obligations of the Company to the Koyah Entities on account of
      the
      Koyah Entities Promissory Note is secured by a lien against the same assets
      which secured the pre-bankruptcy claim of the Koyah Entities. The lien will
      have
      the same priority as the pre-bankruptcy lien of the Koyah Entities. The Company
      has agreed to execute any and all documents reasonably requested by the Koyah
      Entities and delivered by the Koyah Entities to the Company to evidence the
      debt
      owing by the Company to the Koyah Entities, including, but not limited to,
      the
      restated Koyah Entities Promissory Note, a restated security agreement, and
      a
      restated financing statement. </font></div>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Item
      1.02.</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Termination
      of a Material Definitive Agreement</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
      connection with the consummation of the Plan, the following agreements are
      no
      longer in effect as of the Effective Date:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
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            <td align="right" style="width: 36pt;"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Symbol, serif">&#183;&#160;&#160;</font></td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Those
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                Entities</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
                set forth under Item 2.04 in the Company&#8217;s Current Report on Form 8-K
                filed with the Securities and Exchange Commission (the &#8220;SEC&#8221;) on June 24,
                2005.</font></div>
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                certain agreements between the Company and the </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Ezra
                Meyer</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
                set forth under Item 2.04 in the Company&#8217;s Current Report on Form 8-K
                filed with the SEC on June 24, 2005.
</font></div>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
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          <tr valign="top" style="line-height: 1.25;">
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                Debtor in Possession Loan Agreement and Security Agreement, approved
                by
                the Court on July 27, 2005, between the Company and Blue Collar Films,
                Inc. (&#8220;Blue Collar&#8221;). </font></div>
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                Debtor in Possession Loan Agreement and Security Agreement, approved
                by
                the Court on September 7, 2005, between the Company and AGP Lender
                LLC
                (&#8220;AGP&#8221;). </font></div>
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                Debtor in Possession Loan Agreement and Security Agreement, approved
                by
                the Court on December 21, 2005, between the Company and </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">a
                group of people and/or entities (collectively referred to as the
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      2.03. Creation of a Direct Financial Obligation or an Obligation Under an
      Off-Balance Sheet Arrangement of a Registrant. </strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      description of the </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Koyah
      Entities Promissory Note is </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">included
      in Item 1.01 and is incorporated by reference into this Item 2.03.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Item
      3.02. Unregistered Sales of Equity Securities. </strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Pursuant
      to the Plan, on the Effective Date, the Company issued approximately 23,000,000
      shares of new common stock and 5,230,000 new warrants. The names of the groups
      of the Company&#8217;s interest holders as of the Effective Date, the aggregate amount
      of shares of new common stock and new warrants issued to each such group, and
      the conversion features of the new warrants are set forth in the Company&#8217;s
      Current Report on Form 8-K filed with the SEC on January 20, 2006, incorporated
      by reference herein. Such securities (other than the shares of new common stock
      and new warrants issued to the New Money Investors described below) were issued
      in reliance upon an exemption from registration with the SEC pursuant to section
      1145 of the Bankruptcy Code.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      shares of new common stock and new warrants issued to the New Money Investors
      on
      the Effective Date were issued in reliance upon an exemption from registration
      with the SEC pursuant to Section 4(2) of the Securities Act of 1933, as amended
      (the &#8220;Securities Act&#8221;), and Rule 506 promulgated thereunder. The New Money
      Investors have represented that they are accredited investors as defined in
      Rule
      501 of Regulation D promulgated under the Securities Act.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Item
      3.03. Material Modification to Rights of Security Holders. </strong></font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>&#160;</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On
      the
      Effective Date, the holders of all issued and outstanding common stock, which
      comprised approximately 439,458,082 shares of common stock, collectively
      received (on a pro rata basis based upon the amount of their respective common
      stock) in full settlement and satisfaction of their common stock, 1,300,000
      shares of new common stock, which comprised approximately 5.7% of the Company&#8217;s
      new common stock issued and outstanding on the Effective Date. The Company&#8217;s
      Amended and Restated Certificate of Incorporation, adopted on the Effective
      Date, authorizes 50,000,000 shares of new common stock and does not provide
      for
      the authorization of any preferred stock. Pursuant to the Plan, on the Effective
      Date, the Company also adopted new Bylaws. Holders of all issued and outstanding
      common stock that received shares of new common stock on the Effective Date
      will
      vote together with all other new common stockholders on all matters submitted
      to
      stockholder vote.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Item
      5.01. Changes in Control of Registrant. </strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As
      of the
      Effective Date, the groups set forth in Item 5.01 held the following approximate
      percentages of shares of new common stock of the Company: New Money Investors
      (14.8%); the </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Aries
      Group (11.2%); Blue Collar, AGP and the Berg Group (collectively, the &#8220;DIP
      Lenders&#8221;) (26.8%); the Koyah Entities (5%); the holders of general unsecured
      claims (20.9%); the holders of Series B Preferred Stock (13.1%); the holders
      of
      Series A Preferred Stock (1.6%); and the holders of the Company&#8217;s old common
      stock (5.7%). </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As
      of the
      Effective Date, the board of directors of the Company consists of five members.
      The Company&#8217;s board members are Marc Hoffman, Arthur Schwartz, Richard Armhurst,
      Melvin Gagerman and Sheldon Appel. </font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Item
      5.02. Departure of Directors or Principal Officers; Election of Directors;
      Appointment of Principal Officers. </strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Pursuant
      to the Plan, as of the Effective Date, Raymond Yu, Sandra Ferro, Billy Anders
      and Yolanda Parker ceased serving as directors of the Company. On the Effective
      Date, the Company&#8217;s board of directors was five individuals. Pursuant to the
      Plan, Marc Hoffman, Arthur Schwartz, Richard Armhurst, Melvin Gagerman and
      Sheldon Appel were appointed as directors of the Company on the Effective Date.
      Pursuant to the Plan, as of the Effective Date, Raymond Yu ceased serving as
      the
      Company&#8217;s Chief Executive Officer. </font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Item
      5.03. Amendment to Articles of Incorporation or Bylaws; Change in Fiscal Year.
      </strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Pursuant
      to the Plan, on the Effective Date, the Company filed its Amended and Restated
      Certificate of Incorporation with the Delaware Secretary of State and adopted
      new Bylaws. For a description of certain provisions of the Company&#8217;s Amended and
      Restated Certificate of Incorporation and new Bylaws, see the Company&#8217;s Form
      8-A, filed with the SEC on January 31, 2006. The Company&#8217;s Amended and Restated
      Certificate of Incorporation and new Bylaws are filed as Exhibits 3.1 and 3.2
      to
      the Form 8-A, and are incorporated by reference herein.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
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        <div id="GLFTR" style="WIDTH: 100%" align="left">
        </div>
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        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: ">3</font></div>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Item
      8.01. Other Events. </strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Attached
      as Exhibit 99.1 hereto is a press release, dated February 2, 2006, issued by
      the
      Company regarding the Effective Date of the Plan. Such exhibit shall not be
      deemed &#8220;filed&#8221; for purposes of Section 18 of the Securities Exchange Act of
      1934, as amended, nor shall it be deemed incorporated by reference in any filing
      under the Securities Act, except as shall be expressly set forth by specific
      reference in such filing.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Item
      9.01.</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Financial
      Statements and Exhibits.</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
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              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(d)&#160;&#160;
                </font></div>
            </td>
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              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Exhibits</font></div>
            </td>
          </tr>
          <tr>
            <td align="right" colspan="2" valign="top" width="11%" style="border-bottom: medium none;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">99.1&#160;&#160;&#160;
                </font></div>
            </td>
            <td align="left" valign="top" width="61%" style="border-bottom: medium none;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Press
                Release of Aura Systems, Inc., dated February 2,
                2006</font></div>
            </td>
          </tr>

      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><br>&#160;</div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left">
        </div>
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      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: ">4</font></div>
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        </div>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>SIGNATURES</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Pursuant
      to the requirements of the Securities Exchange Act of 1934, the registrant
      has
      duly caused this report to be signed on its behalf by the undersigned hereunto
      duly authorized. </font></div>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">

          <tr>
            <td align="left" valign="top" width="34%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
            </td>
            <td align="left" valign="top" width="4%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
            </td>
            <td align="left" valign="top" width="33%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="34%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Date:
                February 6, 2006 </font></div>
            </td>
            <td align="left" colspan="2" valign="top" width="37%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">AURA
                SYSTEMS, INC..</font></div>
            </td>
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            <td align="left" valign="top" width="34%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
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            <td align="left" valign="top" width="4%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
            </td>
            <td align="left" valign="top" width="33%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="34%" style="border-bottom: #ffffff solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
            </td>
            <td align="left" valign="top" width="4%" style="border-bottom: #ffffff solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">By:
                </font></div>
            </td>
            <td align="left" valign="top" width="33%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">/s/
                Marc Hoffman</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" colspan="2" valign="top" width="38%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
            </td>
            <td align="left" valign="top" width="33%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Marc
                Hoffman</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" colspan="2" valign="top" width="38%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
            </td>
            <td align="left" valign="top" width="33%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">President
                </font></div>
            </td>
          </tr>

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      INDEX </strong></font></div>
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                  No.</strong>&#160;</font></div>
              </td>
              <td width="5%" style="border-bottom: #ffffff solid;">&#160;</td>
              <td width="78%" style="border-bottom: black thin solid;">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Description</strong></font></div>
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              <td width="78%">&#160;</td>
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              <td width="12%"><font size="2">99.1&#160;&#160;&#160;</font></td>
              <td width="5%">&#160;</td>
              <td width="78%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Press
                  Release of Aura Systems, Inc., dated February 2,
                  2006</font></div>
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{"company-data": {"conformed-name": "AURA SYSTEMS INC", "cik": "0000826253", "assigned-sic": "3690", "irs-number": "954106894", "state-of-incorporation": "DE", "fiscal-year-end": "0228"}, "filing-values": {"form-type": "8-K", "act": "34", "file-number": "000-17249", "film-number": "06581927"}, "business-address": {"street1": "2335 ALASKA AVE", "city": "EL SEGUNDO", "state": "CA", "zip": "90245", "phone": "3106435300"}, "mail-address": {"street1": "2335 ALASKA AVE", "city": "EL SEGUNDO", "state": "CA", "zip": "90245"}}
UNITED
      STATES
SECURITIES
      AND EXCHANGE COMMISSION
Washington,
      D.C. 20549
FORM
      8-K
Current
      Report
Pursuant
      to Section 13 or 15(d)
of
      the Securities Exchange Act of 1934
Date
      of Report (Date of earliest event reported): January 31,
      2006
AURA
      SYSTEMS, INC.
(Exact
      name of registrant as specified in charter)
Delaware
0-17249
95-4106894
(State
                or other
jurisdiction
                of
incorporation)
(Commission
                File
Number)
(IRS
                Employer
Identification
                No.)
2335
      Alaska Avenue, El Segundo, California 90245
(Address
      of principal executive offices) (Zip Code)
Registrant's
      telephone number, including area code: (310) 643-5300
Not
      Applicable
(Former
      name or former address, if changed since last report)
Check
      the
      appropriate box below if the Form 8-K filing is intended to simultaneously
      satisfy the filing obligation of the registrant under any of the following
      provisions (see General Instruction A.2. below):
¨
Written
                communications pursuant to Rule 425 under the Securities Act (17
                CFR
                230.425)
¨
Soliciting
                material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
                240.14a-12)
¨
Pre-commencement
                communications pursuant to Rule 14d-2(b) under the Exchange Act (17
                CFR
                240.14d-2(b))
¨
Pre-commencement
                communications pursuant to Rule 13e-4(c) under the Exchange Act (17
                CFR
                240.13e-4(c))
Item
      1.01.
Entry
      into a Material Definitive Agreement
.
On
      January 18, 2006, the United States Bankruptcy Court, Central District of
      California, Los Angeles Division (the "Court"), entered an order (the
"Confirmation Order") confirming Aura Systems, Inc. (the "Company") First
      Amended Plan of Reorganization (the "Plan"), as modified
,
under
      Chapter 11 of the United States Bankruptcy Code (the "Bankruptcy Code"). The
      Company filed a voluntary petition for relief with the Court under Chapter
      11 of
      the Bankruptcy Code on June 24, 2005. On January 31, 2006, the Plan became
      effective (the "Effective Date").
Prior
      to
      the Effective Date, the Company owed Koyah Leverage Partners, L.P., Koyah
      Partners, L.P., Koyah Ventures, LLC, Raven Partners, L.P. and Koyah Microcap
      Partners Master Fund, L.P. (collectively, the "Koyah Entities") approximately
      $5,500,000 of secured debt. In consideration for full settlement and
      satisfaction of all of their claims against the Company, the Koyah Entities
      received a restated promissory note from the Company (the "Koyah Entities
      Promissory Note") on the Effective Date. The Koyah Entities Promissory Note
      has,
      among others, the following terms: (a) a principal balance of $2,600,000, (b)
      a
      term of five years, (c) an annual interest rate of 7%, (d) provides for the
      Company to make an initial payment of $75,000 to the Koyah Entities on the
      Effective Date (which reduced the principal amount owing under the Koyah
      Entities Promissory Note on the Effective Date to $2,525,000), (e) beginning
      with the twelfth full calendar month following the Effective Date, provides
      for
      the Company to repay the balance of the Koyah Entities Promissory Note over
      the
      following forty-eight months by making equal monthly payments to the Koyah
      Entities, (f) provides for the Company to pay to the Koyah Entities by the
      date
      which is five years following the Effective Date all outstanding principal
      and
      interest which remain outstanding on that date, and (g) provides for the Company
      to have the right to prepay all or any portion of the outstanding obligations
      owing under the Koyah Entities Promissory Note at any time with no prepayment
      penalty. The obligations of the Company to the Koyah Entities on account of
      the
      Koyah Entities Promissory Note is secured by a lien against the same assets
      which secured the pre-bankruptcy claim of the Koyah Entities. The lien will
      have
      the same priority as the pre-bankruptcy lien of the Koyah Entities. The Company
      has agreed to execute any and all documents reasonably requested by the Koyah
      Entities and delivered by the Koyah Entities to the Company to evidence the
      debt
      owing by the Company to the Koyah Entities, including, but not limited to,
      the
      restated Koyah Entities Promissory Note, a restated security agreement, and
      a
      restated financing statement.
Item
      1.02.
Termination
      of a Material Definitive Agreement
.
In
      connection with the consummation of the Plan, the following agreements are
      no
      longer in effect as of the Effective Date:
·
Those
                certain agreements between the Company and the
Koyah
                Entities
set forth under Item 2.04 in the Company's Current Report on Form 8-K
                filed with the Securities and Exchange Commission (the "SEC") on June 24,
                2005.
·
Those
                certain agreements between the Company and the
Ezra
                Meyer
set forth under Item 2.04 in the Company's Current Report on Form 8-K
                filed with the SEC on June 24, 2005.
·
The
                Debtor in Possession Loan Agreement and Security Agreement, approved
                by
                the Court on July 27, 2005, between the Company and Blue Collar Films,
                Inc. ("Blue Collar").
·
The
                Debtor in Possession Loan Agreement and Security Agreement, approved
                by
                the Court on September 7, 2005, between the Company and AGP Lender
                LLC
                ("AGP").
·
The
                Debtor in Possession Loan Agreement and Security Agreement, approved
                by
                the Court on December 21, 2005, between the Company and
a
                group of people and/or entities (collectively referred to as the
                "New
                Money Investors")
.
Item
      2.03. Creation of a Direct Financial Obligation or an Obligation Under an
      Off-Balance Sheet Arrangement of a Registrant.
The
      description of the
Koyah
      Entities Promissory Note is
included
      in Item 1.01 and is incorporated by reference into this Item 2.03.
2
Item
      3.02. Unregistered Sales of Equity Securities.
Pursuant
      to the Plan, on the Effective Date, the Company issued approximately 23,000,000
      shares of new common stock and 5,230,000 new warrants. The names of the groups
      of the Company's interest holders as of the Effective Date, the aggregate amount
      of shares of new common stock and new warrants issued to each such group, and
      the conversion features of the new warrants are set forth in the Company's
      Current Report on Form 8-K filed with the SEC on January 20, 2006, incorporated
      by reference herein. Such securities (other than the shares of new common stock
      and new warrants issued to the New Money Investors described below) were issued
      in reliance upon an exemption from registration with the SEC pursuant to section
      1145 of the Bankruptcy Code.
The
      shares of new common stock and new warrants issued to the New Money Investors
      on
      the Effective Date were issued in reliance upon an exemption from registration
      with the SEC pursuant to Section 4(2) of the Securities Act of 1933, as amended
      (the "Securities Act"), and Rule 506 promulgated thereunder. The New Money
      Investors have represented that they are accredited investors as defined in
      Rule
      501 of Regulation D promulgated under the Securities Act.
Item
      3.03. Material Modification to Rights of Security Holders.
On
      the
      Effective Date, the holders of all issued and outstanding common stock, which
      comprised approximately 439,458,082 shares of common stock, collectively
      received (on a pro rata basis based upon the amount of their respective common
      stock) in full settlement and satisfaction of their common stock, 1,300,000
      shares of new common stock, which comprised approximately 5.7% of the Company's
      new common stock issued and outstanding on the Effective Date. The Company's
      Amended and Restated Certificate of Incorporation, adopted on the Effective
      Date, authorizes 50,000,000 shares of new common stock and does not provide
      for
      the authorization of any preferred stock. Pursuant to the Plan, on the Effective
      Date, the Company also adopted new Bylaws. Holders of all issued and outstanding
      common stock that received shares of new common stock on the Effective Date
      will
      vote together with all other new common stockholders on all matters submitted
      to
      stockholder vote.
Item
      5.01. Changes in Control of Registrant.
As
      of the
      Effective Date, the groups set forth in Item 5.01 held the following approximate
      percentages of shares of new common stock of the Company: New Money Investors
      (14.8%); the
Aries
      Group (11.2%); Blue Collar, AGP and the Berg Group (collectively, the "DIP
      Lenders") (26.8%); the Koyah Entities (5%); the holders of general unsecured
      claims (20.9%); the holders of Series B Preferred Stock (13.1%); the holders
      of
      Series A Preferred Stock (1.6%); and the holders of the Company's old common
      stock (5.7%).
As
      of the
      Effective Date, the board of directors of the Company consists of five members.
      The Company's board members are Marc Hoffman, Arthur Schwartz, Richard Armhurst,
      Melvin Gagerman and Sheldon Appel.
Item
      5.02. Departure of Directors or Principal Officers; Election of Directors;
      Appointment of Principal Officers.
Pursuant
      to the Plan, as of the Effective Date, Raymond Yu, Sandra Ferro, Billy Anders
      and Yolanda Parker ceased serving as directors of the Company. On the Effective
      Date, the Company's board of directors was five individuals. Pursuant to the
      Plan, Marc Hoffman, Arthur Schwartz, Richard Armhurst, Melvin Gagerman and
      Sheldon Appel were appointed as directors of the Company on the Effective Date.
      Pursuant to the Plan, as of the Effective Date, Raymond Yu ceased serving as
      the
      Company's Chief Executive Officer.
Item
      5.03. Amendment to Articles of Incorporation or Bylaws; Change in Fiscal Year.
Pursuant
      to the Plan, on the Effective Date, the Company filed its Amended and Restated
      Certificate of Incorporation with the Delaware Secretary of State and adopted
      new Bylaws. For a description of certain provisions of the Company's Amended and
      Restated Certificate of Incorporation and new Bylaws, see the Company's Form
      8-A, filed with the SEC on January 31, 2006. The Company's Amended and Restated
      Certificate of Incorporation and new Bylaws are filed as Exhibits 3.1 and 3.2
      to
      the Form 8-A, and are incorporated by reference herein.
3
Item
      8.01. Other Events.
Attached
      as Exhibit 99.1 hereto is a press release, dated February 2, 2006, issued by
      the
      Company regarding the Effective Date of the Plan. Such exhibit shall not be
      deemed "filed" for purposes of Section 18 of the Securities Exchange Act of
      1934, as amended, nor shall it be deemed incorporated by reference in any filing
      under the Securities Act, except as shall be expressly set forth by specific
      reference in such filing.
Item
      9.01.
Financial
      Statements and Exhibits.
(d)
Exhibits
99.1
Press
                Release of Aura Systems, Inc., dated February 2,
                2006
4
SIGNATURES
Pursuant
      to the requirements of the Securities Exchange Act of 1934, the registrant
      has
      duly caused this report to be signed on its behalf by the undersigned hereunto
      duly authorized.
Date:
                February 6, 2006
AURA
                SYSTEMS, INC..
By:
/s/
                Marc Hoffman
Marc
                Hoffman
President
5
EXHIBIT
      INDEX
Exhibit
                  No.
Description
99.1
Press
                  Release of Aura Systems, Inc., dated February 2,
                  2006
6