Business Context and Reporting Period
Company: Intrusion Inc.
Filing Type: Form 8-K (Current Report)
Date of Report: April 6, 2026
Event: Entry into a Material Definitive Agreement (Note Purchase Agreement).
Key Financial Metrics
This filing reports a specific financing transaction rather than periodic financial results. Key metrics related to the transaction include:
- Cash Proceeds: $3,000,000
- Principal Amount: $3,230,000
- Original Issue Discount (OID): $210,000
- Transaction Expenses: $20,000
- Interest Rate: 7% per annum, compounded daily
- Maturity: 24 months from issuance
- Collateral: First-priority security interest in all Company assets and intellectual property
Material Changes and Transaction Terms
The Company entered into a Secured Promissory Note with Streeterville Capital, LLC. Material terms include:
- Monitoring Fee: After 90 days, a provision automatically increases the Outstanding Balance by approximately 17.65%.
- Redemption Rights: The Investor has monthly redemption rights of up to $250,000 beginning six months after issuance.
- Covenants: Includes restrictions on issuing variable-rate or other restricted securities without consent, a most-favored-nation clause, and a requirement to maintain listing on a national exchange.
- Participation Right: The Investor holds a 10% participation right in future debt or equity financings.
Guidance, Outlook, and Risks
Management Commentary: The filing does not contain forward-looking guidance or management commentary regarding future operations beyond the terms of the agreement.
Risks and Contingencies: The transaction significantly increases the Company's debt obligations and grants the Investor a first-priority lien on all assets. The automatic increase in the outstanding balance after 90 days and the redemption rights create specific liquidity pressures. The filing text does not provide a clear value for the Company's current liquidity position outside of this transaction.
Investor Verification Checklist
- Verify the impact of the 17.65% automatic balance increase on total debt load after the 90-day mark.
- Confirm the Company's ability to meet the monthly redemption obligations of up to $250,000 starting in October 2026.
- Review the Security Agreement and Intellectual Property Security Agreement (Exhibit 99.1) to understand the scope of the asset lien.
- Assess how the 10% participation right may dilute future financing opportunities or restrict capital raising.
- Check subsequent filings for any waivers or amendments to the restrictive covenants regarding future securities issuances.