Material Agreement, Asset Transaction (Form 8-K)

Item 1.01 Entry into a Material Definitive Agreement.

On August 28, 2026, Intrusion Inc. (the "Company") entered into a Note Purchase Agreement (the "Purchase Agreement") with Streeterville Capital, LLC (the "Investor"). Pursuant to the Purchase Agreement, the Company issued and sold to the Investor a Secured Promissory Note (the "Note") in the original principal amount of $1,615,000 for cash proceeds of $1,500,000 (reflecting an original issue discount of $105,000 and $10,000 in transaction expenses). The net proceeds of the Note will be used to fund the cash portion of the Second Closing under the MIPA (as defined in Item 2.01 below) and to provide additional working capital for general corporate purposes.

The Note bears interest at 7% per annum, compounded daily, matures 24 months after issuance on August 28, 2028, and includes a monitoring fee provision after 90 days (which automatically increases the Outstanding Balance by approximately 17.65%). The Note is secured by a first-priority security interest in all of the Company's assets and intellectual property pursuant to a Security Agreement and an Intellectual Property Security Agreement, each dated as of August 28, 2026. In addition, the Company's subsidiary, OW Cyber, LLC ("OW Cyber"), unconditionally guaranteed the Company's obligations under the Note and Purchase Agreement pursuant to a Guaranty dated as of August 28, 2026 (the "Guaranty").

The Purchase Agreement contains customary representations, warranties, and covenants, including requirements for timely SEC reporting, maintenance of listing on a national exchange, restrictions on variable-rate or other restricted securities issuances without the Investor's consent, a most-favored-nation clause, and a 10% participation right for the Investor in future debt or equity financings. The Note provides the Investor with monthly redemption rights of up to $150,000 beginning six months after issuance.

The foregoing description is qualified in its entirety by reference to the full text of the Purchase Agreement, the Note, the Security Agreement, the Intellectual Property Security Agreement, and the Guaranty, copies of which are attached hereto as Exhibits 10.1, 10.2, 10.3, 10.4, and 10.5, respectively, and incorporated herein by reference.

Item 2.01 Completion of Acquisition or Disposition of Assets.

As previously disclosed in the Current Report on Form 8-K filed by Intrusion Inc. (the "Company") with the Securities and Exchange Commission (the "SEC") on June 30, 2026, the Company entered into a Membership Interest Purchase Agreement, dated as of June 29, 2026 (the "MIPA"), by and among the Company, OW Cyber LLC ("Target"), and VigilAigent Corp. ("Seller"), the sole member of Target, pursuant to which the Company agreed to acquire 100% of the membership interests of Target from Seller in two distinct closings.

Effective June 29, 2026, the Company consummated the First Closing under the MIPA, acquiring 60% of Target's membership interests. Pursuant to Section 2.07 of the MIPA, the obligations of the parties to consummate the Second Closing-for the acquisition of the remaining 40% of Target's membership interests in exchange for a cash payment of $1,300,000-were subject to specified closing conditions, including obtaining the required stockholder and Nasdaq approvals for the issuance of shares of Common Stock in excess of 19.9% of the Company's outstanding common stock under applicable Nasdaq rules.

On August 27, 2026, at the Company's 2026 Annual Meeting of Stockholders described under Item 5.07 below, the Company's stockholders approved Proposal Three (Approval under Nasdaq Rules of the VigilAigent Transaction Framework & Equity Issuances), satisfying the stockholder approval closing condition set forth in Section 2.07(b)(i) of the MIPA.

Following the receipt of such stockholder approval and the satisfaction or waiver of all other closing conditions set forth in Section 2.07 of the MIPA, on August 28, 2026, the Company consummated the Second Closing pursuant to the terms and conditions of the MIPA. At the Second Closing, the Company acquired the remaining 40% of Target's membership interests from Seller in exchange for the Second Closing Payment of $1,300,000 in cash, which was funded using the net proceeds from the Streeterville Capital financing described in Item 1.01 above. Following the Second Closing, the Target became a 100% wholly-owned direct subsidiary of the Company.