UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
CURRENT REPORT
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Item 1.01 Entry into a Material Definitive Agreement.
As previously disclosed, Intrusion Inc. (the “Company”) had sold and issued to Streeterville Capital, LLC, a Utah limited liability company (“Streeterville”), certain promissory notes, dated March 10, 2022 (“Note #1”), and June 29, 2022 (“Note #2”) (collectively, the “Notes”), pursuant to a Securities Purchase Agreement, dated March 10, 2022 (the “Purchase Agreement”), between the Company and Streeterville (the Notes and Purchase Agreement collectively referred to as the “Transaction Documents”). A description of the Transaction Documents is set forth in the Company’s Current Report on Form 8-K filed March 10, 2022, and the Company’s Amendment to Current Report on Form 8-K filed June 8, 2022, with the Securities and Exchange Commission, and such description is incorporated herein by reference.
Also, as previously disclosed, on January 11, 2023, the Company and Streeterville entered into an amendment of the Transaction Documents (the “Amendment”). The principal purpose of the Amendment was to defer redemptions under the Transaction Documents for the period beginning on January 11, 2023, and through March 31, 2023, in exchange for an agreed-upon fee. The foregoing descriptions do not purport to be complete and are qualified in their entirety by reference to the Transaction Documents and the Amendment.
On August 2, 2023, the Company and Streeterville entered into a Forbearance and Standstill Agreement (the “Forbearance Agreement”) under which both parties agreed to extend the maturity date of each Note by 12 months. The maturity date of Note #1 is now September 10, 2024, and the maturity date of Note #2 is now December 29, 2024.
On August 7, 2023, the Company and Streeterville entered into an amendment to the Forbearance Agreement (“Forbearance Amendment”) under which Streeterville will not seek to redeem any portion of either Note for 180 days from the date on which the Company closes on the sale of common stock in a best-efforts public offering (“Qualified Public Offering”) registered under the Securities Act of 1933 for aggregate proceeds of not less than $5,000,000, so long as the Qualified Public Offering occurs on or before October 1, 2023 (the “Standstill”). If a Qualified Public Offering does not occur by October 1, 2023, the Standstill shall not take effect. Upon the expiration of the Standstill, redemption obligations under the Notes would resume, in addition to weekly cash payments to Streeterville in the amount of $50,000.00 due in the aggregate under the Notes via ACH withdrawal.
In consideration of the extension of the maturity dates and the Standstill, the Company entered into a Security Agreement (Exhibit A to the Forbearance Agreement) with Streeterville, dated August 2, 2023 (the “Security Agreement”), under which Streeterville was granted a first-position security interest in the property described in Schedule A to the Security Agreement (the “Collateral”), subject to dispositions in the ordinary course of such Collateral. The Collateral would include, among other properties and interests, all customer accounts, goods and equipment, inventory, accounts receivable, trademarks, inventions, contract rights, royalties, license rights, cash, deposit accounts, and all other assets, goods and personal property of the Company.
Copies of the Forbearance Agreement and Forbearance Amendment are attached hereto as Exhibits 10.1 and 10.2, respectively, and incorporated herein by reference. The foregoing description of the terms of the Forbearance Agreement and Forbearance Amendment are qualified in their entirety by reference to the full text of the Forbearance Agreement, the Forbearance Amendment, and the Exhibits thereto.
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Item 2.03 Creation of Direct Financial Obligation or an Obligation Under an Off-Balance Sheet Arrangement by a Registrant
The disclosure under Item 1.01 of this Current Report on Form 8-K is incorporated into this Item 2.03 by reference.
Item 3.02 Unregistered Sales of Equity Securities
The disclosure under Item 1.01 of this Current Report on Form 8-K is incorporated into this Item 3.02 by reference. The issuance of shares of Common Stock pursuant to the Notes, if any, will be made in reliance on the exemption provided by Section 4(a)(2) of the Securities Act for the offer and sale of securities not involving a public offering.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits
Exhibit No. Description
10.1 | |
10.2 | |
104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
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SIGNATURE
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.
INTRUSION INC. | ||
Dated: August 7, 2023 | By: | /s/ Kimberly Pinson |
Kimberly Pinson | ||
Chief Financial Officer |
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