INTRUSION INC

8. Common Stock

ATM Offering

In June 2025, the Company terminated its prior At Market Sales Agreement with B. Riley (“prior ATM program”) and entered into a new At the Market Offering Agreement with Wainwright (“Wainwright ATM program”). Under the ATM offering agreement the Company may offer and sell, from time to time, shares of its common stock having an aggregate offering price of up to $50.0 million pursuant to its shelf registration statement on Form S-3/A (File No. 333-281565) which was filed in January 2025 and declared effective in February 2025. Under the ATM offering agreement, Wainwright may sell shares of the Company’s common stock by any method permitted by law deemed to be an “at the market” offering as defined in Rule 415(a)(4) under the Securities Act of 1933, as amended and the Company will pay Wainwright a commission of up to 3.0% of the gross sales price of any shares sold under the program.

The Company filed a replacement shelf registration on Form S-3 in January 2025, with an effective date of February 2025, pursuant to which the Company can sell up to $50.0 million of its common stock. As of February 2025, the Company’s public float calculated in accordance with General Instruction I.B.1 of Form S-3, was $112.9 million based on 19,342,776 shares of common stock outstanding of which 17,861,513 shares are held by non-affiliates, and a per share price of $6.32 based on the average of the bid and asked prices of the Company’s common stock on the Nasdaq on December 30, 2024.

For the year ended December 31, 2025, the Company did not sell any shares of common stock or receive any proceeds under the Wainwright ATM program. For the year ended December 31, 2024, the Company received approximately $9.8 million in net proceeds from the sale of common stock under its prior ATM program.

Registered Direct Offering

In January 2025, the Company sold to a single institutional investor 653 thousand shares of the Company’s common stock at a purchase price of $3.05 per share and 1,806 thousand prefunded warrants to purchase up to 1,806 thousand shares of common stock at a purchase price of $3.0499 for net proceeds of $7.0 million. The prefunded warrants were exercisable immediately at an exercise price of $0.0001 per share subject to the purchaser not being deemed a beneficial owner of greater than 4.99%. All of the pre-funded warrants were exercised in January 2025.

SEPA

In July 2024, the Company entered into a $10 million SEPA with Streeterville pursuant to which the Company has the right, during the 24-month term of the agreement and subject to certain limitations and conditions, to direct Streeterville to purchase shares of the Company’s common stock.

Shares of common stock issued pursuant to SEPA are to be purchased at a price equal to 95% of the lowest volume weighted average price of the Company’s common stock on the Nasdaq Stock Market during the three consecutive trading days during regular trading hours, as reported by Bloomberg L.P., beginning on the date the Company delivers advance notice. The Company is required to use 10% of the proceeds from each advance to redeem outstanding shares of its Series A Preferred Stock held by Streeterville.

Upon execution of the SEPA, the Company issued 93 thousand shares of common stock to Streeterville as payment of a commitment fee equal to 1% of the $10 million commitment and Streeterville purchased 217 thousand shares of common stock at a price of $0.01 per share (the “pre-delivery shares”). Following the termination of the SEPA, Streeterville delivered returned the same number of pre- delivery shares to the Company, and the Company paid $0.01 per pre delivery share.

During the year ended December 31, 2024, pursuant to the SEPA, Streeterville purchased 1.2 million shares of the Company’s common stock resulting in aggregate net proceeds of $1.8 million, of which $0.1 million was received in 2024. The remaining proceeds were recorded as a stock subscription receivable in the consolidated balance sheet as of December 31, 2024, and were collected in January 2025. No sales of common stock pursuant to the SEPA were made during the year ended December 31, 2025.

During the years ended December 31, 2025 and 2024, the Company delivered a total of six advances under the SEPA. In accordance with the terms of SEPA, the Company used 10% of the gross proceeds from such advances to redeem an aggregate of $187 and $119 thousand in cash consideration of its Series A Preferred Stock held by Streeterville during the year ended December 31, 2025 and 2024.

Private Offerings

In April 2024, the Company sold to certain purchasers 1,348,569 shares of the Company’s common stock together with accompanying common stock purchase warrants to purchase 2,697,138 shares of common stock, at a purchase price of $1.95 per share, for net proceeds of approximately $2.6 million. The Common Stock Purchase Warrants will be exercisable at any time following the date of issuance, expire five years following the date of issuance, and have an exercise price of $1.70 per share. None of the shares of Common Stock and shares underlying the Common Stock Purchase Warrants have been registered under the Securities Act and do not carry registration rights.

Series A Preferred Stock

In March 2024, the Company filed the Amended and Restated Certificate of Incorporation (the “A&R Certificate”) to (i) eliminate the Series 1, Series 2, and Series 3 preferred shares and filed a Certificate of Designations creating a new Series A preferred stock, $0.01 par value per share (the “Series A Stock”). Pursuant to the terms of the Series A Certificate,20 thousand shares of Series A Stock are authorized, and each share of Series A Stock has a stated value of $1,100 and accrues a rate of return on the Stated Value of 10% per year, shall be compounded annually and is payable quarterly in cash or additional shares of Series A Stock.

In March 2024, the Company entered into an Exchange Agreement with Streeterville Capital pursuant to which $9.3 million in debt was exchanged for 9,275 shares of newly created Series A Preferred Stock.

During 2024, the Company exchanged an aggregate of 6 thousand shares of Series A Preferred Stock for 2.6 million shares of the Company’s common stock in nine separate transactions. During 2025, the Company exchanged an aggregate of 4 thousand shares of Series A Preferred Stock for 1.3 million shares of common stock in two transactions. All such transactions were made pursuant to the exemption from the registration under the Securities Act.

In September 2024, the Company redeemed 91 shares of Series A Preferred Stock in conjunction with entering into the Streeterville Note Payable described in Note 6. The Company also redeemed 170 and 17 shares of Series A Preferred Stock during 2025 and 2024, respectively, in conjunction with the sale of common stock under the SEPA described above.

For the years ended December 31, 2025 and 2024, the Company recognized $2 thousand and $782 thousand, respectively, in preferred returns through the issuance of 2 and 712 additional shares of Series A Preferred Stock, respectively.

Following the two exchanges in 2025, there wereno remaining shares of Series A preferred stock outstanding.

9. Common Stock Warrants

In April 2024, the Company’s Board of Directors approved entry into a warrant inducement offering that provided, during the period beginning on April 2, 2024 and continuing through April 23, 2024, for the lowering of the exercise price of all outstanding warrants and, for each share of common stock exercised under the warrants, providing the participating warrant holder with a new warrant for that same number of shares of common stock. The reduced exercise price of the warrants was $3.04. The newly issued warrant exercise price is $2.91 with an exercise period of five years. In April 2024, certain holders of the warrants exercised 186 thousand shares of the Company’s common stock resulting in gross proceeds of $0.6 million and the issuance of 186 thousand new warrants. The exercised warrants and newly issued warrants are equity classified. The issuance of the new Warrants was undertaken pursuant to the exemption from registration provided in Rule 506(b) under Regulation D pursuant to the Securities Act.

In November 2024, the Company’s Board of Directors approved entry into an inducement offering that provides, during the period beginning on November 21, 2024 and continuing through December 27, 2024, for the lowering of the exercise price of all outstanding warrants and, for each share of common stock exercised under the Warrants, providing the participating Warrant holder with a New Warrant for that same number of shares of common stock. The reduced exercise price of the Warrants was $0.76, which includes $0.13 per share that is attributable to the purchase price of the New Warrant. The New Warrant exercise price is $0.63 with an exercise period of five years. In December 2024, certain holders of the warrants exercised 369 thousand warrants for the purchase of common stock resulting in gross proceeds of $0.3 million and the issuance of 380 thousand New Warrants. The exercised warrants and newly issued warrants are equity classified.

On December 31, 2025, the Company had 3,198,083 warrants outstanding with a weighted average exercise price of $3.26 per share and average remaining term of 3.4 years.