# EDGAR Filing Document

**Accession Number:** 0000736012
**File Stem:** 0001683168-23-001336
**Filing Date:** 2023-3
**Character Count:** 18642
**Document Hash:** 3a0d91268128a3710b37fb2aa861548e
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001683168-23-001336.hdr.sgml**: 20230306

**ACCESSION NUMBER**: 0001683168-23-001336

**CONFORMED SUBMISSION TYPE**: 8-K

**PUBLIC DOCUMENT COUNT**: 14

**CONFORMED PERIOD OF REPORT**: 20230306

**ITEM INFORMATION**: Results of Operations and Financial Condition

**ITEM INFORMATION**: Other Events

**ITEM INFORMATION**: Financial Statements and Exhibits

**FILED AS OF DATE**: 20230306

**DATE AS OF CHANGE**: 20230306

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** INTRUSION INC
- **CENTRAL INDEX KEY:** 0000736012
- **STANDARD INDUSTRIAL CLASSIFICATION:** COMPUTER COMMUNICATIONS EQUIPMENT [3576]
- **IRS NUMBER:** 751911917
- **STATE OF INCORPORATION:** DE
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 8-K
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-39608
- **FILM NUMBER:** 23709651

**BUSINESS ADDRESS:**
- **STREET 1:** 101 EAST PARK BLVD, SUITE 1200
- **CITY:** PLANO
- **STATE:** TX
- **ZIP:** 75074
- **BUSINESS PHONE:** 9722346400

**MAIL ADDRESS:**
- **STREET 1:** 101 EAST PARK BLVD, SUITE 1200
- **CITY:** PLANO
- **STATE:** TX
- **ZIP:** 75074

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** INTRUSION COM INC
- **DATE OF NAME CHANGE:** 20000601

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** ODS NETWORKS INC
- **DATE OF NAME CHANGE:** 19970507

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** OPTICAL DATA SYSTEMS INC
- **DATE OF NAME CHANGE:** 19950517

?xml version="1.0" encoding="utf-8"?

**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): **March 6, 2023**

**INTRUSION INC.**

(Exact Name of Registrant as Specified in Its Charter)

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| | | |
|:---|:---|:---|
| **Delaware** | **001-39608** | **75-1911917** |
| (State or Other Jurisdiction<br> of Incorporation) | (Commission File<br> Number) | (IRS Employer<br> Identification No.) |

---

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| | |
|:---|:---|
| **101 East Park Blvd, Suite 1200<br> Plano, Texas** | **75074** |
| (Address of Principal Executive Offices) | (Zip Code) |

---

(888) 637-7770

(Registrant's Telephone Number, Including Area Code)

**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:

&nbsp;&nbsp;&nbsp;&nbsp;□ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

&nbsp;&nbsp;&nbsp;&nbsp;□ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

&nbsp;&nbsp;&nbsp;&nbsp;□ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

&nbsp;&nbsp;&nbsp;&nbsp;□ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

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| | | |
|:---|:---|:---|
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
| Common Stock, $0.01 par value per share | INTZ | NASDAQ Capital Market |

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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 or Rule 12b-2 of the Securities Exchange Act of 1934.

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

**ITEM 2.02. RESULTS OF OPERATIONS AND FINANCIAL CONDITION**

The following information is furnished pursuant to Item 2.02, Disclosure of Results of Operations and Financial Condition.

On March 6, 2023, Intrusion Inc. (the "Company") issued a press release announcing its financial results for the year ended December 31, 2022. A copy of the press release is attached as Exhibit 99.1 hereto and incorporated herein by reference.

**ITEM 8.01. OTHER ITEMS**

The Company recorded in the fourth quarter of 2022 revenue of $1.4 million, gross profit margin of 63%, operating expense of $5.4 million and net loss of ($5.2) million, or net loss per share of $(0.25).

Also, as of December 31, 2022, the Company had cash and cash equivalents of $3.0 million. The company estimates it will require between $15 to $20 million in 2023 to fund its growth plan and financial commitments and that it will require a portion of those funds within the next 30 days. Although there can be no assurances that the Company will be able to raise such funds on a timely basis or on satisfactory terms, the Company is actively evaluating its financing options. The Company expects to obtain at least a portion of its 2023 financing needs through sales of its common stock in registered direct offerings and the use of its At-The-Market program.

*Cautionary Statement Regarding Forward-Looking Information*

 

This current report on Form 8-K contains certain forward-looking statements, including, without limitation, statements regarding the Company's expected capital requirements and ability to obtain additional financing, which statements reflect management's expectations regarding future events and operating performance. These forward-looking statements speak only as of the date hereof. These statements are made under the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995 and involve risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements, including, the risk that any financing efforts fail to provide the needed capital for the Company to execute its current business strategies, the Company being unable to achieve the anticipated results from its current sales, marketing, operational, and product development initiatives, as well as risks that we have detailed in the Company's most recent reports on Form 10-K and Form 10-Q, particularly under the heading "Risk Factors."

**ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Exhibits

99.1 [Press Release Issued by Intrusion Inc. on March 6, 2023](intrusion_ex9901.htm) <br> 104 Cover Page Interactive Data File (embedded within the Inline XBRL document)

**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.

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| | | |
|:---|:---|:---|
|  | **INTRUSION INC.** | **INTRUSION INC.** |
| Dated: March 6, 2023 | By: | /s/ Kimberley Pinson |
|  |  | Kimberly Pinson |
|  |  | Chief Financial Officer |

---

## Exhibit 99.1

**Exhibit 99.1**

**Intrusion, Inc. Reports Fourth Quarter and Full Year 2022 Results**

*Intrusion Shield Gains Traction Year over Year*

 

**PLANO, Texas, March 6, 2023 (GLOBE NEWSWIRE)** -- Intrusion Inc. (NASDAQ: INTZ), a leader in cyberattack prevention solutions, announced today financial results for the fourth quarter and full year ended December 31, 2022.

**Recent Financial & Business Highlights:**

&nbsp;&nbsp;&nbsp;&nbsp;· Fourth quarter revenue of $1.4 million was down $0.2 million, or 12%, year-over-year.

&nbsp;&nbsp;&nbsp;&nbsp;· Full year 2022 revenue of $7.5 million was up $0.3 million, or 3%, year-over-year.

&nbsp;&nbsp;&nbsp;&nbsp;· **Intrusion Shield** revenues for the fourth quarter totaled $0.3 million, representing 22% of total
revenues.

&nbsp;&nbsp;&nbsp;&nbsp;· **Intrusion Shield** revenues for the full year 2022 totaled $1.2 million, representing 16% of total
revenues.

"Intrusion improved its overall financial performance on nearly every standard financial metric during fiscal year 2022, capping an important year where we made progress along our financial, operational, and strategic objectives," said Tony Scott, CEO of Intrusion. "Our top line fourth quarter results were not as we expected, primarily due to the loss of a single consulting contract in the fourth quarter. Fortunately, this contract carried a lower margin profile and the impact on our bottom line was not as pronounced. Shield revenues for the fourth quarter were $0.3 million, which was flat sequentially and up compared to the fourth quarter of 2021. This was disappointing, but understandable when taken in the context of the broader macroeconomic landscape. The demand remains strong for both the Shield On-Premise and the new products with several potential large deals in the pipeline."

Mr. Scott continued, "We exited 2022 with positive momentum having rounded out the management team, enhanced the product branding and messaging, increased the stability and performance of the Shield appliance, and launched new products. The majority of the overhang that existed when I first joined the Company has been resolved and we are moving forward with a clear path forward to achieve our objectives."

**Fourth Quarter Financial Results**

Revenue for the fourth quarter of 2022 was $1.4 million, a decrease of $0.7 million sequentially and $0.2 million compared with the fourth quarter of the prior year.

The gross profit margin was 63% for the fourth quarter of 2022, compared to 50% in the fourth quarter of 2021.

Operating expenses in the fourth quarter of 2022 were $5.4 million, an increase from $4.7 million in the comparable quarter of last year.

The net loss for the fourth quarter of 2022 was ($5.2) million, or ($0.25) per share, compared to a loss of ($3.8) million, or ($0.20) per share for the fourth quarter of 2021.

**Full Year 2022 Financial Results**

Revenue was $7.5 million for the full year ended December 31, 2022, an increase of $0.3 million compared to 2021.

The gross profit margin was 55% for the full year ended December 31, 2022, compared to 50% in 2021.

Operating expenses were $20.5 million in the full year ended December 31, 2022, a decrease from $23.2 million in 2021.

The net loss was ($16.2) million, or ($0.82) per share, for the full year ended December 31, 2022, compared to a loss of ($18.8) million, or ($1.05) per share in 2021.

As of December 31, 2022, cash and cash equivalents were $3.0 million, down from $4.1 million on December 31, 2021. Subsequent to year end, the company amended the debt agreement with Streeterville whereby Streeterville agreed to waive their right to principal redemptions through March 31st. Additionally, in February, the company entered into a note purchase agreement with Streeterville in the amount of $1.4 million and a related security agreement whereby Intrusion granted a security interest in the employee retention tax credits due to the company under the Cares Act. Both the amendment to the existing agreement and the new note purchase agreement were entered into in order to provide a longer runway to secure financing on terms acceptable to the company. The company estimates it will require between $15 to $20 million in 2023 to fund its growth plan and financial commitments and that it will require a portion of those funds within the next 30 days. Although there can be no assurances that the company will be able to raise such funds on a timely basis or on satisfactory terms, the company is actively evaluating its financing options. Intrusion expects to obtain at least a portion of its 2023 financing needs through sales of its common stock in registered direct offerings and the use of its At-The-Market program.

**Conference Call** 

Intrusion's management will host a conference call today at 4:00 P.M., CST. Interested investors can access the live call by dialing 1-888-330-2041, or 1-646-960-0151 for international callers, and providing the following access code: 6774917. The call will also be webcast live LINK. For those unable to participate in the live conference call, a replay will be accessible beginning tonight at 7:00 P.M. CST until March 13, 2023, by dialing 1-800-770-2030, or 1-647-362-9199 for international callers, and entering the following access code: 6774917. Additionally, a live and archived audio webcast of the conference call will be available at www.intrusion.com.

**About Intrusion Inc.** 

Intrusion, Inc. is a cybersecurity company based in Plano, Texas. The Company offers its customers access to its exclusive threat intelligence database containing the historical data, known associations, and reputational behavior of over 8.5 billion IP addresses. After years of gathering global internet intelligence and working exclusively with government entities, the company released its first commercial product in 2021. **Intrusion Shield** is designed to allow businesses to incorporate a Zero Trust, reputation-based security solution into their existing infrastructure. **Intrusion Shield** observes traffic flow and instantly blocks known malicious or unknown connections from both entering or exiting a network to help protect against Zero-Day and ransomware attacks. Incorporating **Intrusion Shield** into a network can elevate an organization's overall security posture by enhancing the performance and decision-making of other solutions in its cybersecurity architecture.

**Cautionary Statement Regarding Forward-Looking Information** 

This release may contain certain forward-looking statements, including, without limitation, our expectations for positive results from our recent sales, marketing, and strategic initiatives, our ability to close anticipated commercial transactions, our expected capital requirements and our financing expectations, which statements reflect management's expectations regarding future events and operating performance. These forward-looking statements speak only as of the date hereof. These statements are made under the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995 and involve risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements, including, the risk that any financing fails to provide the needed capital for the Company to execute its current business strategies, the Company does not achieve the anticipated results from its current sales, marketing, operational, and product development initiatives, as well as risks that we have detailed in the Company's most recent reports on Form 10-K and Form 10-Q, particularly under the heading "Risk Factors."

**IR Contact:** 

Alpha IR Group

Mike Cummings or Sam Cohen

INTZ@alpha-ir.com

**Media Contact:**<br> LaunchTech Communications<br> Sara Knott<br> sknott@golaunchtech.com<br> 540-764-0043

Source: Intrusion, Inc.

**INTRUSION INC. AND SUBSIDIARIES<br> CONSOLIDATED STATEMENTS OF OPERATIONS<br> (In thousands, except per share amounts)**

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three Months Ended** | **Three Months Ended** | **Twelve Months Ended** | **Twelve Months Ended** |
|  | **December 31, 2022** | **December 31, 2021** | **December 31, 2022** | **December 31, 2021** |
| Revenue | $1444 | $1645 | $7529 | $7277 |
| Cost of Revenue | 540 | 826 | 3354 | 3621 |
| Gross Profit | 904 | 819 | 4175 | 3656 |
| Operating Expenses: |  |  |  |  |
| &nbsp;&nbsp;Sales and marketing | 2025 | 1559 | 6510 | 10935 |
| &nbsp;&nbsp;Research and development | 1873 | 1467 | 6465 | 6328 |
| &nbsp;&nbsp;General and administrative | 1522 | 1634 | 7483 | 5896 |
| Operating Loss | (4516) | (3841) | (16283) | (19503) |
| Interest and Other Income | 24 |  | 2028 | 722 |
| Interest Expense | (702) | (11) | (2359) | (21) |
| Gain on Lease Termination | – | – | 385 | – |
| Net Loss | $(5194) | $(3852) | $(16229) | $(18802) |
| Net loss per share: |  |  |  |  |
| Basic | $(0.25) | $(0.20) | $(0.82) | $(1.05) |
| Diluted | $(0.25) | $(0.20) | $(0.82) | $(1.05) |
| Weighted average common shares outstanding: |  |  |  |  |
| Basic | 20854 | 18885 | 19791 | 17992 |
| Diluted | 20854 | 18885 | 19791 | 17992 |

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**INTRUSION INC. AND SUBSIDIARIES**

**CONSOLIDATED BALANCE SHEETS**

**(In thousands, except par value amounts)**

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| | | |
|:---|:---|:---|
|  | **December 31,**<br> **2022** | **December 31,<br> 2021** |
| **ASSETS** |  |  |
| Current Assets: |  |  |
| &nbsp;&nbsp;Cash and cash equivalents | $3015 | $4100 |
| &nbsp;&nbsp;Accounts receivable | 530 | 1034 |
| &nbsp;&nbsp;Prepaid expenses and other assets | 1877 | 356 |
| Total current assets | 5422 | 5490 |
| Noncurrent Assets: |  |  |
| &nbsp;&nbsp;Property and equipment: |  |  |
| &nbsp;&nbsp;Equipment | 2865 | 2517 |
| &nbsp;&nbsp;Capitalized software development | 1380 |  |
| &nbsp;&nbsp;Furniture and fixtures | 43 | 43 |
| &nbsp;&nbsp;Leasehold improvements | 78 | 67 |
| Property and equipment, gross | 4366 | 2627 |
| &nbsp;&nbsp;Accumulated depreciation and amortization | (2208) | (1567) |
| &nbsp;&nbsp;Property and equipment, net | 2158 | 1060 |
| &nbsp;&nbsp;Finance leases, right-of-use assets, net | 1048 | 1709 |
| &nbsp;&nbsp;Operating leases, right-of-use assets, net | 504 | 808 |
| &nbsp;&nbsp;Other assets | 143 | 166 |
| Total noncurrent assets | 3853 | 3743 |
| **TOTAL ASSETS** | $9275 | $9233 |
| **LIABILITIES AND STOCKHOLDERS' EQUITY** |  |  |
| Current Liabilities: |  |  |
| &nbsp;&nbsp;Accounts payable, trade | $1273 | $718 |
| &nbsp;&nbsp;Accrued expenses | 446 | 534 |
| &nbsp;&nbsp;Finance lease liabilities, current portion | 667 | 644 |
| &nbsp;&nbsp;Operating lease liabilities, current portion | 294 | 935 |
| &nbsp;&nbsp;Notes payable | 10114 |  |
| &nbsp;&nbsp;Deferred revenue | 455 | 560 |
| Total current liabilities | 13249 | 3391 |
| Noncurrent Liabilities: |  |  |
| &nbsp;&nbsp;&nbsp;Finance lease liabilities, noncurrent portion | 10 | 673 |
| &nbsp;&nbsp;&nbsp;Operating lease liabilities, noncurrent portion | 231 | 1250 |
| Total noncurrent liabilities | 241 | 1923 |
| Commitments and Contingencies |  |  |
| Stockholders' Equity: |  |  |
| &nbsp;&nbsp;Common stock $0.01 par value: Authorized shares – 80,000; Issued shares – 21,198 in 2022 and 19,135 in 2021; Outstanding shares – 21,188 in 2022 and 19,125 in 2021 | 212 | 191 |
| &nbsp;&nbsp;Common stock held in treasury, at cost – 10 shares | (362) | (362) |
| &nbsp;&nbsp;Additional paid-in capital | 92304 | 84230 |
| &nbsp;&nbsp;Accumulated deficit | (96326) | (80097) |
| &nbsp;&nbsp;Accumulated other comprehensive loss | (43) | (43) |
| Total stockholders' equity | (4215) | 3919 |
| **TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY** | $9275 | $9233 |

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