This Placement Agency Agreement (this Agreement) is made and entered into as of February 7, 2005 (the Effective Date), by and between Intrusion Inc., a Delaware corporation (the Company), and Stonegate Securities, Inc., a Texas corporation (Stonegate).

WHEREAS, the Company desires to retain Stonegate as its non-exclusive placement agent, and Stonegate is willing to act in such capacity, in each case subject to the terms and conditions of this Agreement.

NOW, THEREFORE, in consideration of the premises and the mutual covenants herein contained, the Company and Stonegate (each a Party and collectively, the Parties) hereby agree as follows:

1. RETENTION OF STONEGATE; SCOPE OF SERVICES.

(a) Subject to the terms and conditions set forth herein, the Company hereby retains Stonegate to act as the non-exclusive placement agent to the Company during the Contract Period (as defined in Section 2 below), and Stonegate hereby agrees to be so retained.

(b) As the non-exclusive placement agent to the Company, Stonegate will have the non-exclusive right during the Contract Period to identify for the Company prospective accredited investors, as such term is defined in Rule 501 of the Securities Act of 1933, as amended (the Securities Act) (such accredited investors being collectively, the Purchasers and each, individually, a Purchaser), in one or more placement (each, a Placement and collectively, the Placements) of equity securities to be issued by the Company, the type and dollar amount being as mutually agreed to by the Parties (the Securities).

(c) Terms of the Placements shall be as set forth in subscription documents, including any stock purchase or subscription agreement, escrow agreement, registration rights agreement, warrant agreement and/or other documents to be executed and delivered in connection with each Placement (collectively, the Subscription Documents). The Placements are intended to be exempt from the registration requirements of the Securities Act of 1933, as amended (the Securities Act), pursuant to Regulation D (Regulation D) of the rules and regulations of the Securities and Exchange Commission (the SEC) promulgated under the Securities Act.

(d) Stonegate will act on a best efforts basis and will have no obligation to purchase any of the Securities offered in any Placement. During the Contract Period, Stonegate shall have the non-exclusive right to arrange for all sales of Securities in the Placements, including without limitation the exclusive right to identify potential buyers for the Securities. All Purchasers and sales of Securities in the Placements

shall be subject to the approval of the Company, which approval may be withheld, in whole or in part, in the Companys sole discretion.

2. CONTRACT PERIOD AND TERMINATION.

(a) Stonegate shall act as the Companys non-exclusive placement agent under this Agreement for a period commencing on the Effective Date, and continuing until terminated by either Party upon 10 days notice to the other Party (the Contract Period).

(b) Upon termination, neither party will have any further obligation under this Agreement, except as provided in Sections 5, 6, 7, 8, 9 and 10 hereof.

3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.

The company represents and warrants that it has full power and authority to enter into this Agreement and to perform its obligations hereunder. This Agreement is enforceable against the Company in accordance with its terms, subject to applicable laws governing bankruptcy, insolvency and creditors rights generally. The Agreement does not conflict with, violate, cause a default, right of termination, or acceleration (whether through the passage of time or otherwise) under any contract, agreement, or understanding binding upon the Company or any subsidiary of the Company.

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