SDR Drone Files 8-K Restating 2024 and 2025 Financials

What happened

SDR Drone, Inc. (ticker HLLK), a Florida corporation headquartered in North Palm Beach, filed a Form 8-K with the Securities and Exchange Commission on September 9, 2026, under Item 4.02, the item reserved for telling investors that previously issued financial statements should no longer be relied upon.

According to the filing, misstatements were found in the accounting for convertible notes payable, accrued interest, derivative liabilities, and related equity and income-statement items. The errors made restated results for the year ended December 31, 2024, worse by $826,206, and the year ended December 31, 2025, worse by $1,569,224.

The company had already restated those years before this 8-K was filed — the 2024 figures appeared as comparatives in the 10-K filed April 28, 2026, and the full restatement for both years appeared in a Form 10-K/A filed May 28, 2026. The 8-K says the company did not file the required Item 4.02 report within four business days of the April 27 and May 27, 2026 non-reliance determinations, and that this filing is being made to report those determinations.

What the filing says was wrong

For fiscal 2025, the largest single correction concerned the treatment of derivative liabilities tied to convertible debt. When convertible debt was converted, the change in fair value of the related derivative liability had been recorded as an income-statement item; the correction moved $1,433,682 out of that line and increased additional paid-in capital by $1,519,614, treating the change as a capital transaction instead. A separate redetermination of derivative liabilities raised debt discount, loss on issuance of convertible debt, and amortization of debt discount by smaller amounts. A July 8, 2025 convertible note was found to be understated by $25,000 of principal plus $1,138 of accrued interest.

For fiscal 2024, the filing lists seven corrections, including revenue of $555,195 recognized before the performance criteria in ASC Topic 606 were met, a $105,326 note receivable written down to zero, $52,355 of cash recorded as an asset that the company says belonged to a related party, and two period-end cutoff errors that left interest and vendor obligations unaccrued.

Restated basic and diluted net loss per share for 2024 was $(0.56). The filing states the corrections had no effect on periods before 2024, and that the 2024 statements also reflect the company's former Jubilee Intel, LLC operations as a discontinued operation and a retroactive 1-for-500 reverse stock split, neither of which the filing describes as an error correction.

What this means

A Form 8-K is the filing a US public company must make to report material events between quarterly and annual reports. Item 4.02 is the specific line item that says previously issued financial statements, or an audit report covering them, can no longer be trusted. Once a company files it, investors and analysts are expected to stop using the old numbers.

Restating means redoing and reissuing financial statements because errors were found. Here, the audit reports came from two different firms: Olayinka Oyebola & Co. signed off on the originally filed 2024 statements, and Integritat CPA signed the 2025 report and a reissued 2024 report. The Integritat report is dual-dated — April 27, 2026 for most matters and May 27, 2026 for the notes affected by the later findings — which is how an auditor signals it did more work after its original sign-off date.

The instruments at the center of this are convertible notes, which are loans that can be exchanged for stock, and derivative liabilities, which are the accounting counterpart when a conversion feature has to be valued separately. Small companies with limited accounting staff frequently report material weaknesses in these areas.

The filing names three material weaknesses: no accounting staff able to separate duties or handle complex transactions, no independent audit committee, and no completed internal control assessment. The company says it formed an Audit Committee in June 2026, and that the committee intends to recommend fixes to the board in the fourth quarter of 2026.

The stock closed at $1.75 on the day of the filing, unchanged from the prior close, according to the price data.

What the company does

SDR Drone, Inc. is an aircraft-related company incorporated in Florida, headquartered in North Palm Beach, and listed on SEC Form 8-K with an IRS identification number and commission file number, but the filing lists no exchange or trading symbol under Section 12(b). The filing does not describe the company's business further.