SCHEDULE: Hawkeye Systems: Major Stakeholder Discloses Significant Convertible Note Holding

Hawkeye Systems, Inc. has filed a Schedule 13D revealing that Hawkeye Holdco LLC, managed by MCIMAC, LLC and Martin Sumichrast, beneficially owns approximately 69.1% of the company's outstanding common stock through a convertible promissory note.

Summary

• Hawkeye Holdco LLC, along with its manager MCIMAC, LLC and its manager Martin Sumichrast, have collectively filed a Schedule 13D, indicating beneficial ownership of 23,064,633 shares of Hawkeye Systems, Inc. common stock.
• This significant stake, representing 69.1% of the outstanding shares as of April 1, 2026, is derived from a convertible promissory note with an initial principal amount of $2,767,756.
• The convertible note was issued on April 1, 2026, in exchange for a previously existing note held by Steve Hall, which Hawkeye Holdco LLC had purchased.
• The note has a maturity date of 24 months from issuance and can be converted into common stock at an initial conversion price of $0.12 per share, subject to adjustments.
• An Investor Rights Agreement was also entered into, requiring the company to file a registration statement for the resale of these shares within 30 days of a request and to use reasonable efforts to have it declared effective within 75 days.
• Furthermore, the agreement mandates an increase in the company's Board of Directors from one to five members, with four directors to be designated by Hawkeye Holdco LLC.
• Martin Sumichrast, Sim Farar, Nathan Bradley Fleisher, and Ralph Olson are conditionally appointed as directors, effective ten days after a Schedule 14f-1 filing.
• David Wachsman has been appointed President and Quinton Byron Hamlet as CFO, effective April 1, 2026.

Sentiment

Score: 5

Explanation: StockSavvy.ai views this filing as neutral to slightly positive. While the significant ownership stake and board control are positive indicators of investor commitment, the prior legal issues of Martin Sumichrast and the contingent repurchase right introduce elements of risk and uncertainty.

Positives

• Significant stake acquired by Hawkeye Holdco LLC, potentially indicating strong investor confidence.
• Conversion of a convertible note provides a pathway for substantial equity ownership.
• Investor Rights Agreement ensures registration of resale shares, facilitating liquidity for the holder.
• Expansion of the Board of Directors to five members, with four designated by the significant stakeholder, suggests a move towards enhanced governance and representation.
• Appointment of new President and CFO indicates potential for strategic and operational improvements.

Negatives

• The reporting persons may be deemed to have sole voting and dispositive power over 69.1% of the company's stock, which could lead to concentrated control.
• Martin Sumichrast was subject to a permanent injunction and agreed to pay $350,000 in disgorgement, interest, and penalties related to violations of the Investment Advisers Act of 1940, as per a judgment on April 29, 2024.
• A repurchase right exists for Steve Hall if the company does not secure at least $1.0 million in gross proceeds from a Subsequent Financing within two years of issuance, or if the OTC Market Group Inc. places a 'caveat emptor' designation on the securities.

Risks

• The repurchase right held by Steve Hall poses a risk if the company fails to secure adequate subsequent financing or faces regulatory scrutiny.
• Concentrated ownership and control by Hawkeye Holdco LLC could lead to potential conflicts of interest or influence over corporate decisions.
• The prior legal proceedings involving Martin Sumichrast may raise concerns about his suitability or the company's governance practices.

Future Outlook

The company has agreed to file a registration statement for the resale of registrable securities within 30 days of a request and to have it declared effective within 75 days. The company's Board of Directors is set to expand significantly, with four new members designated by the major stakeholder. New leadership in the President and CFO roles has also been appointed.

Management Comments

• The shares listed above represent 23,064,633 shares of common stock that may become issuable upon conversion of a convertible promissory note (the "Note") held by Hawkeye Holdco LLC ("HH").
• As MCIMAC, LLC ("MCIMAC") serves as manager of HH and Martin Sumichrast ("Mr. Sumichrast") serves as manager of MCIMAC, each of MCIMAC and Mr. Sumichrast may be deemed to have sole voting and dispositive power over the shares of common stock underlying the Note and are deemed to be the beneficial owners of the shares of common stock underlying the Note.
• To the extent the actions described herein may be deemed to constitute a "control purpose" with respect to the Securities Exchange Act of 1934, as amended, and the regulations thereunder, the Reporting Persons have such a purpose.
• Depending on various factors including, without limitation, the Issuer's financial position and investment strategy, the price levels of the Common Stock, conditions in the securities markets and general economic and industry conditions, the Reporting Persons may in the future take such actions with respect to their investment in the Issuer as they deem appropriate including, without limitation, engaging in communications with management and the Board, engaging in discussions with stockholders of the Issuer or other third parties about the Issuer and the Reporting Persons' investment, including potential business combinations or dispositions involving the Issuer or certain of its businesses, making recommendations or proposals to the Issuer concerning changes to the capitalization of the Issuer, ownership structure, organizational documents, Board structure (including Board composition), potential business combinations or dispositions involving the Issuer or certain of its businesses, or suggestions for improving the Issuer's financial and/or operational performance, purchasing additional shares securities of the Issuer, and/or selling some or all of the Reporting Persons' securities in the Issuer.

Industry Context

StockSavvy.ai notes that the significant stake disclosed via a convertible note and the subsequent Investor Rights Agreement are common strategies for investors seeking to gain substantial influence or control in smaller public companies, particularly those trading on over-the-counter markets. The expansion of the board and appointment of new executives suggest a potential shift in the company's strategic direction or operational focus.

Management Changes

Corporate Governance

Legal Proceedings

• On April 29, 2024, a final judgment was entered in Securities and Exchange Commission v. Martin Sumichrast, permanently restraining and enjoining Mr. Sumichrast from violating Sections 206(2) and 206(3) of the Investment Advisers Act of 1940. Mr. Sumichrast agreed to pay $350,000 in disgorgement, prejudgment interest, and penalties.

Related Party Transactions

• Hawkeye Holdco LLC purchased an existing note from Steve Hall, which was then amended and restated by the Issuer into the current Convertible Promissory Note.
• Steve Hall retains a repurchase right on the Convertible Promissory Note (or shares issued upon conversion) under specific conditions related to subsequent financing or regulatory designations.

Stakeholder Impact

• Shareholders: Increased potential for board representation and influence by a major stakeholder. The registration of resale shares could lead to increased trading volume. The prior legal issues of Mr. Sumichrast may impact investor sentiment.
• Creditors: The contingent repurchase right held by Steve Hall could impact the company's financial obligations if triggered.
• Management/Employees: New leadership in President and CFO roles, along with board changes, may signal a shift in company strategy or operations.

Next Steps

• Hawkeye Holdco LLC may request the filing of a registration statement for the resale of its shares.
• The company is expected to complete the appointment of four new directors to its Board.
• The new President and CFO will assume their roles.
• The reporting persons may engage in further communications with management, the Board, or other stockholders regarding the company's strategy, capitalization, or operations.

Key Dates

Recommendation

The filing indicates a significant shift in control and governance with Hawkeye Holdco LLC's substantial stake and board appointments. However, the prior legal entanglements of Martin Sumichrast and the contingent repurchase right introduce considerable uncertainty. While the increased representation and potential for strategic direction are positive, the risks associated with concentrated control and past regulatory issues warrant a cautious 'hold' stance until further clarity on the company's future strategy and operational performance emerges.

Keywords

Schedule 13D, Hawkeye Systems, Convertible Promissory Note, Beneficial Ownership, Martin Sumichrast, Hawkeye Holdco LLC, MCIMAC, LLC, Common Stock, Investor Rights Agreement, Board of Directors, SEC Filing