Document:

Exhibit 10.59

 

STOCK PLEDGE AGREEMENT

 

This STOCK PLEDGE AGREEMENT (the “Agreement”)
is entered into by and between MEIER FAMILY HOLDING COMPANY, LLC, a Utah limited liability company (the “Pledgor”),
and SUPERIOR DRILLING PRODUCTS, INC. (previously known as SD Company, Inc.), a Utah corporation (the “Company”).

 

BACKGROUND

 

A.                
The Company is purchasing the Second Amended and Restated Promissory Note of TRONCO ENERGY CORPORATION (“Tronco”)
in favor of ACF PROPERTY MANAGEMENT, INC. (“Original Lender”), dated effective as of January 1, 2014
(“Tronco Loan”) from the Original Lender (“Loan Purchase”).

 

B.                
The collateral for the Tronco Loan includes the Guaranty Agreements (the “Guaranties”), each dated
June 15, 2009, from G. Troy Meier, Annette Deuel Meier, the Gilbert Troy Meier Trust, and the Annette Deuel Meier Trust, respectively
(collectively, the “Guarantors”).

 

C.                
 This Agreement is being entered into as additional Pledged Shares to secure the performance of the Guarantors under the
Guaranties after the Company’s purchase of the Tronco Loan from the Original Lender. 

 

AGREEMENT

 

For good and valuable consideration, the
receipt and sufficiency of which is acknowledged, the parties agree as follows:

 

1.                  “Pledged
Shares” means (a) the 5,641,510 Shares of the Company’s common stock owned by Pledgor, and (b) any shares
of stock (including, without limitation, any stock dividend or any distribution or exchange of stock in connection with the
reorganization, recapitalization, reclassification or increase or reduction of capital) to which Pledgor will become entitled
for any reason whatsoever as an addition to, in substitution for, or in exchange for, any of the Pledged Shares.

 

2.                 
Pledge. Effective as of the date that the Company purchases the Tronco Loan from the Original Lender (the “Effective
Date”), Pledgor hereby grants to the Company a security interest in the Pledged Shares, and their proceeds, to secure
performance and payment of all obligations and indebtedness of the Guarantors to the Company under the terms of the Guaranties,
with all of the rights of a secured party under the Uniform Commercial Code of Utah and any other applicable law.

 

3.                 
Escrow

 

3.1.           
Delivery; Release. Upon issuance of the Pledged Shares, the Company will direct its transfer agent to deliver the certificates
representing the Pledged Shares to the Escrow Agent signing below (the “Escrow Agent”) to hold in trust
for the benefit of the Company until all amounts owed under the Guaranties (“Indebtedness”) are paid
in full. Upon receipt of evidence that the Indebtedness has been paid in full, or if not paid in full, instructions from the Company
to release a specified portion of Pledged Shares, Escrow Agent will be authorized to release all or the remaining Pledged Shares
to Pledgor.

 

3.2.           
Escrow Agent.  The parties acknowledge and agree that the Escrow Agent serves as legal counsel for the Company
and is serving as Escrow Agent as a convenience to the parties, without additional fee, at their request, in order to facilitate
the closing of the Loan Purchase.  In the event of a dispute between the parties as to the Pledged Shares or otherwise in
connection with this Escrow Agreement, the Escrow Agent shall be permitted to assign all of its rights, duties and obligations
as provided in this Agreement to another law firm or bank located in Houston, Texas, and to represent the Company as legal counsel
to the extent requested by the Company in the resolution of any such dispute.  The Pledgor, by its execution and delivery
of this Agreement, hereby agrees with the foregoing and waives any conflict of interest that may otherwise be present in connection
with such future representation of the Company by the Escrow Agent.

 

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3.3.           
Successor Escrow Agents.  The Escrow Agent, or any successor escrow agent, may resign at any time by giving notice
in writing to each of the other parties, and shall be discharged from its duties under this Escrow Agreement on the first to occur
of (a) the appointment of a successor escrow agent as provided in this Section 3.3, or (b) the expiration of 30 calendar days after
such notice is given.  Any successor escrow agent shall deliver to each of the parties a written instrument accepting appointment
under this Escrow Agreement, and thereupon it shall succeed to all the rights and duties of the Escrow Agent hereunder and shall
be entitled to receive, in its capacity as escrow agent, possession of the Pledged Shares.  In such event, the Pledgor and
the Company shall deliver to the former Escrow Agent a release executed by each of them, releasing said Escrow Agent from its obligations
hereunder and any liabilities in connection herewith.

 

3.4.           
Indemnification.  In the event the Escrow Agent becomes involved in any suit, litigation or other investigative
or legal proceeding in connection with this Agreement, the Pledged Shares, or any matter relating hereto or thereto, the Pledgor
and the Company, jointly and severally, agree to indemnify and hold the Escrow Agent harmless from all loss, cost, damage, expense,
liability, fees and expenses (including attorneys' fees and expenses) suffered or incurred by the Escrow Agent as a result thereof,
except any such loss, cost, damage, expense, or liability that arises as a result of the Escrow Agent's gross negligence or willful
misconduct.

 

3.5.           
Acting on Notices.  The Escrow Agent shall be protected in acting on any written notice, request, waiver, consent,
certificate, receipt, authorization, power of attorney, or other paper or document that the Escrow Agent believes to be genuine. 

 

3.6.           
Standard of Care.  The Escrow Agent shall not be liable for anything that it may do or refrain from doing in connection
herewith, provided it acts in good faith and is not grossly negligent.

 

3.7.           
Consultation with Counsel.  The Escrow Agent may consult with legal counsel in the event of any dispute or question
as to the construction of any of the provisions of this Escrow Agreement or the Escrow Agent's duties hereunder, and it shall incur
no liability and shall be fully protected in acting in accordance with the opinion and instructions of such counsel.  The
Pledgor and the Company agree that each party shall jointly and severally be liable for any attorneys’ fees incurred by Escrow
Agent in connection with the foregoing, and in the vent of any dispute, the non-prevailing party as between the Pledgor and the
Company shall be liable for the payment of any attorney fees reasonably incurred by the Escrow Agent in connection with the foregoing.

 

3.8.           
Discharge of Obligations.  The Escrow Agent, upon (a) fully performing its duties under this Agreement, or (b)
interpleading the Pledged Shares, shall be discharged from any further obligation hereunder.

 

4.                 
Voting and Dividends. Pledgor will be entitled to vote the Pledged Shares and receive all dividends and distributions
declared or paid upon the Pledged Shares at all times, except as provided in this Agreement. Pledgor will not vote the Pledged
Shares for any corporate action which results in a merger, dissolution, liquidation, partial liquidation, distribution, transfer,
or assignment of its principal assets except as permitted in the Stock Purchase Agreement, or a corporate action which results
in a dilution of the Pledged Shares.

 

5.                 
Default; Remedies

 

5.1.           
If the Guarantors default under the terms of the Guaranties and fail to cure such default within 30 days of receiving
written notice of default from Company, the Company (a) will be entitled to direct the Escrow Agent to sell that amount of Pledged
Shares, on the Pledgor’s behalf, as necessary to repay the Tronco Loan in full, subject to all applicable holding periods
under Rule 144 of the Securities Act of 1933 and required black-out periods, (b) will be entitled to vote the Pledged Shares and
receive and retain, as payment of interest or principal on the Note, any and all dividends and any other distributions declared
or paid upon the Pledged Shares during such period, until such time as the Guarantors cure such default, and (c) may also exercise
all of the rights, powers and remedies of a secured party under the Uniform Commercial Code in force in the State of Utah at the
date of execution of this Agreement and any other applicable law.

 

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5.2.           
Subject to Section 5.1, upon the occurrence of an event of default under the Guaranties, and during the continuation
thereof, and at any time thereafter:

 

5.2.1.     
If notice to Pledgor is required by the Uniform Commercial Code of Utah of public or private sale of Pledged Shares, Company
may give written notice to Pledgor five days prior to the date of public sale of the Pledged Shares or prior to the date after
which private sale of the Pledged Shares. The Company may apply the proceeds of any disposition of the Pledged Shares to satisfaction
of the Indebtedness and the expenses of sale in any order of preference which Company, in its sole discretion, chooses. Pledgor
shall remain liable for any deficiency.

 

5.2.2.     
Pledgor irrevocably makes, constitutes, and appoints the Company its true and lawful attorney for it and in its name, place,
and stead to do any and every act and exercise any and every power that Pledgor might or could
do or exercise to fully, effectually, and finally carry out and comply with all of the terms and provisions of this Agreement,
to attend all meetings of the shareholders, and then and there to vote in its name, stead, and behalf any and all of the Pledged
Shares; and to make, execute, and enter into, in its stead and behalf as a shareholder in the Company, any and all consents, certificates,
or other documents, including those relating to a merger with other corporations, re-organizations, or other change in the corporate
structure. This proxy is coupled with an interest in that the Pledged Shares, and shall be and remain exclusive and irrevocable
so long as any Guarantor remains indebted to the Company under the Guaranties, and shall be binding upon the Pledgor and its administrators,
and assigns, as the case may be. The Company shall have full power of substitution hereunder, and any party designated by Company
as its substitute shall be entitled to exercise all powers herein granted with respect to any and all shares of stock mentioned
or referred to in the Agreement.

 

6.                 
Further Cooperation. Pledgor agrees that at any time and from time to time upon written request of the Lender, Pledgor
will execute and deliver such further documents and do such further acts as may reasonably be requested in order to effect the
purposes of this Pledge Agreement.

 

7.                 
General

 

7.1.           
Notices. The parties will deliver any notices provided under this Agreement in writing by personal or courier delivery,
facsimile transmission, or by registered or certified U.S. mail, return receipt requested, postage prepaid, to address set forth
next to the parties' signatures, or to such other address as specified by a party in writing. Notices will be deemed effective
as of the date of personal or courier delivery, confirmed facsimile transmission, or the date on the U.S. postmark affixed to the
notice.

 

7.2.           
Dispute Resolution. In the event of any disagreement involving the parties resulting in adverse claims or demands being
made in connection with the Pledged Shares, or in the event that the Escrow Agent, in good faith, shall be in doubt as to what
action it should take hereunder, the Escrow Agent may, at its option and in its sole discretion, (a) interplead the Pledged Shares
into a court of competent jurisdiction, and/or (b) refuse to take any other action hereunder, so long as such disagreement continues
or such doubt exists, and in such event, the Escrow Agent shall not be or become liable in any way or to any person for its failure
or refusal to act.  The Escrow Agent shall be entitled to continue to refrain from acting until (i) the rights of all interested
parties shall have been fully and finally adjudicated by a court of competent jurisdiction, or (ii) all differences shall have
been adjusted and all doubt resolved by agreement between the parties, and (iii) the Escrow Agent shall have been notified thereof
by a written document signed by the Pledgor and each of the Company.  Should a bill of interpleader be instituted, or should
the Escrow Agent become involved in litigation in any manner whatsoever on account of this Escrow Agreement or the terms or performance
hereof, the Pledgor and the Company hereby bind and obligate themselves, jointly and severally, and their respective heirs, executors,
administrators, successors, assigns and legal representatives, that the non-prevailing party as between the Pledgor and the Company
will pay the reasonable attorney fees incurred by the Escrow Agent, and any other disbursements, expenses, losses, costs, and damages
in connection with and resulting from such litigation.

 

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7.3             
Equitable Relief.  The parties acknowledge that the rights of the parties contained in this Agreement are unique, and that
money damages alone for breach of this Agreement would be inadequate. Any party aggrieved by a breach of the provisions of this
Agreement may bring an action at law or suit in equity for specific performance, injunctive relief or any other available equitable
remedy.

 

7.4             
Attorney Fees.  The substantially prevailing party in any mediation, arbitration, other dispute resolution proceeding,
or litigation, concerning this Agreement is entitled to reimbursement of its court costs and attorney fees by the non-prevailing
party, including such costs and fees as may be incurred on appeal or in a bankruptcy proceeding.

 

7.5             
General Provisions. This Agreement (a) cannot be assigned without the written consent of all parties, (b) will be enforced,
governed and construed exclusively under the laws of the State of Utah, and under the jurisdiction of and venue in any appropriate
court in Utah County, State of Utah, (c) benefits and is binding upon each of the parties and their respective heirs, estate, legal
representatives, successors and assigns, as appropriate, (d) will remain in full force and effect to the extent possible if any
portion of this Agreement is declared invalid by a court having jurisdiction, (e) constitutes the entire agreement of the parties,
and supercedes all previous agreements, written or oral, with regard to its subject matter, (f) may only be waived of modified,
in any respect, in writing and signed by all parties, and (g) may be executed in two or more counterparts, which together constitute
one and the same instrument.

 

 

Signatures are on the following page.

 

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SIGNATURE PAGE FOLLOWS

 

IN WITNESS WHEREOF, the parties hereto have
executed this Agreement as of the day and year first above written.

 

	COMPANY:	 	PLEDGOR:
	 	 	 	 	 
	SUPERIOR DRILLING PRODUCTS, INC.	 	MEIER FAMILY HOLDING COMPANY, LLC
	 	 	 
	 	 	 
	By:  	/s/ Christopher Cashion	 	By: 	/s/ Annette Meier
	 	Christopher Cashion	 	 	Annette Meier, Manager
	 	Chief Financial Officer	 	 	 

 

 

AGREED TO AND ACCEPTED ON THIS 12th DAY OF MAY, 2014.

 

EWING & JONES, PLLC

 

 

	By 	/s/ Randolph Ewing	 	 
	 	Randolph Ewing	 	 
	 	Chief Executive Officer	 	 

 

    	5Exhibit 10.1

Loan Number:  HHHT(2014)ZHSX0034

 

Comprehensive Credit Facility Agreement

 

(Summary Translation for Reference Only)

 

	Borrower:	Inner Mongolia Yongye Nongfeng Biotech Co., Ltd.
	Address:	Yongye Industrial Park, Jinshan Boulevard, 
	 	Jinshan Development Zone, Hohhot
	Legal Representative:	SUN Xiaofeng
	Telephone:	0471-3395763
	Fax:	 
	 	 
	Creditor:	China Everbright Bank Holdings. Co., Ltd., Hohhot Branch
	Address:	78 Xinhua Road East, Sai'an District, Hohhot
	Telephone:	0471-5165035
	Fax:	 

 

Pursuant to the provisions of PRC “Commercial
Banking Law”, “Commercial Bank Credit Granting and Management Interim Policies”, “Commercial Bank Group
Client Credit Business Risk Management Guidelines” and other relevant statutes, the Borrower ("Party A") and the
Creditor ("Party B") have entered into this Agreement as below.

 

Article I Definition and Explanation

 

1.           The
terms used herein shall have the following definition, unless otherwise indicated.

 

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Comprehensive Credit: Conditional commitment
by Party B to Party A to provide credit support of one or more kinds.

 

Specific Business: Specific business determined
by Party B, for which Party B provides loan, bank acceptance note and trade financing.

 

Maximum Credit Amount: The maximum debt
principal amount, based on the determination by Party B on the comprehensive credit facility granted to Party A, generated from
various Specific Businesses for which Party A applies to Party B for use of credit during the effective period of the credit facility
hereunder.

 

Specific Credit Amount: The maximum debt
principal amount, determined within the Maximum Credit Amount, generated from one Specific Business for which Party A has applied
to Party B for use of credit during the effective period of the credit facility hereunder.

 

Credit Amount Used: The sum of the outstanding
balance of loan principal for one Specific Business during the effective period of the comprehensive credit facility provided herein.

 

Specific Business Contract: Corresponding
contract or agreement entered into between Party A and Party B regarding one specific business and the specific credit amount.

 

Article II Maximum Credit Amount and
Specific Credit Amount

 

2.            The
maximum credit amount granted hereunder by Party B to Party A is RMB 200,000,000.00. This maximum credit amount includes still
unsettled outstanding balance under the previous Comprehensive Credit Facility Agreement (Contract No. HHHT(2013)ZHSX0154).

 

3.            Within
the maximum credit amount mentioned above, the specific credit amount for each specific business is:

General loan: specific credit amount RMB
200,000,000.00

 

The parties hereto agree that, within the
maximum credit amount, the amount can be adjusted or changed according to specific business types and be crossed used in between.

 

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Article III Term of the Credit Facility

 

4.            The
effective term for use of the credit facility is: March 13, 2014 to March 13, 2015.

 

The term of the specific business is to
be provided in the specific business contract; however, the beginning date for use of the specific credit amount must not be later
than the above end date of the maximum credit amount.

 

Article IV Use of Maximum Credit Amount
and Specific Credit Amount

 

5.            Party
A may apply to Party B in one time or separately for use of each specific credit amount within the limit of maximum credit amount
and its effective period; Party B will confirm the name of Party A's specific business, amount approved and the term based on Party
A's credit and Party B's lending policies.

 

6.            Provisions
on the revolving use: Party A may use the specific credit amount on a revolving basis within the limit of maximum credit amount
and its effective period.

 

7.            Party
A and Party B must execute an specific business contract; if any discrepancies exist, the specific business contract shall prevail.

 

Article V Fees and Interest Rate

 

8.            The
interest rate, conversion rate, fee rate and other fees charged by Party B will be specified in the specific business contract.

 

Article VI Adjustments to Maximum Credit
Amount and Specific Credit Amount

 

9.            Upon
the occurrence of the following, Party B has the right to adjust the maximum credit amount and specific credit amount and the term
thereof and to terminate the comprehensive facility.

 

		9.1	Major changes of the State’s currency policy;

		9.2	Potential material financial risk in Party A’s
region;

		9.3	Material changes in Party A’s business sector;

		9.4	Operation difficulty or risk experienced or will be experienced
by Party A;

		9.5	Party A’s undertaking spin-off, merger, or being
terminated;

		9.6	Party’s refusal to accept Party B’s supervision
of its use of the fund and operation and financial activities;

		9.7	Party A’s failure to use the funds from the facility
for the stated purposes;

		9.8	Party A has provided false documents or omitted material
operation and financial facts;

 

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		9.9	Transfer of assets, flight of capital or avoidance of
debts by Party A;

		9.10	Party A’s use of false contracts with its related
parties or other accounts receivables without underlying trades as pledges to obtain credit;

		9.11	Party A’s breach of provisions herein;

		9.12	Shortage of funds or major operation difficulty experienced
by Party A’s guarantor;

		9.13	Damage to or loss of the security property mortgaged
by the guarantor;

		9.14	Other events or situations that, in Party B’s view,
affects or will affect Party B’s repayment ability;

		9.15	Failure by Party A to perform any obligations provided
in an specific business contract.

 

10.          After
the signing of this agreement, Party A may apply in writing to Party B for adjustment to each of the specific credit amounts.

 

Article VII Guarantee

 

11.          The
following guarantee method has been adopted in ensure the repayment of the debts hereunder:

 

Maximum Amount Contract executed by WU Zishen

(No. HHHT(2014)ZGZRRBZ0057).

Maximum Amount Contract executed by YIN Ping

(No. HHHT(2014)ZGZRRBZ0058).

Maximum Amount Pledge Contract executed by Inner Mongolia
Yongye Nongfeng Biotech Co., Ltd

(No. HHHT(2014)ZGZY0001)

 

12.          If
Party B deems it necessary, Party B still has the right to demand that Party A provide additional guarantee when the two parties
are discussing specific business applications and Party A must not refuse.

 

Article VIII Party B’s Commitments

 

13.          When
Party A applies for the use of specific credit amount in accordance with the provisions herein, Party B must promptly review the
application and notify Party A of the review result.

 

14.          Party
B shall not arbitrarily make adjustments to maximum credit amount and specific credit amount which are adverse to Party A, unless
otherwise stipulated.

 

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Article IX Party A’s Commitments

 

15.          Repay
the debts on time in accordance with specific business contracts and pay all the fees on schedule.

 

16.          The
use of the specific credit amount must comply with the law and the provisions herein and those in specific business contracts and
must accept Party B’s supervision.

 

17.          Provide
to Party B truthful financial reports, bank accounts balance situation and other relevant operation documents during the term of
the facility.

 

18.          If
Party A is a group client characterized by Party B in accordance with the provisions of “Commercial Bank Group Client Credit
Business Risk Management Guidelines”, Party A must report all related party transaction involving more than 10% of its assets
during the effective term of the credit facility.

 

19.          Provide
advance notice to Party B if Party A provides guarantee to any third party and such guarantee must not affect Party A’s repayment
ability during term of the facility.

 

20.          The
obligation to notify Party B upon the occurrence of the following during the term of the facility:

 

20.1         Within
15 days starting from the date of any change of legal representative, business address, increase/decrease of registered capital,
major changes in equity and investment.

 

20.2         Immediately
upon the occurrence of any involvement in major litigation, arbitration or other legal proceedings or administrative sanctions,
or material changes in Party B’s operation or financial situations that will impact the realization of Party B’s creditor’s
right.

 

20.3         Within
2 months upon the occurrence of any major corporate event such as M/A, spin-off or capital reorganization, any form of contract
operation, lease that will change the business operation right, business or operation method restructuring, filing for dissolution,
bankruptcy or ceasing business, and repay all the outstanding debts or make arrangements for repayments.

 

21.         If
Party A violates any provisions herein or those in specific business contracts, Party B shall have the right to recall all the
funds under the maximum credit amount in advance and terminate this agreement and specific business contracts. 

Party A shall be responsible to compensate
Party B for all the resulting losses.

 

Article X Effectuation of the Agreement

 

22.         This
agreement becomes effective on the day of its execution by both parties.

 

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Article XI Resolution of Dispute

 

23.         Any
dispute in connection with this contract must be settled through consultation; if consultation fails, both parties may submit the
dispute to legal proceedings at the local court where the Party B resides.

 

Article XII Complete Agreement

 

24.         Each
of the specific business contracts entered into in accordance with this agreement is the component part hereof and, together, they
form the complete agreement.

 

25.         Party
A’s failure to perform its obligation under any specific business contract constitutes a breach of this agreement and Party
B may terminate this contract and recall all the outstanding debts in advance.

 

26.         Upon
Party B’s approval, Party A may grant all or some of the amount of the facility hereunder to other divisions and execute
relevant specific business contract in the name of such divisions. Specifics must be based on “Credit Facility Use Authorization”
issued by Party A and acknowledged by Party B.

 

27.         Such
“Credit Facility Use Authorization” need not specify the amount of the specific credit amount mentioned in Section
3 herein.

 

28.         Such
“Credit Facility Use Authorization” must specify whether the Borrower divisions have any transfer right.

 

29.         Other
matters not covered herein may be provided in supplemental agreement hereto.

 

Article XIII Supplementary Provisions

 

30.         This
contract has to four copies, with one to Party A, two to Party B and one to be used for pledge registration, and all have the same
legal effect.

 

31.         This
contract is executed on March 13, 2014 in Hohhot.

 

32.         The
parties hereto agree that this contract must be certified (optional provision; not applicable to this contract.)

 

33.         If,
at any time, any of the provisions herein becomes illegal, invalid or unenforceable in any aspect, the legality, validity or enforceability
of other provisions herein shall not be affected or diminished.

 

34.         In
the event of bank acceptance note service (not applicable).

 

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35.         Other
provisions (none).

 

	Party A:	/seal/ Inner Mongolia Yongye Nongfeng Biotech Co., Ltd.
	Legal Representative:	/s/ SUN Xiaofeng
	 	 
	Party B:	/seal/ China Everbright Bank Holdings. Co., Ltd., Hohhot Branch
	Legal Representative:	/s/ ZHANG Ling

 

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