Document:

Exhibit 10.2

 

THIS WARRANT
and the shares of stock that may be purchased upon the exercise of this warrant have been acquired for INVESTMENT AND NOT FOR DISTRIBUTION,
AND have NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (the “Act”). Such securities may not
be offered for sale, sold, pledged or hypothecated, or otherwise transferred unless and until registration under the act or an
exemption from the registration requirements of the act is available for such offer, sale, pledge, hypothecation, or transfer in
the opinion of legal counsel reasonably satisfactory to the company.

SUPERIOR DRILLING PRODUCTS,
INC.

COMMON STOCK WARRANT

 

Warrant No. CS-2016-01

 

Date of Issuance: August
5, 2016

 

Superior Drilling Products,
Inc., a Utah corporation (the “Company”), for valid consideration received, hereby certifies that Donald
A. Foss as Trustee of the Donald A. Foss Trust, dated June 16, 1981, as amended and restated, or its registered assigns (in each
case “Holder”), is entitled, subject to the terms set forth below, to purchase from the Company, prior to termination
as provided in Section 5 hereof, up to 250,000 shares of Common Stock with an exercise price per share of Common Stock equal
$1.38 (this “Warrant”). The shares purchasable upon exercise of this Warrant, and the purchase price per share
as described in this paragraph, each as adjusted from time to time pursuant to the terms of this Warrant, are hereinafter referred
to as the “Warrant Stock” and the “Purchase Price,” respectively.

 

1.     
Exercise.

 

A.    
This Warrant may be exercised by Holder in whole or in part prior to termination as provided in Section 5 hereof, by
surrendering this Warrant, with the purchase form appended hereto as Exhibit A completed in accordance with the instructions
thereto and duly executed by such Holder or by such Holder’s duly authorized attorney, at the principal office of the Company,
or at such other office or agency as the Company may designate, accompanied by payment in full by cash, check or wire transfer
of the Purchase Price payable in respect of the number of shares of Warrant Stock purchased upon such exercise.

 

B.    
The exercise of this Warrant shall be deemed to have been effected immediately prior to the close of business on the day
on which this Warrant shall have been surrendered to the Company as provided in Section 1(A) above or 1(C) below, as applicable.
If Holder exercises this Warrant in connection with a Change of Control Transaction (as defined in Section 5 below), Holder may
designate that the exercise date be deemed the closing date of such Change of Control Transaction, and conditional upon the occurrence
of such event. At such time, the person or persons in whose name or names any certificates for Warrant Stock shall be issuable
upon such exercise shall be deemed to have become Holder or holders of record of the Warrant Stock represented by such certificates.

 

C.    
Net Issue Exercise.

 

                                                                            
(i)           
In lieu of exercising this Warrant in the manner provided above in Section 1(A), Holder may elect to receive shares
equal to the value of this Warrant (or the portion thereof being canceled) by surrendering this Warrant, with the purchase form
appended hereto as Exhibit A completed in accordance with the instructions thereto and duly executed by such Holder
or by such Holder’s duly authorized attorney, at the principal office of the Company, or at such other office or agency as
the Company may designate, in which event the Company shall issue to Holder a number of shares of Warrant Stock computed using
the following formula:

 

X = Y (A - B)

             A

 

Where                   X
=The number of shares of Warrant Stock to be issued to Holder pursuant to this net exercise.

 

Y = The
number of shares of Warrant Stock in respect of which the net issue election is made (at the date of such calculation).

 

A = The
fair market value of one share of Warrant Stock (at the date of such calculation).

 

B = The
Purchase Price (as adjusted to the date of such calculation).

 

                                                                          
(ii)           
For purposes of this Section 1(C), “fair market value” of a share of Warrant Stock as of a particular
date (the “Determination Date”) shall mean (A) the average of the closing price of a share of the Warrant Stock
of the Company on the last twenty (20) trading days prior to the Determination Date reported on the NYSE MKT (the “Exchange”)
as reported in The Wall Street Journal, or (B) if shares of Warrant Stock are not traded on the Exchange but trade in the
over-the-counter market and such shares are quoted on the OTC Bulletin Board (the “OTCBB”), (I) the average
of the last sales prices reported on the OTCBB or (II) if such shares are an issue for which last sale prices are not reported
on the OTCBB, the average of the closing bid and ask prices, in each case on the last twenty (20) trading days (or if the relevant
price or quotation did not exist on any of such days, the relevant price or quotation on the next preceding business day on which
there was such a price or quotation) prior to the Determination Date as reported at www.otcbb.com; or (C) if the shares of Warrant
Stock are neither traded on an exchange or in the over-the-counter market, then as determined in good faith by the board of directors
of the Company.

 

D.    
As soon as practicable after the exercise of this Warrant, the Company shall cause to be issued in the name of, and delivered
to, Holder, or as such Holder may direct, a certificate or certificates for the number of shares of Warrant Stock to which such
Holder shall be entitled. Issuance of certificates pursuant to this Section 1(D) shall be made without charge to Holder for any
issue or transfer tax or other incidental expenses in respect of the issuance of such certificate, all of which taxes and expenses
shall be paid by the Company.

 

E.     
Each certificate for Warrant Stock or for any other security issued or issuable upon exercise of this Warrant shall bear
the following legend:

 

    	 	- 2 -	 

     

    

 

“THE
SECURITIES REPRESENTED HEREBY HAVE BEEN ACQUIRED FOR INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE “ACT”). SUCH SECURITIES MAY NOT BE SOLD, PLEDGED OR OTHERWISE TRANSFERRED IN THE ABSENCE OF
SUCH REGISTRATION UNLESS THE COMPANY RECEIVES AN OPINION OF COUNSEL REASONABLY ACCEPTABLE TO THE COMPANY STATING THAT SUCH SALE,
PLEDGE OR TRANSFER IS EXEMPT FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF THE ACT UNLESS SOLD PURSUANT TO RULE
144 PROMULGATED UNDER THE ACT.”

 

F.     
The Company covenants that the Warrant Stock, when issued pursuant to the exercise of this Warrant, will be duly and validly
issued, fully paid and nonassessable and free from all taxes, liens and charges with respect to the issuance thereof.

 

2.     
Adjustments.

 

A.    
The exercise price per share of Common Stock of this Warrant shall automatically be adjusted to equal the per share offering
price of Common Stock in the first Qualified Financing completed following the date of this Warrant. “Qualified Financing”
means a sale of Common Stock to investors on or before February 5, 2017, with total proceeds to the Company of not less than $2,000,000.
For the avoidance of doubt, the Promissory Note issued to the Holder of even date herewith and any securities issued pursuant thereto
shall not count toward a Qualified Financing.

 

B.    
If outstanding shares of Common Stock shall be subdivided into a greater number of shares or a stock dividend shall be paid
in respect of Common Stock, the Purchase Price in effect immediately prior to such subdivision or at the record date of such dividend,
as the case may be, shall simultaneously with the effectiveness of such subdivision or immediately after the record date of such
dividend be proportionately reduced. If outstanding shares of Common Stock shall be combined into a smaller number of shares, the
Purchase Price in effect immediately prior to such combination shall, simultaneously with the effectiveness of such combination,
be proportionately increased. When any adjustment is required to be made in the Purchase Price, the number of shares of Warrant
Stock purchasable upon the exercise of this Warrant shall be changed to the number determined by dividing (i) an amount equal
to the number of shares of Warrant Stock issuable upon the exercise of this Warrant immediately prior to such adjustment, multiplied
by the Purchase Price in effect immediately prior to such adjustment, by (ii) the Purchase Price in effect immediately after
such adjustment. Any adjustment under this Section 2(B) shall become effective at the close of business on the date the subdivision
or combination becomes effective, or as of the record date of such dividend, or in the event that no record date is fixed, upon
the making of such dividend.

 

C.    
In case of any reclassification, change or conversion of securities of the Company of the class issuable upon the exercise
of this Warrant or in case of any reorganization of the Company on or after the date hereof, other than upon a Change of Control
Transaction and other than as a result of a subdivision, combination or stock dividend provided for in Section 2(B) above, then
and in each such case Holder of this Warrant, upon the exercise hereof at any time after the consummation of such reclassification,
change, conversion or reorganization shall be entitled to receive (and upon written request, the Company shall provide Holder duly
executed documents evidencing the same), in lieu of the stock or other securities and property receivable upon the exercise hereof
prior to such consummation, the stock or other securities or property to which such Holder would have been entitled upon such consummation
if such Holder had exercised this Warrant immediately prior thereto, at an aggregate exercise price not more than that payable
upon the exercise if this Warrant prior to such consummation, all subject to further adjustment as provided in Section 2(B) above;
and in each such case, the terms of this Section 2 shall be applicable to the shares of stock or other securities properly
receivable upon the exercise of this Warrant after such consummation.

 

    	 	- 3 -	 

     

    

 

D.    
Whenever the Purchase Price or the number of shares of Warrant Stock purchasable hereunder shall be adjusted pursuant to
Section 2 hereof, the Company shall promptly give written notice thereof to Holder in the form of a certificate, signed by the
chief executive officer and the executive officer responsible for the creation of such certificate, setting forth, in reasonable
detail, the event requiring the adjustment, the amount of the adjustment, the method by which such adjustment was calculated, and
the Purchase Price and the number of shares of Warrant Stock purchasable hereunder after giving effect to such adjustment. Such
certificate shall be delivered to Holder within thirty (30) days of such adjustment, in accordance with Section 9 hereof.

 

3.     
Transfers. Each Holder of this Warrant acknowledges that this Warrant and the Warrant Stock have not been registered
under the Act, and agrees not to offer for sale, sell, pledge, distribute, transfer or otherwise dispose of this Warrant and agrees
not to offer for sale, sell, pledge, distribute, transfer or otherwise dispose of any Warrant Stock issued upon its exercise in
the absence of (i) an effective registration statement under the Act as to this Warrant and the Warrant Stock and registration
or qualification of under any applicable Blue Sky or state securities law then in effect, or (ii) an opinion of counsel, reasonably
satisfactory to the Company, that such registration and qualification are not required; provided, however, that no
opinion need be obtained with respect to a transfer to (A) a partner or member, active or retired, of Holder, (B) the estate of
any such partner or member, (C) an “affiliate” of Holder as that term is defined in Rule 405 promulgated by the U.S.
Securities and Exchange Commission (the “SEC”) under the Act, or (D) the spouse, children, grandchildren or
spouse of such children or grandchildren of Holder or to trusts for the benefit of Holder or such persons, in each case if the
transferee agrees to be subject to the terms hereof. Notwithstanding the foregoing, any transferee receiving shares that (A) have
been registered under the Act or (B) are resaleable under Rule 144 promulgated under the Act shall not be required to agree in
writing to be subject to the terms of this Section 3.

 

4.     
No Impairment. The Company will not, by amendment of its Articles of Incorporation or through reorganization, consolidation,
merger, dissolution, sale of assets or any other voluntary action, avoid or seek to avoid the observance or performance of any
of the terms of this Warrant, but will at all times in good faith assist in the carrying out of all such terms and in the taking
of all such action as may be reasonably necessary or appropriate in order to protect the rights of Holder of this Warrant against
impairment.

 

5.     
Termination.

 

A.    
This Warrant (and the right to purchase securities upon exercise hereof) shall terminate upon the earliest of: (i) August
8, 2021 (the “Expiration Date”), and (ii) the closing of a liquidation, dissolution or winding up of the Company.
For purposes of this Warrant, each of the following transactions shall be deemed to be a liquidation, dissolution or winding up
of the Company: (i) a sale, exclusive lease, exclusive license or other disposition of all or substantially all of the assets of
the Company; or (ii) any reorganization, consolidation, merger, stock sale, reorganization or similar transaction in which the
Company is a constituent corporation or is a party if, as a result of such transaction, the voting securities of the Company that
are outstanding immediately prior to such transaction do not represent, or are not converted into, securities of the resulting
or surviving corporation that together represent a majority of the voting power of the surviving or resulting corporation in such
a transaction (a “Change of Control Transaction”).

 

    	 	- 4 -	 

     

    

 

B.    
This Warrant shall be deemed to be exercised automatically in full pursuant to the provisions of Section 1(C) hereof, without
any further action on behalf of Holder, immediately prior to the time this Warrant would otherwise terminate pursuant to Section
5(A) above.

 

6.     
Notices of Certain Transactions.

 

A.                
In the event:

 

                                                                            
(i)           
that the Company takes a record of Holders of its Common Stock (or other stock or securities at the time deliverable upon
the exercise of this Warrant) for the purpose of entitling or enabling them to receive any dividend or other distribution, or to
receive any right to subscribe for or purchase any shares of stock of any class or any other securities, or to receive any other
right to subscribe for or purchase any shares of stock of any class or any other securities, or to receive any other right;

 

                                                                          
(ii)           
that the Company makes any amendment to the Company’s articles of incorporation;

 

                                                                        
(iii)           
of any capital reorganization of the Company, any reclassification of the capital stock of the Company, any Change of Control
Transaction, any other consolidation or merger of the Company with or into another corporation, or any other transaction or series
of related transactions pursuant to which the Company’s stockholders immediately prior thereto will possess a minority of
the voting power of the surviving or acquiring entity immediately thereafter, or any transfer of all or substantially all of the
assets of the Company; or

 

                                                                        
(iv)           
of the voluntary or involuntary dissolution, liquidation or winding-up of the Company;

 

then, and in each such
case, the Company will mail or cause to be mailed to Holder a notice specifying, as the case may be, (a) the date on which a record
is to be taken for the purpose of such dividend, distribution or right, and stating the amount and character of such dividend,
distribution or right, (b) a certified copy of the Company’s current articles of incorporation, or (c) the effective date
on which such reorganization, reclassification, consolidation, merger, transfer, Change of Control Transaction, dissolution, liquidation,
winding-up or redemption is to take place, and the time, if any is to be fixed, as of which Holders of record of Common Stock (or
such other stock or securities at the time deliverable upon such reorganization, reclassification, consolidation, merger, transfer,
dissolution, liquidation, winding-up or redemption) shall be determined. Such notice shall be mailed at least twenty (20) days
prior to the record date or effective date for the event specified in such notice.

 

B.    
The Company shall mail or cause to be mailed to the Holder, by certified mail, return receipt requested, notice of the Expiration
Date of the Warrant, no later than twenty (20) days prior to the Expiration Date.

 

7.     
Reservation of Stock. The Company will at all times reserve and keep available, solely for the issuance and delivery
upon the exercise of this Warrant, such shares of Warrant Stock and other stock, securities and property, as from time to time
shall be issuable upon the exercise of this Warrant and conversion of the Warrant Stock. The Company covenants and agrees that
all shares of Warrant Stock which may be issued upon the exercise of the rights represented by this Warrant will, upon issuance,
be duly authorized, validly issued, fully paid (assuming payment of the exercise price by Holder) and nonassessable and free from
all preemptive rights of any stockholder and free of all taxes, liens and charges with respect to the issue thereof. The Company
will take all such action as may be reasonably necessary to assure that such shares of Warrant Stock may be issued as provided
herein without violation of any applicable law or regulation, or of any requirements of any domestic securities exchange upon which
the securities of the Company may be listed; provided, however, that the Company shall not be required to effect
a registration under Federal or state securities laws with respect to such exercise.

 

    	 	- 5 -	 

     

    

 

8.     
Exchange of Warrants. Upon the surrender by Holder of any Warrant, properly endorsed, to the Company at the principal
office of the Company, the Company will, subject to the provisions of Section 3 hereof, issue and deliver to or upon the order
of such Holder, at Holder’s expense, a new Warrant of like tenor, in the name of such Holder or as such Holder (upon payment
by such Holder of any applicable transfer taxes) may direct, calling in the aggregate on the face or faces thereof for the number
of shares of Warrant Stock called for on the face or faces of the Warrant so surrendered.

 

9.     
Replacement of Warrants. Upon receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction
or mutilation of this Warrant and (in the case of loss, theft or destruction) upon delivery of an indemnity agreement (with surety
if reasonably required) in an amount reasonably satisfactory to the Company, or (in the case of mutilation) upon surrender and
cancellation of this Warrant, the Company will issue, in lieu thereof, a new Warrant of like tenor at Holder’s expense.

 

10. 
Notices. All notices and other communications required or permitted hereunder shall be in writing and delivered,
mailed or transmitted by any standard form of telecommunication. Notices and other communications to Holder shall be directed to
it at its address set forth on the signature page hereto; and notices and other communications to the Company shall be directed
to it at its address set forth on the signature page hereto; or as to each party, at such other address as shall be designated
by such party in a written notice to the other party pursuant hereto. Any such notice or other communication shall be deemed to
have been duly given (a) when sent by Federal Express or other overnight delivery service of recognized standing, on the business
day following deposit with such service; (b) when mailed by registered or certified mail, first class postage prepaid and
addressed as aforesaid through the United States Postal Service, upon receipt; (c) when delivered by hand, upon delivery;
and (d) when telecopied, upon confirmation of receipt. Any party hereto may by notice so given change its address for future
notice hereunder.

 

11. 
No Rights as Stockholder. Until the exercise of this Warrant, Holder of this Warrant shall not have or exercise any
rights by virtue hereof as a stockholder of the Company. Without limiting the generality of the foregoing, and except as otherwise
provided in Section 2 hereof, no dividends shall accrue to the shares of Warrant Stock underlying this Warrant until the exercise
hereof and the purchase of the underlying shares of Warrant Stock, at which point dividends shall begin to accrue with respect
to such purchased shares of Warrant Stock from and after the date such shares of Warrant Stock are so purchased. Nothing in this
Section 11 shall limit the right of Holder to be provided the notices required to be provided pursuant to the terms of this Warrant.

 

12. 
No Fractional Shares. No fractional shares of Warrant Stock will be issued in connection with any exercise hereunder.
In lieu of any fractional shares which would otherwise be issuable, the Company shall pay cash equal to the product of such fraction
multiplied by the purchase price per share of Warrant Stock.

 

13. 
Headings. The headings in this Warrant are for purposes of reference only and shall not limit or otherwise affect
the meaning of any provision of this Warrant.

 

14. 
Governing Law. This Warrant and all actions arising out of or in connection with this Warrant shall be governed by
and construed in accordance with the laws of the State of Utah, without application of conflicts of law principles thereunder.

 

    	 	- 6 -	 

     

    

 

15. 
Amendment or Waiver. Any provision of this Warrant may be amended, waived or modified (either generally or in a particular
instance, either retroactively or prospectively, and either for a specified period of time or indefinitely) only by an instrument
in writing signed by the Company and Holder. Any amendment, waiver or modification effected in accordance with this Section 15
shall be binding upon Holder, each future holder of the Warrant or the Warrant Stock and the Company.

 

16. 
Sundays and Holidays. This Warrant shall be exercisable as provided for herein, except that in the event that the
expiration date of this Warrant shall fall on a Saturday, Sunday and/or and United States federally recognized Holiday, the expiration
date for this Warrant shall be extended to 5:00 p.m. Pacific time on the business day following such Saturday, Sunday or recognized
Holiday.

 

17. 
Successor and Assigns. The terms and provisions of this Warrant and the Purchase Agreement shall incur to the benefit
of, and be binding upon, the Company and each Holder hereof and their respective permitted successors and assigns.

 

18. 
Attorneys’ Fees. If any action at law or in equity is necessary to enforce or interpret the terms of this Warrant
the adjudicating party may in its discretion order that the non-prevailing party, as determined by such adjudicating party, reimburse
the prevailing party for reasonable attorney’s fees and costs in addition to any other relief to which such prevailing party
may be entitled.

 

[Remainder of Page
Intentionally Left Blank]

 

    	 	- 7 -	 

     

    

 

IN WITNESS WHEREOF,
the Company has caused this Warrant to be signed by its duly authorized officer as of the date first written above.

 

	 	SUPERIOR DRILLING PRODUCTS, INC.
	 	 	 
	 	By: 	/s/ G. Troy Meier
	 	Name: G. Troy Meier
	 	Title: Chief Executive Officer

  

	 	Address:	1583 South 1700 East
	 	 	Vernal, Utah 84078

 

By its counter-signature
below, Holder hereby agrees to the foregoing terms and conditions set forth in this Warrant.

 

	 	HOLDER (if an entity):
	 	 
	Name of Holder:	Donald A. Foss Trust dated June 16, 1981, as amended and restated
	 	 
	 	By:	/s/ Donald A. Foss
	 	 	Name:	Donald A. Foss
	 	 	Title:	Trustee
	 	 
	 	Address:	25505 W. 12 Mile Road
	 	
         

         
	
        Suite 4125

        Southfield, MI 48034

	 	 	 
	 	HOLDER (if an individual):
	 	 
	Name of Holder:	 
	 	 
	 	 
	Signature:	 
	 	 
	 	 
	 	Address:	 
	 	 	 

 

[Signature Page to Common
Stock Warrant]

 

     

     

    

 

EXHIBIT A

 

PURCHASE FORM

 

	To:	XXXXXXXXX, INC.	Dated: ______________

  

		(1)	By checking the applicable box below (please check
only one), the undersigned hereby irrevocably elects:

 

		 ̈	to purchase _______ shares
of the Warrant Stock covered by the attached Warrant and herewith makes payment of $_________ by cash, check or wire transfer,
representing the full purchase price for such shares at the price per share provided for in such Warrant, pursuant to Section
1(A) thereof; OR

 

		 ̈	to exercise the attached
Warrant pursuant to Section 1(C) thereof. The number of shares of Warrant Stock in respect of which this net issue election is
made is _____________.

 

(2)           Please
issue a certificate or certificates representing said shares of Warrant Stock in the name of the undersigned or in such other
name as is specified below:

 

	 
	 
	(Name)
	 
	 
	 
	(Address)

  

(3)              
The undersigned represents that the aforesaid shares of Warrant Stock are being acquired for the account of the undersigned
for investment and not with a view to, or for resale in connection with, the distribution thereof and that the undersigned has
no present intention of distributing or reselling such shares except in compliance with applicable securities laws.

 

	 	 
	 	(entity name, if applicable)
	 	 

 

	 	By: 	 
	 	Name:	 
	 	Title:Exhibit 10.3

 

THIRD AMENDED AND RESTATED PROMISSORY
NOTE

 

$9,500,000.00               August 10, 2016

 

WHEREAS,
the Maker (as defined below) previously executed that certain Promissory Note dated May 9, 2014, in the principal amount of Twelve
Million Five Hundred Thousand Dollars ($12,500,00) for the benefit of the Payee (as defined below) (the “Initial Note”)
which was modified and renewed by that certain Second Amended and Restated Promissory Note dated September 28, 2015 in the principal
amount of Ten Million Dollars ($10,000,000) for the the benefit of Payee (the A/R Note:);

 

WHEREAS,
the Maker made a principal payment to Payee in the amount of Five Hundred Thousand ($500,000) plus all accrued interest on January
15, 2016 and an accrued interest payment on August 5, 2016 (accrued from January 15, 2016-August 5, 2016) and

 

WHEREAS,
the Maker and the Payee desire to amend and restate the A/R Note to, among other things, change the principal amount and the repayment
schedule

 

NOW, THEREFORE,
for and in consideration of the foregoing, this Promissory Note is executed and delivered to read as follows:

 

FOR VALUE
RECEIVED, the undersigned, HARD ROCK SOLUTIONS, LLC, a Utah limited liability company with its principal place of business at 2221
N. 3250 W. Vernal, Utah 84078 and SUPERIOR DRILLING SOLUTIONS, LLC, f/k/a Superior Drilling Products, LLC, a Utah limited liability
company with its principal place of business at 2221 N. 3250 W. Vernal, Utah 84078, (hereinafter collectively the “Maker”),
hereby promise to pay to the order of WMAFC, INC, f/k/a HARD ROCK SOLUTIONS, INC., a Texas corporation with its principal place
of business at 7507 County Road 72, Windsor, Colorado 80550 (the “Payee”), the principal sum of Nine Million
Five Hundred Thousand and No/00 Dollars ($9,500,000.00) together with interest on the outstanding balance of the principal sum
at the rates and commencing at the times and pursuant to the terms hereinafter provided until this promissory note (“Promissory
Note”) is paid in full.

 

1.Terms.
Capitalized terms used herein without definition have the meanings ascribed to them in that certain Membership Interest Purchase
Agreement dated January 28, 2014 by and between Maker, Payee and James D. Isenhour, an individual (the “Purchase
Agreement”).

 

2.Principal
and Interest. This Promissory Note shall bear interest from the date hereof until January 15, 2020 (the “Maturity
Date”) at a fixed interest rate equal to 5.75% per annum (for the actual number of days occurring in the period for which
interest is payable) (“Fixed Rate”). All accrued and unpaid interest on this Promissory Note shall be due and
payable by Maker to Payee as follows:

 

     

     

    

 

pg 2

 

(i)subject
to the succeeding paragraph, commencing on October 15, 2016, a principal payment of $1,500,000.00 plus accrued interest at the
Fixed Rate in effect for the period (herein , the “October 15, 2016 Payment”);

 

(ii)commencing on January 15, 2017,
a payment of accrued interest at the Fixed Rate in effect for the period;

 

(iii)commencing on March 15, 2017,
a payment of accrued interest at the Fixed Rate in effect for the period;

 

(iv)commencing on May 15, 2017, a payment
of accrued interest at the Fixed Rate in effect for the period;

 

(v)commencing on July 15, 2017, a payment
of accrued interest at the Fixed Rate in effect for the period;

 

(vi)commencing on January 15, 2018,
a principal payment of $500,000.00 plus accrued interest at the Fixed Rate in effect for the period;

 

(vii)commencing on March 15, 2018,
a principal payment of $500,000.00 plus accrued interest at the Fixed Rate in effect for the period;

 

(viii)commencing on May 15, 2018, a
principal payment of $500,000.00 plus accrued interest at the Fixed Rate in effect for the period;

 

(ix)commencing on July 15, 2018, a
principal payment of $500,000.00 plus accrued interest at the Fixed Rate in effect for the period;

 

(x)commencing on January 15, 2019,
a principal payment of $1,000,000.00 plus accrued interest at the Fixed Rate in effect for the period;

 

(xi)commencing on March 15, 2019, a
principal payment of $1,000,000.00 plus accrued interest at the Fixed Rate in effect for the period;

 

(xii)commencing on May 15, 2019, a
principal payment of $1,000,000.00 plus accrued interest at the Fixed Rate in effect for the period;

 

(xiii)commencing on July 15, 2019,
a principal payment of $1,000,000.00 plus accrued interest at the Fixed Rate in effect for the period; and

 

(xiv)subject to the succeeding
paragraph, on the Maturity Date, the final payment of the entire remaining principal balance of this Promissory Note in the
amount of $2,000,000.00 plus accrued interest at the Fixed Rate in effect for the period is due in full (the “Final
Payment”).

 

     

     

    

 

pg3

 

3.Maturity
Date. The entire outstanding principal balance of this Promissory Note, together with all accrued but unpaid interest
thereon, shall be due and payable in full on the Maturity Date (or, if such date is not a business day, then on the immediately
preceding business day), or upon any earlier acceleration of the Maker's obligations hereunder, unless such obligations are earlier
satisfied in accordance with the terms hereof.

 

4.Default.If
Maker fails to pay, within fifteen (15) days, any principal of or interest on this Promissory Note when due (“Default”),
the holder of this Promissory Note or any part thereof may thereafter provide Maker written notice of the Default, and if Maker
continues to be in Default for thirty (30) days or more after receipt of written notice, Payee may declare the principal balance
hereof and the interest accrued hereon to be immediately due and payable.

 

A default under
the terms of the Security and Pledge Agreement securing this Promissory Note (hereinafter “Security Agreement”)
also is a default under this Promissory Note. If Maker is in default under the terms of the Security Agreement, Payee shall provide
Maker with written notice specifying such default and allow thirty (30) days from receipt of said notice to cure the default. Maker
shall not be in default under the terms of the Security Agreement until such notice has been given and Maker has failed to cure
the default within the thirty (30) day grace period. In the event of a default under the Security Agreement which is not cured
within the time period specified herein, Payee, at Payee's option, may also accelerate the entire balance of this Promissory Note.

 

If Payee elects
to accelerate the balance of this Promissory Note as permitted herein, the entire balance of principal, together with interest
to the date of default and all other amounts due under this Note or the Security Agreement shall, from the date of default, bear
interest at the rate of nine percent (9.00%) per annum (“Default Interest Rate”), and all such amounts shall
be immediately due and payable in full. Interest shall continue to accrue on the full amount of principal, interest and such other
amounts due as of the default date until the default has been cured. The Payee shall have the right to recover from Maker an additional
amount equal to Payee's reasonable costs in enforcing this Promissory Note and the Security Agreement in the event of default,
including reasonable attorney's fees and other costs related to the default, whether or not suit is commenced, and whether or not
Payee elects to accelerate the balance. All such reasonable fees and costs must be paid before a default will be cured.

 

5.Prepayment.
Maker may, at any time, prepay the outstanding balance of principal and interest due under this Promissory Note in whole or in
part, without premium or penalty. In the event of prepayment, there shall become due and payable an amount equal to all accrued
interest attributable to that portion of the outstanding principal balance of the Promissory Note being prepaid at that time. Partial
prepayments shall not defer the due dates for, or the amounts of, succeeding payments. By its execution hereof, Maker agrees that
it shall endeavor to make principal and/or accrued
interest payments on this Promissory Note prior to the due dates set forth herein if in Maker's good faith determination it has
the financial wherewithal to make such prepayments.

 

     

     

    

pg4

 

6.Payments
and Computations. All payments on account of indebtedness evidenced by this Promissory Note shall be made on the day when
due in lawful money of the United States. Payments are to be made at such place as Payee or the legal holders of this Promissory
Note may, from time to time, in writing appoint, and in the absence of such appointment, then at the place provided in the Notice
section of the Purchase Agreement. Notwithstanding the foregoing, Payee agrees to accept 700,000 unregistered shares of common
stock in Superior Drilling Products, Inc., a Utah corporation (“Superior”) valued at One Million Dollars ($1,000,000.00)
in exchange for a reduction in the principal amount of the existing indebtedness due on October 15, 2016. Although the Payee will
accept the referenced stock for payment toward the principal due on the October 15, 2016 Payment, interest will continue to accrue
on the deemed principal amount until said shares become registered.

 

7.Applicable
Law and Jurisdiction. Maker represents and agrees that this instrument and the rights and obligations of all parties
hereunder shall be governed by and construed under the laws of the State of Colorado without regard to the conflicts of law
principles. Maker hereby consents to the jurisdiction in Colorado concerning any enforcement of this Promissory Note.

 

8.Severability.
The parties hereto intend and believe that each provision in this Promissory Note comports with all applicable local, state and
federal laws and judicial decisions. However, if any provision or provisions, or if any portion of any provision or provisions,
of this Promissory Note is found by a court of law to be in violation of any applicable local, state or federal ordinance, statute,
law, administrative or judicial decision, or public policy, and if the court should declare that portion, provision or provisions
to be illegal, invalid, unlawful, void or unenforceable as written, then it is the intent of Maker and Payee that such portion,
provision or provisions be given force to the fullest possible extent that they are legal, valid and enforceable, that the remainder
of this Promissory Note shall be construed as if the illegal, invalid, unlawful, void or unenforceable portion, provision or provisions
were not contained herein, and that the rights, obligations and interest of Maker and Payee or the legal holders hereof under the
remainder of this Promissory Note shall continue in full force and effect.

 

9.Maximum
Interest. Payee and Maker intend to contract in strict compliance with applicable usury law from time to time in effect.
In furtherance thereof Payee and Maker hereby stipulate and agree that none of the terms and provisions contained herein shall
ever be construed to create a contract to pay, for the use, forbearance or detention of money, interest in excess of the maximum
amount of interest permitted to be charged by applicable law from time to time in effect. Neither Maker nor any present or future
guarantors, endorsers, or other Persons hereafter becoming liable for payment of any indebtedness hereunder shall ever be liable
for unearned interest thereon or shall ever be required to pay interest thereon in excess of the maximum amount that may be lawfully
contracted for, charged, or received under applicable law from time to time in effect, and the provisions of this section shall
control over all other provisions hereof which may be in conflict or apparent conflict herewith. Payee expressly disavows any
intention to contract for, charge, collect or receive excessive or unearned interest or finance charges in the event the maturity
of any indebtedness hereunder is accelerated or upon the occurrence of any other event. If the maturity of any indebtedness hereunder
is accelerated for any reason, any such indebtedness is prepaid and as a result any amounts that constitute interest are in excess
of the legal maximum, or Payee or any other holder of any or all of the indebtedness hereunder shall otherwise charge, receive,
or collect, or any Person shall pay, moneys which would otherwise increase the interest on any or all of the indebtedness hereunder
to an amount in excess of that permitted by applicable law then in effect, then all sums that constitute interest in excess of
such legal limit shall, without penalty, be promptly applied to reduce the then outstanding principal of the related indebtedness
or, at Payee's or holder's option, promptly returned to Maker or the other payor thereof, as applicable, upon such determination.
In determining whether or not the interest paid or payable, under any specific circumstance, exceeds the maximum amount permitted
under applicable law, Payee and Maker (and any other payors thereof) shall to the greatest extent permitted under applicable law,
characterize any non-principal payment as an expense, fee or premium rather than as interest, exclude voluntary prepayments and
the effects thereof, and amortize, prorate, allocate, and spread the total amount of interest throughout the entire contemplated
term of the instruments evidencing the indebtedness hereunder in accordance with the amounts outstanding from time to time thereunder
and the maximum legal rate of interest from time to time in effect under applicable law in order to lawfully contract for, charge,
collect, or receive the maximum amount of interest permitted under applicable law. As used in this section the term “applicable
law” means the laws of the State of Colorado including the Laws of the United States of America, as such Laws now exist
or may be changed or amended or come into effect in the future.

 

     

     

    

 

pg5

 

10.Purchase
Agreement. This Promissory Note is the Note referred to in the Purchase Agreement. Payment of this Promissory Note is subject
to the Purchase Agreement and the parties hereto agree that this Promissory Note shall not be effective until the occurrence of
the Closing and the satisfaction of any obligations as specifically set forth in the Purchase Agreement.

 

11.Assignment.
Payee may assign this Promissory Note in whole or in part or any right to the proceeds hereof, provided that Payee gives Maker
prior written notice of any such assignment.

 

12.Notices.
All notices and other communications provided for hereunder shall be in writing (including facsimile
communication) and mailed, telegraphed, telecopied or delivered to the addresses provided for in the Purchase Agreement or, as
to each party, at such other address as designated by that party in a written notice to the other party. All notices and communications
shall be deemed to have been validly served, given or delivered (i) three (3) business days following deposit in the United States
mail, with proper postage prepaid; (ii) upon delivery if delivered by hand to the party to be notified; or (iii) the following
day if sent by facsimile transmission.

 

     

     

    

 

pg6

 

13.Waiver.
Maker and all parties now or hereafter liable for the payment hereof, whether as endorser, guarantor,
surety or otherwise, generally waive demand, presentment for payment, notice of dishonor, protest and notice of protest, notice
of intent to accelerate and notice of acceleration, and diligence in collecting or bringing suit against any party hereto, and
agree to all extensions, renewals, indulgences, releases or changes which from time to time may be granted by the holder hereof
and to all partial payments hereon, with or without notice before or after maturity.

 

14.Attorney's
Fees. Should the indebtedness represented by this Promissory Note or any part hereof
be collected at law or in equity or through any bankruptcy, receivership, probate or other court proceedings or if this Promissory
Note is placed in the hands of attorneys for collection after any default, Maker and all endorsers, guarantors and sureties of
this Promissory Note jointly and severally agree to pay to the holder of this Promissory Note in addition to the principal and
interest due and payable hereon all the costs and expenses of said holder in enforcing this Promissory Note including, without
limitation, reasonable attorneys' fees and legal expenses.

 

15.Collateral.
This Promissory Note is secured by a first lien security interest in all of the collateral described in the Security Agreement

 

16.Promissory
Note. This Promissory Note shall constitute a modification and a renewal of all prior
promissory notes executed by Maker and payable to the Payee.

 

Time is of the essence as to all dates set forth
herein.

 

 

 

[Signature page follows]

 

     

     

    

 

pg 7

 

 

Maker
has executed and delivered this Promissory Note as of the day and year first set forth above.

 

	MAKER:	HARD ROCK SOLUTIONS, LLC
	 	a Utah limited liability company
	 	 	 	 
	 	By Its Manager:
	 	 	Superior Drilling Solutions, LLC f/k/a Superior Drilling Products, LLC,
	 	 	a Utah limited liability company
	 	 	 	 
	 	 	By:	/s/ Troy Meier
	 	 	 	Troy Meier, President
	 	 	 	 
	 	SUPERIOR DRILLING SOLUTIONS, LLC f/k/a Superior Drilling Products, LLC,
	 	a Utah limited liability company
	 	 	 	 
	 	By:	/s/ Troy Meier
	 	 	Troy Meier, President
	 	 	 	 
	PAYEE:	WMAFC, INC. f/k/a HARD ROCK SOLUTIONS, INC.,
	 	a Texas corporation
	 	 	 	 
	 	By:	/s/ James D. Isenhour
	 	 	James D. Isenhour, President

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