Document:

Exhibit 10.1

 

BUSINESS LOAN AGREEMENT

 

	
        Principal

        $4,996,411.01
	
        Loan Date

        04-09-2015
	
        Maturity

        08-15-2018
	
        Loan No

        99800297
	Call/Cell	
        Account

        262119235
	
        Officer

        ***
	Initials
	References in the boxes above are for Lender’s use only and do not limit the applicability of this document to any particular loan or items.  Any item above containing “****” has been omitted due to the text length limitations.

 

	Borrower:	MEIER PROPERTIES, SERIES LLC	Lender:	American Bank of the North
	 	2221 N. 3250 W.	 	Region 98
	 	Vernal, UT  84076 	 	2310 NW 3rd ST
	 	 	 	PO Box 160
	 	 	 	Grand Rapids, MN  55744

 

THIS BUSINESS LOAN AGREEMENT dated April
9, 2015, is made and executed between MEIER PROPERTIES, SERIES LLC (“Borrower”) and American Bank of the North (“Lender”)
on the following terms and conditions. Borrower has received prior commercial loans from Lender or has applied to Lender for a
commercial loan or loans or other financial accommodations, including those which may be described on any exhibit or schedule attached
to this Agreement. Borrower understands and agrees that: (A) in granting, renewing, or extending any Loan, Lender is relying upon
Borrower’s representations, warranties, and agreements as set forth in this Agreement; (B) the granting, renewing, or extending
of any Loan by Lender at all times shall be subject to Lender’s sole judgment and discretion; and (C) all such Loans shall
be and remain subject to the terms and conditions of this Agreement.

 

TERM.  This Agreement
shall be effective as of April 9, 2015, and shall continue in full force and effect until such time as all of Borrower’s
Loans in favor of Lender have been paid in full, including principal, interest, costs, expenses, attorneys’ fees, and other
fees and charges, or until such time as the parties may agree in writing to terminate this Agreement.

 

CONDITIONS PRECEDENT TO EACH ADVANCE.  Lender’s
obligation to make the initial Advance and each subsequent Advance under this Agreement shall be subject to the fulfillment to
Lender’s satisfaction of all of the conditions set forth in this Agreement and in the Related Documents.

 

Loan Documents.  Borrower
shall provide to Lender the following documents for the Loan: (1) the Note; (2) Security Agreements granting to Lender security
interests in the Collateral; (3) financing statements and all other documents perfecting Lender’s Security Interests; (4)
evidence of insurance as required below; (5) guaranties; (6) together with all such Related Documents as Lender may require for
the Loan; all in form and substance satisfactory to Lender and Lender’s counsel.

 

Borrower’s Authorization.  Borrower
shall have provided in form and substance satisfactory to Lender properly certified resolutions, duly authorizing the execution
and delivery of this Agreement, the Note and the Related Documents. In addition, Borrower shall have provided such other resolutions,
authorizations, documents and instruments as Lender or its counsel, may require.

 

Payment of Fees and Expenses.  Borrower
shall have paid to Lender all fees, charges, and other expenses which are then due and payable as specified in this Agreement or
any Related Document.

 

Representations and Warranties.  The
representations and warranties set forth in this Agreement, in the Related Documents, and in any document or certificate delivered
to Lender under this Agreement are true and correct.

 

No Event of Default.  There
shall not exist at the time of any Advance a condition which would constitute an Event of Default under this Agreement or under
any Related Document.

 

    	 

    	 

    

 

	Loan No. 99800297	BUSINESS LOAN AGREEMENT

(Continued)	Page 2

 

REPRESENTATIONS AND WARRANTIES.  Borrower
represents and warrants to Lender, as of the date of this Agreement, as of the date of each disbursement of loan proceeds, as of
the date of any renewal, extension or modification of any Loan, and at all times any Indebtedness exists:

 

Organization.  Borrower
is a limited liability company which is, and at all times shall be, duly organized, validly existing, and in good standing under
and by virtue of the laws of the State of Utah. Borrower is duly authorized to transact business in all other states in which Borrower
is doing business, having obtained all necessary filings, governmental licenses and approvals for each state in which Borrower
is doing business. Specifically, Borrower is, and at all times shall be, duly qualified as a foreign limited liability company
in all states in which the failure to so qualify would have a material adverse effect on its business or financial condition. Borrower
has the full power and authority to own its properties and to transact the business in which it is presently engaged or presently
proposes to engage. Borrower maintains an office at 2221 N 3250 W, Vernal, UT 84078. Unless Borrower has designated otherwise in
writing, the principal office is the office at which Borrower keeps its books and records including its records concerning the
Collateral. Borrower will notify Lender prior to any change in the location of Borrower’s state of organization or any change
in Borrower’s name. Borrower shall do all things necessary to preserve and to keep in full force and effect its existence,
rights and privileges, and shall comply with all regulations, rules, ordinances, statutes, orders and decrees of any governmental
or quasi-governmental authority or court applicable to Borrower and Borrower’s business activities.

 

Assumed Business Names.  Borrower
has filed or recorded all documents or filings required by law relating to all assumed business names used by Borrower. Excluding
the name of Borrower, the following is a complete list of all assumed business names under which Borrower does business: None.

 

Authorization.  Borrower’s
execution, delivery, and performance of this Agreement and all the Related Documents have been duly authorized by all necessary
action by Borrower and do not conflict with, result in a violation of, or constitute a default under (1) any provision of (a) Borrower’s
articles of organization or membership agreements, or (b) any agreement or other instrument binding upon Borrower or (2) any law,
governmental regulation, court decree, or order applicable to Borrower or to Borrower’s properties.

 

Financial Information.  Each
of Borrower’s financial statements supplied to Lender truly and completely disclosed Borrower’s financial condition
as of the date of the statement, and there has been no material adverse change in Borrower’s financial condition subsequent
to the date of the most recent financial statement supplied to Lender. Borrower has no material contingent obligations except as
disclosed in such financial statements.

 

Legal Effect.  This
Agreement constitutes, and any instrument or agreement Borrower is required to give under this Agreement when delivered will constitute
legal, valid, and binding obligations of Borrower enforceable against Borrower in accordance with their respective terms.

 

Properties.  Except
as contemplated by this Agreement or as previously disclosed in Borrower’s financial statements or in writing to Lender and
as accepted by Lender, and except for property tax liens for taxes not presently due and payable, Borrower owns and has good title
to all of Borrower’s properties free and clear of all Security Interests, and has not executed any security documents or
financing statements relating to such properties. All of Borrower’s properties are titled in Borrower’s legal name,
and Borrower has not used or filed a financing statement under any other name for at least the last five (5) years.

 

    	 

    	 

    

 

	Loan No. 99800297	BUSINESS LOAN AGREEMENT

(Continued)	Page 3

 

Hazardous Substances.  Except
as disclosed to and acknowledged by Lender in writing, Borrower represents and warrants that: (1) During the period of Borrower’s
ownership of the Collateral, there has been no use, generation, manufacture, storage, treatment, disposal, release or threatened
release of any Hazardous Substance by any person on, under, about or from any of the Collateral. (2) Borrower has no knowledge
of, or reason to believe that there has been (a) any breach or violation of any Environmental Laws; (b) any use, generation, manufacture,
storage, treatment, disposal, release or threatened release of any Hazardous Substance on, under, about or from the Collateral
by any prior owners or occupants of any of the Collateral; or (c) any actual or threatened litigation or claims of any kind by
any person relating to such matters. (3) Neither Borrower nor any tenant, contractor, agent or other authorized user of any of
the Collateral shall use, generate, manufacture, store, treat, dispose of or release any Hazardous Substance on, under, about or
from any of the Collateral; and any such activity shall be conducted in compliance with all applicable federal, state, and local
laws, regulations, and ordinances, including without limitation all Environmental Laws. Borrower authorizes Lender and its agents
to enter upon the Collateral to make such inspections and tests as Lender may deem appropriate to determine compliance of the Collateral
with this section of the Agreement. Any inspections or tests made by Lender shall be at Borrower’s expense and for Lender’s
purposes only and shall not be construed to create any responsibility or liability on the part of Lender to Borrower or to any
other person. The representations and warranties contained herein are based on Borrower’s due diligence in investigating
the Collateral for hazardous waste and Hazardous Substances. Borrower hereby (1) releases and waives any future claims against
Lender for indemnity or contribution in the event Borrower becomes liable for cleanup or other costs under any such laws, and (2)
agrees to indemnify, defend, and hold harmless Lender against any and all claims, losses, liabilities, damages, penalties, and
expenses, including attorneys’ fees, consultants’ fees, and costs which Lender may directly or indirectly sustain or
suffer resulting from a breach of this section of the Agreement or as a consequence of any use, generation, manufacture, storage,
disposal, release or threatened release of a hazardous waste or substance on the Collateral. The provisions of this section of
the Agreement, including the obligation to indemnify and defend, shall survive the payment of the Indebtedness and the termination,
expiration or satisfaction of this Agreement and shall not be affected by Lender’s acquisition of any interest in any of
the Collateral, whether by foreclosure or otherwise.

 

Litigation and Claims.  No
litigation, claim, investigation, administrative proceeding or similar action (including those for unpaid taxes) against Borrower
is pending or threatened, and no other event has occurred which may materially adversely affect Borrower’s financial condition
or properties, other than litigation, claims, or other events, if any, that have been disclosed to and acknowledged by Lender in
writing.

 

Taxes.  To the
best of Borrower’s knowledge, all of Borrower’s tax returns and reports that are or were required to be filed, have
been filed, and all taxes, assessments and other governmental charges have been paid in full, except those presently being or to
be contested by Borrower in good faith in the ordinary course of business and for which adequate reserves have been provided.

 

Lien Priority.  Unless
otherwise previously disclosed to Lender in writing, Borrower has not entered into or granted any Security Agreements, or permitted
the filing or attachment of any Security Interests on or affecting any of the Collateral directly or indirectly securing repayment
of Borrower’s Loan and Note, that would be prior or that may in any way be superior to Lender’s Security Interests
and rights in and to such Collateral.

 

    	 

    	 

    

 

	Loan No. 99800297	BUSINESS LOAN AGREEMENT

(Continued)	Page 4

 

Binding Effect.  This
Agreement, the Note, all Security Agreements (if any), and all Related Documents are binding upon the signers thereof, as well
as upon their successors, representatives and assigns, and are legally enforceable in accordance with their respective terms.

 

AFFIRMATIVE COVENANTS.  Borrower
covenants and agrees with Lender that, so long as this Agreement remains in effect, Borrower will:

 

Notices of Claims and Litigation.  Promptly
inform Lender in writing of (1) all material adverse changes in Borrower’s financial condition, and (2) all existing and
all threatened litigation, claims, investigations, administrative proceedings or similar actions affecting Borrower or any Guarantor
which could materially affect the financial condition of Borrower or the financial condition of any Guarantor.

 

Financial Records.  Maintain
its books and records in accordance with GAAP, applied on a consistent basis, and permit Lender to examine and audit Borrower’s
books and records at all reasonable times.

 

Financial Statements.  Furnish
Lender with the following:

 

Additional Requirements.  Annual
SEC 10K/Audited Financial Statements - Superior Drilling Products, Inc. due to Lender.

 

Quarterly SEC 10Q Financial Statements
- Superior Drilling Products, Inc. due to Lender.

 

Annual Tax Return of G. Troy Meier
and Annette D. Meier due to Lender no later than 30 days following each applicable filing date.

 

Annually, G. Troy Meier and Annette
D. Meier to provide Personal Financial Statement to Lender as requested.

 

Annual Tax Return of Superior Drilling
Products, Inc. due to Lender no later than 30 days following each applicable filing date.

 

All financial reports required
to be provided under this Agreement shall be prepared in accordance with GAAP, applied on a consistent basis, and certified by
Borrower as being true and correct.

 

Additional Information.
  Furnish such additional information and statements, as Lender may request from time to time.

 

Insurance.  Maintain
fire and other risk insurance, public liability insurance, and such other insurance as Lender may require with respect to Borrower’s
properties and operations, in form, amounts, coverages and with insurance companies acceptable to Lender. Borrower, upon request
of Lender, will deliver to Lender from time to time the policies or certificates of insurance in form satisfactory to Lender, including
stipulations that coverages will not be cancelled or diminished without at least ten (10) days prior written notice to Lender.
Each insurance policy also shall include an endorsement providing that coverage in favor of Lender will not be impaired in any
way by any act, omission or default of Borrower or any other person. In connection with all policies covering assets in which Lender
holds or is offered a security interest for the Loans, Borrower will provide Lender with such lender’s loss payable or other
endorsements as Lender may require.

 

    	 

    	 

    

 

	Loan No. 99800297	BUSINESS LOAN AGREEMENT

(Continued)	Page 5

 

Insurance Reports.  Furnish
to Lender, upon request of Lender, reports on each existing insurance policy showing such information as Lender may reasonably
request, including without limitation the following: (1) the name of the insurer; (2) the risks insured; (3) the amount of the
policy; (4) the properties insured; (5) the then current property values on the basis of which insurance has been obtained, and
the manner of determining those values; and (6) the expiration date of the policy. In addition, upon request of Lender (however
not more often than annually), Borrower will have an independent appraiser satisfactory to Lender determine, as applicable, the
actual cash value or replacement cost of any Collateral. The cost of such appraisal shall be paid by Borrower.

 

Guaranties.  Prior
to disbursement of any Loan proceeds, furnish executed guaranties of the Loans in favor of Lender, executed by the guarantors named
below, on Lender’s forms, and in the amounts and under the conditions set forth in those guaranties.

 

	Names of Guarantors	Amounts
	Gilbert Troy Meier	Unlimited
	Annette D. Meier	Unlimited
	Superior Drilling Products, Inc.	Unlimited

 

Other Agreements.  Comply
with all terms and conditions of all other agreements, whether now or hereafter existing, between Borrower and any other party
and notify Lender immediately in writing of any default in connection with any other such agreements.

 

Loan Proceeds.  Use
all Loan proceeds solely for Borrower’s business operations, unless specifically consented to the contrary by Lender in writing.

 

Taxes, Charges and Liens.  Pay
and discharge when due all of its indebtedness and obligations, including without limitation all assessments, taxes, governmental
charges, levies and liens, of every kind and nature, imposed upon Borrower or its properties, income, or profits, prior to the
date on which penalties would attach, and all lawful claims that, if unpaid, might become a lien or charge upon any of Borrower’s
properties, income, or profits. Provided however, Borrower will not be required to pay and discharge any such assessment, tax,
charge, levy, lien or claim so long as (1) the legality of the same shall be contested in good faith by appropriate proceedings,
and (2) Borrower shall have established on Borrower’s books adequate reserves with respect to such contested assessment,
tax, charge, levy, lien, or claim in accordance with GAAP.

 

Performance.  Perform
and comply, in a timely manner, with all terms, conditions, and provisions set forth in this Agreement, in the Related Documents,
and in all other instruments and agreements between Borrower and Lender. Borrower shall notify Lender immediately in writing of
any default in connection with any agreement.

 

Operations.  Maintain
executive and management personnel with substantially the same qualifications and experience as the present executive and management
personnel; provide written notice to Lender of any change in executive and management personnel; conduct its business affairs in
a reasonable and prudent manner.

 

    	 

    	 

    

 

	Loan No. 99800297	BUSINESS LOAN AGREEMENT

(Continued)	Page 6

 

Environmental Studies.  Promptly
conduct and complete, at Borrower’s expense, all such investigations, studies, samplings and testings as may be requested
by Lender or any governmental authority relative to any substance, or any waste or by-product of any substance defined as toxic
or a hazardous substance under applicable federal, state, or local law, rule, regulation, order or directive, at or affecting any
property or any facility owned, leased or used by Borrower.

 

Compliance with Governmental
Requirements.  Comply with all laws, ordinances, and regulations, now or hereafter in effect, of all governmental
authorities applicable to the conduct of Borrower’s properties, businesses and operations, and to the use or occupancy of
the Collateral, including without limitation, the Americans With Disabilities Act. Borrower may contest in good faith any such
law, ordinance, or regulation and withhold compliance during any proceeding, including appropriate appeals, so long as Borrower
has notified Lender in writing prior to doing so and so long as, in Lender’s sole opinion, Lender’s interests in the
Collateral are not jeopardized. Lender may require Borrower to post adequate security or a surety bond, reasonably satisfactory
to Lender, to protect Lender’s interest.

 

Inspection.  Permit
employees or agents of Lender at any reasonable time to inspect any and all Collateral for the Loan or Loans and Borrower’s
other properties and to examine or audit Borrower’s books, accounts, and records and to make copies and memoranda of Borrower’s
books, accounts, and records. If Borrower now or at any time hereafter maintains any records (including without limitation computer
generated records and computer software programs for the generation of such records) in the possession of a third party, Borrower,
upon request of Lender, shall notify such party to permit Lender free access to such records at all reasonable times and to provide
Lender with copies of any records it may request, all at Borrower’s expense.

 

Compliance Certificates.  Unless
waived in writing by Lender, provide Lender at least annually, with a certificate executed by Borrower’s chief financial
officer, or other officer or person acceptable to Lender, certifying that the representations and warranties set forth in this
Agreement are true and correct as of the date of the certificate and further certifying that, as of the date of the certificate,
no Event of Default exists under this Agreement.

 

Environmental Compliance and
Reports.  Borrower shall comply in all respects with any and all Environmental Laws; not cause or permit to exist,
as a result of an intentional or unintentional action or omission on Borrower’s part or on the part of any third party, on
property owned and/or occupied by Borrower, any environmental activity where damage may result to the environment, unless such
environmental activity is pursuant to and in compliance with the conditions of a permit issued by the appropriate federal, state
or local governmental authorities; shall furnish to Lender promptly and in any event within thirty (30) days after receipt thereof
a copy of any notice, summons, lien, citation, directive, letter or other communication from any governmental agency or instrumentality
concerning any intentional or unintentional action or omission on Borrower’s part in connection with any environmental activity
whether or not there is damage to the environment and/or other natural resources.

 

Additional Assurances.  Make,
execute and deliver to Lender such promissory notes, mortgages, deeds of trust, security agreements, assignments, financing statements,
instruments, documents and other agreements as Lender or its attorneys may reasonably request to evidence and secure the Loans
and to perfect all Security Interests.

 

    	 

    	 

    

 

	Loan No. 99800297	BUSINESS LOAN AGREEMENT

(Continued)	Page 7

 

LENDER’S EXPENDITURES.  If
any action or proceeding is commenced that would materially affect Lender’s interest in the Collateral or if Borrower fails
to comply with any provision of this Agreement or any Related Documents, including but not limited to Borrower’s failure
to discharge or pay when due any amounts Borrower is required to discharge or pay under this Agreement or any Related Documents,
Lender on Borrower’s behalf may (but shall not be obligated to) take any action that Lender deems appropriate, including
but not limited to discharging or paying all taxes, liens, security interests, encumbrances and other claims, at any time levied
or placed on any Collateral and paying all costs for insuring, maintaining and preserving any Collateral. All such expenditures
incurred or paid by Lender for such purposes will then bear interest at the rate charged under the Note from the date incurred
or paid by Lender to the date of repayment by Borrower. All such expenses will become a part of the Indebtedness and, at Lender’s
option, will (A) be payable on demand; (B) be added to the balance of the Note and be apportioned among and be payable with any
installment payments to become due during either (1) the term of any applicable insurance policy; or (2) the remaining term of
the Note; or (C) be treated as a balloon payment which will be due and payable at the Note’s maturity.

 

NEGATIVE COVENANTS.  Borrower
covenants and agrees with Lender that while this Agreement is in effect, Borrower shall not, without the prior written consent
of Lender:

 

Indebtedness and Liens.  (1)
Except for trade debt incurred in the normal course of business and indebtedness to Lender contemplated by this Agreement, create,
incur or assume indebtedness for borrowed money, including capital leases, (2) sell, transfer, mortgage, assign, pledge, lease,
grant a security interest in, or encumber any of Borrower’s assets (except as allowed as Permitted Liens), or (3) sell with
recourse any of Borrower’s accounts, except to Lender.

 

Continuity of Operations.  (1)
Engage in any business activities substantially different than those in which Borrower is presently engaged, (2) cease operations,
liquidate, merge, transfer, acquire or consolidate with any other entity, change its name, dissolve or transfer or sell Collateral
out of the ordinary course of business, or (3) make any distribution with respect to any capital account, whether by reduction
of capital or otherwise.

 

Loans, Acquisitions and Guaranties.  (1)
Loan, invest in or advance money or assets to any other person, enterprise or entity, (2) purchase, create or acquire any interest
in any other enterprise or entity, or (3) incur any obligation as surety or guarantor other than in the ordinary course of business.

 

Agreements.  Enter
into any agreement containing any provisions which would be violated or breached by the performance of Borrower’s obligations
under this Agreement or in connection herewith.

 

CESSATION OF ADVANCES.  If
Lender has made any commitment to make any Loan to Borrower, whether under this Agreement or under any other agreement, Lender
shall have no obligation to make Loan Advances or to disburse Loan proceeds if: (A) Borrower or any Guarantor is in default under
the terms of this Agreement or any of the Related Documents or any other agreement that Borrower or any Guarantor has with Lender;
(B) Borrower or any Guarantor dies, becomes incompetent or becomes insolvent, files a petition in bankruptcy or similar proceedings,
or is adjudged a bankrupt; (C) there occurs a material adverse change in Borrower’s financial condition, in the financial
condition of any Guarantor, or in the value of any Collateral securing any Loan; or (D) any Guarantor seeks, claims or otherwise
attempts to limit, modify or revoke such Guarantor’s guaranty of the Loan or any other loan with Lender; or (E) Lender in
good faith deems itself insecure, even though no Event of Default shall have occurred.

 

RIGHT OF SETOFF.  To the
extent permitted by applicable law, Lender reserves a right of setoff in all Borrower’s accounts with Lender (whether checking,
savings, or some other account). This includes all accounts Borrower holds jointly with someone else and all accounts Borrower
may open in the future. However, this does not include any IRA or Keogh accounts, or any trust accounts for which setoff would
be prohibited by law. Borrower authorizes Lender, to the extent permitted by applicable law, to charge or setoff all sums owing
on the Indebtedness against any and all such accounts, and, at Lender’s option, to administratively freeze all such accounts
to allow Lender to protect Lender’s charge and setoff rights provided in this paragraph.

 

    	 

    	 

    

 

	Loan No. 99800297	BUSINESS LOAN AGREEMENT

(Continued)	Page 8

 

DEFAULT.  Each of the
following shall constitute an Event of Default under this Agreement:

 

Payment Default.  Borrower
fails to make any payment when due under the Loan.

 

Other Defaults.  Borrower
fails to comply with or to perform any other term, obligation, covenant or condition contained in this Agreement or in any of the
Related Documents or to comply with or to perform any term, obligation, covenant or condition contained in any other agreement
between Lender and Borrower.

 

False Statements.  Any
warranty, representation or statement made or furnished to Lender by Borrower or on Borrower’s behalf under this Agreement
or the Related Documents is false or misleading in any material respect, either now or at the time made or furnished or becomes
false or misleading at any time thereafter.

 

Death or Insolvency.  The
dissolution of Borrower (regardless of whether election to continue is made), any member withdraws from Borrower, or any other
termination of Borrower’s existence as a going business or the death of any member, the insolvency of Borrower, the appointment
of a receiver for any part of Borrower’s property, any assignment for the benefit of creditors, any type of creditor workout,
or the commencement of any proceeding under any bankruptcy or insolvency laws by or against Borrower.

 

Defective Collateralization.  This
Agreement or any of the Related Documents ceases to be in full force and effect (including failure of any collateral document to
create a valid and perfected security interest or lien) at any time and for any reason.

 

Creditor or Forfeiture Proceedings.  Commencement
of foreclosure or forfeiture proceedings, whether by judicial proceeding, self-help, repossession or any other method, by any creditor
of Borrower or by any governmental agency against any collateral securing the Loan. This includes a garnishment of any of Borrower’s
accounts, including deposit accounts, with Lender. However, this Event of Default shall not apply if there is a good faith dispute
by Borrower as to the validity or reasonableness of the claim which is the basis of the creditor or forfeiture proceeding and if
Borrower gives Lender written notice of the creditor or forfeiture proceeding and deposits with Lender monies or a surety bond
for the creditor or forfeiture proceeding, in an amount determined by Lender, in its sole discretion, as being an adequate reserve
or bond for the dispute.

 

Events Affecting Guarantor.  Any
of the preceding events occurs with respect to any Guarantor of any of the Indebtedness or any Guarantor dies or becomes incompetent,
or revokes or disputes the validity of, or liability under, any Guaranty of the Indebtedness.

 

Adverse Change.  A
material adverse change occurs in Borrower’s financial condition, or Lender believes the prospect of payment or performance
of the Loan is impaired.

 

EFFECT OF AN EVENT OF DEFAULT.  If
any Event of Default shall occur, except where otherwise provided in this Agreement or the Related Documents, all commitments and
obligations of Lender under this Agreement or the Related Documents or any other agreement immediately will terminate (including
any obligation to make further Loan Advances or disbursements), and, at Lender’s option, all Indebtedness immediately will
become due and payable, all without notice of any kind to Borrower, except that in the case of an Event of Default of the type
described in the “Insolvency” subsection above, such acceleration shall be automatic and not optional. In addition,
Lender shall have all the rights and remedies provided in the Related Documents or available at law, in equity, or otherwise. Except
as may be prohibited by applicable law, all of Lender’s rights and remedies shall be cumulative and may be exercised singularly
or concurrently. Election by Lender to pursue any remedy shall not exclude pursuit of any other remedy, and an election to make
expenditures or to take action to perform an obligation of Borrower or of any Grantor shall not affect Lender’s right to
declare a default and to exercise its rights and remedies.

 

    	 

    	 

    

 

	Loan No. 99800297	BUSINESS LOAN AGREEMENT

(Continued)	Page 9

 

MISCELLANEOUS PROVISIONS.  The
following miscellaneous provisions are a part of this Agreement:

 

Amendments.  This
Agreement, together with any Related Documents, constitutes the entire understanding and agreement of the parties as to the matters
set forth in this Agreement. No alteration of or amendment to this Agreement shall be effective unless given in writing and signed
by the party or parties sought to be charged or bound by the alteration or amendment.

 

Attorneys’ Fees; Expenses.  Borrower
agrees to pay upon demand all of Lender’s costs and expenses, including Lender’s reasonable attorneys’ fees and
Lender’s legal expenses, incurred in connection with the enforcement of this Agreement. Lender may hire or pay someone else
to help enforce this Agreement, and Borrower shall pay the costs and expenses of such enforcement. Costs and expenses include Lender’s
reasonable attorneys’ fees and legal expenses whether or not there is a lawsuit, including reasonable attorneys’ fees
and legal expenses for bankruptcy proceedings (including efforts to modify or vacate any automatic stay or injunction), appeals,
and any anticipated post-judgment collection services. Borrower also shall pay all court costs and such additional fees as may
be directed by the court.

 

Caption Headings.  Caption
headings in this Agreement are for convenience purposes only and are not to be used to interpret or define the provisions of this
Agreement.

 

Consent to Loan Participation.  Borrower
agrees and consents to Lender’s sale or transfer, whether now or later, of one or more participation interests in the Loan
to one or more purchasers, whether related or unrelated to Lender. Lender may provide, without any limitation whatsoever, to any
one or more purchasers, or potential purchasers, any information or knowledge Lender may have about Borrower or about any other
matter relating to the Loan, and Borrower hereby waives any rights to privacy Borrower may have with respect to such matters. Borrower
additionally waives any and all notices of sale of participation interests, as well as all notices of any repurchase of such participation
interests. Borrower also agrees that the purchasers of any such participation interests will be considered as the absolute owners
of such interests in the Loan and will have all the rights granted under the participation agreement or agreements governing the
sale of such participation interests. Borrower further waives all rights of offset or counterclaim that it may have now or later
against Lender or against any purchaser of such a participation interest and unconditionally agrees that either Lender or such
purchaser may enforce Borrower’s obligation under the Loan irrespective of the failure or insolvency of any holder of any
interest in the Loan. Borrower further agrees that the purchaser of any such participation interests may enforce its interests
irrespective of any personal claims or defenses that Borrower may have against Lender.

 

    	 

    	 

    

 

	Loan No. 99800297	BUSINESS LOAN AGREEMENT

(Continued)	Page 10

 

Governing Law.  This
Agreement will be governed by federal law applicable to Lender and, to the extent not preempted by federal law, the laws of the
State of Minnesota without regard to its conflicts of law provisions. This Agreement has been accepted by Lender in the State of
Minnesota.

 

Choice of Venue.  If
there is a lawsuit, Borrower agrees upon Lender’s request to submit to the jurisdiction of the courts of Itasca County, State
of Minnesota.

 

No Waiver by Lender.  Lender
shall not be deemed to have waived any rights under this Agreement unless such waiver is given in writing and signed by Lender.
No delay or omission on the part of Lender in exercising any right shall operate as a waiver of such right or any other right.
A waiver by Lender of a provision of this Agreement shall not prejudice or constitute a waiver of Lender’s right otherwise
to demand strict compliance with that provision or any other provision of this Agreement. No prior waiver by Lender, nor any course
of dealing between Lender and Borrower, or between Lender and any Grantor, shall constitute a waiver of any of Lender’s rights
or of any of Borrower’s or any Grantor’s obligations as to any future transactions. Whenever the consent of Lender
is required under this Agreement, the granting of such consent by Lender in any instance shall not constitute continuing consent
to subsequent instances where such consent is required and in all cases such consent may be granted or withheld in the sole discretion
of Lender.

 

Notices.  Any
notice required to be given under this Agreement shall be given in writing, and shall be effective when actually delivered, when
actually received by telefacsimile (unless otherwise required by law), when deposited with a nationally recognized overnight courier,
or, if mailed, when deposited in the United States mail, as first class, certified or registered mail postage prepaid, directed
to the addresses shown near the beginning of this Agreement. Any party may change its address for notices under this Agreement
by giving formal written notice to the other parties, specifying that the purpose of the notice is to change the party’s
address. For notice purposes, Borrower agrees to keep Lender informed at all times of Borrower’s current address. Unless
otherwise provided or required by law, if there is more than one Borrower, any notice given by Lender to any Borrower is deemed
to be notice given to all Borrowers.

 

Severability.  If
a court of competent jurisdiction finds any provision of this Agreement to be illegal, invalid, or unenforceable as to any circumstance,
that finding shall not make the offending provision illegal, invalid, or unenforceable as to any other circumstance. If feasible,
the offending provision shall be considered modified so that it becomes legal, valid and enforceable. If the offending provision
cannot be so modified, it shall be considered deleted from this Agreement. Unless otherwise required by law, the illegality, invalidity,
or unenforceability of any provision of this Agreement shall not affect the legality, validity or enforceability of any other provision
of this Agreement.

 

Subsidiaries and Affiliates
of Borrower.  To the extent the context of any provisions of this Agreement makes it appropriate, including without
limitation any representation, warranty or covenant, the word “Borrower” as used in this Agreement shall include all
of Borrower’s subsidiaries and affiliates. Notwithstanding the foregoing however, under no circumstances shall this Agreement
be construed to require Lender to make any Loan or other financial accommodation to any of Borrower’s subsidiaries or affiliates.

 

Successors and Assigns.  All
covenants and agreements by or on behalf of Borrower contained in this Agreement or any Related Documents shall bind Borrower’s
successors and assigns and shall inure to the benefit of Lender and its successors and assigns. Borrower shall not, however, have
the right to assign Borrower’s rights under this Agreement or any interest therein, without the prior written consent of
Lender.

 

    	 

    	 

    

 

	Loan No. 99800297	BUSINESS LOAN AGREEMENT

(Continued)	Page 11

 

Survival of Representations
and Warranties.  Borrower understands and agrees that in making the Loan, Lender is relying on all representations,
warranties, and covenants made by Borrower in this Agreement or in any certificate or other instrument delivered by Borrower to
Lender under this Agreement or the Related Documents. Borrower further agrees that regardless of any investigation made by Lender,
all such representations, warranties and covenants will survive the making of the Loan and delivery to Lender of the Related Documents,
shall be continuing in nature, and shall remain in full force and effect until such time as Borrower’s Indebtedness shall
be paid in full, or until this Agreement shall be terminated in the manner provided above, whichever is the last to occur.

 

Time is of the Essence.  Time
is of the essence in the performance of this Agreement.

 

Waive Jury.  All
parties to this Agreement hereby waive the right to any jury trial in any action, proceeding, or counterclaim brought by any party
against any other party.

 

DEFINITIONS.  The following
capitalized words and terms shall have the following meanings when used in this Agreement. Unless specifically stated to the contrary,
all references to dollar amounts shall mean amounts in lawful money of the United States of America. Words and terms used in the
singular shall include the plural, and the plural shall include the singular, as the context may require. Words and terms not otherwise
defined in this Agreement shall have the meanings attributed to such terms in the Uniform Commercial Code. Accounting words and
terms not otherwise defined in this Agreement shall have the meanings assigned to them in accordance with generally accepted accounting
principles as in effect on the date of this Agreement:

 

Advance.  The
word “Advance” means a disbursement of Loan funds made, or to be made, to Borrower or on Borrower’s behalf on
a line of credit or multiple advance basis under the terms and conditions of this Agreement.

 

Agreement.  The
word “Agreement” means this Business Loan Agreement, as this Business Loan Agreement may be amended or modified from
time to time, together with all exhibits and schedules attached to this Business Loan Agreement from time to time.

 

Borrower.  The
word “Borrower” means MEIER PROPERTIES, SERIES LLC and includes all co-signers and co-makers signing the Note and all
their successors and assigns.

 

Collateral.  The
word “Collateral” means all property and assets granted as collateral security for a Loan, whether real or personal
property, whether granted directly or indirectly, whether granted now or in the future, and whether granted in the form of a security
interest, mortgage, collateral mortgage, deed of trust, assignment, pledge, crop pledge, chattel mortgage, collateral chattel mortgage,
chattel trust, factor’s lien, equipment trust, conditional sale, trust receipt, lien, charge, lien or title retention contract,
lease or consignment intended as a security device, or any other security or lien interest whatsoever, whether created by law,
contract, or otherwise.

 

Environmental Laws.  The
words “Environmental Laws” mean any and all state, federal and local statutes, regulations and ordinances relating
to the protection of human health or the environment, including without limitation the Comprehensive Environmental Response, Compensation,
and Liability Act of 1980, as amended, 42 U.S.C. Section 9601, et seq. (“CERCLA”), the Superfund Amendments and Reauthorization
Act of 1986, Pub. L. No. 99-499 (“SARA”), the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et seq.,
the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, et seq., or other applicable state or federal laws, rules,
or regulations adopted pursuant thereto.

 

    	 

    	 

    

 

	Loan No. 99800297	BUSINESS LOAN AGREEMENT

(Continued)	Page 12

 

Event of Default.  The
words “Event of Default” mean any of the events of default set forth in this Agreement in the default section of this
Agreement.

 

GAAP.  The word
“GAAP” means generally accepted accounting principles.

 

Grantor.  The
word “Grantor means each and all of the persons or entities granting a Security Interest in any Collateral for the Loan,
including without limitation all Borrowers granting such a Security Interest.

 

Guarantor.  The
word “Guarantor” means any guarantor, surety, or accommodation party of any or all of the Loan.

 

Guaranty.  The
word “Guaranty” means the guaranty from Guarantor to Lender, including without limitation a guaranty of all or part
of the Note.

 

Hazardous Substances.  The
words “Hazardous Substances” mean materials that, because of their quantity, concentration or physical, chemical or
infectious characteristics, may cause or pose a present or potential hazard to human health or the environment when improperly
used, treated, stored, disposed of, generated, manufactured, transported or otherwise handled. The words “Hazardous Substances”
are used in their very broadest sense and include without limitation any and all hazardous or toxic substances, materials or waste
as defined by or listed under the Environmental Laws. The term “Hazardous Substances” also includes, without limitation,
petroleum and petroleum by-products or any fraction thereof and asbestos.

 

Indebtedness.  The
word Indebtedness” means the indebtedness evidenced by the Note or Related Documents, including all principal and interest
together with all other indebtedness and costs and expenses for which Borrower is responsible under this Agreement or under any
of the Related Documents.

 

Lender.  The
word “Lender” means American Bank of the North, its successors and assigns.

 

Loan.  The word
“Loan” means any and all loans and financial accommodations from Lender to Borrower whether now or hereafter existing,
and however evidenced, including without limitation those loans and financial accommodations described herein or described on any
exhibit or schedule attached to this Agreement from time to time.

 

Note.  The word
“Note” means the Note dated April 9, 2015 and executed by MEIER PROPERTIES, SERIES LLC in the principal amount of $4,966,411.01,
together with all renewals of, extensions of, modifications of, refinancings of, consolidations of, and substitutions for the note
or credit agreement.

 

Permitted Liens.  The
words “Permitted Liens” mean (1) liens and security interests securing Indebtedness owed by Borrower to Lender; (2)
liens for taxes, assessments, or similar charges either not yet due or being contested in good faith; (3) liens of materialmen,
mechanics, warehousemen, or carriers, or other like liens arising in the ordinary course of business and securing obligations which
are not yet delinquent; (4) purchase money liens or purchase money security interests upon or in any property acquired or held
by Borrower in the ordinary course of business to secure indebtedness outstanding on the date of this Agreement or permitted to
be incurred under the paragraph of this Agreement titled Indebtedness and Liens”; (5) liens and security interests which,
as of the date of this Agreement, have been disclosed to and approved by the Lender in writing; and (6) those liens and security
interests which in the aggregate constitute an immaterial and insignificant monetary amount with respect to the net value of Borrower’s
assets.

 

    	 

    	 

    

 

	Loan No. 99800297	BUSINESS LOAN AGREEMENT

(Continued)	Page 13

 

Related Documents.  The
words “Related Documents” mean all promissory notes, credit agreements, loan agreements, environmental agreements,
guaranties, security agreements, mortgages, deeds of trust, security deeds, collateral mortgages, and all other instruments, agreements
and documents, whether now or hereafter existing, executed in connection with the Loan.

 

Security Agreement.  The
words “Security Agreement” mean and include without limitation any agreements, promises, covenants, arrangements, understandings
or other agreements, whether created by law, contract, or otherwise, evidencing, governing, representing, or creating a Security
Interest.

 

Security Interest.  The
words “Security Interest” mean, without limitation, any and all types of collateral security, present and future, whether
in the form of a lien, charge, encumbrance, mortgage, deed of trust, security deed, assignment, pledge, crop pledge, chattel mortgage,
collateral chattel mortgage, chattel trust, factor’s lien, equipment trust, conditional sale, trust receipt, lien or title
retention contract, lease or consignment intended as a security device, or any other security or lien interest whatsoever whether
created by law, contract, or otherwise.

 

BORROWER ACKNOWLEDGES HAVING READ ALL
THE PROVISIONS OF THIS BUSINESS LOAN AGREEMENT AND BORROWER AGREES TO ITS TERMS. THIS BUSINESS LOAN AGREEMENT IS DATED APRIL 9,
2015.

 

BORROWER:

 

MEIER PROPERTIES, SERIES LLC

 

	By: 	/s/ Annette D. Meier	 	By: 	/s/ Gilbert Troy Meier
	 	Annette D. Meier, Manager of MEIER	 	 	Gilbert Troy Meier
	 	PROPERTIES, SERIES LLC	 	 	 

 

LENDER:

 

AMERICAN BANK OF THE NORTH

 

	By: 	/s/ John Zanoti	 
	 	Authorized SignerExhibit 10.2

 

COMMERCIAL GUARANTY

 

	
        Principal

         
	
        Loan Date

        5
	
        Maturity

         
	
        Loan No

         
	Call/Coll	
        Account

         
	
        Officer

        ***
	Initials
	References in the boxes above are for Lender’s use only and do not limit the applicability of this document to any particular loan or items.  Any item above containing “****” has been omitted due to the text length limitations.

 

	Borrower:	MEIER PROPERTIES, SERIES LLC	Lender:	American Bank of the North
	 	2221 N. 3250 W.	 	Region 98
	 	Vernal, UT  84076	 	2310 NW 3rd ST
	 	 	 	PO Box 160
	 	 	 	Grand Rapids, MN  55744
	 	 	 	 
	Guarantor:	Superior Drilling Products, Inc.	 	 
	 	PO Box 1656	 	 
	 	 Vernal, UT  84078	 	 

 

CONTINUING GUARANTEE OF PAYMENT AND
PERFORMANCE.  For good and valuable consideration, Guarantor absolutely and unconditionally guarantees full and punctual
payment and satisfaction of the Indebtedness of Borrower to Lender, and the performance and discharge of all Borrower’s obligations
under the Note and the Related Documents. This is a guaranty of payment and performance and not of collection, so Lender can enforce
this Guaranty against Guarantor even when Lender has not exhausted Lender’s remedies against anyone else obligated to pay
the Indebtedness or against any collateral securing the Indebtedness, this Guaranty or any other guaranty of the Indebtedness.
Guarantor will make any payments to Lender or its order, on demand, in legal tender of the United States of America, in same-day
funds, without set-off or deduction or counterclaim, and will otherwise perform Borrower’s obligations under the Note and
Related Documents. Under this Guaranty, Guarantor’s liability is unlimited and Guarantor’s obligations are continuing.

 

INDEBTEDNESS.  The word
“Indebtedness” as used in this Guaranty means all of the principal amount outstanding from time to time and at any
one or more times, accrued unpaid interest thereon and all collection costs and legal expenses related thereto permitted by law,
reasonable attorneys’ fees, arising from any and all debts, liabilities and obligations of every nature or form, now existing
or hereafter arising or acquired, that Borrower individually or collectively or interchangeably with others, owes or will owe Lender.
“Indebtedness” includes, without limitation, loans, advances, debts, overdraft indebtedness, credit card indebtedness,
lease obligations, liabilities and obligations under any interest rate protection agreements or foreign currency exchange agreements
or commodity price protection agreements, other obligations, and liabilities of Borrower, and any present or future judgments against
Borrower, future advances, loans or transactions that renew, extend, modify, refinance, consolidate or substitute these debts,
liabilities and obligations whether: voluntarily or involuntarily incurred; due or to become due by their terms or acceleration;
absolute or contingent; liquidated or unliquidated; determined or undetermined; direct or indirect; primary or secondary in nature
or arising from a guaranty or surety; secured or unsecured; joint or several or joint and several; evidenced by a negotiable or
non-negotiable instrument or writing; originated by Lender or another or others; barred or unenforceable against Borrower for any
reason whatsoever; for any transactions that may be voidable for any reason (such as infancy, insanity, ultra vires or otherwise);
and originated then reduced or extinguished and then afterwards increased or reinstated.

 

If Lender presently holds one or more guaranties,
or hereafter receives additional guaranties from Guarantor, Lender’s rights under all guaranties shall be cumulative. This
Guaranty shall not (unless specifically provided below to the contrary) affect or invalidate any such other guaranties. Guarantor’s
liability will be Guarantor’s aggregate liability under the terms of this Guaranty and any such other unterminated guaranties.

 

CONTINUING GUARANTY.  THIS
IS A “CONTINUING GUARANTY” UNDER WHICH GUARANTOR AGREES TO GUARANTEE THE FULL AND PUNCTUAL PAYMENT, PERFORMANCE AND
SATISFACTION OF THE INDEBTEDNESS OF BORROWER TO LENDER, NOW EXISTING OR HEREAFTER ARISING OR ACQUIRED, ON AN OPEN AND CONTINUING
BASIS. ACCORDINGLY, ANY PAYMENTS MADE ON THE INDEBTEDNESS WILL NOT DISCHARGE OR DIMINISH GUARANTOR’S OBLIGATIONS AND LIABILITY
UNDER THIS GUARANTY FOR ANY REMAINING AND SUCCEEDING INDEBTEDNESS EVEN WHEN ALL OR PART OF THE OUTSTANDING INDEBTEDNESS MAY BE
A ZERO BALANCE FROM TIME TO TIME.

 

    	 

    	 

    

 

DURATION OF GUARANTY.  This
Guaranty will take effect when received by Lender without the necessity of any acceptance by Lender, or any notice to Guarantor
or to Borrower, and will continue in full force until all the Indebtedness incurred or contracted before receipt by Lender of any
notice of revocation shall have been fully and finally paid and satisfied and all of Guarantor’s other obligations under
this Guaranty shall have been performed in full. If Guarantor elects to revoke this Guaranty, Guarantor may only do so in writing.
Guarantor’s written notice of revocation must be mailed to Lender, by certified mail, at Lender’s address listed above
or such other place as Lender may designate in writing. Written revocation of this Guaranty will apply only to new Indebtedness
created after actual receipt by Lender of Guarantor’s written revocation. For this purpose and without limitation, the term
“new Indebtedness” does not include the Indebtedness which at the time of notice of revocation is contingent, unliquidated,
undetermined or not due and which later becomes absolute, liquidated, determined or due. For this purpose and without limitation,
“new Indebtedness” does not include all or part of the Indebtedness that is: incurred by Borrower prior to revocation;
incurred under a commitment that became binding before revocation; any renewals, extensions, substitutions, and modifications of
the Indebtedness. This Guaranty shall bind Guarantor’s estate as to the Indebtedness created both before and after Guarantor’s
death or incapacity, regardless of Lender’s actual notice of Guarantor’s death. Subject to the foregoing, Guarantor’s
executor or administrator or other legal representative may terminate this Guaranty in the same manner in which Guarantor might
have terminated it and with the same effect. Release of any other guarantor or termination of any other guaranty of the Indebtedness
shall not affect the liability of Guarantor under this Guaranty. A revocation Lender receives from any one or more Guarantors shall
not affect the liability of any remaining Guarantors under this Guaranty. It is anticipated that fluctuations may occur in the
aggregate amount of the Indebtedness covered by this Guaranty, and Guarantor specifically acknowledges and agrees that reductions
in the amount of the Indebtedness, even to zero dollars ($0.00), shall not constitute a termination of this Guaranty. This Guaranty
is binding upon Guarantor and Guarantor’s heirs, successors and assigns so long as any of the Indebtedness remains unpaid
and even though the Indebtedness may from time to time be zero dollars ($0.00).

 

GUARANTOR’S AUTHORIZATION TO LENDER.  Guarantor
authorizes Lender, either before or after any revocation hereof, without notice or demand and without lessening Guarantor’s
liability under this Guaranty, from time to time: (A) prior to revocation as set forth above, to make one or more additional secured
or unsecured loans to Borrower, to lease equipment or other goods to Borrower, or otherwise to extend additional credit to Borrower;
(B) to alter, compromise, renew, extend, accelerate, or otherwise change one or more times the time for payment or other terms
of the Indebtedness or any part of the Indebtedness, including increases and decreases of the rate of interest on the Indebtedness;
extensions may be repeated and may be for longer than the original loan term; (C) to take and hold security for the payment of
this Guaranty or the Indebtedness, and exchange, enforce, waive, subordinate, fail or decide not to perfect, and release any such
security, with or without the substitution of new collateral; (D) to release, substitute, agree not to sue, or deal with any one
or more of Borrower’s sureties, endorsers, or other guarantors on any terms or in any manner Lender may choose; (E) to determine
how, when and what application of payments and credits shall be made on the Indebtedness; (F) to apply such security and direct
the order or manner of sale thereof, including without limitation, any nonjudicial sale permitted by the terms of the controlling
security agreement or deed of trust, as Lender in its discretion may determine; (G) to sell, transfer, assign or grant participations
in all or any part of the Indebtedness; and (H) to assign or transfer this Guaranty in whole or in part.

 

GUARANTOR’S REPRESENTATIONS AND
WARRANTIES.  Guarantor represents and warrants to Lender that (A) no representations or agreements of any kind have
been made to Guarantor which would limit or qualify in any way the terms of this Guaranty; (B) this Guaranty is executed at Borrower’s
request and not at the request of Lender; (C) Guarantor has full power, right and authority to enter into this Guaranty; (D) the
provisions of this Guaranty do not conflict with or result in a default under any agreement or other instrument binding upon Guarantor
and do not result in a violation of any law, regulation, court decree or order applicable to Guarantor; (E) Guarantor has not and
will not, without the prior written consent of Lender, sell, lease, assign, encumber, hypothecate, transfer, or otherwise dispose
of all or substantially all of Guarantor’s assets, or any interest therein; (F) upon Lender’s request, Guarantor will
provide to Lender financial and credit information in form acceptable to Lender, and all such financial information which currently
has been, and all future financial information which will be provided to Lender is and will be true and correct in all material
respects and fairly present Guarantor’s financial condition as of the dates the financial information is provided; (G) no
material adverse change has occurred in Guarantor’s financial condition since the date of the most recent financial statements
provided to Lender and no event has occurred which may materially adversely affect Guarantor’s financial condition; (H) no
litigation, claim, investigation, administrative proceeding or similar action (including those for unpaid taxes) against Guarantor
is pending or threatened; (I) Lender has made no representation to Guarantor as to the creditworthiness of Borrower; and (J) Guarantor
has established adequate means of obtaining from Borrower on a continuing basis information regarding Borrower’s financial
condition. Guarantor agrees to keep adequately informed from such means of any facts, events, or circumstances which might in any
way affect Guarantor’s risks under this Guaranty, and Guarantor further agrees that, absent a request for information, Lender
shall have no obligation to disclose to Guarantor any information or documents acquired by Lender in the course of its relationship
with Borrower.

 

    	 

    	 

    

 

GUARANTOR’S FINANCIAL STATEMENTS.  Guarantor
agrees to furnish Lender with the following:

 

Tax Returns.  As
soon as available, but in no event later than thirty (30) days after the applicable filing date for the tax reporting period ended,
Guarantor’s Federal and other governmental tax returns, prepared by Guarantor.

 

Additional Requirements.  Annual
SEC 10K/Audited Financial Statements due to Lender.

 

All financial reports required to be provided
under this Guaranty shall be prepared in accordance with GAAP, applied on a consistent basis, and certified by Guarantor as being
true and correct.

 

GUARANTOR’S WAIVERS.  Except
as prohibited by applicable law, Guarantor waives any right to require Lender (A) to continue lending money or to extend other
credit to Borrower; (B) to make any presentment, protest, demand, or notice of any kind, including notice of any nonpayment of
the Indebtedness or of any nonpayment related to any collateral, or notice of any action or nonaction on the part of Borrower,
Lender, any surety, endorser, or other guarantor in connection with the Indebtedness or in connection with the creation of new
or additional loans or obligations; (C) to resort for payment or to proceed directly or at once against any person, including Borrower
or any other guarantor; (D) to proceed directly against or exhaust any collateral held by Lender from Borrower, any other guarantor,
or any other person; (E) to give notice of the terms, time, and place of any public or private sale of personal property security
held by Lender from Borrower or to comply with any other applicable provisions of the Uniform Commercial Code; (F) to pursue any
other remedy within Lender’s power; or (G) to commit any act or omission of any kind, or at any time, with respect to any
matter whatsoever.

 

Guarantor also waives any and all rights
or defenses based on suretyship or impairment of collateral including, but not limited to, any rights or defenses arising by reason
of (A) any “one action” or “anti-deficiency” law or any other law which may prevent Lender from bringing
any action, including a claim for deficiency, against Guarantor, before or after Lender’s commencement or completion of any
foreclosure action, either judicially or by exercise of a power of sale; (B) any election of remedies by Lender which destroys
or otherwise adversely affects Guarantor’s subrogation rights or Guarantor’s rights to proceed against Borrower for
reimbursement, including without limitation, any loss of rights Guarantor may suffer by reason of any law limiting, qualifying,
or discharging the Indebtedness; (C) any disability or other defense of Borrower, of any other guarantor, or of any other person,
or by reason of the cessation of Borrower’s liability from any cause whatsoever, other than payment in full in legal tender,
of the Indebtedness; (D) any right to claim discharge of the Indebtedness on the basis of unjustified impairment of any collateral
for the Indebtedness; (E) any statute of limitations, if at any time any action or suit brought by Lender against Guarantor is
commenced, there is outstanding Indebtedness which is not barred by any applicable statute of limitations; or (F) any defenses
given to guarantors at law or in equity other than actual payment and performance of the Indebtedness. If payment is made by Borrower,
whether voluntarily or otherwise, or by any third party, on the Indebtedness and thereafter Lender is forced to remit the amount
of that payment to Borrower’s trustee in bankruptcy or to any similar person under any federal or state bankruptcy law or
law for the relief of debtors, the Indebtedness shall be considered unpaid for the purpose of the enforcement of this Guaranty.

 

    	 

    	 

    

 

Guarantor further waives and agrees not
to assert or claim at any time any deductions to the amount guaranteed under this Guaranty for any claim of setoff, counterclaim,
counter demand, recoupment or similar right, whether such claim, demand or right may be asserted by the Borrower, the Guarantor,
or both.

 

GUARANTOR’S UNDERSTANDING WITH
RESPECT TO WAIVERS.  Guarantor warrants and agrees that each of the waivers set forth above is made with Guarantor’s
full knowledge of its significance and consequences and that, under the circumstances, the waivers are reasonable and not contrary
to public policy or law. If any such waiver is determined to be contrary to any applicable law or public policy, such waiver shall
be effective only to the extent permitted by law or public policy.

 

RIGHT OF SETOFF.  To the
extent permitted by applicable law, Lender reserves a right of setoff in all Guarantor’s accounts with Lender (whether checking,
savings, or some other account). This includes all accounts Guarantor holds jointly with someone else and all accounts Guarantor
may open in the future. However, this does not include any IRA or Keogh accounts, or any trust accounts for which setoff would
be prohibited by law. Guarantor authorizes Lender, to the extent permitted by applicable law, to hold these funds if there is a
default, and Lender may apply the funds in these accounts to pay what Guarantor owes under the terms of this Guaranty.

 

SUBORDINATION OF BORROWER’S DEBTS
TO GUARANTOR.  Guarantor agrees that the Indebtedness, whether now existing or hereafter created, shall be superior
to any claim that Guarantor may now have or hereafter acquire against Borrower, whether or not Borrower becomes insolvent. Guarantor
hereby expressly subordinates any claim Guarantor may have against Borrower, upon any account whatsoever, to any claim that Lender
may now or hereafter have against Borrower. In the event of insolvency and consequent liquidation of the assets of Borrower, through
bankruptcy, by an assignment for the benefit of creditors, by voluntary liquidation, or otherwise, the assets of Borrower applicable
to the payment of the claims of both Lender and Guarantor shall be paid to Lender and shall be first applied by Lender to the Indebtedness.
Guarantor does hereby assign to Lender all claims which it may have or acquire against Borrower or against any assignee or trustee
in bankruptcy of Borrower; provided however, that such assignment shall be effective only for the purpose of assuring to Lender
full payment in legal tender of the Indebtedness. If Lender so requests, any notes or credit agreements now or hereafter evidencing
any debts or obligations of Borrower to Guarantor shall be marked with a legend that the same are subject to this Guaranty and
shall be delivered to Lender. Guarantor agrees, and Lender is hereby authorized, in the name of Guarantor, from time to time to
file financing statements and continuation statements and to execute documents and to take such other actions as Lender deems necessary
or appropriate to perfect, preserve and enforce its rights under this Guaranty.

 

    	 

    	 

    

 

MISCELLANEOUS PROVISIONS.  The
following miscellaneous provisions are a part of this Guaranty:

 

Amendments.  This
Guaranty, together with any Related Documents, constitutes the entire understanding and agreement of the parties as to the matters
set forth in this Guaranty. No alteration of or amendment to this Guaranty shall be effective unless given in writing and signed
by the party or parties sought to be charged or bound by the alteration or amendment.

 

Attorneys’ Fees; Expenses.  Guarantor
agrees to pay upon demand all of Lender’s costs and expenses, including Lender’s reasonable attorneys’ fees and
Lender’s legal expenses, incurred in connection with the enforcement of this Guaranty. Lender may hire or pay someone else
to help enforce this Guaranty, and Guarantor shall pay the costs and expenses of such enforcement. Costs and expenses include Lender’s
reasonable attorneys’ fees and legal expenses whether or not there is a lawsuit, including reasonable attorneys’ fees
and legal expenses for bankruptcy proceedings (including efforts to modify or vacate any automatic stay or injunction), appeals,
and any anticipated post-judgment collection services. Guarantor also shall pay all court costs and such additional fees as may
be directed by the court.

 

Caption Headings.  Caption
headings in this Guaranty are for convenience purposes only and are not to be used to interpret or define the provisions of this
Guaranty.

 

Governing Law.  This
Guaranty will be governed by federal law applicable to Lender and, to the extent not preempted by federal law, the laws of the
State of Minnesota without regard to its conflicts of law provisions.

 

Choice of Venue.  If
there is a lawsuit, Guarantor agrees upon Lender’s request to submit to the jurisdiction of the courts of Itasca County,
State of Minnesota.

 

Integration.  Guarantor
further agrees that Guarantor has read and fully understands the terms of this Guaranty; Guarantor has had the opportunity to be
advised by Guarantor’s attorney with respect to this Guaranty; the Guaranty fully reflects Guarantor’s intentions and
parol evidence is not required to interpret the terms of this Guaranty. Guarantor hereby indemnifies and holds Lender harmless
from all losses, claims, damages, and costs (including Lender’s attorneys’ fees) suffered or incurred by Lender as
a result of any breach by Guarantor of the warranties, representations and agreements of this paragraph.

 

Interpretation.  In
all cases where there is more than one Borrower or Guarantor, then all words used in this Guaranty in the singular shall be deemed
to have been used in the plural where the context and construction so require; and where there is more than one Borrower named
in this Guaranty or when this Guaranty is executed by more than one Guarantor, the words “Borrower and “Guarantor”
respectively shall mean all and any one or more of them. The words “Guarantor,” “Borrower,” and “Lender”
include the heirs, successors, assigns, and transferees of each of them. If a court finds that any provision of this Guaranty is
not valid or should not be enforced, that fact by itself will not mean that the rest of this Guaranty will not be valid or enforced.
Therefore, a court will enforce the rest of the provisions of this Guaranty even if a provision of this Guaranty may be found to
be invalid or unenforceable. If any one or more of Borrower or Guarantor are corporations, partnerships, limited liability companies,
or similar entities, it is not necessary for Lender to inquire into the powers of Borrower or Guarantor or of the officers, directors,
partners, managers, or other agents acting or purporting to act on their behalf, and any indebtedness made or created in reliance
upon the professed exercise of such powers shall be guaranteed under this Guaranty.

 

Notices.  Any
notice required to be given under this Guaranty shall be given in writing, and, except for revocation notices by Guarantor, shall
be effective when actually delivered, when actually received by telefacsimile (unless otherwise required by law), when deposited
with a nationally recognized overnight courier, or, if mailed, when deposited in the United States mail, as first class, certified
or registered mail postage prepaid, directed to the addresses shown near the beginning of this Guaranty. All revocation notices
by Guarantor shall be in writing and shall be effective upon delivery to Lender as provided in the section of this Guaranty entitled
“DURATION OF GUARANTY.” Any party may change its address for notices under this Guaranty by giving formal written notice
to the other parties, specifying that the purpose of the notice is to change the party’s address. For notice purposes, Guarantor
agrees to keep Lender informed at all times of Guarantor’s current address. Unless otherwise provided or required by law,
if there is more than one Guarantor, any notice given by Lender to any Guarantor is deemed to be notice given to all Guarantors.

 

    	 

    	 

    

 

No Waiver by Lender.  Lender
shall not be deemed to have waived any rights under this Guaranty unless such waiver is given in writing and signed by Lender.
No delay or omission on the part of Lender in exercising any right shall operate as a waiver of such right or any other right.
A waiver by Lender of a provision of this Guaranty shall not prejudice or constitute a waiver of Lender’s right otherwise
to demand strict compliance with that provision or any other provision of this Guaranty. No prior waiver by Lender, nor any course
of dealing between Lender and Guarantor, shall constitute a waiver of any of Lender’s rights or of any of Guarantor’s
obligations as to any future transactions. Whenever the consent of Lender is required under this Guaranty, the granting of such
consent by Lender in any instance shall not constitute continuing consent to subsequent instances where such consent is required
and in all cases such consent may be granted or withheld in the sole discretion of Lender.

 

Successors and Assigns.  Subject
to any limitations stated in this Guaranty on transfer of Guarantor’s interest, this Guaranty shall be binding upon and inure
to the benefit of the parties, their successors and assigns.

 

Waive Jury.  Lender
and Guarantor hereby waive the right to any jury trial in any action, proceeding, or counterclaim brought by either Lender or Guarantor
against the other.

 

DEFINITIONS.  The following
capitalized words and terms shall have the following meanings when used in this Guaranty. Unless specifically stated to the contrary,
all references to dollar amounts shall mean amounts in lawful money of the United States of America. Words and terms used in the
singular shall include the plural, and the plural shall include the singular, as the context may require. Words and terms not otherwise
defined in this Guaranty shall have the meanings attributed to such terms in the Uniform Commercial Code:

 

Borrower.  The
word “Borrower” means MEIER PROPERTIES, SERIES LLC and includes all co-signers and co-makers signing the Note and all
their successors and assigns.

 

GAAP.  The word
“GAAP” means generally accepted accounting principles.

 

Guarantor.  The
word “Guarantor” means everyone signing this Guaranty, including without limitation Superior Drilling Products, Inc.,
and in each case, any signer’s successors and assigns.

 

Guaranty.  The
word “Guaranty” means this guaranty from Guarantor to Lender.

 

Indebtedness.  The
word “Indebtedness” means Borrower’s indebtedness to Lender as more particularly described in this Guaranty.

 

Lender.  The
word “Lender” means American Bank of the North, its successors and assigns.

 

    	 

    	 

    

 

Note.  The word
“Note” means and includes without limitation all of Borrower’s promissory notes and/or credit agreements evidencing
Borrower’s loan obligations in favor of Lender, together with all renewals of, extensions of, modifications of, refinancings
of, consolidations of and substitutions for promissory notes or credit agreements.

 

Related Documents.  The
words “Related Documents” mean all promissory notes, credit agreements, loan agreements, environmental agreements,
guaranties, security agreements, mortgages, deeds of trust, security deeds, collateral mortgages, and all other instruments, agreements
and documents, whether now or hereafter existing, executed in connection with the Indebtedness.

 

EACH UNDERSIGNED GUARANTOR ACKNOWLEDGES
HAVING READ ALL THE PROVISIONS OF THIS GUARANTY AND AGREES TO ITS TERMS. IN ADDITION, EACH GUARANTOR UNDERSTANDS THAT THIS GUARANTY
IS EFFECTIVE UPON GUARANTOR’S EXECUTION AND DELIVERY OF THIS GUARANTY TO LENDER AND THAT THE GUARANTY WILL CONTINUE UNTIL
TERMINATED IN THE MANNER SET FORTH IN THE SECTION TITLED “DURATION OF GUARANTY”. NO FORMAL ACCEPTANCE BY LENDER IS
NECESSARY TO MAKE THIS GUARANTY EFFECTIVE. THIS GUARANTY IS DATED APRIL 9, 2015.

 

GUARANTOR:

 

SUPERIOR DRILLING PRODUCTS, INC.

 

	By: 	/s/ Annette D. Meier	 	By: 	/s/ Gilbert Troy Meier
	 	Annette D. Meier, President, Chief Operating	 	 	Gilbert Troy Meier, Chairman and Chief
	 	Officer, and Corporate Secretary of Superior	 	 	Executive Officer of Superior Drilling
	 	Drilling Products, Inc.	 	 	Products, Inc.

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