Filing Details

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

SCHEDULE 13D

Under the Securities Exchange Act of 1934

(Amendment No. 3)*

 

 

Superior Drilling Products, Inc.

(Name of Issuer)

Common Stock, par value $0.001 per share

(Title of Class of Securities)

868153107

(CUSIP Number)

Mr. Reid Walker

3953 Maple Avenue, Suite #150,

Dallas, Texas 75219

Telephone: 214-871-8618

(Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications)

September 30, 2016

(Date of Event which Requires Filing of this Statement)

 

 

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of Sections 240.13d-1(e), (f) or (g), check the following box. ☐

 

 

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Section 240.13d-7 for other parties to whom copies are to be sent.

 

 

 

*	The remainder of this cover page shall be filled out for a reporting persons initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.

The information required on the remainder of this cover page shall not be deemed to be filed for the purpose of Section 18 of the Securities Exchange Act of 1934 (Act) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

 

 

 

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SCHEDULE 13D

 

CUSIP No. 868153107

 

1		NAME OF REPORTING PERSON I.R.S. IDENTIFICATION NO. OF ABOVE PERSON   Hard 4 Holdings, LLC1
2		CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a)  ☐        (b)  ☒
3		SEC USE ONLY
4		SOURCE OF FUNDS   OO
5		CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)  ☐
6		CITIZENSHIP OR PLACE OF ORGANIZATION   Texas
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH				7		SOLE VOTING POWER   0
				8		SHARED VOTING POWER   1,471,4292
				9		SOLE DISPOSITIVE POWER   0
				10		SHARED DISPOSITIVE POWER   1,471,429
11		AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON   1,471,429
12		CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES  ☐
13		PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)   6.1%3
14		TYPE OF REPORTING PERSON   OO4

 

1	Hard 4 Holdings, LLC (Holdings) is a Texas limited liability company of which Reid Walker (Walker) is the Manager and sole equity owner. In such capacities, Walker is deemed to share voting and dispositive power over the shares of Common Stock held directly by Holdings.

2	Includes 1,114,286 shares of Common Stock held directly, and 357,143 shares of Common Stock issuable upon exercise of the Warrant (as defined below), which is currently exercisable.

3	Ownership percentages reflected herein are calculated based on 23,961,631 shares of Common Stock outstanding on October 5, 2016, as reflected in Exhibit 99.1 to the Issuers Form 8-K filed on or about October 5, 2016.

4	Hard 4 Holdings, LLC is a limited liability company formed and existing under the laws of the State of Texas.

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SCHEDULE 13D

 

CUSIP No. 868153107

 

1		NAME OF REPORTING PERSON I.R.S. IDENTIFICATION NO. OF ABOVE PERSON   Reid Walker
2		CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a)  ☐        (b)  ☒
3		SEC USE ONLY
4		SOURCE OF FUNDS   PF
5		CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)  ☐
6		CITIZENSHIP OR PLACE OF ORGANIZATION   Texas
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH				7		SOLE VOTING POWER   185,7145
				8		SHARED VOTING POWER   1,471,4296
				9		SOLE DISPOSITIVE POWER   185,714
				10		SHARED DISPOSITIVE POWER   1,471,429
11		AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON   1,657,143
12		CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES  ☐
13		PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)   6.9%
14		TYPE OF REPORTING PERSON   IN

 

5	Reflects shares of Common Stock owned directly by Walker.

6	Includes 1,114,286 shares of Common Stock held directly by Holdings, and 357,143 shares of Common Stock issuable upon exercise of the Warrant. Walker is deemed to share voting and dispositive power over the shares of Common Stock deemed beneficially owned by Holdings.

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AMENDMENT NO. 3

TO STATEMENT ON SCHEDULE 13D

Filed Pursuant to Rule 13d-1(a)

 

ITEM 1.

Security and Issuer.

This Amendment No. 3 to Statement on Schedule 13D (this Amended Schedule 13D) relates to the common stock, par value $0.001 per share (the Common Stock), of Superior Drilling Products, Inc., a Utah corporation (the Issuer), and is being filed jointly by Reid Walker, a resident of the State of Texas (Walker), and Hard 4 Holdings, LLC, a Texas limited liability company wholly-owned and controlled by Walker (Holdings, and collectively with Walker, the Reporting Persons). The Issuers principal executive offices are located at 1583 South 1700 East, Vernal UT 84078. This Amended Schedule 13D further amends and restates, in its entirety, the Statement on Schedule 13D previously filed by the Reporting Persons on or about June 6, 2014, as previously amended on or about January 2, 2015, and as further amended on or about December 9, 2015 (collectively, the Prior Filings).

This Amended Schedule 13D is being filed to reflect the acquisition of additional shares of Common Stock acquired by the Reporting Persons since the Prior Filings. Note that, due to the need to file this amendment promptly, the amounts and percentages reflected herein as held by the Reporting Persons takes into account an aggregate of 56,000 shares of Common Stock acquired on September 30, 2016, by Holdings for subsequent transfer to a trust established for and benefitting the son of Walker (the Trust Shares). Upon such transfer (which is expected to be consummated shortly), neither of the Reporting Persons shall be deemed to hold any beneficial interest in such Trust Shares.

 

ITEM 2.

Identity and Background.

 

(a)

Name. The names of the Reporting Persons are as follows:

Hard 4 Holdings, LLC

Reid Walker

 

(b)

Business Address. The business address of each of the Reporting Persons is 3953 Maple Avenue, Suite #150, Dallas Texas 75219.

 

(c)

Occupation and Employment.

Walker is a private businessman and currently serves as the sole member and manager of Holdings.

Holdings is a Texas limited liability company formed by Walker as an investment vehicle and holding company. Walker exercises control over all activities and operations of Holdings.

 

(d) and (e)

Proceedings. During the previous five (5) years, none of the Reporting Persons have been convicted in any criminal proceeding (excluding traffic violations or similar misdemeanors) nor has any Reporting Person been party to a civil proceeding of a judicial or administrative body of competent jurisdiction such that, as a result of such proceeding, such Reporting Person was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activity subject to, federal or state securities laws or finding any violation with respect to such laws.

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(f)

Citizenship.

Walker is a citizen of the United States.

Holdings is a limited liability company formed and existing under the laws of the State of Texas.

 

ITEM 3.

Source and Amount of Funds or Other Consideration.

Walker acquired the 185,714 shares of Common Stock over which he has sole voting and dispositive control in the Issuers initial public offering. None of such shares were acquired with borrowed funds and none are pledged as security against any borrowed funds.

The shares of Common Stock deemed beneficially owned by Holdings were acquired as follows (i) the Warrant and 357,143 shares of Common Stock were acquired from D4D LLC, a Texas limited liability company in dissolution (D4D), pursuant to a pro rata liquidating distribution from D4D to its members (including Holdings), (ii) 507,143 shares of Common Stock were acquired in open market purchases at quoted prices, and (iii) 250,000⁷ shares of Common Stock (Offering Shares) were acquired in an underwritten secondary public offering by the Issuer (Registration No. 333-212477) (the Offering), which Offering was priced on September 30, 2016, and closed on October 5, 2016. The open market purchases and the Offering Shares were funded from the working capital of Holdings.

The remaining shares of Common Stock (including Common Stock issuable upon exercise of the Warrant) held by Holdings were initially acquired by D4D upon conversion of a Convertible Note (as defined in and incorporated by reference to the Prior Filings) between the Issuer and D4D and in the Issuers initial public offering. Such Convertible Note was purchased by D4D from the Issuer from the working capital of D4D pursuant to the terms of the Securities Purchase Agreement (as defined in and incorporated by reference from the Prior Filings). Holdings funded its pro rata portion of the capitalization of D4D from its working capital. No interest of Holdings in D4D nor any shares of Common Stock held by Holdings (including the shares distributed from D4D, the Offering Shares or the shares acquired in open market purchases) were acquired with borrowed funds.

On or about September 30, 2016, Holdings acquired an aggregate of 306,000 shares of Common Stock in the Offering. Due to certain timing requirements for filing this amendment and the terms and conditions of the governing documents of the Trust, Holdings will finally dispose of the Trust Shares subsequent to the date hereof (resulting in the net of 250,000 Offering Shares being acquired and held by Holdings) and the number of shares of Common Stock reflected herein for the Reporting Persons gives effect to such proposed transfer.

No shares of Common Stock held by the Reporting Persons are pledged as security against any borrowed funds.

Reference is made to the Prior Filings for discussion of D4Ds acquisition and disposition of the securities of the Issuer.

 

7	Gives effect to the contemplated transfer of such Trust Shares.

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ITEM 4.

Purpose of Transaction.

The shares of Common Stock beneficially owned by the Reporting Persons were acquired for investment purposes. The Reporting Persons periodically review their investment in the Issuer and, based on a number of factors, including the Reporting Persons evaluation of the Issuers business prospects and financial condition, the market for the Issuers shares, the working capital needs of the Issuer, general economic and stock market conditions and other investment opportunities, the Reporting Persons may acquire additional securities of the Issuer by exercise of the Warrant or through open market or privately negotiated transactions (including additional registered or private offerings by the Issuer), or the Reporting Persons may dispose of the shares of Common Stock through open market or privately negotiated transactions, as applicable. Further, the Reporting Persons are in the process of transferring, by way of gift, the Trust Shares to the Trust. The number of shares of Common Stock (and percentage of ownership) reflected herein for the Reporting Persons gives effect to such proposed transfer.

Walker and reprsentatives of the Issuer engage in discussions, from time to time, with respect to general industry trends, proposed operational changes, strategic business transactions and other matters Walker believes will increase shareholder value.

Except as set for the above, the Reporting Person does not have any additional plans or proposals which would relate to or would result in:

 

the acquisition of additional securities of the Issuer or the disposition of securities of the Issuer, although the Reporting Person reserves the right to exercise the Warrant at any time, or acquire or dispose of securities of the Issuer, from time to time, based on their evaluation of the Issuer and market conditions (as discussed above);

 

any extraordinary corporate transaction, such as a merger, reorganization or liquidation, involving the Issuer or any of its subsidiaries;

 

a sale or transfer of a material amount of the assets of the Issuer or any of its subsidiaries;

 

any change in the present board of directors or management of the Issuer, including any plans or proposals to change the number or term of directors or to fill any existing vacancies on the board;

 

any material change in the present capitalization or dividend policy of the Issuer;

 

any other material change in the Issuers business or corporate structure, including, but not limited to, if the Issuer is a registered closed-end investment company, any plans or proposals to make any changes in its investment policy for which a vote is required by Section 13 of the Investment Company Act of 1940;

 

changes in the Issuers charter, bylaws or instruments corresponding thereto or other actions which may impede acquisition of control of the Issuer by any person;

 

causing a class of securities of the Issuer to be delisted from a national securities exchange or to cease to be authorized to be quoted in an inter-dealer quotation system of a registered national securities association;

 

a class of equity securities of the Issuer becoming eligible for termination of registration pursuant to Section 12(g)(4) of the Act; or

 

any action similar to any of those enumerated above.

The Reporting Persons reserve the right to determine in the future to change the purpose or purposes described above, or engage in any of the activities set forth above.

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ITEM 5.

Interests in Securities of the Issuer.

 

(a)

Aggregate Number and Percentage of Securities.

As of the date of this Amended Schedule 13D (and giving effect to the transfer of the Trust Shares), Holdings is deemed to beneficially own 1,471,429 shares of Common Stock of the Issuer (representing approximately 6.1% of the Issuers Common Stock), consisting of (i) 1,114,286 shares of Common Stock, and (ii) a warrant (the Warrant), which is currently exercisable, representing the right to purchase an additional 357,143 shares of Common Stock. Due to Walkers control over and ownership of Holdings, Walker is deemed to beneficially own the shares of Common Stock held directly by Holdings, and is deemed to share voting and dispositive control over such shares of Common Stock (including Common Stock issuable upon exercise of the Warrant) with Holdings.

As of the date of this Amended Schedule 13D (and giving effect to the transfer of the Trust Shares), Walker is deemed to beneficially own an aggregate of 1,657,143 shares of Common Stock of the Issuer (representing approximately 6.9% of the Issuers Common Stock), consisting of (i) 185,714 shares of Common Stock held directly by Walker, (ii) 1,114,286 shares of Common Stock held directly by Holdings, and (iii) 357,143 shares of Common Stock issuable upon exercise of the Warrant. Walker is the Manager and sole member of Holdings and, in such capacities, exercises complete control over Holdings and is deemed to beneficially own the shares of Common Stock (including Common Stock issuable upon exercise of the Warrant) beneficially owned by Holdings.

 

(b)

Power to Vote and Dispose.

Holdings shares the voting and dispositive right over the shares of Common Stock it holds (including Common Stock issuable upon exercise of the Warrant) with Walker and does not have sole power to direct the vote or disposition of any shares of Common Stock. Walker is the Manager and sole member of Holdings, and as a result, exercises complete control over the actions and operations of Holdings.

Walker shares the voting and dispositive right over the 1,471,429 shares of Common Stock owned directly by Holdings, and has the sole voting and dispositive right over the 185,714 shares of Common Stock held directly by Walker.

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(c)

Transactions Within the Past 60 Days.

During the 60-day period immediately preceding the filing date of this Amended Schedule 13D, the Reporting Person acquired an aggregate of 306,000 shares of Common Stock in the Offering, and will subsequently dispose of the Trust Share, as set forth in the table below:

 

Date of Acquisition/Disposition		Number of Shares of Common Stock Acquired/<Disposed>		Price Per Share		Type and Manner of Acquisition
09/30/2016		306,000		$1.00		Secondary Offering by Issuer.
October 2016		<56,000>		$0.00		Gift to Trust.

Except for the transactions reflected above, the Reporting Persons have not effected any other transactions in the Issuers securities, including its shares of Common Stock, within sixty (60) days preceding the date hereof.

Since the Prior Filings, Holdings acquired an additional 82,143 shares of Common Stock in open market transactions at quoted prices during the months of January, February and March 2016. No amendment was made to the Prior Filings as such acquisitions did not cause a material change in the information reflected in the Prior Filings.

 

(d)

Certain Rights of Other Persons.

Not applicable.

 

(e)

Date Ceased to be a 5% Owner

Not applicable.

 

ITEM 6.

Contracts, Arrangements, or Understandings or Relationships with Respect to Securities of the Issuer.

 

1.

Holdings, as an assignee of D4D, is party to a Registration Rights Agreement with the Issuer (reference is made to the Prior Filings). The Registration Rights Agreement is incorporated herein by reference, and the foregoing description of the Registration Rights Agreement is qualified in its entirety by reference to the full text of such agreement.

 

2.

Holdings, as an assignee of D4D, is party to the Warrant representing the right to acquire an additional 357,143 shares of Common Stock pursuant to the terms thereof. The Warrant is incorporated herein by reference, and the foregoing description of the Warrant is qualified in its entirety by reference to the full text of such instrument.

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ITEM 7.

Material to be Filed as Exhibits.

 

No.		Document
1.		Joint Filing Agreement between the Reporting Persons.
2.		Form of Common Stock Purchase Warrant by and between Issuer and Holdings, as assignee of D4D*
3.		Form of Registration Rights Agreement by and between Issuer and Holdings, as assignee of D4D*

 

*	Filed as part of Prior Filings and incorporated herein by reference.

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After reasonable inquiry, and to the best of the undersigneds knowledge and belief, the undersigned certifies that the information set forth in this Amendment No. 3 to Schedule 13D is true, complete and correct.

Date: October 12, 2016

 

Attention: Intentional misstatements or

omissions of fact constitute Federal

criminal violations (See 18 U.S.C. § 1001).

 

[Signature Page to Amendment No. 3 to Schedule 13D]

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INDEX OF EXHIBITS

 

No.		Document
1.		Joint Filing Agreement between the Reporting Persons.
2.		Form of Common Stock Purchase Warrant by and between Issuer and Holdings, as assignee of D4D.*
3.		Form of Registration Rights Agreement by and between Issuer and Holdings, as assignee of D4D.*

 

*	Filed as part of Prior Filings and incorporated herein by reference.