Exhibit 4.1


 


SECURED
PROMISSORY NOTE #1


 


	Effective Date: November 23, 2021	 	 	 	     U.S. $5,250,000.00




 


FOR
VALUE RECEIVED, Aridis Pharmaceuticals, Inc., a Delaware corporation (“Borrower”),
promises to pay to Streeterville Capital, LLC, a Utah limited liability company, or its
successors or assigns (“Lender”), $5,250,000.00 and any interest, fees, charges, and late fees accrued hereunder on
the date that is twenty-four (24) months after the Purchase Price Date (the “Maturity Date”) in accordance with the
terms set forth herein and to pay interest on the Outstanding Balance at the rate of six percent (6%) per annum from the Purchase Price
Date until the same is paid in full. All interest calculations hereunder shall be computed on the basis of a 360-day year comprised of
twelve (12) thirty (30) day months, shall compound daily and shall be payable in accordance with the terms of this Note. This
Secured Promissory Note #1 (this “Note”) is issued and made effective as of November 22, 2021 (the “Effective
Date”). This Note is issued pursuant to that certain Note Purchase Agreement dated November 23, 2021, as the same may be
amended from time to time, by and between Borrower and Lender (the “Purchase Agreement”). Certain capitalized terms
used herein are defined in Attachment 1 attached hereto and incorporated herein by this reference.


 


This Note carries an OID of $250,000.00. The purchase
price for this Note shall be $5,000,000.00 (the “Purchase Price”), computed as follows: $5,250,000.00 original principal
balance, less the OID. The Purchase Price shall be payable by Lender by wire transfer of immediately available funds.


 


1.            Payment;
Prepayment.


 


1.1.            Payment.
All payments owing hereunder shall be in lawful money of the United States of America and delivered to Lender at the address or
bank account furnished to Borrower for that purpose. All payments shall be applied first to (a) costs of collection, if any, then
to (b) fees and charges, if any, then to (c) accrued and unpaid interest, and thereafter, to (d) principal.


 


1.2.            Prepayment
Premium. Borrower may pay all or any portion of the Outstanding Balance earlier than it is due; provided that in the event
Borrower elects to prepay all or any portion of the Outstanding Balance it shall pay to Lender: (a) 105% of the portion of the Outstanding
Balance Borrower elects to prepay if the prepayment occurs on or before the three-month anniversary of the Purchase Price Date; (b) 107.5%
of the portion of the Outstanding Balance Borrower elects to prepay if the prepayment occurs after the three-month anniversary of the
Purchase Price Date but on or before the six-month anniversary of the Purchase Price Date; and (c) 110% of the portion of the Outstanding
Balance Borrower elects to prepay if the prepayment occurs after the six-month anniversary of the Prepayment Date. Early payments of less
than all principal, fees and interest outstanding will not, unless agreed to by Lender in writing, relieve Borrower of Borrower’s
remaining obligations hereunder.


 


2.            Security.
This Note is secured by the Security Agreement (as defined in the Purchase Agreement), executed by Borrower in favor of Lender encumbering
the collateral set forth therein, as more specifically set forth in the Security Agreement, all the terms and conditions of which are
hereby incorporated into and made a part of this Note.


 


3.            Redemptions.
Beginning on the date that is six (6) months following the Purchase Price Date, Lender shall have the right, exercisable at any time
in its sole and absolute discretion, to redeem any amount of this Note up to the Maximum Monthly Redemption Amount (such amount, the “Redemption
Amount”) per calendar month by providing written notice to Borrower (each, a “Redemption Notice”). For the
avoidance of doubt, Lender may submit to Borrower one (1) or more Redemption Notices in any given calendar month so long as the aggregate
amount being redeemed in such month does not exceed the Maximum Monthly Redemption Amount. Upon receipt of any Redemption Notice, Borrower
shall pay the applicable Redemption Amount in cash to Lender within three (3) Trading Days of Borrower’s receipt of such Redemption
Notice. Borrower shall have the right to defer all redemption payments that Lender could otherwise elect to make during any calendar month
on three (3) separate occasions by providing written notice to Lender at least three (3) Trading Days prior to the first day
of each such calendar month for which it wishes to defer redemptions for that month. In the event Borrower elects to exercise its deferral
right, the Outstanding Balance shall automatically be increased by: (a) 0.5% for the first exercise of Borrower’s deferral
right; (b) 1% for the second exercise of Borrower’s deferral right; and (c) 1.5% for the third exercise of Borrower’s
deferral right. For the avoidance of doubt, any redemption payment made pursuant to this Section 3 shall be considered a prepayment
and subject to the prepayment premium set forth in Section 1.2(b) above.


 






     


     


    

 


4.            Defaults
and Remedies.


 


4.1.            Defaults.
The following are events of default under this Note (each, an “Event of Default”): (a) Borrower fails to pay any
principal, interest, fees, charges, or any other amount when due and payable hereunder; (b) a receiver, trustee or other similar
official shall be appointed over Borrower or a material part of its assets and such appointment shall remain uncontested for twenty (20)
days or shall not be dismissed or discharged within sixty (60) days; (c) Borrower becomes insolvent or generally fails to pay, or
admits in writing its inability to pay, its debts as they become due, subject to applicable grace periods, if any; (d) Borrower makes
a general assignment for the benefit of creditors; (e) Borrower files a petition for relief under any bankruptcy, insolvency or similar
law (domestic or foreign); (f) an involuntary bankruptcy proceeding is commenced or filed against Borrower; (g) Borrower or
any pledgor, trustor, or guarantor of this Note defaults or otherwise fails to observe or perform any covenant, obligation, condition
or agreement of Borrower or such pledgor, trustor, or guarantor contained herein or in any other Transaction Document (as defined in the
Purchase Agreement), other than those specifically set forth in this Section 4.1 and Section 4 of the Purchase Agreement; (h) any
representation, warranty or other statement made or furnished by or on behalf of Borrower or any pledgor, trustor, or guarantor of this
Note to Lender herein, in any Transaction Document, or otherwise in connection with the issuance of this Note is false, incorrect, incomplete
or misleading in any material respect when made or furnished; (i) the occurrence of a Fundamental Transaction without Lender’s
prior written consent unless this Note is paid in full in connection with such Fundamental Transaction; (j) Borrower effectuates
a reverse split of its Common Stock (as defined in the Purchase Agreement) without twenty (20) Trading Days prior written notice to Lender;
(k) any United States money judgment, writ or similar process is entered or filed against Borrower or any subsidiary of Borrower
or any of its property or other assets for more than $1,000,000.00, and shall remain unvacated, unbonded or unstayed for a period of twenty
(20) calendar days unless otherwise consented to by Lender; (l) Borrower fails to observe or perform any covenant set forth in Section 4
of the Purchase Agreement; or (m) Borrower, any affiliate of Borrower, or any pledgor, trustor, or guarantor of this Note breaches
any covenant or other term or condition contained in any Other Agreements.


 


4.2.            Remedies.
At any time and from time to time after Lender becomes aware of the occurrence of any Event of Default, Lender may accelerate this Note
by written notice to Borrower, with the Outstanding Balance becoming immediately due and payable in cash at the Mandatory Default Amount.
Notwithstanding the foregoing, at any time following the occurrence of any Event of Default, Lender may, at its option, elect to increase
the Outstanding Balance by applying the Default Effect (subject to the limitation set forth below) via written notice to Borrower without
accelerating the Outstanding Balance, in which event the Outstanding Balance shall be increased as of the date of the occurrence of the
applicable Event of Default pursuant to the Default Effect, but the Outstanding Balance shall not be immediately due and payable unless
so declared by Lender (for the avoidance of doubt, if Lender elects to apply the Default Effect pursuant to this sentence, it shall reserve
the right to declare the Outstanding Balance immediately due and payable at any time and no such election by Lender shall be deemed to
be a waiver of its right to declare the Outstanding Balance immediately due and payable as set forth herein unless otherwise agreed to
by Lender in writing). Notwithstanding the foregoing, upon the occurrence of any Event of Default described in clauses (b), (c), (d),
(e) or (f) of Section 4.1, the Outstanding Balance as of the date of acceleration shall become immediately and automatically
due and payable in cash at the Mandatory Default Amount, without any written notice required by Lender. At any time following the
occurrence of any Event of Default, upon written notice given by Lender to Borrower, interest shall accrue on the Outstanding Balance
beginning on the date the applicable Event of Default occurred at an interest rate equal to the lesser of eighteen percent (18%) per annum
or the maximum rate permitted under applicable law (“Default Interest”). In connection with acceleration described
herein, Lender need not provide, and Borrower hereby waives, any presentment, demand, protest or other notice of any kind, and Lender
may immediately and without expiration of any grace period enforce any and all of its rights and remedies hereunder and all other remedies
available to it under applicable law. Such acceleration may be rescinded and annulled by Lender at any time prior to payment hereunder
and Lender shall have all rights as a holder of the Note until such time, if any, as Lender receives full payment pursuant to this Section 4.2.
No such rescission or annulment shall affect any subsequent Event of Default or impair any right consequent thereon. Nothing herein shall
limit Lender’s right to pursue any other remedies available to it at law or in equity including, without limitation, a decree of
specific performance and/or injunctive relief.


 






    2


     


    

 


5.            Unconditional
Obligation; No Offset. Borrower acknowledges that this Note is an unconditional, valid, binding and enforceable obligation of Borrower
not subject to offset, deduction or counterclaim of any kind. Borrower hereby waives any rights of offset it now has or may have hereafter
against Lender, its successors and assigns, and agrees to make the payments called for herein in accordance with the terms of this Note.


 


6.            Waiver.
No waiver of any provision of this Note shall be effective unless it is in the form of a writing signed by the party granting the waiver.
No waiver of any provision or consent to any prohibited action shall constitute a waiver of any other provision or consent to any other
prohibited action, whether or not similar. No waiver or consent shall constitute a continuing waiver or consent or commit a party to provide
a waiver or consent in the future except to the extent specifically set forth in writing.


 


7.            Opinion
of Counsel. In the event that an opinion of counsel is needed for any matter related to this Note, Lender has the right to have any
such opinion provided by its counsel.


 


8.            Governing
Law; Venue. This Note shall be construed and enforced in accordance with, and all questions concerning the construction, validity,
interpretation and performance of this Note shall be governed by, the internal laws of the State of Utah, without giving effect to any
choice of law or conflict of law provision or rule (whether of the State of Utah or any other jurisdiction) that would cause the
application of the laws of any jurisdiction other than the State of Utah. The provisions set forth in the Purchase Agreement to determine
the proper venue for any disputes are incorporated herein by this reference.


 


9.            Arbitration
of Disputes. By its issuance or acceptance of this Note, each party agrees to be bound by the Arbitration Provisions (as defined in
the Purchase Agreement) set forth as an exhibit to the Purchase Agreement.


 


10.            Cancellation.
After repayment of the entire Outstanding Balance, this Note shall be deemed paid in full, shall automatically be deemed canceled, and
shall not be reissued.


 


11.            Amendments.
The prior written consent of both parties hereto shall be required for any change or amendment to this Note.


 






    3


     


    

 


12.            Assignments.
Borrower may not assign this Note without the prior written consent of Lender. This Note may be offered, sold, assigned or transferred
by Lender without the consent of Borrower, so long as such transfer is in accordance with applicable federal and state securities laws.


 


13.            Notices.
Whenever notice is required to be given under this Note, unless otherwise provided herein, such notice shall be given in accordance with
the subsection of the Purchase Agreement titled “Notices.”


 


14.            Liquidated
Damages. Lender and Borrower agree that in the event Borrower fails to comply with any of the terms or provisions of this Note, Lender’s
damages would be uncertain and difficult (if not impossible) to accurately estimate because of the parties’ inability to predict
future interest rates, future share prices, future trading volumes and other relevant factors. Accordingly, Lender and Borrower agree
that any fees, balance adjustments, Default Interest or other charges assessed under this Note are not penalties but instead are
intended by the parties to be, and shall be deemed, liquidated damages.


 


15.            Severability.
If any part of this Note is construed to be in violation of any law, such part shall be modified to achieve the objective of Borrower
and Lender to the fullest extent permitted by law and the balance of this Note shall remain in full force and effect.


 


[Remainder of page intentionally left blank;
signature page follows]


 






    4


     


    

 


IN WITNESS WHEREOF, Borrower has caused this Note
to be duly executed as of the Effective Date.


 


	 	BORROWER:
	 	 
	 	Aridis Pharmaceuticals, Inc.
	 	 
	 	By:	                             
	 	 	Vu Truong, CEO




 


	ACKNOWLEDGED, ACCEPTED AND AGREED:	 
	 	 
	LENDER:	 
	 	 
	Streeterville Capital, LLC	 
	 	 
	By:	                       	 
	 	John M. Fife, President	 




 


[Signature
Page to Secured Promissory Note #1]


 






     


     


    

 


ATTACHMENT 1





DEFINITIONS


 


For
purposes of this Note, the following terms shall have the following meanings:


 


A1.     “Default
Effect” means multiplying the Outstanding Balance as of the date the applicable Event of Default occurred by (a) fifteen
percent (15%) for each occurrence of any Major Default, or (b) five percent (5%) for each occurrence of any Minor Default, and then
adding the resulting product to the Outstanding Balance as of the date the applicable Event of Default occurred, with the sum of the foregoing
then becoming the Outstanding Balance under this Note as of the date the applicable Event of Default occurred; provided that the Default
Effect may only be applied three (3) times hereunder with respect to Major Defaults and three (3) times hereunder with respect
to Minor Defaults.


 


A2.     “Fundamental
Transaction” means that (a) (i) Borrower or any of its subsidiaries shall, directly or indirectly, in one or more
related transactions, consolidate or merge with or into (whether or not Borrower or any of its subsidiaries is the surviving corporation)
any other person or entity, or (ii) Borrower or any of its subsidiaries shall, directly or indirectly, in one or more related transactions,
sell, lease, license, assign, transfer, convey or otherwise dispose of all or substantially all of its respective properties or assets
to any other person or entity, or (iii) Borrower or any of its subsidiaries shall, directly or indirectly, in one or more related
transactions, allow any other person or entity to make a purchase, tender or exchange offer that is accepted by the holders of more than
50% of the outstanding shares of voting stock of Borrower (not including any shares of voting stock of Borrower held by the person or
persons making or party to, or associated or affiliated with the persons or entities making or party to, such purchase, tender or exchange
offer), or (iv) Borrower or any of its subsidiaries shall, directly or indirectly, in one or more related transactions, consummate
a stock or share purchase agreement or other business combination (including, without limitation, a reorganization, recapitalization,
spin-off or scheme of arrangement) with any other person or entity whereby such other person or entity acquires more than 50% of the outstanding
shares of voting stock of Borrower (not including any shares of voting stock of Borrower held by the other persons or entities making
or party to, or associated or affiliated with the other persons or entities making or party to, such stock or share purchase agreement
or other business combination), or (v) Borrower or any of its subsidiaries shall, directly or indirectly, in one or more related
transactions, reorganize, recapitalize or reclassify the Common Stock, other than an increase in the number of authorized shares of Borrower’s
Common Stock, or reverse splits of its outstanding and authorized shares of Common Stock to meet Nasdaq listing requirements or (b) any
 “person” or “group” (as these terms are used for purposes of Sections 13(d) and 14(d) of the 1934 Act
and the rules and regulations promulgated thereunder) is or shall become the “beneficial owner” (as defined in Rule 13d-3
under the 1934 Act), directly or indirectly, of 50% of the aggregate ordinary voting power represented by issued and outstanding voting
stock of Borrower.


 


A3.     “Mandatory
Default Amount” means the Outstanding Balance following the application of the Default Effect.


 


A4.     “Maximum
Monthly Redemption Amount” means $450,000.00 per calendar month.


 


A5.     “OID”
means an original issue discount.


 


A6.     “Other
Agreements” means, collectively, (a) all existing and future agreements and instruments between, among or by Borrower (or
an affiliate), on the one hand, and Lender (or an affiliate), on the other hand, and (b) any financing agreement or a material agreement
that affects Borrower’s ongoing business operations.


 


A7.     “Outstanding
Balance” means as of any date of determination, the Purchase Price, as reduced or increased, as the case may be, pursuant to
the terms hereof for payment, offset, or otherwise, plus the OID, plus accrued but unpaid interest, collection and enforcements costs
(including attorneys’ fees) incurred by Lender, transfer, stamp, issuance and similar taxes and fees incurred under this Note.


 


A8.     “Purchase
Price Date” means the date the Purchase Price is delivered by Lender to Borrower.


 


A9.     “Trading
Day” means any day on which the New York Stock Exchange (or such other principal market for the Common Stock) is open for trading.
For purposes of determining Borrower’s cash payment deadline under this Note, such “Trading Day” shall exclude any day
on which banking institutions in Dalian, China are authorized or required by law or other governmental action to close.


 


[Remainder of page intentionally left blank]