Exhibit 4.1


 


Original Issue Date: August 10, 2022


 


	 	$5,500,000


 


10% SECURED OID PROMISSORY NOTE


 


THIS NOTE of BitNile, Inc.,
a Nevada corporation, having a principal place of business at 11411 Southern Highlands Parkway, Suite 240, Las Vegas, Nevada 89141 (the
“Company”), designated as its 10% Secured OID Promissory Note (the “Note”). Capitalized terms used
herein not otherwise defined shall have the meaning ascribed to them in the Purchase Agreement by and among the Company and the Investors
named therein (“Purchase Agreement”).


 


FOR VALUE RECEIVED, the Company
promises to pay to __________ or its registered assigns (the “Holder”), the principal sum of Five Million Five Hundred
Thousand Dollars ($5,500,000) (“Principal Amount”) and to pay accrued interest thereon at the rate of ten percent (10%)
(the “Interest Rate”) per annum from the date of this Note through the date on which such Principal Amount is paid
in full (whether payment in full is at stated maturity, by acceleration or otherwise) in accordance with the terms of this Note.


 


This
Note is subject to the terms and conditions set forth in the Purchase Agreement, as well as to the
following additional provisions:


 


Section 1.     This
Note is exchangeable for an equal aggregate Principal Amount of Notes of different authorized denominations, as requested by the Holder
surrendering the same. No service charge will be made for such registration of transfer or exchange.


 


Section
2.     This Note has been issued subject to certain investment representations of the original Holder set forth in the Purchase
Agreement and may be transferred or exchanged only in compliance with the Purchase Agreement and
applicable federal and state securities laws and regulations. Prior to due presentment to the Company for transfer of this Note, the Company
and any agent of the Company may treat the Person in whose name this Note is duly registered on the Note register as the owner hereof
for the purpose of receiving payment as herein provided and for all other purposes, whether or not this Note is overdue, and neither the
Company nor any such agent shall be affected by notice to the contrary.


 


Section 3.     Events
of Default.


 


(a)       “Event
of Default”, wherever used herein, means any one of the following events (whatever the reason and whether it shall be voluntary
or involuntary or effected by operation of law or pursuant to any judgment, decree or order of any court, or any order, rule or regulation
of any administrative or governmental body):


 


(i)       default
shall be made in the payment of the Principal Amount or interest on this Note when the same becomes due and payable and the default continues
for a period of ten (10) calendar days; or


 



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(iii)     any
representation or warranty made by the Company in the Purchase Agreement was incorrect in any material
respect on or as of the date made; or


 


(iv)    the
Company shall fail to observe or perform any other covenant or agreement contained in this Note, the Purchase Agreement, the Security
Agreement (as defined in Section 15 below) which failure is not cured, if possible to cure, within 10 calendar days after written notice
of such default is sent by the Holder; or


 


(v)    
unless otherwise approved in writing in advance by the Holder, the


Company shall announce an intention to
pursue or consummate a Change of Control, or the Company shall enter into any agreement, understanding or arrangement with respect to
any Change of Control; or


 


(vi)   
the Company shall (A) default in any payment of any amount or amounts of principal of or interest (if any) on any Indebtedness (other
than the indebtedness hereunder), the aggregate principal amount of which indebtedness is in excess of $250,000 that will permit the holder
or holders of such indebtedness to become due prior to its stated maturity or (B) default in the observance or performance of any other
agreement or condition relating to any such indebtedness or contained in any instrument or agreement evidencing, securing or relating
thereto, or any other event shall occur or condition exist, the effect of which default or other event or condition is to cause, or to
permit the holder or holders or beneficiary or beneficiaries of such indebtedness to cause with the giving of notice if required, such
indebtedness to become due prior to its stated maturity and any such default is not remedied within ten (10) Business Days (as
defined in Section 15 below) from the Event of Default occurring by the Company’s failure to comply
with this Section 3(a)(vi); or


 


(viii)   the
Company shall commence, or there shall be commenced against the Company a case under any applicable bankruptcy or insolvency laws as now
or hereafter in effect or any successor thereto, or the Company commences any other proceeding under any reorganization, arrangement,
adjustment of debt, relief of debtors, dissolution, insolvency or liquidation or similar law of any jurisdiction whether now or hereafter
in effect relating to the Company or there is commenced against the Company any such bankruptcy, insolvency or other proceeding which
remains undismissed for a period of 60 days; or the Company is adjudicated insolvent or bankrupt; or any order of relief or other order
approving any such case or proceeding is entered; or the Company suffers any appointment of any custodian or the like for it or any substantial
part of its property which continues undischarged or unstayed for a period of 60 days; or the Company makes a general assignment for the
benefit of creditors; or the Company shall fail to pay, or shall state that it is unable to pay, or shall be unable to pay, its debts
generally as they become due; or the Company; or any corporate or other action is taken by the Company or any Subsidiary thereof for the
purpose of effecting any of the foregoing; or


 



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(vi)     default
with respect to any contractual obligation of the Company under or pursuant to any contract, lease, or other agreement to which the Company
is a party and such default shall continue for more than the period of grace, if any, therein specified, if the aggregate amount of the
Company’s contractual liability arising out of such default exceeds or is reasonably estimated to exceed $500,000; or


 


(vii)    final
judgment for the payment of money in excess of $100,000 shall be rendered against the Company and the same shall remain undischarged for
a period of 60 days during which execution shall not be effectively stayed; or


 


(viii)   Parent’s
Common Stock is no longer publicly traded or ceases to be listed on the Principal Market; or


 


(ix)     Parent
ceases to be a “reporting company” under the Exchange Act, or applies to do so, in either case without the prior written consent
of the Holder; or


 


(x)      there
shall be any SEC or judicial stop trade order or trading suspension stop-order or management cease trade order or any restriction in place
with the transfer agent for the Common Stock of Parent restricting the trading of such Common Stock; or


 


(xi)     in
the event that each of Milton C. Ault, III and William B. Horne cease to be the Executive Chairman and Chief Executive Officer, respectively,
of Parent; or


 


(xii)    the
occurrence of a Material Adverse Effect in respect of the Company, or the Company and its Subsidiaries taken as a whole, and any such
occurrence is not remedied within ten (10) Business Days from the Event of Default occurring by the Company’s failure to comply
with this Section.


 


(b)       If
any Event of Default occurs, the full Principal Amount of this Note, together with the amount of unpaid interest that would have been
payable if the Note was repaid in full in accordance with the terms hereof on the first anniversary of the Original Issue Date and other
amounts owing in respect thereof, to the date of acceleration shall become immediately due and payable in cash. Commencing upon an Event
of Default that results in the eventual acceleration of this Note, the interest rate on this Note shall accrue at the rate of 18% per
annum, or such lower maximum amount of interest permitted to be charged under applicable law). The Holder need not provide, and the Company
hereby waives any presentment, demand, protest or other notice of any kind, and the Holder 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
declaration may be rescinded and annulled by Holder at any time prior to payment hereunder and the Holder shall have all rights as a Note
holder until such time, if any, as the full payment under this Section shall have been received by it. No such rescission or annulment
shall affect any subsequent Event of Default or impair any right consequent thereon.


 



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(c)       Upon
the occurrence of any Event of Default, the Company shall, as promptly as possible but in any event within three (3) Business Days of
such Event of Default, notify the Holder of the occurrence of such Event of Default, describing the event or factual situation giving
rise to the Event of Default and specifying the relevant subsection or subsections of Section 3(a) hereof under which such Event of Default
has occurred


 


Section
4.     This Note is a direct obligation of the Company, and the obligation of the Company to repay this Note is absolute and
unconditional. The obligation to repay this Note shall be secured pursuant to the Security Agreement. In addition, each of Milton C. Ault,
III and Parent shall guarantee to the Holder the performance and punctual payment in respect of the Note pursuant to a Guaranty (as defined
in Section 15 below).


 


Section 5.     Interest
on the amount advanced will accrue on this Note until the Maturity Date (as defined in Section 15 below) at the rate of ten percent (10%)
per annum based on a 365-day year. All accrued but unpaid interest will be paid monthly in arrears
with each Monthly Payment (as defined in Section 6 below). If an Event of Default shall occur, interest at the rate of eighteen percent
(18%) per annum or the highest rate allowed by law, whichever is lower, shall accrue on the outstanding principal of this Note from and
after the date of the Event of Default until the date that the Event of Default is cured. All past due interest shall accrue on a daily
basis and shall be payable in cash. The Holder may demand payment of all or any part of this Note, together with accrued interest, if
any, and any other amounts due hereunder, as of the Maturity Date or any date thereafter.


 


 Section 6.     Provided that
the Company does not elect to exercise a Monthly Forbearance (as defined in Section 7 below), the Company shall make monthly payments
(each a “Monthly Payment”) of Five Hundred Thousand Dollars ($500,000) each in accordance with the amortization table
attached as Exhibit A hereto by the tenth (10th) calendar day of each month commencing in September 2022. Subject to Section
3(b) above and Section 7 below, all payments due and owing under this Note will become due and payable on the Maturity Date.


 


 Section 7.     Subject to the Company
making the first six (6) Monthly Payments in full to Holder on a timely basis, the Company, in lieu of making a Monthly Payment, in its
sole option, may elect to pay a forbearance fee equal to $125,000 (each a “Monthly Forbearance”) by the due date of
such Monthly Payment. For each Monthly Forbearance elected by the Company, the due date of each subsequent Monthly Payment and the Maturity
Date will be extended by one (1) month, provided, however, that the Company may not elect a Monthly Forbearance in consecutive months.


 


 Section 8.     [Reserved]


 


 Section 9.    Any payment made by
the Company to the Holder, on account of this Note shall be applied in the following order of priority: (i) first, to any amounts other
than principal and accrued interest, if any, owed hereunder, (ii) second, to accrued interest, if any, through and including the date
of payment, and (iii) then, to Principal Amount of this Note.


 



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 Section 10. Amounts due under this
Note may be prepaid at any time; provided however, upon the prepayment of this Note in full, there shall
be due to the Holder the amount of unpaid interest that would have accrued in accordance with the terms hereof through the first anniversary
of the Original Issue Date.


 


Section 11.  This
Note shall be governed by and interpreted in accordance with the laws of the State of New York for
contracts to be wholly performed in such state and without giving effect to the principles thereof regarding the conflict of laws. Each
of the parties consents to the exclusive jurisdiction of the state courts of the State of New York
located in New York County and the United States District Court for the Southern District of New York in
connection with any dispute arising under this Agreement and hereby waives, to the maximum extent permitted by law, any objection, including
any objection based on forum non convenes, to the bringing of any such proceeding in such jurisdictions. To the extent determined by such
court, the Company shall reimburse the Holder for any reasonable legal fees and disbursements incurred by the Holder in enforcement of
or protection of any of its rights under this Note. The Company and the Holder hereby waive a trial by jury in any action, proceeding
or counterclaim brought by either of the parties hereto against the other in respect of any matter arising out of or in connection with
this Agreement or the Note.


 


Section 12.  Any
and all notices or other communications or deliveries to be provided by the Holder hereunder, including, without limitation, any notice
of conversion, shall be in writing and delivered personally, by facsimile, sent by a nationally recognized overnight courier service,
addressed to the Company, at the address set forth above Attn: William B. Horne or by email to ____________ or such other address or email
address as the Company may specify for such purposes by notice to the Holder delivered in accordance with this Section. Any and all notices
or other communications or deliveries to be provided by the Company hereunder shall be in writing and delivered personally, sent by a
nationally recognized overnight courier service addressed to each Holder or at the email address of Holder appearing on the books of the
Company, or if no such email address or address appears, at the principal place of business of the Holder. Any notice or other communication
or deliveries hereunder shall be deemed given and effective on the earliest of (i) the date of transmission, if such notice or communication
is delivered via email prior to 5:30 p.m. (New York, New York time), (ii) the date after the date
of transmission, if such notice or communication is delivered via email specified in this Section later than 5:30 p.m. (New York,
New York time) on any date and earlier than 11:59 p.m. (New York, New York time)
on such date, (iii) the second Business Day following the date of mailing, if sent by nationally recognized overnight courier service,
or (iv) upon actual receipt by the party to whom such notice is required to be given. Whenever any payment or other obligation hereunder
shall be due on a day other than a Business Day, such payment shall be made on the next succeeding Business Day.


 


Section 13.   If this
Note shall be mutilated, lost, stolen or destroyed, the Company shall execute and deliver, in exchange and substitution for and upon cancellation
of a mutilated Note, or in lieu of or in substitution for a lost, stolen or destroyed Note, a new Note for the principal amount of this
Note so mutilated, lost, stolen or destroyed but only upon receipt of evidence of such loss, theft or destruction of such Note, and of
the ownership hereof, and indemnity, if requested, all reasonably satisfactory to the Company.


 



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Section 14.   If
any provision of this Note is invalid, illegal or unenforceable, the balance of this Note shall remain in effect, and if any provision
is inapplicable to any person or circumstance, it shall nevertheless remain applicable to all other persons and circumstances. If it shall
be found that any interest or other amount deemed interest due hereunder violates applicable laws governing usury, the applicable rate
of interest due hereunder shall automatically be lowered to equal the maximum permitted rate of interest. The Company covenants (to the
extent that it may lawfully do so) that it shall not at any time insist upon, plead, or in any manner whatsoever claim or take the benefit
or advantage of, any stay, extension or usury law or other law which would prohibit or forgive the Company from paying all or any portion
of the principal of or interest on this Note as contemplated herein, wherever enacted, now or at any time hereafter in force, or which
may affect the covenants or the performance of this indenture, and the Company (to the extent it may lawfully do so) hereby expressly
waives all benefits or advantage of any such law, and covenants that it will not, by resort to any such law, hinder, delay or impeded
the execution of any power herein granted to the Holder, but will suffer and permit the execution of every such as though no such law
has been enacted.


 


Section 15.   Definitions.
For the purposes hereof, in addition to the terms defined elsewhere in this Note: (a) capitalized terms not otherwise defined herein have
the meanings given to such terms in the Purchase Agreement, and (b) the following terms shall have the following meanings:


 


“Business Day”
means any day except Saturday, Sunday and any day which shall be a federal legal holiday in the United States or a day on which banking
institutions in the State of New York are authorized or required by law or other government action to close.


 


“Change of
Control” means, with respect to the Company, on or after the date of this Note:


 


(a) a change in the composition
of the Board of Directors of the Company at a single shareholder meeting where a majority of the individuals that were directors of the
Company immediately prior to the start of such shareholder meeting are no longer directors at the conclusion of such meeting, without
the prior written consent of a majority in interest of the Investors;


 


(b) a change, without the
prior written consent of a majority in interest of the Investors, in the composition of the Board of Directors of the Company prior to
the termination of this Agreement where a majority of the individuals that were directors as of the date of this Note cease to be directors
of the Company prior to the payment if full of the Notes; or


 


(c) other than a shareholder
that holds such a position at the date of this Agreement, if a Person comes to have beneficial ownership, control or direction over more
than forty percent (40%) of the voting rights attached to any class of voting securities of the Company; or


 


(d) the sale or other disposition
by the Company or any of its Subsidiaries in a single transaction, or in a series of transactions, of all or substantially all of their
respective assets.


 



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“Guaranty”
means each of (i) the Guaranty, dated as of the date hereof, by Milton C. Ault, III in favor of the original Holders, as amended, modified
or supplemented from time to time in accordance with its terms (ii) the Guaranty, dated as of the date hereof, by Digital Power Lending,
LLC in favor of the original Holders, as amended, modified or supplemented from time to time in accordance with its terms and (iii) the
Guaranty, dated as of the date hereof, by Parent in favor of the original Holders, as amended, modified or supplemented from time to time
in accordance with its terms.


 


“Maturity Date”
means the first anniversary of the Original Issue Date; provided, however, that the Maturity Date is subject to acceleration as provided
in Section 3(b) above and to extension as provided in Section 7 above.


 


“Parent”
means BitNile Holdings, Inc., a Delaware corporation.


 


“Person”
means a corporation, an association, a partnership, organization, a business, an individual, a government or political subdivision thereof
or a governmental agency.


 


“Purchase Agreement”
means the Purchase Agreement, dated as of the date hereof, to which the Company and the original Holder are parties, as amended, modified
or supplemented from time to time in accordance with its terms.


 


“Security Agreement”
means the Security Agreement, dated as of the date hereof, to which the Company and the original Holder are parties, as amended, modified
or supplemented from time to time in accordance with its terms.


 


 


*********************

 



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IN WITNESS WHEREOF, the Company
has caused this Note to be duly executed by a duly authorized officer as of the date first above indicated.


 


	 	BITNILE, INC.
	 	 	 
	 	 	 
	 	By:	 
	 	 	
    Name: William B. Horne

    Title: Chief Executive Officer



 



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Exhibit A


 


 


	Date	 	 	Total Payment	 	 	Interest Pmt.	 	 	Principal Pmt.	 	 	Interest 
 Expense	 	 	Balance	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	08/10/2022	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	$	5,500,000	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	09/10/2022	 	 	$	(500,000	)	 	$	(85,600	)	 	$	(414,400	)	 	$	85,600	 	 	$	5,085,600	 
	10/10/2022	 	 	 	(500,000	)	 	 	(72,554	)	 	 	(427,446	)	 	 	72,554	 	 	 	4,658,154	 
	11/10/2022	 	 	 	(500,000	)	 	 	(60,415	)	 	 	(439,585	)	 	 	60,415	 	 	 	4,218,569	 
	12/10/2022	 	 	 	(500,000	)	 	 	(56,537	)	 	 	(443,463	)	 	 	56,537	 	 	 	3,775,106	 
	02/10/2023	 	 	 	(500,000	)	 	 	(48,962	)	 	 	(451,038	)	 	 	48,962	 	 	 	3,324,068	 
	03/10/2023	 	 	 	(500,000	)	 	 	(43,112	)	 	 	(456,888	)	 	 	43,112	 	 	 	2,867,180	 
	04/10/2023	 	 	 	(500,000	)	 	 	(39,665	)	 	 	(460,335	)	 	 	39,665	 	 	 	2,406,845	 
	05/10/2023	 	 	 	(500,000	)	 	 	(29,135	)	 	 	(470,865	)	 	 	29,135	 	 	 	1,935,980	 
	06/10/2023	 	 	 	(500,000	)	 	 	(25,946	)	 	 	(474,054	)	 	 	25,946	 	 	 	1,461,926	 
	07/10/2023	 	 	 	(500,000	)	 	 	(17,697	)	 	 	(482,303	)	 	 	17,697	 	 	 	979,623	 
	08/10/2023	 	 	 	(500,000	)	 	 	(13,976	)	 	 	(486,024	)	 	 	13,976	 	 	 	493,599	 
	09/10/2023	 	 	 	(500,000	)	 	 	(6,401	)	 	 	(493,599	)	 	 	6,401	 	 	 	-	 
	Total	 	 	$	(6,000,000	)	 	$	(500,000	)	 	$	(5,500,000	)	 	$	500,000	 	 	$	-	 



 


 


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