Material Agreement, Financial Obligation (Form 8-K)

Item 1.01 Entry into a Material Definitive Agreement

On July 3, 2025, Avalon GloboCare Corp., a Delaware corporation (the "Company") issued two Convertible Promissory Notes (each, a "Note" and collectively, the "Notes") to two accredited investors (each, an "Investor" and together, the "Investors"), on identical terms. Each Note had a principal amount of $100,000, bears a one-time interest charge of $30,000, and matures nine months from the date of issuance.

Pursuant to the terms of the Notes, beginning six months after the issue date, the Investors may convert the outstanding principal and accrued interest into shares of the Company's common stock at a fixed conversion price of $1.00 per share, subject to certain adjustments as provided for in the Notes for stock splits, dividends, combinations, or reclassifications.

The Notes contains a beneficial ownership limitation that restricts the Investors from converting any portion of the Notes to the extent that, after giving effect to such conversion, the Investor, and each of them, would beneficially own more than 4.99% of the Company's outstanding common stock. The Notes also contain an "Exchange Cap" limiting the total number of shares issuable under each Note to no more than 19.99% of the Company's outstanding common stock, unless and until shareholder approval is obtained in accordance with Nasdaq Listing Rule 5635(d).

The Company may prepay the Notes at any time without penalty. The Notes are unsecured and ranks junior to all secured indebtedness of the Company. In the event of default, including failure to pay amounts when due, bankruptcy, or breach of material covenants, the Notes becomes immediately due and payable, and the Investors may elect to receive payment in cash or in shares of common stock in accordance with the conversion formula.

As consideration for the Investors' purchase of the Notes, the Company agreed to issue 5,000 shares of restricted common stock to each Investor as a commitment fee (the "Commitment Shares"). The Commitment Shares were deemed fully earned as of the issue date.

The foregoing description of the terms of the Notes does not purport to be complete and is qualified in its entirety by reference to the copy of the Notes, filed hereto as Exhibits 10.1 and 10.2 to this Current Report on Form 8-K, and is incorporated herein by reference.

Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant

The disclosures set forth in Item 1.01 of this Current Report are incorporated herein by reference.