Document:

Exhibit 4.2

 

(English
translation)

 

Supplementary
Agreement on Matters Related to Share Subscription

 

This
Supplementary Agreement on Matters Related to Share Subscription (hereinafter referred to as “this Agreement”)
is entered into as of April 23, 2018 (hereinafter referred to as the “Effective Date”) in Beijing by and among:

 

		(1)	Avalon
GloboCare Corp. (hereinafter referred to as “Avalon”), a public company in the U.S. (Stock Code: AVCO) with
its registered address at 83 South Street, Suite 101, Freehold, NJ 07728, the U.S.;

 

		(2)	Avalon
(Shanghai) Healthcare Technology Co., Ltd. (hereinafter referred to as “Avalon Shanghai”), a wholly owned subsidiary
of Avalon incorporated and existing in accordance with the laws of the People’s Republic of China, with its domicile at
No. 90 Luke Road, Pudong New Area, Shanghai;

 

		(3)	Beijing
DOING Biomedical Technology Co., Ltd. (hereinafter referred to as “DOING”), a limited liability company incorporated
and existing in accordance with the laws of the People’s Republic of China, with its domicile at Room 529, 5/F, Building
11, Courtyard No.7, Songyu North Road, Chaoyang District, Beijing;

 

		(4)	LIANG
DARON (hereinafter referred to as the “Nominal Holder”), a U.S. citizen (Passport No. 506245270), with the
permanent address at 37 Latourette Lane, Staten Island, NY10314; and

 

		(5)	Lu
Wenzhao (hereinafter referred to as the “Guarantor”), a U.S. citizen (Passport No. 470492414), with the permanent
address at Room 710, 7/F, Huabin Building, YongAn Dong Li, Chaoyang District, Beijing

 

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The
parties above shall hereinafter be referred to individually as a “Party” and collectively as the “Parties”.

 

Whereas,

 

		1.	DOING
                                         and the Guarantor have reached a consensus on their strategic cooperation and signed
                                         a Strategic Cooperation Agreement between Beijing DOING Biomedical Technology Co.,
                                         Ltd. and Lu Wenzhao (hereinafter referred to as the “Strategic Cooperation
                                         Agreement”) on January 22, 2017; and on the same day, the Guarantor issued
                                         a Letter of Commitment, which was replaced by the Guaranty Agreement on
                                         February 25, 2017, and at the same time lost its legal validity;

 

		2.	The
                                         parties and other interested parties separately or jointly signed the Four-Party Agreement
                                         on Share Subscription (hereinafter referred to as the “Four-Party Agreement”),
                                         Entrusted Shareholding Agreement, Guaranty Agreement, Share Subscription
                                         Agreement and Shares Transfer Agreement (hereinafter collectively referred
                                         to as the “Transaction Documents”), agreeing that DOING subscribes
                                         for three million shares of Avalon that are not publicly issued (hereinafter referred
                                         to as the “Avalon Shares”, the actual quantity is subject to adjustment
                                         in accordance with the stipulations in Article 1 herein) at US$ 1 per share, and DOING
                                         entrusts the Nominal Holder with subscription of and hold Avalon Shares in his name on
                                         behalf of DOING; on March 3, 2017, DOING paid an earnest money of RMB 20,640,000 (equivalent
                                         to USD 3 million) (hereinafter referred to as the “Earnest Money”)
                                         to Avalon Shanghai in accordance with the Four-Party Agreement, and a share certificate
                                         of corresponding amount was issued to the Nominal Holder by Avalon on March 27, 2017;
                                         thus the aforementioned share subscription was completed on March 27, 2017 (hereinafter
                                         referred to as the “Completion of Share Subscription”).

 

		3.	According
                                         to the Four-Party Agreement, if DOING fails to complete the filing of outbound
                                         investment with the local Commission of Commerce within one year of the Completion of
                                         Share Subscription, upon request of DOING, the total amount of the earnest money and
                                         20% of the interest on the fund shall be refunded to DOING, and the parties shall restore
                                         to the state before the Four-Party Agreement was signed;

 

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		4.	As
                                         of the Effective Date of this Agreement, DOING is not able to complete the filing of
                                         the outbound investment in Avalon with the local Commission of Commerce for objective
                                         reasons, and the aforementioned one-year period is about to expire;

 

		5.	Based
                                         on the commercial considerations of all parties, the parties agree to enter into this
                                         Agreement to make modifications and supplements to the stipulations in the Transaction
                                         Documents.

 

Terms
not expressly defined herein shall have the meanings defined in the Four-Party Agreement.

 

Therefore,
the parties agree as follows:

 

		1.	Refund
                                         of Partial Earnest Money

 

		1.1	Refund
                                         of Partial Earnest Money and Interest: The parties agree that Avalon Shanghai
                                         shall pay one-third of the earnest money and corresponding interest on the fund calculated
                                         at 20% of the annual interest (collectively referred to as “Partial Earnest
                                         Money and Interest”) in a lump sum to the domestic bank account designated
                                         by DOING within one month from the date when DOING sent a written notice to any of Avalon,
                                         Avalon Shanghai or the Guarantor (that is, March 23, 2018). For the avoidance of doubt,
                                         Partial Earnest Money and Interest shall be equal to the product of: (i) one-third of
                                         the earnest money (RMB 20,640,000) actually paid by DOING to Avalon Shanghai on March
                                         3, 2017, multiplied by (ii) 120%. The parties hereby confirm that the total amount of
                                         the Partial Earnest Money and Interest calculated according to the method above is Renminbi
                                         Eight Million Two Hundred and Fifty-Six Thousand Yuan (RMB 8,256,000)

 

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		1.2	Adjustment
to Avalon Shares: The parties agree and confirm that, on the date when Avalon Shanghai actually pays RMB 8,256,000 to
DOING in accordance with Article 1.1 herein, Avalon Shares shall be decreased by one-third and become 2,000,000 shares. DOING
agrees to, together with the Nominal Holder, cooperate with Avalon to deal with (including but not limited to transfer, repurchase
and cancel or otherwise) the decreased 1,000,000 shares, with the related costs incurred to be borne by Avalon; for the avoidance
of doubt, neither DOING nor the Nominal Holder is obliged to assume any contribution obligations or responsibilities to Avalon
with regard to the aforementioned decreased 1,000,000 shares. Avalon shall complete the relevant procedures such as updating of
the certificate of Avalon Shares, change of the register of shareholders and announcement of listed company within five (5) working
days thereafter.

 

		2.	Term
                                         Extension and Subsequent Arrangement

 

		2.1	Term
                                         Extension: The parties agree to extend the one-year period from the Completion
                                         of Share Subscription as stipulated in the Transaction Documents (from March 27, 2017
                                         to March 26, 2018) until July 31, 2018. DOING promises not to implement any of the stipulations
                                         in this Article 2 during such extended term. Upon expiration of the extended term, unless
                                         it is otherwise agreed by the parties, DOING is entitled to implement any of the stipulations
                                         in Article 2.2 and/or Article 2.3 at any time to choose to transfer all or part of the
                                         remaining Avalon Shares (that is, 2,000,000 shares minus the shares already transferred
                                         under Article 2.2) to the designated Nominal Holder, or choose to request Avalon Shanghai
                                         to refund all or part of the remaining Earnest Money (“Remaining Earnest Money”
                                         refers to the amount of RMB13,760,000 after the Earnest Money is deducted by the Partial
                                         Earnest Money and Interest refunded under Article 1 herein, minus the amounts refunded
                                         under Article 2.2 and Article 2.3) and interest on the corresponding fund. This right
                                         of option should stay effective without any limit of time.

 

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		2.2	Transfer
                                         Shares to Nominal Holder Designated by DOING: Upon expiration of the extended
                                         term, in accordance with Article 2 “Share Transfer/Termination of Shareholding
                                         Entrustment” of the Four-Party Agreement and further consultations of the
                                         parties, DOING is entitled to issue a written notice requesting all or part of the Remaining
                                         Avalon Shares (hereinafter referred to as the “Transferred Shares”) to be
                                         transferred to its designated Nominal Holder, and requiring Avalon Shanghai to cooperate
                                         in refunding the Remaining Earnest Money corresponding to the Transferred Shares, and
                                         DOING will designate another Nominal Holder (hereinafter referred to as the “New
                                         Nominal Holder”) to pay Avalon a subscription price equal to the amount of
                                         the Remaining Earnest Money already refunded by Avalon Shanghai. Upon request of DOING,
                                         the subscription price can be paid in Renminbi to Avalon Shanghai, and Avalon should
                                         issue a written document to DOING to confirm the payment method of such subscription
                                         price. Avalon shall, within five (5) working days after the subscription price is paid,
                                         cancel the Original Nominal Holder Daron Liang as a shareholder and withdraw the certificate
                                         for the Transferred Shares held by him, register the New Nominal Holder as Avalon’s
                                         shareholder and right holder, issue a new certificate for the Transferred Shares to him,
                                         and assist with completion of the shares transfer. When requested by DOING, Avalon and
                                         DOING should cooperate with each other to complete the filing of the outbound investment
                                         with the local Commission of Commerce, including but not limited to assistance in providing
                                         relevant documents and materials and in handling the relevant procedures.

 

2.3  Restoration:
Upon expiration of the extended term, DOING is entitled to choose to request Avalon Shanghai to refund all or part of the Remaining
Earnest Money and corresponding interest on the fund calculated at 20% of the annual interest in a lump sum to the bank account
designated by DOING within five (5) working days from the date when DOING sends a written notice to either Avalon or Avalon Shanghai.
For the avoidance of doubt, the interest on the aforementioned fund shall be calculated from the date when DOING pays the Earnest
Money to Avalon Shanghai pursuant to the Four-Party Agreement (March 3, 2017) until the date when the corresponding Earnest
Money and interest on the fund is actually refunded by Avalon Shanghai.

 

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		3.	Liability
                                         for Breach

 

Any
party failing to perform any of its obligations hereunder or failing to comply with its commitments made herein shall be deemed
a breach of this agreement. In particular, in the event of a breach of payment obligation, the breaching party shall pay to the
non-breaching party, in addition to outstanding payment, liquidated damages at 1‰ per day of the due amount starting from
the due date to the actual payment date. Moreover, if any breach of the breaching party brings about any direct economic losses
to the non-breaching party, payment of the aforementioned liquidated damages shall not affect the breaching party’s obligation
to make full compensation for such losses suffered by the non-breaching party.

 

		4.	Guarantee

 

The
Guarantor hereby agrees and promises that the Guarantor shall make every effort to make the Nominal Holder, Avalon and Avalon
Shanghai properly perform their obligations hereunder, and assume joint and several liabilities for any breach of the parties
above.

 

		5.	Miscellaneous

 

		5.1	Exchange
                                         Rate: The parties agree that the exchange rate of USD against RMB used hereunder
                                         shall adopt the exchange rate announced by China Foreign Exchange Trade System on the
                                         day of payment. Losses resulting from the change of exchange rate shall be borne by the
                                         parties respectively.

 

		5.2	Notice:
                                         The parties agree that notices from any party should be delivered to one or more of the
                                         other parties by e-mail or courier or other means agreed by the parties.

 

		5.3	Confidentiality:
                                         The parties agree to keep the information and matters in relation to this Agreement strictly
                                         confidential and not to disclose to any third party.

 

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		5.4	Validity:
                                         This Agreement shall take effect as of the date when signed by all the parties, which
                                         is legally binding on all the parties. The parties agree that, in the event of any discrepancy
                                         or inconsistency between the Transaction Documents and the Guarantee Agreement,
                                         this Agreement shall prevail. In particular, the effectiveness, modification or performance
                                         of the Strategic Cooperation Agreement between DOING and the Guarantor shall not
                                         affect the validity or performance of any terms herein.

 

		5.5	Governing
                                         Law: This Agreement shall be governed by and interpreted in accordance with the
                                         laws of the People’s Republic of China.

 

		5.6	Dispute
                                         Resolution: All disputes arising out of, or relating to, this Agreement shall
                                         be solved through friendly consultation. If the consultation fails, the dispute should
                                         be submitted, by any party hereto, to Beijing Arbitration Commission and be solved by
                                         arbitration in accordance with the arbitration rules in effect at that time. The arbitration
                                         shall be held in Beijing and Chinese shall be the language used during arbitration. The
                                         award rendered by arbitration shall be final and binding on all the parties. The parties
                                         agree to waive their right to bring an action against the arbitral award.

 

		5.7	Counterparts:
                                         This Agreement is made in quintuplicate in Chinese, each party holding one copy respectively,
                                         with the five counterparts being equally authentic.

 

In
witness whereof, the parties hereto have executed this Agreement the date and year first before written.

 

[No
text below]

 

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[No
text on this page. It’s the signature page of the Supplementary Agreement on Matters Related to Share Subscription.]

 

Avalon
GloboCare Corp.

 

Signature
of Authorized Representative: /s/David Jin

 

    Signature Page

     

    

 

[No
text on this page. It’s the signature page of the Supplementary Agreement on Matters Related to Share Subscription.]

 

Avalon
(Shanghai) Healthcare Technology Co., Ltd. (Company Seal)

 

Signature
of Legal Representative or Authorized Representative: /s/Meng Li 

 

    Signature Page

     

    

 

[No
text on this page. It’s the signature page of the Supplementary Agreement on Matters Related to Share Subscription.]

 

Beijing
DOING Biomedical Technology Co., Ltd. (Company Seal)

 

Signature
of Legal Representative or Authorized Representative: /s/Yonghong Tang 

 

    Signature Page

     

    

 

[No
text on this page. It’s the signature page of the Supplementary Agreement on Matters Related to Share Subscription.]

 

Nominal
Holder: LIANG DARON

 

Signature:
/s/Daron Liang

 

    Signature Page

     

    

 

[No
text on this page. It’s the signature page of the Supplementary Agreement on Matters Related to Share Subscription.]

 

Guarantor:
Lu Wenzhao

 

Signature:
/s/ Lu Wenzhao

 

    Signature PageExhibit

Exhibit 10.1
THE ALTRIA GROUP, INC.
2015 PERFORMANCE INCENTIVE PLAN 

RESTRICTED STOCK UNIT AGREEMENT
FOR ALTRIA GROUP, INC. COMMON STOCK
(January 30, 2018)

ALTRIA GROUP, INC. (the “Company”), a Virginia corporation, hereby grants to the employee identified in the 2018 Stock Award section of the Award Statement (the “Employee”) under the Altria Group, Inc. 2015 Performance Incentive Plan (the “Plan”) a Restricted Stock Unit Award (the “Award”) dated January 30, 2018 (the “Award Date”), with respect to the number of shares of the Common Stock of the Company (the “Common Stock”) set forth in the 2018 Stock Award section of the Award Statement (the “RSUs”), all in accordance with and subject to the following terms and conditions of this Restricted Stock Unit Agreement (the “Agreement”):

1.    Condition to Award.  As applicable and in the sole discretion of the Company or its delegate, this Award may be contingent on, and in consideration of, the execution of a Confidentiality and Non-Competition Agreement by the Employee.  In the event the Employee is required to execute a Confidentiality and Non-Competition Agreement, the Company or its delegate will so notify the Employee as soon as practicable after the Award Date.  If the Employee does not execute the Confidentiality and Non-Competition Agreement within a reasonable time frame established by the Company or its delegate, but no later than 90 days after the Confidentiality and Non-Competition Agreement is provided to the Employee, this Agreement will be null and void with respect to the Employee and the Employee will forfeit any and all rights to the Award.    

2.    Normal Vesting.  Subject to Section 1 above and Section 3 below, the RSUs shall become fully vested on the vesting date set forth in the 2018 Stock Award section of the Award Statement (the “Vesting Date”), provided that the Employee remains an employee of the Company (or a subsidiary or affiliate) during the entire period commencing on the Award Date and ending on the Vesting Date. 

3.    Accelerated Vesting and Forfeiture.  In the event of the termination of the Employee’s employment with the Company (and with all subsidiaries and affiliates of the Company) prior to the Vesting Date due to death, Disability or Normal Retirement, the RSUs shall become fully vested on the date of such termination of employment.

If the Employee’s employment with the Company (and with all subsidiaries and affiliates of the Company) is terminated for any reason other than death, Disability or Normal Retirement prior to the Vesting Date, the Employee shall forfeit all rights to the RSUs immediately after termination of employment.  For this purpose, a termination of employment shall include the sale of a subsidiary that employs the Employee.  Notwithstanding the foregoing, upon a termination of employment described in this paragraph, the Compensation Committee of the Board of Directors of the Company (the “Compensation Committee”) may, in its sole discretion, vest some or all of the RSUs.

In addition, in the event of a “Change in Control” within the meaning of the Plan, the RSUs shall become vested and payable in the circumstances and in the manner specified in section 6(a) of the Plan and Section 9 below.

4.    Voting and Dividend Rights.  The Employee does not have the right to vote the RSUs or receive dividends prior to the date, if any, that the shares of Common Stock underlying the RSUs are paid to the Employee pursuant to the terms hereof.  However, unless otherwise determined by the Compensation Committee, the Employee shall receive cash payments (less applicable withholding taxes) in lieu of dividends otherwise payable with respect to shares of Common Stock equal in number to the RSUs that have not been forfeited, as such dividends are paid.

5.    Transfer Restrictions.  This Award and the RSUs are non-transferable and may not be assigned, hypothecated or otherwise pledged and shall not be subject to execution, attachment or similar process.  Upon any attempt to effect any such disposition, or upon the levy of any such process, the Award shall immediately become null and void and the RSUs shall be forfeited.  These restrictions shall not apply, however, to any payments received pursuant to Section 8 below.  If the Employee is a resident of Canada, the Employee acknowledges that the shares of Common Stock that the Employee receives pursuant to Section 8 are subject to a restriction on the first trade under Canadian securities laws.  As a result, the Employee acknowledges that any first trade of such shares of Common Stock must be made (a) through an exchange, or a market, outside of Canada, (b) to a person or company outside of Canada or (c) otherwise in compliance with applicable Canadian securities laws.

6.    Withholding Taxes.  The Company is authorized to satisfy any withholding taxes arising in connection with this Award by (a) deducting the number of RSUs having an aggregate value equal to the amount of withholding taxes due, or (b) the remittance of the required amounts from any proceeds realized upon the open-market sale of the Common Stock received in payment of vested RSUs by the Employee. The Company is authorized to satisfy any withholding taxes arising from the payment of cash in lieu of dividends pursuant to Section 4 by withholding the required amounts from such cash payment. The Company is also authorized to satisfy any withholding taxes referred to in this paragraph by requiring a cash payment from the Employee or by withholding from other payments due to the Employee.  If the Employee is covered by a Company tax equalization policy, the Employee also agrees to pay to the Company any additional hypothetical tax obligation calculated and paid under the terms and conditions of such tax equalization policy.  

7.    Death of Employee.  If any of the RSUs shall vest upon the death of the Employee, any Common Stock received in payment of the vested RSUs shall be registered in the name of the estate of the Employee except that, to the extent permitted by the Compensation Committee, if the Company shall have received in writing a beneficiary designation, the Common Stock shall be registered in the name of the designated beneficiary.

8.    Payment of RSUs.  The RSUs granted pursuant to this Award represent an unfunded and unsecured promise of the Company, subject to the vesting and other terms of this Agreement, to issue to the Employee the number of shares of the Common Stock underlying the vested RSUs. Except as otherwise expressly provided in the 2018 Stock Award section of the Award Statement, this Agreement and the Plan, such issuance shall be made to the Employee (or, in the event of his or her death to the Employee’s estate or beneficiary as provided above) as soon as practicable following the  vesting of the RSUs pursuant to Section 2 or 3 and by the later of December 31 of the year of such vesting or two and a half months after such vesting. Notwithstanding the foregoing, the RSUs shall be settled in the form of cash rather than shares of Common Stock if such form of settlement is specified in the Award Statement.

9.    Special Payment Provisions.  This Agreement shall be construed in a manner consistent with section 409A of the Internal Revenue Code and the regulations thereunder (“Code section 409A”).  If the Employee will become eligible for Retirement (a) for RSUs with a Vesting Date between January 1 and March 15, before the calendar year preceding the Vesting Date and (b) for RSUs with a Vesting Date after March 15, before the calendar year in which such Vesting Date occurs, then notwithstanding anything in this Agreement to the contrary, the following provisions shall apply:

(i)    If the Employee is a “specified employee” within the meaning of Code section 409A, any payment of RSUs under Section 8 that is on account of his or her separation from service shall be delayed until the earlier of six months following such separation from service or the Employee’s death.

(ii)    In the event of a “Change in Control” under section 6(b) of the Plan that is not also a “change in control event” with the meaning of Treas. Reg. §1.409A-3(i)(5)(i), any RSUs that would otherwise become vested and paid pursuant to section 6(a) of the Plan upon such Change in Control shall become 

2

vested, but shall not be paid upon such Change in Control, and shall instead be paid at the time the RSUs would otherwise be paid pursuant to this Agreement.

(iii)    In the event of a sale of a subsidiary that is treated under Section 3 as a termination of the Employee’s employment but that is not a “separation from service” within the meaning of Code section 409A, any RSUs that become vested pursuant to Section 3 shall not be paid upon such accelerated vesting, but shall instead be paid at the time the RSUs would otherwise be paid pursuant to this Agreement.  

10.    Board Authorization in the Event of Restatement.  Notwithstanding anything in this Agreement to the contrary, if the Board of Directors of the Company or an appropriate Committee of the Board determines that, as a result of a restatement of the Company’s financial statements, the Employee has received greater compensation in connection with the Award than would been received absent the incorrect financial statements, the Board or Committee, in its discretion, may take such action with respect to this Award as it deems necessary or appropriate to address the events that gave rise to the restatement and to prevent its recurrence.  Such action may include, to the extent permitted by applicable law, causing the full or partial cancellation of this Award and, with respect to RSUs that have vested, requiring the Employee to repay to the Company the full or partial Fair Market Value of the Award determined at the time of vesting, and the Employee agrees by accepting this Award that the Board or Committee may make such a cancellation, impose such a repayment obligation, or take other necessary or appropriate actions in such circumstances.

11.    Other Terms and Definitions.  The terms and provisions of the Plan (a copy of which will be furnished to the Employee upon written request to the Office of the Corporate Secretary, Altria Group, Inc., 6601 West Broad Street, Richmond, Virginia 23230) are incorporated herein by reference.  To the extent any provision of this Award is inconsistent or in conflict with any term or provision of the Plan, the Plan shall govern. Capitalized terms not otherwise defined herein have the meaning set forth in the Plan.  

For purposes of this Agreement, (a) the term “Disability” means a disability that entitles the Employee to benefits under the applicable long-term disability insurance program of the Company or any subsidiary or affiliate of the Company, (b) the term “Normal Retirement” means retirement from active employment with the Company and any subsidiary or affiliate of the Company following both attainment of age 65 and completion of five years of service with the Company, its subsidiaries, and its affiliates, (c) the term “Retirement” means retirement from active employment with the Company and any subsidiary or affiliate of the Company following both attainment of age 55 and completion of five years of service with the Company, its subsidiaries, and its affiliates, and (d) the terms “termination of employment,” “separation from service,” and similar references mean a separation from service within the meaning of Code section 409A with the Company and all of its subsidiaries and affiliates, which includes circumstances in which the Employee is reasonably anticipated not to perform further services with the Company and its affiliates or subsidiaries.  Generally, for purposes of this Agreement, (x) a “subsidiary” includes only any company in which the Company, directly or indirectly, has a beneficial ownership interest of greater than 50 percent and (y) an “affiliate” includes only any company that (i) has a beneficial ownership interest, directly or indirectly, in the Company of greater than 50 percent or (ii) is under common control with the Company through a parent company that, directly or indirectly, has a beneficial ownership interest of greater than 50 percent in both the Company and the affiliate.

IN WITNESS WHEREOF, this Restricted Stock Unit Agreement has been duly executed as of January 30, 2018.
	
			
	 
	ALTRIA GROUP, INC.

	 
	 
	 

	 
	By:
	/s/ W. HILDEBRANDT SURGNER, JR.

	 
	Name:
	W. Hildebrandt Surgner, Jr.

	 
	Title:
	Corporate Secretary

	 
	 
	 

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