Exhibit 10.6


 


March 30, 2022


 


Redwoods Acquisition Corp.

1115 Broadway, 12th Floor


New York, NY 10010


 


Ladies and Gentlemen:


 


Redwoods Acquisition Corp.
(the “Company”), a blank check company formed for the purpose of entering into a merger, share exchange, asset acquisition,
stock purchase, recapitalization, reorganization or other similar business combination with one or more businesses or entities (a “Business
Combination”), intends to register its securities under the Securities Act of 1933, as amended (“Securities Act”), in
connection with its initial public offering (“IPO”), pursuant to a registration statement on Form S-1 (“Registration
Statement”).


 


The undersigned hereby commits
that it will purchase 100,000 units of the Company (“Placement Units”), each Placement Unit consisting of one share of common
stock of the Company, $0.0001 par value (the “Common Stock”), one warrant entitling its holder to purchase one share of Common
Stock and one right to receive one-tenth (1/10) of one share of Common Stock upon the consummation of an initial Business Combination,
at $10.00 per Placement Unit, for a purchase price of $1,000,000 (the “Placement Unit Purchase Price”). 


 


The undersigned hereby agrees
that it will purchase an additional amount of units of the Company (“Over-Allotment Units”), up to a maximum of 15,000 Over-Allotment
Units, or a maximum purchase price of $150,000 (“Over-Allotment Unit Purchase Price,” together with the Placement Unit Purchase
Price, the “Purchase Price”), in the event that the underwriters in the IPO exercise their over-allotment option, such that
the amount held in the trust account (as described in the Registration Statement, the “Trust Account”) does not fall below
$10.10 per share for each share of Common Stock sold in the IPO.


 


The consummation of the purchase
and issuance of the Placement Units shall occur simultaneously with the consummation of the IPO and the consummation of the purchase and
issuance of the Over-Allotment Units shall occur simultaneously with the closing of any exercise of the over-allotment option related
to the IPO.


  


The Placement Units and Over-Allotment
Units will be identical to the units to be sold by the Company in the IPO, except as described in the Registration Statement. Additionally,
the undersigned agrees:


 


		●	to vote the shares of Common Stock included in the Placement Units and Over-Allotment Units in favor of
any proposed Business Combination;



 


		●	not to propose, or vote in favor of, an amendment to the Company’s Amended and Restated Certificate
of Incorporation (the “Certificate of Incorporation”) that would affect the substance or timing of the Company’s obligation
to redeem 100% of the Company’s shares of Common Stock sold in the IPO if the Company does not complete an initial Business Combination
within 12 months from the closing of the IPO (or up to 18 months, as applicable), unless the Company provides the holders of shares of
Common Stock underlying the units sold in the IPO with the opportunity to redeem their shares of Common Stock upon approval of any such
amendment at a per-share price, payable in cash, equal to the aggregate amount of the Trust Account, including interest earned on Trust
Account and not previously released to the Company to pay the Company’s franchise and income taxes, divided by the number of then
outstanding shares of Common Stock underlying the units sold in the IPO;



 


		●	not to convert any shares of Common Stock included in the Placement Units and Over-Allotment Units into
the right to receive cash from the Trust Account in connection with a shareholder vote to approve either a Business Combination or an
amendment to the provisions of the Certificate of Incorporation, and not to tender any shares of Common Stock included in the Placement
Units and Over-Allotment Units in connection with a tender offer conducted prior to the closing of a Business Combination;



 






     


     


    

 


		●	that the undersigned will not participate in any liquidation distribution with respect to the Placement
Units and Over-Allotment Units or any underlying securities (but will participate in liquidation distributions with respect to any units
or shares of Common Stock purchased by the undersigned in the IPO or in the open market) if the Company fails to consummate a Business
Combination;



 


		●	that the Placement Units, Over-Allotment Units and underlying securities will not be transferable until
after the consummation of a Business Combination except (i) to the Company’s pre-IPO shareholders, or to the Company’s officers,
directors, advisors and employees, (ii) transfers to the undersigned’s affiliates or its members upon its liquidation, (iii) to
relatives and trusts for estate planning purposes, (iv) by virtue of the laws of descent and distribution upon death, (v) pursuant to
a qualified domestic relations order, (vi) by private sales made at prices no greater than the price at which the Placement Units were
originally purchased or (vii) to the Company for cancellation in connection with the consummation of a Business Combination, in each case
(except for clause vii) where the transferee agrees to the terms of the transfer restrictions; and



 


		●	the Placement Units and Over-Allotment Units will include any additional terms or restrictions as is customary
in other similarly structured blank check company offerings or as may be reasonably required by the underwriters in the IPO in order to
consummate the IPO, each of which will be set forth in the Registration Statement.



  


The undersigned acknowledges
and agrees that the purchaser of the Placement Units and Over-Allotment Units will execute agreements in form and substance typical for
transactions of this nature necessary to effectuate the foregoing agreements and obligations prior to the consummation of the IPO as are
reasonably acceptable to the undersigned, including but not limited to an insider letter agreement.


 


The undersigned hereby represents
and warrants that:


 


		(a)	it has been advised that the Placement Units and Over-Allotment Units have not been registered under the
Securities Act;



 


		(b)	it will be acquiring the Placement Units and Over-Allotment Units for its account for investment purposes
only;



 


		(c)	it has no present intention of selling or otherwise disposing of the Placement Units and Over-Allotment
Units in violation of the securities laws of the United States;



 


		(d)	it is an “accredited investor” as defined by Rule 501 of Regulation D promulgated under the
Securities Act;



 


		(e)	it has had both the opportunity to ask questions and receive answers from the officers and directors of
the Company and all persons acting on its behalf concerning the terms and conditions of the offer made hereunder;



 


		(f)	it is familiar with the proposed business, management, financial condition and affairs of the Company;



 


		(g)	it has full power, authority and legal capacity to execute and deliver this letter agreement and any documents
contemplated herein or needed to consummate the transactions contemplated in this letter agreement; and



 


		(h)	this letter agreement constitutes its legal, valid and binding obligation, and is enforceable against
it.



 






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The undersigned agrees that,
in accordance with FINRA Rule 5110(e)(1), it will not sell, transfer, assign, pledge or hypothecate in whole or in part any Placement
Units, shares of Common Stock, warrants and rights underlying the Placement Units, or shares of Common Stock that are issuable pursuant
to the warrants or rights included in the Placement Units (in whole or in part) or any interest herein, or subject any such securities
to any hedging, short sale, derivative or put or call transaction that would result in the economic disposition of such securities, for
a lock-up period of 180 days following the effective date of the Registration Statement or the commencement of sales in the IPO to anyone
other than (i) an underwriter or a selected dealer participating in the IPO or (ii) any officer or partner, registered person or affiliate
of any such underwriter or selected dealer. Additionally, pursuant to FINRA Rule 5110(g)(8)(A), the warrants underlying the Placement
Units may not be exercised beyond the fifth anniversary of the effective date of the Registration Statement. Further, certain registration
rights have been provided with respect to the Placement Units purchased by the undersigned and other holders, which registration rights
will at all times be in compliance with FINRA Rule 5110(g)(8)(B)-(D).


 


[Signature Page Follows]


 






    3


     


    

 


This letter agreement constitutes
the entire agreement between the undersigned and the Company with respect to the purchase of the Placement Units and Over-Allotment Units,
and supersedes all prior and contemporaneous understandings, agreements, representations and warranties, both written and oral, with respect
to the same. 


 


	 	Very truly yours,
	 	 
	 	Chardan Capital Markets, LLC
	 	 
	 	By:	/s/ Steven Urbach
	 	Name: 	Steven Urbach                  
	 	Title:	CEO 


 


	Accepted and Agreed:	 
	 	 
	REDWOODS ACQUISITION CORP.	 
	 	 
	By:	/s/ Jiande Chen	 
	 	Name:	Jiande Chen	 
	 	Title:	Chief Executive Officer	 


 


Signature Page to Private Units Subscription Agreement