Exhibit 10.2


 


FORM OF INSIDER’S LETTER


 


________________, 2021


 


Metal Sky Star Acquisition Corporation


132 West 31st Street, First Floor


New York, New York, 10001


 


Underwriter Representative 


Ladenburg Thalmann & Co., Inc.


 


	 	Re:	Metal Sky Star Acquisition Corporation Public Offering; Voting, Lock-Up and
    Waiver


 


Gentlemen:


 


This letter (this “Letter
Agreement”) is being delivered to you in accordance with the Underwriting Agreement (the “Underwriting Agreement”)
to be entered into by and between Metal Sky Star Acquisition Corporation, a Cayman Islands exempted company (the “Company”),
and Ladenburg Thalmann & Co. Inc., as representative (the “Representative”) of the several underwriters
(each, an “Underwriter” and collectively, the “Underwriters”), relating to an underwritten
initial public offering (the “Public Offering”), of 5,750,000 of the Company’s units (including up to
750,000 units that may be purchased to cover over-allotments, if any) (the “Units”), each comprised of one
of the Company’s ordinary shares, par value $0.001 per share (the “Ordinary Shares”), one warrant to
purchase one-half of an Ordinary Share (“Warrant”) and a right (“Right”) to receive 1/10th
of an Ordinary Share. Each Warrant entitles the holder thereof to purchase one-half of one Ordinary Share at a price of $11.50
per share, subject to adjustment. The Units shall be sold in the Public Offering pursuant to a registration statement on Form S-1 (File
No. 333-_______) and prospectus (the “Prospectus”) filed by the Company with the Securities and Exchange Commission
(the “Commission”) and the Company shall apply to have the Units and components thereof listed on the Nasdaq
Capital Market. Certain capitalized terms used herein are defined in Section 12 hereof.


 


In order to induce the Company
and the Underwriters to enter into the Underwriting Agreement and to proceed with the Public Offering and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, M-Star Management Corporation (the “Sponsor”)
and the undersigned individuals, each of whom is a member of the Company’s board of directors and/or management team (each, an
“Insider” and collectively, the “Insiders”), hereby agrees with the Company as follows:


 


1. The Sponsor and each
Insider agrees that (A) if the Company seeks shareholder approval of a proposed Business Combination, then in connection with such
proposed Business Combination, it, he or she shall (i) vote any Shares owned by it, him or her in favor of any proposed Business
Combination and (ii) not redeem any Shares owned by it, him or her in connection with such shareholder approval, (B) if the
Company engages in a tender offer in connection with any proposed Business Combination, it, he or she shall not sell any Shares to the
Company in connection therewith and (C) if the Company seeks shareholder approval of any proposed amendment to the Charter prior
to the consummation of a Business Combination, it, he or she shall not redeem any Shares owned by it, him or her in connection with such
shareholder approval.


 


2. The Sponsor and each
Insider hereby agrees that in the event that the Company fails to consummate a Business Combination within the time period set forth in
the Charter, the Sponsor and each Insider shall take all reasonable steps to cause the Company to (i) cease all operations except
for the purpose of winding up, (ii) as promptly as reasonably possible but not more than 10 business days thereafter, subject to
lawfully available funds therefor, redeem 100% of the Ordinary Shares sold as part of the Units in the Public Offering (the “Offering
Shares”), at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account,
including interest earned on the funds held in the Trust Account and not previously released to the Company to pay any taxes (less up
to $50,000 of interest to pay dissolution expenses), divided by the number of then outstanding Offering Shares, which redemption will
completely extinguish all Public Shareholders’ rights as shareholders (including the right to receive further liquidation distributions,
if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval
of the Company’s remaining shareholders and the Company’s board of directors, dissolve and liquidate, subject in the case
of clauses (ii) and (iii) above to the Company’s obligations under Cayman Islands law to provide for claims of creditors
and other requirements of applicable law. The Sponsor and each Insider agrees to not propose any amendment to the Charter (i) that
would affect the substance or timing of the Company’s obligation to redeem 100% of the Offering Shares if the Company does not complete
a Business Combination within the time period described in the Prospectus or (ii) with respect to any other provision relating to
shareholders’ rights or pre-Business Combination activity, unless the Company provides its public shareholders with the opportunity
to redeem their Ordinary Shares upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate
amount then on deposit in the Trust Account, including interest earned on the funds held in the Trust Account and not previously released
to the Company to pay any taxes, divided by the number of then outstanding Offering Shares.


 






    


     


    

 


3. The Sponsor and each Insider
acknowledges that it, he or she has no right, title, interest or claim of any kind in or to any monies held in the Trust Account or any
other asset of the Company as a result of any liquidation of the Company with respect to the Founder Shares held by it, him or her. The
Sponsor and each Insider hereby further waives any claim such Sponsor or Insider may have in the future as a result of, or arising out
of, any contracts or agreements with the Company and will not seek recourse against the Trust Account for any reason whatsoever except
in each case with respect to the Insider’s right to a pro rata interest in the proceeds held in the Trust Account for any Offering
Shares such Sponsor or Insider may hold.


 


4. During the period
commencing on the effective date of the Underwriting Agreement and ending 180 days after such date, the Sponsor and each Insider shall
not, without the prior written consent of the Representative, (i) sell, offer to sell, contract or agree to sell, hypothecate, pledge,
grant any option to purchase or otherwise dispose of or agree to dispose of, directly or indirectly, or establish or increase a put equivalent
position or liquidate or decrease a call equivalent position within the meaning of Section 16 of the Securities Exchange Act of 1934,
as amended, and the rules and regulations of the Commission promulgated thereunder, with respect to any Units, Ordinary Shares, Founder
Shares, Warrants, Rights or any securities convertible into, or exercisable, or exchangeable for, Ordinary Shares owned by it, him or
her, (ii) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences
of ownership of any Units, Ordinary Shares, Founder Shares, Warrants, Rights or any securities convertible into, or exercisable, or exchangeable
for, Ordinary Shares owned by it, him or her, whether any such transaction is to be settled by delivery of such securities, in cash or
otherwise, or (iii) publicly announce any intention to effect any transaction specified in clause (i) or (ii). Each of the Insiders
and the Sponsor acknowledges and agrees that, prior to the effective date of any release or waiver, of the restrictions set forth in this
Section 4 or Section 8 below, the Company shall announce the impending release or waiver by press release through a major news
service at least two business days before the effective date of the release or waiver. Any release or waiver granted shall only be effective
two business days after the publication date of such press release. The provisions of this Section will not apply if the release
or waiver is effected solely to permit a transfer not for consideration and the transferee has agreed in writing to be bound by the same
terms described in this Letter Agreement to the extent and for the duration that such terms remain in effect at the time of the transfer.


 


5. In the event of the
liquidation of the Trust Account, the Sponsor (which for purposes of clarification shall not extend to any other shareholders, members
or managers of the Sponsor) agrees to indemnify and hold harmless the Company against any and all loss, liability, claim, damage and expense
whatsoever (including, but not limited to, any and all legal or other expenses reasonably incurred in investigating, preparing or defending
against any litigation, whether pending or threatened, or any claim whatsoever) to which the Company may become subject as a result of
any claim by (i) any third party for services rendered or products sold to the Company or (ii) a prospective target business
with which the Company has entered into a letter of intent, confidentiality or other similar agreement or a Business Combination agreement
(a “Target”); provided, however, that such indemnification of the Company by the Sponsor
shall apply only to the extent necessary to ensure that such claims by a third party for services rendered (other than the Company’s
independent public accountants) or products sold to the Company or a Target do not reduce the amount of funds in the Trust Account to
below (i) $10.[___] per share of the Offering Shares or (ii) such lesser amount per share of the Offering Shares held in the
Trust Account due to reductions in the value of the trust assets as of the date of the liquidation of the Trust Account, in each case,
net of the amount of interest earned on the property in the Trust Account which may be withdrawn to pay taxes, except as to any claims
by a third party (including a Target) who executed a waiver of any and all rights to seek access to the Trust Account and except as to
any claims under the Company’s indemnity of the Underwriters against certain liabilities, including liabilities under the Securities
Act of 1933, as amended. In the event that any such executed waiver is deemed to be unenforceable against such third party, the Sponsor
shall not be responsible to the extent of any liability for such third-party claims. The Sponsor shall have the right to defend against
any such claim with counsel of its choice reasonably satisfactory to the Company if, within 15 days following written receipt of notice
of the claim to the Sponsor, the Sponsor notifies the Company in writing that it shall undertake such defense.


 






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6. To the extent that
the Underwriters do not exercise their over-allotment option to purchase up to an additional 750,000 Units within 45 days from the date
of the Prospectus (and as further described in the Prospectus), the Sponsor agrees to forfeit, at no cost, a number of Founder Shares
in the aggregate equal to 375,000 multiplied by a fraction, (i) the numerator of which is 750,000 minus the number of Units purchased
by the Underwriters upon the exercise of their over-allotment option, and (ii) the denominator of which is 750,000.


 


7. The Sponsor and each
Insider hereby agrees and acknowledges that: (i) the Underwriters and the Company would be irreparably injured in the event of a
breach by such Sponsor or an Insider of its, his or her obligations under Sections 1, 2, 3, 4, 5, 8(a), 8(b), and 9, as applicable, of
this Letter Agreement; (ii) monetary damages may not be an adequate remedy for such breach; and (iii) the non-breaching party
shall be entitled to injunctive relief, in addition to any other remedy that such party may have in law or in equity, in the event of
such breach.


 


8. (a) The Sponsor
and each Insider agrees that it, he or she shall not (a) Transfer 50% of their Founder Shares until the earlier of (A) six months
after the consummation of the Company’s initial Business Combination or (B) the date on which the closing price of the Ordinary
Shares equals or exceeds $12.50 per share (as adjusted for share splits, share capitalizations, rights issuances, subdivisions, reorganizations,
recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing after the Company’s
initial Business Combination or (b) Transfer the remaining 50% of their Founder Shares until six months after the date of the consummation
of the Company’s initial Business Combination, or earlier in either case, if subsequent to the Company’s initial Business
Combination the Company completes a liquidation, merger, share exchange, reorganization or other similar transaction that results in all
of the Company’s shareholders having the right to exchange their Ordinary Shares for cash, securities or other property (the “Founder
Shares Lock-up Period”).


 


(b) The Sponsor and
each Insider agrees that it, he or she shall not Transfer any Private Placement Units (or Warrants and Ordinary Shares issued or issuable
upon the conversion of the Private Placement Units), until 30 days after the completion of a Business Combination (the “Private
Placement Units Lock-up Period”, together with the Founder Shares Lock-up Period, the “Lock-up Periods”).


 


(c) Notwithstanding
the provisions set forth in Sections 8(a) and (b), Transfers of the Founder Shares, Private Placement Units and Warrants and Ordinary
Shares issued or issuable upon the exercise or conversion of the Private Placement Units and that are held by the Sponsor, any Insider
or any of their permitted transferees (that have complied with this Section 8(c)), are permitted (a) to the Company’s
officers or directors, any affiliates or family members of any of the Company’s officers or directors, any members of the Sponsor,
or any affiliates of the Sponsor; (b) in the case of an individual, transfers by gift to a member of the individual’s immediate
family, to a trust, the beneficiary of which is a member of the individual’s immediate family or an affiliate of such person, or
to a charitable organization; (c) in the case of an individual, transfers by virtue of laws of descent and distribution upon death
of the individual; (d) in the case of an individual, transfers pursuant to a qualified domestic relations order; (e) transfers
by private sales or transfers made in connection with the consummation of a Business Combination at prices no greater than the price at
which the securities were originally purchased; (f) transfers in the event of the Company’s liquidation prior to the completion
of an initial Business Combination; (g) transfers by virtue of the laws of the Cayman Islands or the Sponsor’s limited liability
company agreement upon dissolution of the Sponsor; (h) in the event of the Company’s liquidation, merger, share exchange, reorganization
or other similar transaction which results in all of the Company’s shareholders having the right to exchange their Ordinary Shares
for cash, securities or other property subsequent to the completion of the Company’s initial Business Combination; and (i) transfers
in connection with the Company’s initial Business Combination with the Company’s consent to any third party; provided, however,
that in the case of clauses (a) through (e), (h) and (i), these permitted transferees must enter into a written agreement agreeing
to be bound by the restrictions herein.


 






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9. The Sponsor and each
Insider represents and warrants that it, he or she has never been suspended or expelled from membership in any securities or commodities
exchange or association or had a securities or commodities license or registration denied, suspended or revoked. Each Insider’s
biographical information furnished to the Company (including any such information included in the Prospectus) is true and accurate in
all respects and does not omit any material information with respect to the Insider’s background. Each Insider’s questionnaire
furnished to the Company is true and accurate in all respects. Each Insider represents and warrants that: it, he or she is not subject
to or a respondent in any legal action for, any injunction, cease-and-desist order or order or stipulation to desist or refrain from
any act or practice relating to the offering of securities in any jurisdiction; it or he has never been convicted of, or pleaded guilty
to, any crime (i) involving fraud, (ii) relating to any financial transaction or handling of funds of another person, or (iii) pertaining
to any dealings in any securities and it or he is not currently a defendant in any such criminal proceeding.


 


10. Except as disclosed in
the Prospectus, neither the Sponsor nor any Insider nor any affiliate of the Sponsor or any Insider, nor any director or officer of the
Company, shall receive from the Company any finder’s fee, reimbursement, or cash payments prior to, or in connection with any services
rendered in order to effectuate the consummation of the Company’s initial Business Combination (regardless of the type of transaction
that it is), other than the amounts described in the Prospectus under the heading “Summary – The Offering – Limited
Payments to Insiders.”


 


11. The Sponsor and each
Insider has full right and power, without violating any agreement to which it is bound (including, without limitation, any non-competition or non-solicitation agreement
with any employer or former employer), to enter into this Letter Agreement and, as applicable, to serve as an officer and/or director
on the board of directors of the Company and hereby consents to being named in the Prospectus as an officer and/or director of the Company.


 


12. As used herein,
(i) “Business Combination” shall mean a merger, share exchange, asset acquisition, stock purchase,
reorganization or similar business combination, involving the Company and one or more businesses;
(ii) “Shares” shall mean, collectively, the Ordinary Shares and the Founder Shares;
(iii) “Founder Shares” shall mean the 1,437,500 of the ordinary shares, par value $0.001 per share,
initially issued to the Sponsor (up to 187,500 Shares of which are subject to complete or partial forfeiture by the Sponsor if the
over-allotment option is not exercised by the Underwriters) for an aggregate purchase price of $25,000, or $0.01 per share, prior to
the consummation of the Public Offering; (iv) “Initial Shareholders” shall mean the Sponsor and any
Insider that holds Founder Shares; (v) “Private Placement Units” shall mean the Units to purchase up
to 235,000 Units which the Sponsor has agreed to purchase for an aggregate purchase price of $2,350,000, or $10.00 per whole Private
Placement Unit, in a private placement that shall occur simultaneously with the consummation of the Public Offering (subject to
increase to up to 250,000 units for the exercise of the over-allotment); (vi) “Public Shareholders”
shall mean the holders of securities issued in the Public Offering; (vii) “Trust Account” shall mean
the trust fund into which a portion of the net proceeds of the Public Offering shall be deposited with Wilmington Trust Company;
(viii) “Transfer” shall mean the (a) sale of, offer to sell, contract or agreement to sell,
hypothecate, pledge, grant of any option to purchase or otherwise dispose of or agreement to dispose of, directly or indirectly, or
establishment or increase of a put equivalent position or liquidation with respect to or decrease of a call equivalent position
within the meaning of Section 16 of the Securities Exchange Act of 1934, as amended, and the rules and regulations of the
Commission promulgated thereunder with respect to, any security, (b) entry into any swap or other arrangement that transfers to
another, in whole or in part, any of the economic consequences of ownership of any security, whether any such transaction is to be
settled by delivery of such securities, in cash or otherwise, or (c) public announcement of any intention to effect any
transaction specified in clause (a) or (b); and (ix) “Charter” shall mean the
Company’s amended and restated memorandum and articles of association, as the same may be amended from time to time.


 


13. This Letter Agreement
constitutes the entire agreement and understanding of the parties hereto in respect of the subject matter hereof and supersedes all prior
understandings, agreements, or representations by or among the parties hereto, written or oral, to the extent they relate in any way to
the subject matter hereof or the transactions contemplated hereby. This Letter Agreement may not be changed, amended, modified or waived
(other than to correct a typographical error) as to any particular provision, except by a written instrument executed by all parties hereto.


 


14. No party hereto may
assign either this Letter Agreement or any of its rights, interests, or obligations hereunder without the prior written consent of the
other party. Any purported assignment in violation of this Section shall be void and ineffectual and shall not operate to transfer
or assign any interest or title to the purported assignee. This Letter Agreement shall be binding on the Sponsor and each Insider and
their respective successors, heirs and assigns and permitted transferees.


 






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15. Nothing in this Letter
Agreement shall be construed to confer upon, or give to, any person or corporation other than the parties hereto any right, remedy or
claim under or by reason of this Letter Agreement or of any covenant, condition, stipulation, promise or agreement hereof; provided, however,
Ladenburg Thalmann & Co. Inc. as representative of the Underwriters shall be deemed a beneficiary hereof and be entitled to enforce
the provisions of this Agreement. All covenants, conditions, stipulations, promises and agreements contained in this Letter Agreement
shall be for the sole and exclusive benefit of the parties hereto and their successors, heirs, personal representatives and assigns and
permitted transferees.


 


16. This Letter Agreement
may be executed in any number of original or facsimile counterparts and each of such counterparts shall for all purposes be deemed to
be an original, and all such counterparts shall together constitute but one and the same instrument.


 


17. This Letter Agreement
shall be deemed severable, and the invalidity or unenforceability of any term or provision hereof shall not affect the validity or enforceability
of this Letter Agreement or of any other term or provision hereof. Furthermore, in lieu of any such invalid or unenforceable term or provision,
the parties hereto intend that there shall be added as a part of this Letter Agreement a provision as similar in terms to such invalid
or unenforceable provision as may be possible and be valid and enforceable.


 


18. This Letter Agreement
shall be governed by and construed and enforced in accordance with the laws of the State of New York, without giving effect to conflicts
of law principles that would result in the application of the substantive laws of another jurisdiction. The parties hereto (i) all
agree that any action, proceeding, claim or dispute arising out of, or relating in any way to, this Letter Agreement shall be brought
and enforced in the courts of New York City, in the State of New York, and irrevocably submit to such jurisdiction and venue, which jurisdiction
and venue shall be exclusive and (ii) waive any objection to such exclusive jurisdiction and venue or that such courts represent
an inconvenient forum.


 


19. Any notice, consent
or request to be given in connection with any of the terms or provisions of this Letter Agreement shall be in writing and shall be sent
by express mail or similar private courier service, by certified mail (return receipt requested), by hand delivery or facsimile transmission.


 


20. This Letter Agreement
shall terminate on the earlier of (i) the expiration of the Lock-up Periods or (ii) the liquidation of the Company;
provided, however, that this Letter Agreement shall earlier terminate in the event that the Public Offering is not consummated and closed
by October 30, 2021; provided further that Section 5 of this Letter Agreement shall survive such liquidation.


 


[Signature Page to Letter Agreement]


 


	 	SPONSOR
	 	M-STAR MANAGEMENT CORPORATION

	 	 
	 	By: 	                            
	 	Name:
	 	Title:
	 	Officers and Directors


 






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____________________, Chairman and Chief Executive Officer


 


 





 






____________________, Chief Financial Officer


 


 





 






____________________, Director


 


 





 






____________________, Director


 


 





 









____________________, Director


 






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