Exhibit 10.4


 


AVALON ACQUISITION
INC.


2 Embarcadero Center,
8th Floor


San Francisco, CA 94111


 


October 5, 2021


 


Avalon Acquisition Holdings LLC


2 Embarcadero Center, 8th Floor


San Francisco, CA 94111


 


Ladies and Gentlemen:


 


This letter (the “Agreement”)
will confirm our agreement that, commencing on the effective date (the “Effective Date”) of the registration
statement (the “Registration Statement”) for the initial public offering (the “IPO”)
of the securities of Avalon Acquisition Inc. (the “Company”) and continuing until the earlier of (i)
the completion by the Company of an initial business combination or (ii) the Company’s liquidation (in each case as described
in the Registration Statement) (such earlier date hereinafter referred to as the “Termination Date”),
Avalon Acquisition Holdings LLC (“Holdings”) shall take steps directly or indirectly to make available
to the Company certain office space, secretarial and administrative services as may be required by the Company from time to time,
situated at 2 Embarcadero Center, 8th Floor, San Francisco, CA (or any successor location). In exchange therefore, the
Company shall pay Holdings a sum of $10,000 per month, respectively, on the Effective Date and continuing monthly thereafter until
the Termination Date. Holdings hereby irrevocably agrees that it does not have any right, title, interest or claim of any kind
in or to any monies or other assets that may be set aside in a trust account (the “Trust Account”) that
may be established upon the consummation of the IPO (the “Claim”) and hereby irrevocably waives any Claim
it may have in the future as a result of, or arising out of, any negotiations, contracts or agreements with the Company and will
not seek recourse, reimbursement, payment or satisfaction of any Claim against the Trust Account or any monies or other assets
in the Trust Account for any reason whatsoever.


 


This Agreement constitutes the entire agreement
and understanding of the parties hereto in respect of its subject matter 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 Agreement may not be amended, modified
or waived as to any particular provision, except by a written instrument executed by all parties hereto.


 


No party hereto may assign either this Agreement
or any of its rights, interests, or obligations hereunder without the prior written approval of the other party. Any purported
assignment in violation of this paragraph shall be void and ineffectual and shall not operate to transfer or assign any interest
or title to the purported assignee.


 


Any litigation between the parties (whether
grounded in contract, tort, statute, law or equity) shall be governed by, construed in accordance with, and interpreted pursuant
to the laws of the State of New York.


 


This Agreement may be executed in one or more
counterparts, each of which shall for all purposes be deemed to be an original but all of which together shall constitute one and
the same Agreement.


 


[SIGNATURE PAGE FOLLOWS]





 






    	 



    	 



    

 


	Very
truly yours,	 
	 	 	 
	AVALON
ACQUISITION INC.	 
	 	 	 
	By:	/s/
S. Craig Cognetti	 
	Name:	S. Craig Cognetti	 
	Title:	Chief Executive
Officer	 
	 	 	 
	AGREED
TO AND ACCEPTED BY:	 
	 	 	 
	AVALON
ACQUISITION HOLDINGS LLC	 
	 	 	 
	By: 	/s/
Donald H. Putnam	 
	Name: 	Donald H. Putnam	 
	Title:	Managing Member