Exhibit 10.6


 


[●],
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 377,500 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-half (1/2)
of 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 $3,775,000 (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 37,500 Over-Allotment
Units, or a maximum purchase price of $375,000 (“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.


 


At least twenty-four (24)
hours prior to the pricing of the IPO, the undersigned will cause the Purchase Price to be delivered to an escrow account with Loeb &
Loeb LLP (“Loeb”).


 


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. Simultaneously with or prior to the consummation of the IPO, Loeb shall deposit the Purchase Price, without interest or deduction,
into the Trust Account.


 


Each of the Company and the
undersigned acknowledges and agrees that Loeb is serving hereunder solely as a convenience to the parties to facilitate the purchase of
the Placement Units and Loeb’s sole obligation under this letter agreement is to act with respect to holding and disbursing the
Purchase Price for the Placement Units as described above. Loeb shall not be liable to the Company, the underwriters in the IPO or the
undersigned or any other person or entity in respect of any act or failure to act hereunder or otherwise in connection with performing
its services hereunder unless Loeb has acted in a manner constituting gross negligence or willful misconduct. The Company and the undersigned
shall indemnify Loeb against any claim made against it (including reasonable attorney’s fees) by reason of it acting or failing
to act in connection with this letter agreement except as a result of its gross negligence or willful misconduct. Loeb may rely and shall
be protected in acting or refraining from acting upon any written notice, instruction or request furnished to it hereunder and believed
by it to be genuine and to have been signed or presented by the proper party or parties. 


 


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;



 






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		(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.



 


[Signature Page Follows]


 




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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,
	 	 
	 	Redwoods Capital LLC
	 	 
	 	By:	 
	 	Name: 	Min Gan 
	 	Title:	Authorized Representative 


  


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


 


Signature Page to Private Placement Units Subscription
Agreement