Exhibit 10.2


 


INVESTMENT MANAGEMENT TRUST AGREEMENT


 


This Investment Management Trust
Agreement (this “Agreement”) is made effective as of [ ], 2021 by and between ION Acquisition Corp 3 Ltd., a
Cayman Islands exempted company (the “Company”), and Continental Stock Transfer & Trust Company, a New York
limited purpose trust company (the “Trustee”).


 


WHEREAS, the Company’s registration
statement on Form S-1, File No. 333-255072 (the “Registration Statement”) and prospectus (the “Prospectus”)
for the initial public offering (the “Offering”) of the Company’s Class A ordinary shares, par value $0.0001
per share (the “Ordinary Shares”), has been declared effective as of the date hereof by the U.S. Securities
and Exchange Commission;


 


WHEREAS, the Company has entered into
an Underwriting Agreement (the “Underwriting Agreement”) with Morgan Stanley & Co. LLC and Goldman Sachs
& Co. LLC, as representatives (“Representatives”) of the several underwriters (the “Underwriters”)
named therein;


 


WHEREAS, as described in the Prospectus,
$250,000,000 of the gross proceeds of the Offering and sale of the Private Placement Shares (as defined in the Underwriting Agreement)
(or $287,500,000 if the Underwriters’ over-allotment option is exercised in full) will be delivered to the Trustee to be deposited
and held in a segregated trust account located at all times in the United States (the “Trust Account”) for the
benefit of the Company and the holders of the Ordinary Shares issued in the Offering as hereinafter provided (the amount to be delivered
to the Trustee (and any interest subsequently earned thereon) is referred to herein as the “Property,”
the shareholders for whose benefit the Trustee shall hold the Property will be referred to as the “Public Shareholders,”
and the Public Shareholders and the Company will be referred to together as the “Beneficiaries”);


 


WHEREAS, pursuant to the Underwriting Agreement, a portion
of the Property equal to $8,750,000, or $10,062,500 if the Underwriters’ over-allotment option is exercised in full, is attributable
to deferred underwriting discounts and commissions that will be payable by the Company to the Underwriters upon and concurrently with
the consummation of the Business Combination (as defined below) (the “Deferred Discount”); and WHEREAS,
the Company and the Trustee desire to enter into this Agreement to set forth the terms and conditions pursuant to which the Trustee shall
hold the Property.


 


NOW THEREFORE, IT IS AGREED:


 


1. Agreements
and Covenants of Trustee. The Trustee hereby agrees and covenants to:


 


(a) Hold the
Property in trust for the Beneficiaries in accordance with the terms of this Agreement in the Trust Account established by the Trustee
in the United States at J.P. Morgan Chase Bank, N.A. (or at another U.S. chartered commercial bank with consolidated assets of $100 billion
or more) and at a brokerage institution selected by the Trustee that is reasonably satisfactory to the Company;


 


 (b) Manage, supervise and administer the Trust Account subject to the terms and conditions set forth herein;




 


(c) In a timely manner, upon the written instruction
of the Company, invest and reinvest the Property solely in United States government securities within the meaning of Section 2(a)(16)
of the Investment Company Act of 1940, as amended, having a maturity of 185 days or less, or in money market funds meeting the conditions
of paragraphs (d)(1), (d)(2), (d)(3) and (d)(4) of Rule 2a-7 promulgated under the Investment Company Act of 1940, as amended (or any
successor rule), which invest only in direct U.S. government treasury obligations, as determined by the Company; it being understood
that the Trust Account will earn no interest while account funds are uninvested awaiting the Company’s instructions hereunder and
the Trustee may earn bank credits or other consideration;


 




     


     


    

 


(d) Collect
and receive, when due, all interest or other income arising from the Property, which shall become part of the “Property,”
as such term is used herein;


 


(e) Promptly
notify the Company and the Representatives of all communications received by the Trustee with respect to any Property requiring action
by the Company;


 


(f) Supply
any necessary information or documents as may be requested by the Company (or its authorized agents) in connection with the Company’s
preparation of the tax returns relating to assets held in the Trust Account;


 


(g) Participate
in any plan or proceeding for protecting or enforcing any right or interest arising from the Property if, as and when instructed by the
Company to do so;


 


(h) Render
to the Company monthly written statements of the activities of, and amounts in, the Trust Account reflecting all receipts and disbursements
of the Trust Account;


 


(i) Commence
liquidation of the Trust Account only after and promptly after (x) receipt of, and only in accordance with the terms of, a letter
from the Company (“Termination Letter”) in a form substantially similar to that attached hereto as either Exhibit
A or Exhibit B, as applicable, signed on behalf of the Company by its Chief Executive Officer, Chief Financial Officer,
President, Executive Vice President, Vice President, Secretary or Chairman of the board of directors of the Company (the
“Board”) or other authorized officer of the Company, and, in the case of Exhibit A, acknowledged
and agreed to by the Representatives, and complete the liquidation of the Trust Account and distribute the Property in the Trust
Account, including interest earned on the funds held in the Trust Account (less taxes payable and up to $100,000 of interest to pay
dissolution expenses), only as directed in the Termination Letter and the other documents referred to therein, or (y) upon the date
which is the later of (1) 24 months after the closing of the Offering and (2) such later date as may be approved by the
Company’s shareholders in accordance with the Company’s amended and restated memorandum and articles of association if a
Termination Letter has not been received by the Trustee prior to such date, in which case the Trust Account shall be liquidated in
accordance with the procedures set forth in the Termination Letter attached as Exhibit B and the Property in the Trust
Account, including interest earned on the funds held in the Trust Account (less taxes payable and up to $100,000 of interest to pay
dissolution expenses), shall be distributed to the Public Shareholders of record as of such date;


 


(j) Upon written
request from the Company, which may be given from time to time in a form substantially similar to that attached hereto as Exhibit C
(a “Tax Payment Withdrawal Instruction”), withdraw from the Trust Account and distribute to the Company
the amount of interest earned on the Property requested by the Company to cover any tax obligation owed by the Company as a result of
assets of the Company or interest or other income earned on the Property, which amount shall be delivered directly to the Company by electronic
funds transfer or other method of prompt payment, and the Company shall forward such payment to the relevant taxing authority so long
as there is no reduction in the principal amount initially deposited in the Trust Account; provided, however, that
to the extent there is not sufficient cash in the Trust Account to pay such tax obligation, the Trustee shall liquidate such assets held
in the Trust Account as shall be designated by the Company in writing to make such distribution (it being acknowledged and agreed that
any such amount in excess of interest income earned on the Property shall not be payable from the Trust Account). The written request
of the Company referenced above shall constitute presumptive evidence that the Company is entitled to said funds, and the Trustee shall
have no responsibility to look beyond said request;


 


(k) Upon written
request from the Company, which may be given from time to time in a form substantially similar to that attached hereto as Exhibit D
(a “Shareholder Redemption Withdrawal Instruction”), the Trustee shall distribute to the Public Shareholders
on behalf of the Company the amount requested by the Company to be used to redeem Ordinary Shares from Public Shareholders properly submitted
in connection with a shareholder vote to approve an amendment to the Company’s amended and restated memorandum and articles of association
(A) to modify the substance or timing of the Company’s obligation to allow redemption in connection with the Company’s initial
Business Combination or to redeem 100% of the Ordinary Shares sold in the Offering (the “public shares”) if the Company
has not consummated an initial Business Combination within such time as is described in the Company’s amended and restated memorandum
and articles of association or (B) with respect to any other material provisions relating to shareholders’ rights or pre- initial
Business Combination activity. The written request of the Company referenced above shall constitute presumptive evidence that the Company
is entitled to distribute said funds, and the Trustee shall have no responsibility to look beyond said request; and


 


 (l) Not make any withdrawals or distributions from the Trust Account other than pursuant to Section 1(i), (j) or (k) above.




 




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2. Agreements and Covenants of the Company. The Company hereby agrees and covenants to:




 


(a) Give all
instructions to the Trustee hereunder in writing, signed by the Company’s Chairman of the Board, Chief Executive Officer, Chief
Financial Officer, President, Executive Vice President, Vice President or Secretary. In addition, except with respect to its duties under
Sections 1(i), 1(j) and 1(k) hereof, the Trustee shall be entitled to rely on, and shall be protected in relying
on, any verbal or telephonic advice or instruction which it, in good faith and with reasonable care, believes to be given by any one of
the persons authorized above to give written instructions, provided that the Company shall promptly confirm such instructions in writing;


 


(b) Subject
to Section 4 hereof, hold the Trustee harmless and indemnify the Trustee from and against any and all expenses, including reasonable
counsel fees and disbursements, or losses suffered by the Trustee in connection with any action taken by it hereunder and in connection
with any action, suit or other proceeding brought against the Trustee involving any claim, or in connection with any claim or demand,
which in any way arises out of or relates to this Agreement, the services of the Trustee hereunder, or the Property or any interest earned
on the Property, except for expenses and losses resulting from the Trustee’s gross negligence, fraud or willful misconduct. Promptly
after the receipt by the Trustee of notice of demand or claim or the commencement of any action, suit or proceeding, pursuant to which
the Trustee intends to seek indemnification under this Section 2(b), it shall notify the Company in writing of such claim (hereinafter
referred to as the “Indemnified Claim”). The Trustee shall have the right to conduct and manage the defense
against such Indemnified Claim; provided that the Trustee shall obtain the consent of the Company with respect to the selection
of counsel, which consent shall not be unreasonably withheld. The Trustee may not agree to settle any Indemnified Claim without the prior
written consent of the Company, which such consent shall not be unreasonably withheld. The Company may participate in such action with
its own counsel;


 


(c) Pay the
Trustee the fees set forth on Schedule A hereto, including an initial acceptance fee, annual administration fee, and transaction
processing fee which fees shall be subject to modification by the parties from time to time. It is expressly understood that the Property
shall not be used to pay such fees unless and until it is distributed to the Company pursuant to Sections 1(i) through 1(j)
hereof. The Company shall pay the Trustee the initial acceptance fee and the first annual administration fee at the consummation of
the Offering. The Company shall not be responsible for any other fees or charges of the Trustee except as set forth in this Section
2(c), Schedule A and as may be provided in Section 2(b) hereof;


 


(d) In connection
with any vote of the Company’s shareholders regarding a merger, share exchange, asset acquisition, share purchase, reorganization
or similar business combination involving the Company and one or more businesses (the “Business Combination”),
provide to the Trustee an affidavit or certificate of the inspector of elections for the shareholder meeting verifying the vote of such
shareholders regarding such Business Combination;


 


(e) Provide
the Representatives with a copy of any Termination Letter(s) and/or any other correspondence that is sent to the Trustee with respect
to any proposed withdrawal from the Trust Account promptly after it issues the same;


 


(f) Instruct
the Trustee to make only those distributions that are permitted under this Agreement, and refrain from instructing the Trustee to make
any distributions that are not permitted under this Agreement;


 


(g) Within
four (4) business days after the Underwriters exercise the over-allotment option (or any unexercised portion thereof) or such over- allotment
option expires, provide the Trustee with a notice in writing of the total amount of the Deferred Discount, which shall in no event be
less than $8,750,000; and


 


(h) Expressly
provide in any Instruction Letter (as defined in Exhibit A) delivered in connection with a Termination Letter in the form of Exhibit A
that the Deferred Discount be paid directly to the account or accounts directed by the Representatives prior to any transfer of the funds
held in the Trust Account to the Company or any other person.


 




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3. Limitations of Liability. The Trustee shall have no responsibility or liability to:




 


(a) Imply
obligations, perform duties, inquire or otherwise be subject to the provisions of any agreement or document other than this Agreement
and that which is expressly set forth herein;


 


(b) Take any
action with respect to the Property, other than as directed in Section 1 hereof, and the Trustee shall have no liability to any
third party except for liability arising out of the Trustee’s gross negligence, fraud or willful misconduct;


 


(c) Institute
any proceeding for the collection of any principal and income arising from, or institute, appear in or defend any proceeding of any kind
with respect to, any of the Property unless and until it shall have received instructions from the Company given as provided herein to
do so and the Company shall have advanced or guaranteed to it funds sufficient to pay any expenses incident thereto;


 


 (d) Refund any depreciation in principal of any Property;




 


(e) Assume
that the authority of any person designated by the Company to give instructions hereunder shall not be continuing unless provided otherwise
in such designation, or unless the Company shall have delivered a written revocation of such authority to the Trustee;


 


(f) The other
parties hereto or to anyone else for any action taken or omitted by it, or any action suffered by it to be taken or omitted, in good faith
and in the Trustee’s best judgment, except for the Trustee’s gross negligence, fraud or willful misconduct. The Trustee may
rely conclusively and shall be protected in acting upon any order, notice, demand, certificate, opinion or advice of counsel (including
counsel chosen by the Trustee, which counsel may be the Company’s counsel), statement, instrument, report or other paper or document
(not only as to its due execution and the validity and effectiveness of its provisions, but also as to the truth and acceptability of
any information therein contained) which the Trustee believes, in good faith and with reasonable care, to be genuine and to be signed
or presented by the proper person or persons. The Trustee shall not be bound by any notice or demand, or any waiver, modification, termination
or rescission of this Agreement or any of the terms hereof, unless evidenced by a written instrument delivered to the Trustee, signed
by the proper party or parties and, if the duties or rights of the Trustee are affected, unless it shall give its prior written consent
thereto;


 


 (g) Verify the accuracy of the information contained in the Registration Statement;




 


(h) Provide
any assurance that any Business Combination entered into by the Company or any other action taken by the Company is as contemplated by
the Registration Statement;


 


(i) File information
returns with respect to the Trust Account with any local, state or federal taxing authority or provide periodic written statements to
the Company documenting the taxes payable by the Company, if any, relating to any interest income earned on the Property;


 


(j) Prepare,
execute and file tax reports, income or other tax returns and pay any taxes with respect to any income generated by, and activities relating
to, the Trust Account, regardless of whether such tax is payable by the Trust Account or the Company, including, but not limited to, tax
obligations, except pursuant to Section 1(j) hereof; or


 


 (k) Verify calculations, qualify or otherwise approve the Company’s written requests for distributions pursuant to Sections 1(i), 1(j) or 1(k) hereof.




 




    4


     


    

 


4. Trust
Account Waiver. The Trustee has no right of set-off or any right, title, interest or claim of any kind (“Claim”)
to, or to any monies in, the Trust Account, and hereby irrevocably waives any Claim to, or to any monies in, the Trust Account that it
may have now or in the future. In the event the Trustee has any Claim against the Company under this Agreement, including, without limitation,
under Section 2(b) or Section 2(c) hereof, the Trustee shall pursue such Claim solely against the Company and its assets
outside the Trust Account and not against the Property or any monies in the Trust Account.


 


 5. Termination. This Agreement shall terminate as follows:




 


(a) If the
Trustee gives written notice to the Company that it desires to resign under this Agreement, the Company shall use its reasonable efforts
to locate a successor trustee, pending which the Trustee shall continue to act in accordance with this Agreement. At such time that the
Company notifies the Trustee that a successor trustee has been appointed and has agreed to become subject to the terms of this Agreement,
the Trustee shall transfer the management of the Trust Account to the successor trustee, including but not limited to the transfer of
copies of the reports and statements relating to the Trust Account, whereupon this Agreement shall terminate; provided, however,
that in the event that the Company does not locate a successor trustee within ninety (90) days of receipt of the resignation notice from
the Trustee, the Trustee may submit an application to have the Property deposited with any court in the State of New York or with the
United States District Court for the Southern District of New York and upon such deposit, the Trustee shall be immune from any liability
whatsoever; or


 


(b) At such
time that the Trustee has completed the liquidation of the Trust Account and its obligations in accordance with the provisions of Section
1(i) hereof and distributed the Property in accordance with the provisions of the Termination Letter, this Agreement shall terminate
except with respect to Section 2(b).


 


 6. Miscellaneous.




 


(a) The Company
and the Trustee each acknowledge that the Trustee will follow the security procedures set forth below with respect to funds transferred
from the Trust Account. The Company and the Trustee will each restrict access to confidential information relating to such security procedures
to authorized persons. Each party must notify the other party immediately if it has reason to believe unauthorized persons may have obtained
access to such confidential information, or of any change in its authorized personnel. In executing funds transfers, the Trustee shall
rely upon all information supplied to it by the Company, including, account names, account numbers, and all other identifying information
relating to a Beneficiary, Beneficiary’s bank or intermediary bank. Except for any liability arising out of the Trustee’s
gross negligence, fraud or willful misconduct, the Trustee shall not be liable for any loss, liability or expense resulting from any error
in the information or transmission of the funds.


 


(b) This Agreement
shall be governed by and construed and enforced in accordance with the laws of the State of New York. This Agreement may be executed in
several original or facsimile counterparts, each one of which shall constitute an original, and together shall constitute but one instrument.


 


(c) This Agreement
contains the entire agreement and understanding of the parties hereto with respect to the subject matter hereof. Except for Section
1(i), 1(j) and 1(k) hereof (which sections may not be modified, amended or deleted without the affirmative vote of at
least two-thirds of the Company’s Ordinary Shares and Class B ordinary shares, par value $0.0001 per share, that are represented
in person or by proxy at a general meeting of the Company, voting together as a single class; provided that no such amendment
will affect any Public Shareholder who has properly elected to redeem his or her Ordinary Shares in connection with a shareholder vote
to amend this Agreement (A) to modify the substance or timing of the Company’s obligation to allow redemption in connection with
the Company’s initial Business Combination or to redeem 100% of the public shares if the Company does not complete its initial Business
Combination within the time frame specified in the Company’s amended and restated memorandum and articles of association or (B)
with respect to any other material provisions relating to shareholders’ rights or pre-initial Business Combination activity), this
Agreement or any provision hereof may only be changed, amended or modified (other than to correct a typographical error) by a writing
signed by each of the parties hereto.


 


(d) The parties
hereto consent to the jurisdiction and venue of any state or federal court located in the City of New York, State of New York, for purposes
of resolving any disputes hereunder. AS TO ANY CLAIM, CROSS-CLAIM OR COUNTERCLAIM IN ANY WAY RELATING TO THIS AGREEMENT, EACH PARTY WAIVES
THE RIGHT TO TRIAL BY JURY.


 




    5


     


    

 


(e) Any notice,
statement or demand authorized by this Agreement to be given or made by the Trustee or on the Company shall be sufficiently given when
delivered (if given by hand, overnight delivery or certified mail) or when sent (if given electronically) (until another address is filed
in writing by the Company with the Trustee), as follows:


 


if to the Trustee, to:


 


Continental Stock Transfer & Trust Company


1 State Street, 30th Floor New York, New York 10004 


Attn: Francis Wolf & Celeste Gonzalez


Email: fwolf@continentalstock.com


Email: cgonzalez@continentalstock.com 


 


if to the Company, to:


 


ION Acquisition Corp 3 Ltd. 

89 Medinat Hayehudim Street


Herzliya 4676672, Israel


+972 (9) 970-3620


Attn: Anthony Reich


Email: Anthony@ion-am.com


 


in each case,
with copies to: 

White & Case LLP


1221 Avenue of the Americas 

New York,
New York 10020

 Attn: Colin Diamond


Email: cdiamond@whitecase.com and


 


Morgan Stanley & Co. LLC 

1585 Broadway
New York,

 New York 10036 

Attn: Equity Syndicate Desk


 


with a copy to the Legal Department


 


and


 


Goldman Sachs & Co. LLC

 200 West Street New York,


New York 10282 

Attn: General Counsel


 


and


 


Skadden, Arps, Slate, 

Meagher & Flom LLP


One Manhattan West,


New York, New York 10001-8602


Attn: David J Goldschmidt & Yossi
Vebman


Email: david.goldschmidt@skadden.com


Email: yossi.vebman@skadden.com


 




    6


     


    

 


(f) This Agreement may not be assigned by the Trustee without the prior consent of the Company.




 


(g) Each of
the Company and the Trustee hereby represents that it has the full right and power and has been duly authorized to enter into this Agreement
and to perform its respective obligations as contemplated hereunder. The Trustee acknowledges and agrees that it shall not make any claims
or proceed against the Trust Account, including by way of set-off, and shall not be entitled to any funds in the Trust Account under any
circumstance.


 


(h) This Agreement
is the joint product of the Trustee and the Company and each provision hereof has been subject to the mutual consultation, negotiation
and agreement of such parties and shall not be construed for or against any party hereto.


 


(i) This Agreement
may be executed in any number of counterparts, each of which shall be deemed to be an original, but all such counterparts shall together
constitute one and the same instrument. Delivery of a signed counterpart of this Agreement by facsimile or electronic transmission shall
constitute valid and sufficient delivery thereof.


 


(j) Each of
the Company and the Trustee hereby acknowledges and agrees that each Representative, on behalf of the Underwriters, is a third-party beneficiary
of this Agreement.


 


 (k) Except as specified herein, no party to this Agreement may assign its rights or delegate its obligations hereunder to any other person or entity.


 


[Signature page follows]




 




    7


     


    

 


IN WITNESS WHEREOF, the parties have duly executed this
Investment Management Trust Agreement as of the date first written above.


 


	 	CONTINENTAL STOCK TRANSFER & TRUST COMPANY, as
    Trustee
	 	 	 	 
	 	By:	 	 
	 	 	Name:	 Francis Wolf 
	 	 	Title:	Vice President
	 	 	 	 
	 	ION ACQUISITION CORP 3 LTD.
	 	 	 	 
	 	By:	 	 
	 	 	Name:	Anthony Reich
	 	 	Title:	Chief Financial Officer






 


[Signature Page to Investment Management Trust Agreement]


 


 




     


     


    

 


SCHEDULE A


 


	Fee Item	 	Time and method of payment	 	Amount	 
	Initial set-up fee	 	Initial closing of Offering by wire transfer.	 	$	3,500.00	 
	Trustee administration fee	 	Payable annually. First year fee payable, at initial closing of Offering by wire transfer, thereafter by wire transfer or check.	 	$	10,000.00	 
	Transaction processing
    fee for disbursements to Company under Section 1	 	Billed to Company following disbursement made to Company under Section 1	 	$	250.00	 
	Paying Agent services as required pursuant to Section 1(i) and 1(k)	 	Billed to Company upon delivery of service pursuant to Section 1(i) and
    1(k)	 	 	Prevailing rates	 




 




     


     


    




 


EXHIBIT A


 


[Letterhead of Company] 

[Insert
date]


 


Continental Stock Transfer & Trust Company 

1 State
Street, 30th Floor 

New York, New York 10004


Attn: Francis Wolf


 


Re:     Trust Account - Termination
Letter


 


Dear Mr. Wolf and Ms. Gonzalez:



 


Pursuant to Section 1(i) of
the Investment Management Trust Agreement between ION Acquisition Corp 3 Ltd. (the “Company”) and Continental
Stock Transfer & Trust Company (“Trustee”), dated as of __________, 2021 (the “Trust Agreement”),
this is to advise you that the Company has entered into an agreement with ___________ (the “Target Business”)
to consummate a business combination with Target Business (the “Business Combination”) on or about [insert
date]. The Company shall notify you at least seventy-two (72) hours in advance of the actual date (or such shorter period as you may
agree) of the consummation of the Business Combination (the “Consummation Date”). Capitalized terms used but
not defined herein shall have the meanings set forth in the Trust Agreement.


 


In accordance with the terms of the Trust
Agreement, the Company hereby authorizes you to commence to liquidate all of the assets of the Trust


 


Account, and to transfer the proceeds
to a segregated account held by you on behalf of the Beneficiaries to the effect that, on the Consummation Date, all of the funds held
in the Trust Operating Account will be immediately available for transfer to the account or accounts that the Company shall direct on
the Consummation Date (including as directed to it by the Representatives on behalf of the Underwriters (with respect to the Deferred
Discount)).


 


On the Consummation Date (i) counsel
for the Company shall deliver to you written notification that the Business Combination has been consummated, or will be consummated concurrently
with your transfer of funds to the accounts as directed by the Company (the “Notification”), and (ii) the Company
shall deliver to you (a) a certificate by the Chief Executive Officer, Chief Financial Officer or Chief Operating Officer, which verifies
that the Business Combination has been approved by a vote of the Company’s shareholders, if a vote is held and (b) a joint written
instruction signed by the Company and the Representatives with respect to the transfer of the funds held in the Trust Account, including
payment of the Deferred Discount from the Trust Account (the “Instruction Letter”). You are hereby directed
and authorized to transfer the funds held in the Trust Account immediately upon your receipt of the Notification and the Instruction Letter,
in accordance with the terms of the Instruction Letter. In the event that certain deposits held in the Trust Account may not be liquidated
by the Consummation Date without penalty, you will notify the Company in writing of the same and the Company shall direct you as to whether
such funds should remain in the Trust Account and be distributed after the Consummation Date to the Company. Upon the distribution of
all the funds, net of any payments necessary for reasonable unreimbursed expenses related to liquidating the Trust Account, your obligations
under the Trust Agreement shall be terminated.


 


In the event that the Business Combination
is not consummated on the Consummation Date described in the notice thereof and the Company has not notified you on or before the original
Consummation Date of a new Consummation Date, then upon receipt by the Trustee of written instructions from the Company, the funds held
in the Trust Account shall be reinvested as provided in Section 1(c) of the Trust Agreement on the business day immediately following
the Consummation Date as set forth in such notice as soon thereafter as possible.


 


[Signature page follows]


 




     


     


    

 


	 	 	 	 	Very truly yours,



	 	 	 	 	ION Acquisition Corp 3 Ltd.
	 	 	 	 	 
	 	 	 	 	By:	 	 
	 	 	 	 	 	Name:	 
	 	 	 	 	 	Title:	 
	 	 	 	 	 	 	 
	Agreed and acknowledged by:

 Morgan Stanley & Co. LLC


	 	 	 	 
	 	 	 	 	 
	By:	 	 	 	 	 	 
	 	Name:	 	 	 	 	 
	 	Title:	 	 	 	 	 
	 	 	 	 	 	 	 
	Goldman Sachs & Co. LLC	 	 	 	 
	 	 	 	 	 
	By:	 	 	 	 	 	 
	 	Name:	 	 	 	 	 
	 	Title:	 	 	 	 	 



 




     


     


    

  


EXHIBIT B


 


[Letterhead of Company]

 [Insert
date]


 


Continental Stock Transfer & Trust Company


1 State Street, 30th Floor 

New York, New York 10004


Attn: Francis Wolf


 


Re:     Trust Account - Termination
Letter


 


Dear Mr. Wolf and Ms. Gonzalez:



 


Pursuant to Section 1(i) of
the Investment Management Trust Agreement between ION Acquisition Corp 3 Ltd. (the “Company”) and Continental
Stock Transfer & Trust Company (the “Trustee”), dated as of _________, 2021 (the “Trust Agreement”),
this is to advise you that the Company has been unable to effect a business combination with a Target Business (the “Business
Combination”) within the time frame specified in the Company’s Amended and Restated Memorandum and Articles of Association,
as described in the Company’s Prospectus relating to the Offering. Capitalized terms used but not defined herein shall have the
meanings set forth in the Trust Agreement.


 


In accordance with the
terms of the Trust Agreement, the Company hereby authorizes you to liquidate all of the assets in the Trust Account and to transfer the
total proceeds into a segregated account held by you on behalf of the Beneficiaries to await distribution to the Public Shareholders.
The Company has selected __________1 as the effective date for the purpose of determining
when the Public Shareholders will be entitled to receive their share of the liquidation proceeds. You agree to be the Paying Agent of
record and, in your separate capacity as Paying Agent, agree to distribute said funds directly to the Company’s Public Shareholders
in accordance with the terms of the Trust Agreement and the Memorandum and Articles of Association of the Company. Upon the distribution
of all the funds, net of any payments necessary for reasonable unreimbursed expenses related to liquidating the Trust Account, your obligations
under the Trust Agreement shall be terminated, except to the extent otherwise provided in Section 1(i) of the Trust Agreement.


 


	 	Very truly yours,



	 	ION Acquisition Corp 3 Ltd.
	 	 
	 	By:	 	 
	 	 	Name:	 
	 	 	Title:	 



 


	cc:	Morgan
Stanley & Co. LLC
	 
	 	Goldman Sachs & Co. LLC	 



 


	1	24 months from the closing of the Offering, or at a later
date, if extended.



 




     


     


    

 


EXHIBIT C


 


[Letterhead of Company]

 [Insert
date]


 


Continental Stock Transfer & Trust Company 

1 State Street,
30th Floor 

New York, New York 10004


Attn: Francis Wolf



 


Re:      Trust Account - Tax Payment
Withdrawal Instruction


 


Dear Mr. Wolf:


 


Pursuant to Section 1(j) of
the Investment Management Trust Agreement between ION Acquisition Corp 3 Ltd. (the “Company”) and Continental
Stock Transfer & Trust Company (the “Trustee”), dated as of ________, 2021 (the “Trust Agreement”),
the Company hereby requests that you deliver to the Company $ of the interest income earned on the Property as of the date
hereof. Capitalized terms used but not defined herein shall have the meanings set forth in the Trust Agreement.


 


The Company needs such funds to pay
for the tax obligations as set forth on the attached tax return or tax statement. In accordance with the terms of the Trust Agreement,
you are hereby directed and authorized to transfer (via wire transfer) such funds promptly upon your receipt of this letter to the Company’s
operating account at:


 


[WIRE INSTRUCTION INFORMATION]


 





	 	Very truly yours,



	 	ION Acquisition Corp 3 Ltd.
	 	 
	 	By:	 	 
	 	 	Name:	 
	 	 	Title:	 



 


	cc:	Morgan Stanley & Co. LLC 

Goldman Sachs & Co. LLC



 




     


     


    

 


EXHIBIT D


 


[Letterhead of Company]

 [Insert
date]


 


Continental Stock Transfer & Trust Company

 1 State Street,
30th Floor 

New York, New York 10004


Attn: Francis Wolf & Celeste Gonzalez



 


Re:     Trust Account - Shareholder
Redemption Withdrawal Instruction


 


Dear Mr. Wolf and Ms. Gonzalez:


 


Pursuant to Section 1(k) of
the Investment Management Trust Agreement between ION Acquisition Corp 3 Ltd. (the “Company”) and Continental
Stock Transfer & Trust Company (the “Trustee”), dated as of , 2021 (the “Trust Agreement”),
the Company hereby requests that you deliver to the redeeming Public Shareholders of the Company $____ of the principal and interest income
earned on the Property as of the date hereof to a segregated account held by you on behalf of the Beneficiaries for distribution to the
Public Shareholders who have requested redemption of their Ordinary Shares. Capitalized terms used but not defined herein shall have the
meanings set forth in the Trust Agreement.


 


The Company needs such funds to pay
its Public Shareholders who have properly elected to have their Ordinary Shares redeemed by the Company in connection with a shareholder
vote to approve an amendment to the Company’s amended and restated memorandum and articles of association


 


(A) to modify the substance or timing
of the Company’s obligation to allow redemption in connection with the Company’s initial Business Combination or to redeem
100% of the Ordinary Shares sold in the Offering if the Company has not consummated an initial Business Combination within such time as
is described in the Company’s amended and restated memorandum and articles of association or (B) with respect to any other material
provisions relating to shareholders’ rights or pre-initial Business Combination activity. As such, you are hereby directed and authorized
to transfer (via wire transfer) such funds promptly upon your receipt of this letter.


 


	 	Very truly yours,
	 	ION Acquisition Corp 3 Ltd.
	 	 
	 	By:	 
	 	 	Name:	Anthony Reich
	 	 	Title:	Chief Financial Officer



  


	cc:	Morgan Stanley & Co. LLC 

Goldman Sachs & Co. LLC