Document:

Exhibit 4.1

 

WARRANT AGREEMENT 

 

between 

AVALON ACQUISITION INC.

an

CONTINENTAL STOCK TRANSFER & TRUST
COMPANY

 

Dated October 5, 2021

 

THIS WARRANT AGREEMENT (this “Agreement”),
dated as of October 5, 2021, is by and between Avalon Acquisition Inc., a Delaware corporation (the “Company”),
and Continental Stock Transfer & Trust Company, a New York limited purpose trust company , as warrant agent (in such
capacity, the “Warrant Agent”, also referred to herein as the “Transfer Agent”).

 

WHEREAS, on or about the date hereof, the Company
entered into that certain Private Placement Warrants Purchase Agreement, with Avalon Acquisition Holdings LLC, a Delaware limited
liability company (the “Sponsor”), pursuant to which the Sponsor will purchase an aggregate of 7,175,000
warrants (or 8,100,000 warrants in the aggregate if the Over-allotment Option (as defined below) in connection with the Company’s
Offering (as defined below) is exercised in full) simultaneously with the closing of the Offering (and the closing of the Over-allotment
Option, if applicable), bearing the legend set forth in Exhibit B hereto (the “Private Placement Warrants”)
at a purchase price of $1.00 per Private Placement Warrant. Each Private Placement Warrant entitles the holder thereof to purchase
one share of Class A common stock (as defined below) at a price of $11.50 per share, subject to adjustment as described herein;
and

 

WHEREAS, in order to finance the Company’s
transaction costs in connection with an intended initial merger, stock exchange, asset acquisition, stock purchase, reorganization
or similar business combination, involving the Company and one or more businesses (a “Business Combination”),
the Sponsor or an affiliate of the Sponsor or certain of the Company’s officers and directors may, but are not obligated
to, loan the Company funds as the Company may require, of which up to $1,500,000 of such loans may be convertible into up to an
additional 1,500,000 Private Placement Warrants at a price of $1.00 per Private Placement Warrant; and

 

WHEREAS, the Company is engaged in an initial
public offering (the “Offering”) of units of the Company’s equity securities, each such unit comprised
of one share of Class A common stock (as defined below) and three-fourths of one Public Warrant (as defined below) (the “Units”)
and, in connection therewith, has determined to issue and deliver up to 13,500,000 redeemable warrants (including up to 2,025,000
redeemable warrants subject to the Over-allotment Option) to public investors in the Offering (the “Public Warrants”
and, together with the Private Placement Warrants , the “Warrants”). Each whole Warrant entitles the
holder thereof to purchase one share of Class A common stock of the Company, par value $0.0001 per share (“Class A
common stock”), for $11.50 per share, subject to adjustment as described herein. Only whole Warrants are exercisable.
A holder of the Public Warrants will not be able to exercise any fraction of a Warrant; and

 

WHEREAS, the Company has filed with the Securities
and Exchange Commission (the “Commission”) a registration statement on Form S-1, No. 333-253654
(the “Registration Statement”) and a registration statement on Form S-1, No. 333-260077 (the “462(b)
Registration Statement”), and prospectus (the “Prospectus”), for the registration, under
the Securities Act of 1933, as amended (the “Securities Act”), of the Units, the Public Warrants and
the shares of Class A common stock included in the Units; and

 

WHEREAS, the Company desires the Warrant Agent
to act on behalf of the Company, and the Warrant Agent is willing to so act, in connection with the issuance, registration, transfer,
exchange, redemption and exercise of the Warrants; and

 

WHEREAS, the Company desires to provide for
the form and provisions of the Warrants, the terms upon which they shall be issued and exercised, and the respective rights, limitation
of rights, and immunities of the Company, the Warrant Agent and the holders of the Warrants; and

 

    	 

    	 

    

 

WHEREAS, all acts and things have been done
and performed which are necessary to make the Warrants, when executed on behalf of the Company and countersigned by or on behalf
of the Warrant Agent (if a physical certificate is issued), as provided herein, the valid, binding and legal obligations of the
Company, and to authorize the execution and delivery of this Agreement.

 

NOW, THEREFORE, in consideration of the mutual agreements herein
contained, the parties hereto agree as follows:

 

1.
Appointment of Warrant Agent. The Company hereby appoints the Warrant Agent to act as agent for the Company for the
Warrants, and the Warrant Agent hereby accepts such appointment and agrees to perform the same in accordance with the terms and
conditions set forth in this Agreement.

 

2.
Warrants.

 

2.1 Form of Warrant. Each Warrant shall
initially be issued in registered form only.

 

2.2 Effect of Countersignature. If a
physical certificate is issued, unless and until countersigned by the Warrant Agent pursuant to this Agreement, a certificated
Warrant shall be invalid and of no effect and may not be exercised by the holder thereof.

 

2.3 Registration.

 

2.3.1 Warrant Register. The Warrant
Agent shall maintain books (the “Warrant Register”), for the registration of original issuance and the
registration of transfer of the Warrants. Upon the initial issuance of the Warrants in book-entry form, the Warrant Agent shall
issue and register the Warrants in the names of the respective holders thereof in such denominations and otherwise in accordance
with instructions delivered to the Warrant Agent by the Company. Ownership of beneficial interests in the Public Warrants shall
be shown on, and the transfer of such ownership shall be effected through, records maintained by institutions that have accounts
with The Depository Trust Company (the “Depositary”) (such institution, with respect to a Warrant in
its account, a “Participant”).

 

If the Depositary subsequently ceases to make
its book-entry settlement system available for the Public Warrants, the Company may instruct the Warrant Agent regarding making
other arrangements for book-entry settlement. In the event that the Public Warrants are not eligible for, or it is no longer necessary
to have the Public Warrants available in, book-entry form, the Warrant Agent shall provide written instructions to the Depositary
to deliver to the Warrant Agent for cancellation each book-entry Public Warrant, and the Company shall instruct the Warrant Agent
to deliver to the Depositary definitive certificates in physical form evidencing such Warrants (“Definitive Warrant
Certificates”) which shall be in the form annexed hereto as Exhibit A.

 

Physical certificates, if issued, shall be
signed by, or bear the facsimile signature of, the President, Chief Executive Officer, Chief Financial Officer, or other principal
officer of the Company. In the event the person whose facsimile signature has been placed upon any Warrant shall have ceased to
serve in the capacity in which such person signed the Warrant before such Warrant is issued, it may be issued with the same effect
as if he or she had not ceased to be such at the date of issuance.

 

2.3.2 Registered Holder. Prior to due
presentment for registration of transfer of any Warrant, the Company and the Warrant Agent may deem and treat the person in whose
name such Warrant is registered in the Warrant Register (the “Registered Holder”) as the absolute owner
of such Warrant and of each Warrant represented thereby (notwithstanding any notation of ownership or other writing on any physical
certificate made by anyone other than the Company or the Warrant Agent), for the purpose of any exercise thereof, and for all other
purposes, and neither the Company nor the Warrant Agent shall be affected by any notice to the contrary.

 

2.4 Detachability of Warrants. The shares
of Class A common stock and Public Warrants comprising the Units shall begin separate trading on the 52nd day following the
date of the Prospectus or, if such 52nd day is not on a day, other than a Saturday, Sunday or federal holiday, on which banks in
New York City are generally open for normal business (a “Business Day”), then on the immediately succeeding
Business Day following such date, or earlier (the “Detachment Date”) with the consent of Maxim Group
LLC, as representative of several underwriters, but in no event shall the shares of Class A common stock and the Public Warrants
comprising the Units be separately traded until (A) the Company has filed a Current Report on Form 8-K with the Commission
containing an audited balance sheet reflecting the receipt by the Company of the gross proceeds of the Offering, including the
proceeds then received by the Company from the exercise by the underwriter of its right to purchase additional Units in the Offering
(the “Over-allotment Option”), if the Over-allotment Option is exercised prior to the filing of the Current
Report on Form 8-K, and (B) the Company issues a press release and files with the Commission a current report on Form 8-K
announcing when such separate trading shall begin.

 

    	 

    	 

    

 

2.5 Fractional Warrants. The Company
shall not issue fractional Warrants other than as part of the Units, each of which is comprised of one share of Class A common
stock and three-fourths of one whole Public Warrant. If, upon the detachment of Public Warrants from the Units or otherwise, a
holder of Warrants would be entitled to receive a fractional Warrant, the Company shall round down to the nearest whole number
the number of Warrants to be issued to such holder.

 

2.6 Private Placement Warrants.

 

2.6.1 The Private Placement Warrants shall
be identical to the Public Warrants, except that so long as they are held by the Sponsor or any of its Permitted Transferees (as
defined below) the Private Placement Warrants: (i) may be exercised for cash or on a “cashless basis,” pursuant
to subsection 3.3.1(c) hereof, (ii) including the shares of Class A common stock issuable upon exercise of the
Private Placement Warrants, may not be transferred, assigned or sold until the completion by the Company of an initial Business
Combination, (iii) shall not be redeemable by the Company pursuant to Section 6.1 hereof and (iv) shall only
be redeemable by the Company pursuant to Section 6.2 if the Reference Value (as defined below) is less than $18.00
per share (subject to adjustment in compliance with Section 4 hereof); provided, however, that in the case of
clause (ii), the Private Placement Warrants and any shares of Class A common stock held by the Sponsor or any of its Permitted
Transferees that are issued upon exercise of the Private Placement Warrants may be transferred by the holders thereof:

 

(a) to the Company’s officers or directors,
any affiliates or family members of any of the Company’s officers or directors, any members or partners of the Sponsor or
their respective affiliates, any affiliates of the Sponsor or any employees of such affiliates;

 

(b) in the case of an individual, by gift
to a member of the individual’s immediate family, or to a trust, the beneficiary of which is a member of one of the individual’s
immediate family, or an affiliate of such person, or to a charitable organization;

 

(c) in the case of an individual, by virtue
of laws of descent and distribution upon death of the individual;

 

(d) in the case of an individual, pursuant
to a qualified domestic relations order;

 

(e) by private sales or transfers made in
connection with the consummation of the Company’s Business Combination at prices no greater than the price at which the Private
Placement Warrants, were originally purchased;

 

(f) by virtue of the laws of the State of
Delaware or either of the Sponsor’s organizational documents upon liquidation or dissolution of our Sponsor;

 

(g) to the Company for no value for cancellation
in connection with the completion of its initial Business Combination;

 

(h) in the event of the Company’s liquidation
prior to the Company’s completion of its initial Business Combination; or

 

    	 

    	 

    

 

(i) in the event of the Company’s completion
of a liquidation, merger, capital stock exchange or other similar transaction which results in all of the Company’s shareholders
having the right to exchange their shares of Class A common stock for cash, securities or other property subsequent to the
completion of the Company’s initial Business Combination; provided, however, that in the case of clauses (a)
through (i) or with the prior written consent of the Company, prior to such registration for transfer, the Warrant Agent shall
be presented with written documentation pursuant to which each permitted transferee (the “Permitted Transferees”)
must enter into a written agreement with the Company agreeing to be bound by these transfer restrictions in this agreement.

 

3.
Terms and Exercise of Warrants.

 

3.1 Warrant Price. Each whole Warrant
shall entitle the Registered Holder thereof, subject to the provisions of such Warrant and of this Agreement, to purchase from
the Company the number of shares of Class A common stock stated therein, at the price of $11.50 per share, subject to the
adjustments provided in Section 4 hereof and in the last sentence of this Section 3.1. The term “Warrant
Price” as used in this Agreement shall mean the price per share (including in cash or by payment of Warrants pursuant
to a “cashless exercise,” to the extent permitted hereunder) described in the prior sentence at which shares of Class A
common stock may be purchased at the time a Warrant is exercised. The Company in its sole discretion may lower the Warrant Price
(including by allowing “cashless exercise”) at any time prior to the Expiration Date (as defined below) for a period
of not less than twenty (20) Business Days (unless otherwise required by the Commission, any national securities exchange
on which the Warrants are listed or applicable law), provided that the Company shall provide at least twenty (20) days prior
written notice of such reduction to Registered Holders of the Warrants and, provided further that any such reduction shall be identical
among all of the Warrants.

 

3.2 Duration of Warrants. A Warrant
may be exercised only during the period (the “Exercise Period”) (A) commencing on the later of: (i) the
date that is thirty (30) days after the first date on which the Company completes a Business Combination, and (ii) the
date that is twelve (12) months from the date of the closing of the Offering, and (B) terminating at the earliest to
occur of (x) 5:00 p.m., New York City time on the date that is five (5) years after the date on which the Company completes
its initial Business Combination, (y) the liquidation of the Company in accordance with the Company’s amended and restated
certificate of incorporation, as amended from time to time, if the Company fails to complete a Business Combination, and (z) other
than with respect to the Private Placement Warrants then held by the Sponsor or its Permitted Transferees with respect to a redemption
pursuant to Section 6.1 hereof or, if the Reference Value equals or exceeds $18.00 per share (subject to adjustment
in compliance with Section 4 hereof), Section 6.2 hereof, 5:00 p.m., New York City time on the Redemption Date
(as defined below) as provided in Section 6.3 hereof (the “Expiration Date”); provided,
however, that the exercise of any Warrant shall be subject to the satisfaction of any applicable conditions, as set forth
in subsection 3.3.2 below, with respect to an effective registration statement or a valid exemption therefrom being available.
Except with respect to the right to receive the Redemption Price (as defined below) (other than with respect to a Private Placement
Warrant then held by the Sponsor, or their Permitted Transferees in connection with a redemption pursuant to Section 6.1
hereof or, if the Reference Value equals or exceeds $18.00 per share (subject to adjustment in compliance with Section 4 hereof),
Section 6.2 hereof) in the event of a redemption (as set forth in Section 6 hereof), each Warrant (other
than a Private Placement Warrant then held by the Sponsor, or their Permitted Transferees in the event of a redemption pursuant
to Section 6.1 hereof or, if the Reference Value equals or exceeds $18.00 per share (subject to adjustment in compliance
with Section 4 hereof), Section 6.2 hereof) not exercised on or before the Expiration Date shall become void,
and all rights thereunder and all rights in respect thereof under this Agreement shall cease at 5:00 p.m. New York City time on
the Expiration Date. The Company in its sole discretion may extend the duration of the Warrants by delaying the Expiration Date;
provided that the Company shall provide at least twenty (20) days prior written notice of any such extension to Registered
Holders of the Warrants and, provided further that any such extension shall be identical in duration among all the Warrants.

 

3.3 Exercise of Warrants.

 

3.3.1 Payment. Subject to the provisions
of the Warrant and this Agreement, a Warrant may be exercised by the Registered Holder thereof by delivering to the Warrant Agent
at its corporate trust department (i) the Definitive Warrant Certificate evidencing the Warrants to be exercised, or, in the
case of a Warrant represented by a book-entry, the Warrants to be exercised (the “Book-Entry Warrants”)
on the records of the Depositary to an account of the Warrant Agent at the Depositary designated for such purposes in writing by
the Warrant Agent to the Depositary from time to time, (ii) an election to purchase (“Election to Purchase”)
any share of Class A common stock pursuant to the exercise of a Warrant, properly completed and executed by the Registered
Holder on the reverse of the Definitive Warrant Certificate or, in the case of a Book-Entry Warrant, properly delivered by the
Participant in accordance with the Depositary’s procedures, and (iii) the payment in full of the Warrant Price for each
share of Class A common stock as to which the Warrant is exercised and any and all applicable taxes due in connection with
the exercise of the Warrant, the exchange of the Warrant for the shares of Class A common stock and the issuance of such shares
of Class A common stock, as follows:

 

    	 

    	 

    

 

(a) in lawful money of the United States,
in good certified check or good bank draft payable to the order of the Warrant Agent;

 

(b) [Reserved];

 

(c) with respect to any Private Placement
Warrant, so long as such Private Placement Warrant is held by the Sponsor or a Permitted Transferee, by surrendering the Warrants
for that number of shares of Class A common stock equal to (i) if in connection with a redemption of Private Placement
Warrants pursuant to Section 6.2 hereof, as provided in Section 6.2 hereof with respect to a Make-Whole
Exercise (as defined below) and (ii) in all other scenarios the quotient obtained by dividing (x) the product of the
number of shares of Class A common stock underlying the Warrants, multiplied by the excess of the “Sponsor Exercise
Fair Market Value” (as defined in this subsection 3.3.1(c)) less the Warrant Price by (y) the Sponsor Exercise
Fair Market Value. Solely for purposes of this subsection 3.3.1(c), the “Sponsor Fair Market Value” shall mean
the average last reported sale price of the shares of Class A common stock for the ten (10) trading days ending on the
third (3rd) trading day prior to the date on which notice of exercise of the Private Placement Warrant is sent to the
Warrant Agent;

 

(d) on a cashless basis, as provided in Section 6.2
hereof with respect to a Make-Whole Exercise; or

 

(e) on a cashless basis, as provided in Section 7.4
hereof.

 

3.3.2 Issuance of Shares of Class A
Common Stock on Exercise. As soon as practicable after the exercise of any Warrant and the clearance of the funds in payment
of the Warrant Price (if payment is pursuant to subsection 3.3.1(a)), the Company shall issue to the Registered Holder of
such Warrant a book-entry position or certificate, as applicable, for the number of shares of Class A common stock to which
he, she or it is entitled, registered in such name or names as may be directed by him, her or it on the register of members of
the Company, and if such Warrant shall not have been exercised in full, a new book-entry position or countersigned Warrant, as
applicable, for the number of shares as to which such Warrant shall not have been exercised. Notwithstanding the foregoing, the
Company shall not be obligated to deliver any shares of Class A common stock pursuant to the exercise of a Warrant and shall
have no obligation to settle such Warrant exercise unless a registration statement under the Securities Act with respect to the
shares of Class A common stock underlying the Public Warrants is then effective and a prospectus relating thereto is current,
subject to the Company’s satisfying its obligations under Section 7.4 or a valid exemption from registration
is available. No Warrant shall be exercisable and the Company shall not be obligated to issue shares of Class A common stock
upon exercise of a Warrant unless the shares of Class A common stock issuable upon such Warrant exercise have been registered,
qualified or deemed to be exempt from registration or qualification under the securities laws of the state of residence of the
Registered Holder of the Warrants. Subject to Section 4.6 of this Agreement, a Registered Holder of Warrants may exercise
its Warrants only for a whole number of shares of Class A common stock. The Company may require holders of Public Warrants
to settle the Warrant on a “cashless basis” pursuant to Section 7.4. If, by reason of any exercise of Warrants
on a “cashless basis”, the holder of any Warrant would be entitled, upon the exercise of such Warrant, to receive a
fractional interest in a share of Class A common stock, the Company shall round down to the nearest whole number, the number
of shares of Class A common stock to be issued to such holder.

 

3.3.3 Valid Issuance. All shares of
Class A common stock issued upon the proper exercise of a Warrant in conformity with this Agreement shall be validly issued,
fully paid and nonassessable.

 

3.3.4 Date of Issuance. Each person
in whose name any book-entry position or certificate, as applicable, for shares of Class A common stock is issued and who
is registered in the register of members of the Company shall for all purposes be deemed to have become the holder of record of
such shares of Class A common stock on the date on which the Warrant, or book-entry position representing such Warrant, was
surrendered and payment of the Warrant Price was made, irrespective of the date of delivery of such certificate in the case of
a certificated Warrant, except that, if the date of such surrender and payment is a date when the register of members of the Company
or book-entry system of the Warrant Agent are closed, such person shall be deemed to have become the holder of such shares at the
close of business on the next succeeding date on which the share transfer books or book-entry system are open.

 

    	 

    	 

    

 

3.3.5 Maximum Percentage. A holder
of a Warrant may notify the Company in writing in the event it elects to be subject to the provisions contained in this subsection
3.3.5; however, no holder of a Warrant shall be subject to this subsection 3.3.5 unless he, she or it makes such
election. If the election is made by a holder, the Warrant Agent shall not effect the exercise of the holder’s Warrant, and
such holder shall not have the right to exercise such Warrant, to the extent that after giving effect to such exercise, such person
(together with such person’s affiliates), to the Warrant Agent’s actual knowledge, would beneficially own in excess
of 4.9% or 9.8% (as specified by the holder) (the “Maximum Percentage”) of the shares of Class A
common stock outstanding immediately after giving effect to such exercise. For purposes of the foregoing sentence, the aggregate
number of shares of Class A common stock beneficially owned by such person and its affiliates shall include the number of
shares of Class A common stock issuable upon exercise of the Warrant with respect to which the determination of such sentence
is being made, but shall exclude shares of Class A common stock that would be issuable upon (x) exercise of the remaining,
unexercised portion of the Warrant beneficially owned by such person and its affiliates and (y) exercise or conversion of
the unexercised or unconverted portion of any other securities of the Company beneficially owned by such person and its affiliates
(including, without limitation, any convertible notes or convertible preferred shares or warrants) subject to a limitation on conversion
or exercise analogous to the limitation contained herein. Except as set forth in the preceding sentence, for purposes of this paragraph,
beneficial ownership shall be calculated in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended
(the “Exchange Act”). For purposes of the Warrant, in determining the number of outstanding shares of
Class A common stock, the holder may rely on the number of outstanding shares of Class A common stock as reflected in
(1) the Company’s most recent Annual Report on Form 10-K, Quarterly Report on Form 10-Q, Current Report on Form 8-K
or other public filing with the Commission as the case may be, (2) a more recent public announcement by the Company or (3) any
other notice by the Company or Continental Stock Transfer &Trust Company, as transfer agent (in such capacity, the “Transfer
Agent”), setting forth the number of shares of Class A common stock outstanding. For any reason at any time,
upon the written request of the holder of the Warrant, the Company shall, within two (2) Business Days, confirm orally and
in writing to such holder the number of shares of Class A common stock then outstanding. In any case, the number of issued
and outstanding shares of Class A common stock shall be determined after giving effect to the conversion or exercise of equity
securities of the Company by the holder and its affiliates since the date as of which such number of issued and outstanding shares
of Class A common stock was reported. By written notice to the Company, the holder of a Warrant may from time to time increase
or decrease the Maximum Percentage applicable to such holder to any other percentage specified in such notice; provided,
however, that any such increase shall not be effective until the sixty-first (61st) day after such notice is delivered to
the Company.

 

4.
Adjustments.

 

4.1 Share Capitalizations.

 

4.1.1 Sub-Divisions. If after the date
hereof, and subject to the provisions of Section 4.6 below, the number of issued and outstanding shares of Class A
common stock is increased by a capitalization or share dividend of shares of Class A common stock, or by a sub-division of
shares of Class A common stock or other similar event, then, on the effective date of such share capitalization, sub-division
or similar event, the number of shares of Class A common stock issuable on exercise of each Warrant shall be increased in
proportion to such increase in the issued and outstanding shares of Class A common stock. A rights offering to holders of
shares of Class A common stock entitling holders to purchase shares of Class A common stock at a price less than the
“Historical Fair Market Value” (as defined below) shall be deemed a capitalization of a number of shares of Class A
common stock equal to the product of (i) the number of shares of Class A common stock actually sold in such rights offering
(or issuable under any other equity securities sold in such rights offering that are convertible into or exercisable for the shares
of Class A common stock) multiplied by (ii) one (1) minus the quotient of (x) the price per share of Class A
common stock paid in such rights offering divided by (y) the Historical Fair Market Value. For purposes of this subsection
4.1.1, (i) if the rights offering is for securities convertible into or exercisable for shares of Class A common stock,
in determining the price payable for shares of Class A common stock, there shall be taken into account any consideration received
for such rights, as well as any additional amount payable upon exercise or conversion and (ii) “Historical Fair Market Value”
means the volume weighted average price of the shares of Class A common stock as reported during the ten (10) trading
day period ending on the trading day prior to the first date on which the shares of Class A common stock trade on the applicable
exchange or in the applicable market, regular way, without the right to receive such rights. No shares of Class A common stock
shall be issued at less than their par value.

 

    	 

    	 

    

 

4.1.2 Extraordinary Dividends. If the
Company, at any time while the Warrants are outstanding and unexpired, shall pay a dividend or make a distribution in cash, securities
or other assets to the holders of shares of Class A common stock on account of such shares of Class A common stock (or
other shares into which the Warrants are convertible), other than (a) as described in subsection 4.1.1 above, (b) Ordinary
Cash Dividends (as defined below), (c) to satisfy the redemption rights of the holders of the shares of Class A common stock
in connection with a proposed initial Business Combination, (d) to satisfy the redemption rights of the holders of the shares
of Class A common stock in connection with a shareholder vote to amend the Company’s amended and restated certificate
of incorporation (i) 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 Company’s public shares if the Company does
not complete its initial Business Combination within the time period required by the Company’s amended and restated certificate
of incorporation, as amended from time to time, or (ii) with respect to any other provision relating to shareholders’
rights or pre-initial Business Combination activity or (e) in connection with the redemption of public shares upon the failure
of the Company to complete its initial Business Combination and any subsequent distribution of its assets upon its liquidation
(any such non-excluded event being referred to herein as an “Extraordinary Dividend”), then the Warrant
Price shall be decreased, effective immediately after the effective date of such Extraordinary Dividend, by the amount of cash
and/or the fair market value (as determined by the Company’s board of directors (the “Board”),
in good faith) of any securities or other assets paid on each share of Class A common stock in respect of such Extraordinary
Dividend. For purposes of this subsection 4.1.2, “Ordinary Cash Dividends” means any cash dividend
or cash distribution which, when combined on a per share basis, with the per share amounts of all other cash dividends and cash
distributions paid on the shares of Class A common stock during the 365-day period ending on the date of declaration of such
dividend or distribution (as adjusted to appropriately reflect any of the events referred to in other subsections of this Section 4
and excluding cash dividends or cash distributions that resulted in an adjustment to the Warrant Price or to the number of shares
of Class A common stock issuable on exercise of each Warrant) to the extent it does not exceed $0.50 (being 5% of the offering
price of the Units in the Offering).

 

4.2 Aggregation of Shares. If after
the date hereof, and subject to the provisions of Section 4.6 hereof, the number of issued and outstanding shares of
Class A common stock is decreased by a consolidation, combination, reverse share split or reclassification of shares of Class A
common stock or other similar event, then, on the effective date of such consolidation, combination, reverse share split, reclassification
or similar event, the number of shares of Class A common stock issuable on exercise of each Warrant shall be decreased in
proportion to such decrease in issued and outstanding shares of Class A common stock.

 

4.3 Adjustments in Warrant Price. Whenever
the number of shares of Class A common stock purchasable upon the exercise of the Warrants is adjusted, as provided in subsection
4.1.1 or Section 4.2 above, the Warrant Price shall be adjusted (to the nearest cent) by multiplying such Warrant
Price immediately prior to such adjustment by a fraction (x) the numerator of which shall be the number of shares of Class A
common stock purchasable upon the exercise of the Warrants immediately prior to such adjustment, and (y) the denominator of
which shall be the number of shares of Class A common stock so purchasable immediately thereafter.

 

4.4 Raising of the Capital in Connection
with the Initial Business Combination. If (x) the Company issues additional shares of Class A common stock or equity-linked
securities for capital raising purposes in connection with the closing of its initial Business Combination at an issue price or
effective issue price of less than $9.20 per share of Class A common stock (with such issue price or effective issue price
to be determined in good faith by the Board and, in the case of any such issuance to the Sponsor or its affiliates, without taking
into account any Class B common stock of the Company, par value $0.0001 per share (the “Class B common stock”),
held by the Sponsor or such affiliates, as applicable, prior to such issuance (the “Newly Issued Price”),
(y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon,
available for the funding of the Company’s initial Business Combination on the date of the completion of the Company’s
initial Business Combination (net of redemptions), and (z) the volume-weighted average trading price of shares of Class A
common stock during the twenty (20) trading day period starting on the trading day prior to the day on which the Company consummates
its initial Business Combination (such price, the “Market Value”) is below $9.20 per share, the Warrant
Price will be adjusted (to the nearest cent) to be equal to 115% of the higher of the Market Value and the Newly Issued Price,
and the $18.00 per share redemption trigger price described in Section 6.1 and Section 6.2 will be adjusted
(to the nearest cent) to be equal to 180% of the higher of the Market Value and the Newly Issued Price and the $10.00 per share
redemption trigger price described in Section 6.2 shall be adjusted (to the nearest cent) to be equal to the higher of the
Market Value and the Newly Issued Price.

 

    	 

    	 

    

 

4.5 Replacement of Securities upon Reorganization,
etc. In case of any reclassification or reorganization of the issued and outstanding shares of Class A common stock (other
than a change under Section 4.1 or Section 4.2 hereof or that solely affects the par value of such shares
of Class A common stock), or in the case of any merger or consolidation of the Company with or into another corporation (other
than a consolidation or merger in which the Company is the continuing corporation and that does not result in any reclassification
or reorganization of the issued and outstanding shares of Class A common stock), or in the case of any sale or conveyance
to another corporation or entity of the assets or other property of the Company as an entirety or substantially as an entirety
in connection with which the Company is dissolved, the holders of the Warrants shall thereafter have the right to purchase and
receive, upon the basis and upon the terms and conditions specified in the Warrants and in lieu of the shares of Class A common
stock of the Company immediately theretofore purchasable and receivable upon the exercise of the rights represented thereby, the
kind and amount of shares of stock or other securities or property (including cash) receivable upon such reclassification, reorganization,
merger or consolidation, or upon a dissolution following any such sale or transfer, that the holder of the Warrants would have
received if such holder had exercised his, her or its Warrant(s) immediately prior to such event (the “Alternative
Issuance”); provided, however, that (i) if the holders of the shares of Class A common stock
were entitled to exercise a right of election as to the kind or amount of securities, cash or other assets receivable upon such
consolidation or merger, then the kind and amount of securities, cash or other assets constituting the Alternative Issuance for
which each Warrant shall become exercisable shall be deemed to be the weighted average of the kind and amount received per share
by the holders of the shares of Class A common stock in such consolidation or merger that affirmatively make such election,
and (ii) if a tender, exchange or redemption offer shall have been made to and accepted by the holders of the shares of Class A
common stock (other than a tender, exchange or redemption offer made by the Company in connection with redemption rights held by
shareholders of the Company as provided for in the Company’s amended and restated certificate of incorporation or as a result
of the redemption of shares of Class A common stock by the Company if a proposed initial Business Combination is presented
to the shareholders of the Company for approval) under circumstances in which, upon completion of such tender or exchange offer,
the maker thereof, together with members of any group (within the meaning of Rule 13d-5(b)(1) under the Exchange Act) of which
such maker is a part, and together with any affiliate or associate of such maker (within the meaning of Rule 12b-2 under the Exchange
Act) and any members of any such group of which any such affiliate or associate is a part, own beneficially (within the meaning
of Rule 13d-3 under the Exchange Act) more than 50% of the issued and outstanding shares of Class A common stock, the holder
of a Warrant shall be entitled to receive as the Alternative Issuance, the highest amount of cash, securities or other property
to which such holder would actually have been entitled as a shareholder if such Warrant holder had exercised the Warrant prior
to the expiration of such tender or exchange offer, accepted such offer and all of the shares of Class A common stock held
by such holder had been purchased pursuant to such tender or exchange offer, subject to adjustments (from and after the consummation
of such tender or exchange offer) as nearly equivalent as possible to the adjustments provided for in this Section 4;
provided further that if less than 70% of the consideration receivable by the holders of the shares of Class A common
stock in the applicable event is payable in the form of shares in the successor entity that is listed for trading on a national
securities exchange or is quoted in an established over-the-counter market, or is to be so listed for trading or quoted immediately
following such event, and if the Registered Holder properly exercises the Warrant within thirty (30) days following the public
disclosure of the consummation of such applicable event by the Company pursuant to a Current Report on Form 8-K filed with the
Commission, the Warrant Price shall be reduced by an amount (in dollars) equal to the difference of (i) the Warrant Price
in effect prior to such reduction minus (ii) (A) the Per Share Consideration (as defined below) (but in no event less than
zero) minus (B) the Black-Scholes Warrant Value (as defined below). The “Black-Scholes Warrant Value” means the
value of a Warrant immediately prior to the consummation of the applicable event based on the Black-Scholes Warrant Model for a
Capped American Call on Bloomberg Financial Markets (assuming zero dividends) (“Bloomberg”). For purposes
of calculating such amount, (i) Section 6 of this Agreement shall be taken into account, (ii) the price of
each share of Class A common stock shall be the volume weighted average price of the shares of Class A common stock as
reported during the ten (10) trading day period ending on the trading day prior to the effective date of the applicable event,
(iii) the assumed volatility shall be the 90 day volatility obtained from the HVT function on Bloomberg determined as of the
trading day immediately prior to the day of the announcement of the applicable event and (iv) the assumed risk-free interest
rate shall correspond to the U.S. Treasury rate for a period equal to the remaining term of the Warrant. “Per Share Consideration”
means (i) if the consideration paid to holders of the shares of Class A common stock consists exclusively of cash, the
amount of such cash per share of Class A common stock, and (ii) in all other cases, the volume weighted average price
of the shares of Class A common stock as reported during the ten (10) trading day period ending on the trading day prior
to the effective date of the applicable event. If any reclassification or reorganization also results in a change in shares of
Class A common stock covered by subsection 4.1.1, then such adjustment shall be made pursuant to subsection 4.1.1
or Sections 4.2, 4.3 and this Section 4.4. The provisions of this Section 4.4 shall similarly
apply to successive reclassifications, reorganizations, mergers or consolidations, sales or other transfers. In no event will the
Warrant Price be reduced to less than the par value per share issuable upon exercise of such Warrant.

 

    	 

    	 

    

 

4.6 Notices of Changes in Warrant. Upon
every adjustment of the Warrant Price or the number of shares issuable upon exercise of a Warrant, the Company shall give written
notice thereof to the Warrant Agent, which notice shall state the Warrant Price resulting from such adjustment and the increase
or decrease, if any, in the number of shares purchasable at such price upon the exercise of a Warrant, setting forth in reasonable
detail the method of calculation and the facts upon which such calculation is based. Upon the occurrence of any event specified
in Sections 4.1, 4.2, 4.3, 4.4, 4.5 or 4.9, the Company shall give written notice of
the occurrence of such event to each holder of a Warrant, at the last address set forth for such holder in the Warrant Register,
of the record date or the effective date of the event. Failure to give such notice, or any defect therein, shall not affect the
legality or validity of such event.

 

4.7 No Fractional Shares. Notwithstanding
any provision contained in this Agreement to the contrary, the Company shall not issue fractional shares upon the exercise of Warrants.
If, by reason of any adjustment made pursuant to this Section 4, the holder of any Warrant would be entitled, upon
the exercise of such Warrant, to receive a fractional interest in a share, the Company shall, upon such exercise, round down to
the nearest whole number the number of shares of Class A common stock to be issued to such holder.

 

4.8 Form of Warrant. The form of Warrant
need not be changed because of any adjustment pursuant to this Section 4, and Warrants issued after such adjustment
may state the same Warrant Price and the same number of shares as is stated in the Warrants initially issued pursuant to this Agreement;
provided, however, that the Company may at any time in its sole discretion make any change in the form of Warrant
that the Company may deem appropriate and that does not affect the substance thereof, and any Warrant thereafter issued or countersigned,
whether in exchange or substitution for an outstanding Warrant or otherwise, may be in the form as so changed.

 

4.9 Other Events. In case any event
shall occur affecting the Company as to which none of the provisions of the preceding subsections of this Section 4
are strictly applicable, but which would require an adjustment to the terms of the Warrants in order to (i) avoid an adverse
impact on the Warrants and (ii) effectuate the intent and purpose of this Section 4, then, in each such case,
the Company shall appoint a firm of independent registered public accountants, investment banking or other appraisal firm of recognized
national standing, which shall give its opinion as to whether or not any adjustment to the rights represented by the Warrants is
necessary to effectuate the intent and purpose of this Section 4 and, if they determine that an adjustment is necessary,
the terms of such adjustment; provided, however, that under no circumstances shall the Warrants be adjusted pursuant
to this Section 4.9 as a result of any issuance of securities in connection with a Business Combination. The Company
shall adjust the terms of the Warrants in a manner that is consistent with any adjustment recommended in such opinion.

 

4.10 No Adjustment. For the avoidance
of doubt, no adjustment shall be made to the terms of the Warrants solely as a result of an adjustment to the conversion ratio
of the Class B common stock into shares of Class A common stock or the conversion of the Class B common stock into
shares of Class A common stock, in each case, pursuant to the Company’s amended and restated certificate of incorporation,
as amended from time to time.

 

    	 

    	 

    

 

5.
Transfer and Exchange of Warrants.

 

5.1 Registration of Transfer. The Warrant
Agent shall register the transfer, from time to time, of any outstanding Warrant upon the Warrant Register, upon surrender of such
Warrant for transfer, properly endorsed with signatures properly guaranteed and accompanied by appropriate instructions for transfer.
Upon any such transfer, a new Warrant representing an equal aggregate number of Warrants shall be issued and the old Warrant shall
be cancelled by the Warrant Agent. In the case of certificated Warrants, the Warrants so cancelled shall be delivered by the Warrant
Agent to the Company from time to time upon request.

 

5.2 Procedure for Surrender of Warrants.
Warrants may be surrendered to the Warrant Agent, together with a written request for exchange or transfer, and thereupon the Warrant
Agent shall issue in exchange therefor one or more new Warrants as requested by the Registered Holder of the Warrants so surrendered,
representing an equal aggregate number of Warrants; provided, however, that except as otherwise provided herein or
with respect to any Book-Entry Warrant, each Book-Entry Warrant may be transferred only in whole and only to the Depositary, to
another nominee of the Depositary, to a successor depository, or to a nominee of a successor depository; provided further,
however that in the event that a Warrant surrendered for transfer bears a restrictive legend (as in the case of the Private
Placement Warrants), the Warrant Agent shall not cancel such Warrant and issue new Warrants in exchange thereof until the Warrant
Agent has received an opinion of counsel for the Company stating that such transfer may be made and indicating whether the new
Warrants must also bear a restrictive legend.

 

5.3 Fractional Warrants. The Warrant
Agent shall not be required to effect any registration of transfer or exchange which shall result in the issuance of a warrant
certificate or book-entry position for a fraction of a warrant, except as part of the Units.

 

5.4 Service Charges. No service charge
shall be made for any exchange or registration of transfer of Warrants.

 

5.5 Warrant Execution and Countersignature.
The Warrant Agent is hereby authorized to countersign and to deliver, in accordance with the terms of this Agreement, the Warrants
required to be issued pursuant to the provisions of this Section 5, and the Company, whenever required by the Warrant
Agent, shall supply the Warrant Agent with Warrants duly executed on behalf of the Company for such purpose.

 

 

 

5.6 Transfer of Warrants. Prior to the
Detachment Date, the Public Warrants may be transferred or exchanged only together with the Unit in which such Warrant is included,
and only for the purpose of effecting, or in conjunction with, a transfer or exchange of such Unit. Furthermore, each transfer
of a Unit on the register relating to such Units shall operate also to transfer the Warrants included in such Unit. Notwithstanding
the foregoing, the provisions of this Section 5.6 shall have no effect on any transfer of Warrants on and after the
Detachment Date.

 

6.
Redemption.

 

6.1 Redemption of Warrants When the Price
per Share of Class A Common Stock Equals or Exceeds $18.00. Subject to Section 6.5 hereof, not less than all
of the outstanding Warrants may be redeemed, at the option of the Company, at any time during the Exercise Period, at the office
of the Warrant Agent, upon notice to the Registered Holders of the Warrants, as described in Section 6.3 below, at
a Redemption Price of $0.01 per Warrant, provided that (a) the Reference Value (as defined below) equals or exceeds
$18.00 per share (subject to adjustment in compliance with Section 4 hereof) and (b) there is an effective registration
statement covering the issuance of the shares of Class A common stock issuable upon exercise of the Warrants, and a current
prospectus relating thereto, available throughout the 30-day Redemption Period (as defined in Section 6.3 below).

 

    	 

    	 

    

 

6.2 Redemption of Warrants When the Price
per Share of Our Class A Common Stock Equals or Exceeds $10.00. Subject to Section 6.5 hereof, not less than
all of the outstanding Warrants may be redeemed, at the option of the Company, at any time during the Exercise Period, at the office
of the Warrant Agent, upon notice to the Registered Holders of the Warrants, as described in Section 6.3 below, at
a Redemption Price of $0.10 per Warrant, provided that (i) the Reference Value equals or exceeds $10.00 per share (subject
to adjustment in compliance with Section 4 hereof) and (ii) if the Reference Value is less than $18.00 per share
(subject to adjustment in compliance with Section 4 hereof), the Private Placement Warrants are also concurrently called
for redemption on the same terms as the outstanding Public Warrants. During the 30-day Redemption Period in connection with a redemption
pursuant to this Section 6.2, Registered Holders of the Warrants may elect to exercise their Warrants on a “cashless
basis” pursuant to subsection 3.3.1 and receive a number of shares of Class A common stock determined by reference
to the table below, based on the Redemption Date (calculated for purposes of the table as the period to expiration of the Warrants)
and the “Redemption Fair Market Value” (as such term is defined in this Section 6.2) (a “Make-Whole
Exercise”). Solely for purposes of this Section 6.2, the “Redemption Fair Market Value” shall
mean the volume weighted average price of the shares of Class A common stock for the ten (10) trading days immediately
following the date on which notice of redemption pursuant to this Section 6.2 is sent to the Registered Holders. In
connection with any redemption pursuant to this Section 6.2, the Company shall provide the Registered Holders with
the Redemption Fair Market Value no later than one (1) Business Day after the ten (10) trading day period described above
ends.

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Redemption   Date	 	Redemption Fair Market Value of Shares of Class A Common Stock
	(period to   expiration   of warrants)	 	£10.00	 	11.00	 	12.00	 	13.00	 	14.00	 	15.00	 	16.00	 	17.00	 	318.00
	60 months	 	 	0.261	 	 	 	0.281	 	 	 	0.297	 	 	 	0.311	 	 	 	0.324	 	 	 	0.337	 	 	 	0.348	 	 	 	0.358	 	 	 	0.361	 
	57 months	 	 	0.257	 	 	 	0.277	 	 	 	0.294	 	 	 	0.310	 	 	 	0.324	 	 	 	0.337	 	 	 	0.348	 	 	 	0.358	 	 	 	0.361	 
	54 months	 	 	0.252	 	 	 	0.272	 	 	 	0.291	 	 	 	0.307	 	 	 	0.322	 	 	 	0.335	 	 	 	0.347	 	 	 	0.357	 	 	 	0.361	 
	51 months	 	 	0.246	 	 	 	0.268	 	 	 	0.287	 	 	 	0.304	 	 	 	0.320	 	 	 	0.333	 	 	 	0.346	 	 	 	0.357	 	 	 	0.361	 
	48 months	 	 	0.241	 	 	 	0.263	 	 	 	0.283	 	 	 	0.301	 	 	 	0.317	 	 	 	0.332	 	 	 	0.344	 	 	 	0.356	 	 	 	0.361	 
	45 months	 	 	0.235	 	 	 	0.258	 	 	 	0.279	 	 	 	0.298	 	 	 	0.315	 	 	 	0.330	 	 	 	0.343	 	 	 	0.356	 	 	 	0.361	 
	42 months	 	 	0.228	 	 	 	0.252	 	 	 	0.274	 	 	 	0.294	 	 	 	0.312	 	 	 	0.328	 	 	 	0.342	 	 	 	0.355	 	 	 	0.361	 
	39 months	 	 	0.221	 	 	 	0.246	 	 	 	0.269	 	 	 	0.290	 	 	 	0.309	 	 	 	0.325	 	 	 	0.340	 	 	 	0.354	 	 	 	0.361	 
	36 months	 	 	0.213	 	 	 	0.239	 	 	 	0.263	 	 	 	0.285	 	 	 	0.305	 	 	 	0.323	 	 	 	0.339	 	 	 	0.353	 	 	 	0.361	 
	33 months	 	 	0.205	 	 	 	0.232	 	 	 	0.257	 	 	 	0.280	 	 	 	0.301	 	 	 	0.320	 	 	 	0.337	 	 	 	0.352	 	 	 	0.361	 
	30 months	 	 	0.196	 	 	 	0.224	 	 	 	0.250	 	 	 	0.274	 	 	 	0.297	 	 	 	0.316	 	 	 	0.335	 	 	 	0.351	 	 	 	0.361	 
	27 months	 	 	0.185	 	 	 	0.214	 	 	 	0.242	 	 	 	0.268	 	 	 	0.291	 	 	 	0.313	 	 	 	0.332	 	 	 	0.350	 	 	 	0.361	 
	24 months	 	 	0.173	 	 	 	0.204	 	 	 	0.233	 	 	 	0.260	 	 	 	0.285	 	 	 	0.308	 	 	 	0.329	 	 	 	0.348	 	 	 	0.361	 
	21 months	 	 	0.161	 	 	 	0.193	 	 	 	0.223	 	 	 	0.252	 	 	 	0.279	 	 	 	0.304	 	 	 	0.326	 	 	 	0.347	 	 	 	0.361	 
	18 months	 	 	0.146	 	 	 	0.179	 	 	 	0.211	 	 	 	0.242	 	 	 	0.271	 	 	 	0.298	 	 	 	0.322	 	 	 	0.345	 	 	 	0.361	 
	15 months	 	 	0.130	 	 	 	0.164	 	 	 	0.197	 	 	 	0.230	 	 	 	0.262	 	 	 	0.291	 	 	 	0.317	 	 	 	0.342	 	 	 	0.361	 
	12 months	 	 	0.111	 	 	 	0.146	 	 	 	0.181	 	 	 	0.216	 	 	 	0.250	 	 	 	0.282	 	 	 	0.312	 	 	 	0.339	 	 	 	0.361	 
	9 months	 	 	0.090	 	 	 	0.125	 	 	 	0.162	 	 	 	0.199	 	 	 	0.237	 	 	 	0.272	 	 	 	0.305	 	 	 	0.336	 	 	 	0.361	 
	6 months	 	 	0.065	 	 	 	0.099	 	 	 	0.137	 	 	 	0.178	 	 	 	0.219	 	 	 	0.259	 	 	 	0.296	 	 	 	0.331	 	 	 	0.361	 
	3 months	 	 	0.034	 	 	 	0.065	 	 	 	0.104	 	 	 	0.150	 	 	 	0.197	 	 	 	0.243	 	 	 	0.286	 	 	 	0.326	 	 	 	0.361	 
	0 months	 	 	—	 	 	 	—	 	 	 	0.042	 	 	 	0.115	 	 	 	0.179	 	 	 	0.233	 	 	 	0.281	 	 	 	0.323	 	 	 	0.361	 

 

The exact Redemption Fair Market Value and
Redemption Date may not be set forth in the table above, in which case, if the Redemption Fair Market Value is between two values
in the table or the Redemption Date is between two redemption dates in the table, the number of shares of Class A common stock
to be issued for each Warrant exercised in a Make-Whole Exercise will be determined by a straight-line interpolation between the
number of shares set forth for the higher and lower Redemption Fair Market Values and the earlier and later redemption dates, as
applicable, based on a 365- or 366-day year, as applicable.

 

The share prices set forth in the column headings
of the table above shall be adjusted as of any date on which the number of shares issuable upon exercise of a Warrant or the Warrant
Price is adjusted pursuant to Section 4 hereof. If the number of shares issuable upon exercise of a Warrant is adjusted pursuant
to Section 4 hereof, the adjusted share prices in the column headings shall equal the share prices immediately prior to such
adjustment, multiplied by a fraction, the numerator of which is the number of shares deliverable upon exercise of a Warrant immediately
prior to such adjustment and the denominator of which is the number of shares deliverable upon exercise of a Warrant as so adjusted.
The number of shares in the table above shall be adjusted in the same manner and at the same time as the number of shares issuable
upon exercise of a Warrant. If the Warrant Price is adjusted, (a) in the case of an adjustment pursuant to Section 4.4 hereof,
the adjusted share prices in the column headings shall equal the share prices immediately prior to such adjustment multiplied by
a fraction, the numerator of which is the higher of the Market Value and the Newly Issued Price and the denominator of which is
$10.00 and (b) in the case of an adjustment pursuant to Section 4.1.2 hereof, the adjusted share prices in the column headings
shall equal the share prices immediately prior to such adjustment less the decrease in the Warrant Price pursuant to such Warrant
Price adjustment. In no event shall the Warrants be exercisable in connection with a Make-Whole Exercise for more than 0.361 shares
of common stock per Warrant (subject to adjustment).

 

    	 

    	 

    

 

6.3 Date Fixed for, and Notice of, Redemption;
Redemption Price; Reference Value. In the event that the Company elects to redeem the Warrants pursuant to Sections 6.1
or 6.2, the Company shall fix a date for the redemption (the “Redemption Date”). Notice of redemption
shall be mailed by first class mail, postage prepaid, by the Company not less than thirty (30) days prior to the Redemption
Date (the period lasting from such time until the Redemption Date, the “30-day Redemption Period”) to
the Registered Holders of the Warrants to be redeemed at their last addresses as they shall appear on the registration books. Any
notice mailed in the manner herein provided shall be conclusively presumed to have been duly given whether or not the Registered
Holder received such notice. As used in this Agreement, (a) “Redemption Price” shall mean the price per
Warrant at which any Warrants are redeemed pursuant to Sections 6.1 or 6.2 and (b) “Reference Value”
shall mean the last reported sales price of the shares of Class A common stock for any twenty (20) trading days within
the thirty (30) trading-day period ending on the third trading day prior to the date on which notice of the redemption is
given.

 

6.4 Exercise After Notice of Redemption.
The Warrants may be exercised, for cash (or on a “cashless basis” in accordance with Section 6.2 of this
Agreement) at any time after notice of redemption shall have been given by the Company pursuant to Section 6.3 hereof
and prior to the Redemption Date. On and after the Redemption Date, the record holder of the Warrants shall have no further rights
except to receive, upon surrender of the Warrants, the Redemption Price.

 

6.5 Exclusion of Private Placement Warrants.
The Company agrees that (a) the redemption rights provided in Section 6.1 hereof shall not apply to the Private
Placement Warrants if at the time of the redemption such Private Placement Warrants continue to be held by the Sponsor , thereof,
or their Permitted Transferees and (b) if the Reference Value equals or exceeds $18.00 per share (subject to adjustment in
compliance with Section 4 hereof), the redemption rights provided in Section 6.2 hereof shall not apply
to the Private Placement Warrants if at the time of the redemption such Private Placement Warrants continue to be held by the Sponsor,
or their Permitted Transferees. However, once such Private Placement Warrants are transferred (other than to Permitted Transferees
in accordance with Section 2.6 hereof), the Company may redeem the Private Placement Warrants pursuant to Section 6.1
or 6.2 hereof, provided that the criteria for redemption are met, including the opportunity of the holder of such Private
Placement Warrants to exercise the Private Placement Warrants prior to redemption pursuant to Section 6.4 hereof. Private
Placement Warrants that are transferred to persons other than Permitted Transferees shall upon such transfer cease to be Private
Placement Warrants and shall become Public Warrants under this Agreement, including for purposes of Section 9.8 hereof.

 

7.
Other Provisions Relating to Rights of Holders of Warrants.

 

7.1 No Rights as Shareholder. A Warrant
does not entitle the Registered Holder thereof to any of the rights of a shareholder of the Company, including, without limitation,
the right to receive dividends, or other distributions, exercise any preemptive rights to vote or to consent or to receive notice
as shareholders in respect of the meetings of shareholders or the election of directors of the Company or any other matter.

 

7.2 Lost, Stolen, Mutilated, or Destroyed
Warrants. If any Warrant is lost, stolen, mutilated, or destroyed, the Company and the Warrant Agent may on such terms as to
indemnity or otherwise as they may in their discretion impose (which shall, in the case of a mutilated Warrant, include the surrender
thereof), issue a new Warrant of like denomination, tenor, and date as the Warrant so lost, stolen, mutilated, or destroyed. Any
such new Warrant shall constitute a substitute contractual obligation of the Company, whether or not the allegedly lost, stolen,
mutilated, or destroyed Warrant shall be at any time enforceable by anyone.

 

    	 

    	 

    

 

7.3 Reservation of Shares of Class A
Common Stock. The Company shall at all times reserve and keep available a number of its authorized but unissued shares of Class A
common stock that shall be sufficient to permit the exercise in full of all outstanding Warrants issued pursuant to this Agreement.

 

7.4 Registration of Shares of Class A
Common Stock; Cashless Exercise at Company’s Option.

 

7.4.1 Registration of the Shares of Class A
Common Stock. The Company agrees that as soon as practicable, but in no event later than twenty (20) Business Days after
the closing of its initial Business Combination, it shall use its commercially reasonable efforts to file with the Commission a
registration statement for the registration, under the Securities Act, of the shares of Class A common stock issuable upon
exercise of the Warrants. The Company shall use its commercially reasonable efforts to cause the same to become effective within
sixty (60) Business Days following the closing of its initial Business Combination and to maintain the effectiveness of such registration
statement, and a current prospectus relating thereto, until the expiration or redemption of the Warrants in accordance with the
provisions of this Agreement. If any such registration statement has not been declared effective by the sixtieth (60th)
Business Day following the closing of the Business Combination, holders of the Warrants shall have the right, during the period
beginning on the sixty-first (61st) Business Day after the closing of the Business Combination and ending upon such
registration statement being declared effective by the Commission, and during any other period when the Company shall fail to have
maintained an effective registration statement covering the issuance of the shares of Class A common stock issuable upon exercise
of the Warrants, to exercise such Warrants on a “cashless basis,” pursuant to subsection 3.3.1, by exchanging
the Warrants (in accordance with Section 3(a)(9) of the Securities Act or another exemption) for that number of shares of
Class A common stock equal to the lesser of (A) the quotient obtained by dividing (x) the product of the number
of shares of Class A common stock underlying the Warrants, multiplied by the excess of the “Fair Market Value”
(as defined below) less the Warrant Price by (y) the Fair Market Value and (B) 0.361. Solely for purposes of this subsection
7.4.1, “Fair Market Value” shall mean the volume-weighted average price of the shares of Class A common stock
as reported during the ten (10) trading day period ending on the trading day prior to the date that notice of exercise is
received by the Warrant Agent from the holder of such Warrants or its securities broker or intermediary. The date that notice of
“cashless exercise” is received by the Warrant Agent shall be conclusively determined by the Warrant Agent. In connection
with the “cashless exercise” of a Public Warrant, the Company shall, upon request, provide the Warrant Agent with an
opinion of counsel for the Company (which shall be an outside law firm with securities law experience) stating that (i) the
exercise of the Warrants on a “cashless basis” in accordance with this subsection 7.4.1 is not required to be
registered under the Securities Act and (ii) the shares of Class A common stock issued upon such exercise shall be freely
tradable under United States federal securities laws by anyone who is not an affiliate (as such term is defined in Rule 144 under
the Securities Act) of the Company and, accordingly, shall not be required to bear a restrictive legend. Except as provided in
subsection 7.4.2, for the avoidance of doubt, unless and until all of the Warrants have been exercised or have expired,
the Company shall continue to be obligated to comply with its registration obligations under the first three sentences of this
subsection 7.4.1.

 

7.4.2 Cashless Exercise at Company’s
Option. If the shares of Class A common stock are at the time of any exercise of a Public Warrant not listed on a national
securities exchange such that they satisfy the definition of a “covered security” under Section 18(b)(1) of the
Securities Act, the Company may, at its option, (i) require holders of Public Warrants who exercise Public Warrants to exercise
such Public Warrants on a “cashless basis” in accordance with Section 3(a)(9) of the Securities Act as described
in subsection 7.4.1 and (ii) in the event the Company so elects, the Company shall (x) not be required to file
or maintain in effect a registration statement for the registration, under the Securities Act, of the shares of Class A common
stock issuable upon exercise of the Warrants, notwithstanding anything in this Agreement to the contrary, and (y) use its
commercially reasonable efforts to register or qualify for sale the shares of Class A common stock issuable upon exercise
of the Public Warrant under applicable blue sky laws of the state of the residence of the holder to the extent an exemption is
not available.

 

8.
Concerning the Warrant Agent and Other Matters.

 

8.1 Payment of Taxes. The Company shall
from time to time promptly pay all taxes and charges that may be imposed upon the Company or the Warrant Agent in respect of the
issuance or delivery of shares of Class A common stock upon the exercise of the Warrants, but the Company shall not be obligated
to pay any transfer taxes in respect of the Warrants or such shares.

 

    	 

    	 

    

 

8.2 Resignation, Consolidation, or Merger
of Warrant Agent.

 

8.2.1 Appointment of Successor Warrant
Agent. The Warrant Agent, or any successor to it hereafter appointed, may resign its duties and be discharged from all further
duties and liabilities hereunder after giving sixty (60) days’ notice in writing to the Company. If the office of the
Warrant Agent becomes vacant by resignation or incapacity to act or otherwise, the Company shall appoint in writing a successor
Warrant Agent in place of the Warrant Agent. If the Company shall fail to make such appointment within a period of thirty (30) days
after it has been notified in writing of such resignation or incapacity by the Warrant Agent or by the holder of a Warrant (who
shall, with such notice, submit his, her or its Warrant for inspection by the Company), then the holder of any Warrant may apply
to the Supreme Court of the State of New York for the County of New York for the appointment of a successor Warrant Agent at the
Company’s cost. Any successor Warrant Agent, whether appointed by the Company or by such court, shall be a corporation organized
and existing under the laws of the State of New York, in good standing and having its principal office in the Borough of Manhattan,
City and State of New York, and authorized under such laws to exercise corporate trust powers and subject to supervision or examination
by federal or state authority. After appointment, any successor Warrant Agent shall be vested with all the authority, powers, rights,
immunities, duties, and obligations of its predecessor Warrant Agent with like effect as if originally named as Warrant Agent hereunder,
without any further act or deed; but if for any reason it becomes necessary or appropriate, the predecessor Warrant Agent shall
execute and deliver, at the expense of the Company, an instrument transferring to such successor Warrant Agent all the authority,
powers, and rights of such predecessor Warrant Agent hereunder; and upon request of any successor Warrant Agent the Company shall
make, execute, acknowledge, and deliver any and all instruments in writing for more fully and effectually vesting in and confirming
to such successor Warrant Agent all such authority, powers, rights, immunities, duties, and obligations.

 

8.2.2 Notice of Successor Warrant Agent.
In the event a successor Warrant Agent shall be appointed, the Company shall give notice thereof to the predecessor Warrant Agent
and the Transfer Agent for the shares of Class A common stock not later than the effective date of any such appointment.

 

8.2.3 Merger or Consolidation of Warrant
Agent. Any entity into which the Warrant Agent may be merged or with which it may be consolidated or any entity resulting from
any merger or consolidation to which the Warrant Agent shall be a party shall be the successor Warrant Agent under this Agreement
without any further act.

 

8.3 Fees and Expenses of Warrant Agent.

 

8.3.1 Remuneration. The Company agrees
to pay the Warrant Agent reasonable remuneration for its services as such Warrant Agent hereunder and shall, pursuant to its obligations
under this Agreement, reimburse the Warrant Agent upon demand for all expenditures that the Warrant Agent may reasonably incur
in the execution of its duties hereunder.

 

8.3.2 Further Assurances. The Company
agrees to perform, execute, acknowledge, and deliver or cause to be performed, executed, acknowledged, and delivered all such further
and other acts, instruments, and assurances as may reasonably be required by the Warrant Agent for the carrying out or performing
of the provisions of this Agreement.

 

8.4 Liability of Warrant Agent.

 

8.4.1 Reliance on Company Statement.
Whenever in the performance of its duties under this Agreement, the Warrant Agent shall deem it necessary or desirable that any
fact or matter be proved or established by the Company prior to taking or suffering any action hereunder, such fact or matter (unless
other evidence in respect thereof be herein specifically prescribed) may be deemed to be conclusively proved and established by
a statement signed by the Chief Executive Officer, President or Chief Financial Officer of the Company and delivered to the Warrant
Agent. The Warrant Agent may rely upon such statement for any action taken or suffered in good faith by it pursuant to the provisions
of this Agreement.

 

    	 

    	 

    

 

8.4.2 Indemnity. The Warrant Agent
shall be liable hereunder only for its own gross negligence, willful misconduct, fraud or bad faith. The Company agrees to indemnify
the Warrant Agent and save it harmless against any and all liabilities, including judgments, out-of-pocket costs and reasonable
outside counsel fees, for anything done or omitted by the Warrant Agent in the execution of this Agreement, except as a result
of the Warrant Agent’s gross negligence, willful misconduct, fraud or bad faith.

 

8.4.3 Exclusions. The Warrant Agent
shall have no responsibility with respect to the validity of this Agreement or with respect to the validity or execution of any
Warrant (except its countersignature thereof). The Warrant Agent shall not be responsible for any breach by the Company of any
covenant or condition contained in this Agreement or in any Warrant. The Warrant Agent shall not be responsible to make any adjustments
required under the provisions of Section 4 hereof or responsible for the manner, method, or amount of any such adjustment
or the ascertaining of the existence of facts that would require any such adjustment; nor shall it by any act hereunder be deemed
to make any representation or warranty as to the authorization or reservation of any shares of Class A common stock to be
issued pursuant to this Agreement or any Warrant or as to whether any shares of Class A common stock shall, when issued, be
valid and fully paid and nonassessable.

 

8.5 Acceptance of Agency. The Warrant
Agent hereby accepts the agency established by this Agreement and agrees to perform the same upon the terms and conditions herein
set forth and among other things, shall account promptly to the Company with respect to Warrants exercised and concurrently account
for, and pay to the Company, all monies received by the Warrant Agent for the purchase of shares of Class A common stock through
the exercise of the Warrants.

 

8.6 Waiver. The Warrant Agent has no
right of set-off or any other right, title, interest or claim of any kind (“Claim”) in, or to any distribution
of, the Trust Account (as defined in that certain Investment Management Trust Agreement, dated as of the date hereof, by and between
the Company and Continental Stock Transfer & Trust Company as trustee thereunder) and hereby agrees not to seek recourse,
reimbursement, payment or satisfaction for any Claim against the Trust Account for any reason whatsoever. The Warrant Agent hereby
waives any and all Claims against the Trust Account and any and all rights to seek access to the Trust Account.

 

9.
Miscellaneous Provisions.

 

9.1 Successors. All the covenants and
provisions of this Agreement by or for the benefit of the Company or the Warrant Agent shall bind and inure to the benefit of their
respective successors and assigns.

 

9.2 Notices. Any notice, statement or
demand authorized by this Agreement to be given or made by the Warrant Agent or by the holder of any Warrant to or on the Company
shall be sufficiently given (i) if by emails, when the email is sent, (ii) if by hand or overnight delivery, when so delivered
or (iii) if sent by certified mail or private courier service within five (5) days after deposit of such notice, postage prepaid,
addressed (until another address is filed in writing by the Company with the Warrant Agent), as follows:

 

Avalon Acquisition Inc.

2 Embarcadero Center, 8th Floor 

San Francisco, CA 94111

Attention: S. Craig Cognetti, Chief Executive Officer 

E-mail: ccognetti@avalonspac.com

 

Any notice, statement or demand authorized by this Agreement to
be given or made by the holder of any Warrant or by the Company to or on the Warrant Agent shall be sufficiently given when so
delivered if by hand or overnight delivery or if sent by certified mail or private courier service within five (5) days after
deposit of such notice, postage prepaid, addressed (until another address is filed in writing by the Warrant Agent with the Company),
as follows:

 

Continental Stock Transfer & Trust
Company

1 State Street, 30th floor 

New York, NY 10004

Attention: Compliance Department

 

    	 

    	 

    

 

9.3 Applicable Law and Exclusive Forum.
The validity, interpretation, and performance of this Agreement and of the Warrants shall be governed in all respects by 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 Company hereby agrees that any action, proceeding or claim against it arising out of or relating
in any way to this Agreement shall be brought and enforced in the courts of the State of New York or the United States District
Court for the Southern District of New York, and irrevocably submits to such jurisdiction, which jurisdiction shall be exclusive
forum for any such action, proceeding or claim. The Company hereby waives any objection to such exclusive jurisdiction and that
such courts represent an inconvenient forum. Notwithstanding the foregoing, the provisions of this paragraph will not apply to
suits brought to enforce any liability or duty created by the Exchange Act or any other claim for which the federal district courts
of the United States of America are the sole and exclusive forum. Any person or entity purchasing or otherwise acquiring any interest
in the Warrants shall be deemed to have notice of and to have consented to the forum provisions in this Section 9.3. If any action,
the subject matter of which is within the scope the forum provisions above, is filed in a court other than a court located within
the State of New York or the United States District Court for the Southern District of New York (a “foreign action”)
in the name of any warrant holder, such warrant holder shall be deemed to have consented to: (x) the personal jurisdiction of the
state and federal courts located within the State of New York or the United States District Court for the Southern District of
New York in connection with any action brought in any such court to enforce the forum provisions (an “enforcement action”),
and (y) having service of process made upon such warrant holder in any such enforcement action by service upon such warrant holder’s
counsel in the foreign action as agent for such warrant holder.

 

9.4 Persons Having Rights under this Agreement.
Nothing in this Agreement shall be construed to confer upon, or give to, any person or corporation other than the parties hereto
and the Registered Holders of the Warrants any right, remedy, or claim under or by reason of this Agreement or of any covenant,
condition, stipulation, promise, or agreement hereof. All covenants, conditions, stipulations, promises, and agreements contained
in this Agreement shall be for the sole and exclusive benefit of the parties hereto and their successors and assigns and of the
Registered Holders of the Warrants.

 

9.5 Examination of the Warrant Agreement.
A copy of this Agreement shall be available at all reasonable times at the office of the Warrant Agent in the Borough of Manhattan,
City and State of New York, for inspection by the Registered Holder of any Warrant. The Warrant Agent may require any such holder
to submit such holder’s Warrant for inspection by the Warrant Agent.

 

9.6 Counterparts. This 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.

 

9.7 Effect of Headings. The section
headings herein are for convenience only and are not part of this Agreement and shall not affect the interpretation thereof.

 

9.8 Amendments. This Agreement may be
amended by the parties hereto without the consent of any Registered Holder for the purpose of curing any ambiguity, or curing,
correcting or supplementing any defective provision contained herein (including conforming the provisions hereof to the description
of the terms of the Warrants and this Agreement set forth in the Prospectus) or adding or changing any other provisions with respect
to matters or questions arising under this Agreement as the parties may deem necessary or desirable and that the parties deem shall
not adversely affect the interest of the Registered Holders. All other modifications or amendments, including any modifications
or amendment to increase the Warrant Price or shorten the Exercise Period hall require the vote or written consent of the Registered
Holders of 50% of the then outstanding Public Warrants and any amendment to the terms of, or any provision of, this Agreement with
respect to only the Private Placement Warrants, shall require the vote or written consent of the Registered Holders of 50% of the
then outstanding Private Placement Warrants. Notwithstanding the foregoing, the Company may lower the Warrant Price or extend the
duration of the Exercise Period pursuant to Sections 3.1 and 3.2, respectively, without the consent of the Registered
Holders.

 

9.9 Severability. This 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 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 Agreement a provision as similar in terms to such invalid
or unenforceable provision as may be possible and be valid and enforceable.

 

Exhibit A: Form of Warrant Certificate

Exhibit B: Legend — Private Placement Warrants

 

    	 

    	 

    

 

IN WITNESS WHEREOF, the parties hereto have
caused this Agreement to be duly executed as of the date first above written.

	 	 	 
	 	AVALON
ACQUISITION INC.
	 	 
	 	By:	/s/
S. Craig Cognetti
	 	Name: S. Craig Cognetti
	 	Title: CEO
	 	 	 
	 	CONTINENTAL STOCK TRANSFER &
TRUST COMPANY,   as Warrant Agent
	 	 
	 	By:	/s/
Douglas Reed
	 	Name:
Douglas Reed	 
	 	Title: Vice President of Account Administration
	 	 	 	 	 

[Signature Page to Warrant Agreement]

 

    	 

    	 

    

 

EXHIBIT
A

 

Form of Warrant Certificate 

 

[FACE]

 

Number

 

Warrants  

THIS WARRANT SHALL BE VOID IF NOT EXERCISED
PRIOR TO 

THE EXPIRATION OF THE EXERCISE PERIOD PROVIDED
FOR 

IN THE WARRANT AGREEMENT DESCRIBED BELOW

 

AVALON ACQUISITION INC. 

Incorporated Under the Laws of the State
of Delaware 

 

CUSIP [•]

 

Warrant Certificate 

 

This Warrant Certificate certifies that
, or registered assigns, is the registered holder of warrant(s) evidenced hereby (the “Warrants” and
each, a “Warrant”) to purchase shares of Class A common stock, $0.0001 par value (the “Class A
common stock”), of Avalon Acquisition Inc., a Delaware corporation (the “Company”). Each
Warrant entitles the holder, upon exercise during the period set forth in the Warrant Agreement referred to below, to receive from
the Company that number of fully paid and non-assessable shares of Class A common stock as set forth below, at the exercise
price (the “Warrant Price”) as determined pursuant to the Warrant Agreement, payable in lawful money
(or through “cashless exercise” as provided for in the Warrant Agreement) of the United States of America
upon surrender of this Warrant Certificate and payment of the Warrant Price at the office or agency of the Warrant Agent referred
to below, subject to the conditions set forth herein and in the Warrant Agreement. Defined terms used in this Warrant Certificate
but not defined herein shall have the meanings given to them in the Warrant Agreement.

 

Each whole Warrant is initially exercisable
for one fully paid and non-assessable share of Class A common stock. No fractional shares will be issued upon exercise of
any Warrant. If, upon the exercise of Warrants, a holder would be entitled to receive a fractional interest in a share of Class A
common stock, the Company will, upon exercise, round down to the nearest whole number the number of shares of Class A common
stock to be issued to the Warrant holder. The number of shares of Class A common stock issuable upon exercise of the Warrants
is subject to adjustment upon the occurrence of certain events as set forth in the Warrant Agreement.

 

The initial Warrant Price per one share of
Class A common stock for any Warrant is equal to $11.50 per share. The Warrant Price is subject to adjustment upon the occurrence
of certain events as set forth in the Warrant Agreement.

 

Subject to the conditions set forth in the
Warrant Agreement, the Warrants may be exercised only during the Exercise Period and to the extent not exercised by the end of
such Exercise Period, such Warrants shall become void. The Warrants may be redeemed, subject to certain conditions, as set forth
in the Warrant Agreement.

 

The Warrants may be redeemed, subject to certain
conditions, as set forth in the Warrant Agreement.

 

Reference is hereby made to the further provisions
of this Warrant Certificate set forth on the reverse hereof and such further provisions shall for all purposes have the same effect
as though fully set forth at this place.

 

This Warrant Certificate shall not be valid
unless countersigned by the Warrant Agent, as such term is used in the Warrant Agreement.

 

This Warrant Certificate shall be governed
by and construed in accordance with the internal laws of the State of New York, without regard to conflicts of laws principles
thereof.

 

    	 

    	 

    

 

	 	AVALON
ACQUISITION INC.
	 	 
	 	By:	 
	 	Name:	 
	 	Title: Authorized
Signatory	 
	 	 	 
	 	CONTINENTAL
STOCK TRANSFER & TRUST COMPANY, as
Warrant Agent
	 	 
	 	By:	 
	 	Name:	 
	 	Title:	 
	 	 	 	 	 

    	 

    	 

    

 

[Form of Warrant Certificate]

[Reverse]

 

The Warrants evidenced by this Warrant Certificate
are part of a duly authorized issue of Warrants entitling the holder on exercise to receive shares of Class A common stock
and are issued or to be issued pursuant to a Warrant Agreement dated as of , 2021 (the “Warrant Agreement”),
duly executed and delivered by the Company to Continental Stock Transfer & Trust Company, a New York corporation, as warrant
agent (the “Warrant Agent”), which Warrant Agreement is hereby incorporated by reference in and made
a part of this instrument and is hereby referred to for a description of the rights, limitation of rights, obligations, duties
and immunities thereunder of the Warrant Agent, the Company and the holders (the words “holders” or “holder”
meaning the Registered Holders or Registered Holder, respectively) of the Warrants. A copy of the Warrant Agreement may be obtained
by the holder hereof upon written request to the Company. Defined terms used in this Warrant Certificate but not defined herein
shall have the meanings given to them in the Warrant Agreement.

 

Warrants may be exercised at any time during
the Exercise Period set forth in the Warrant Agreement. The holder of Warrants evidenced by this Warrant Certificate may exercise
them by surrendering this Warrant Certificate, with the form of Election to Purchase set forth hereon properly completed and executed,
together with payment of the Warrant Price as specified in the Warrant Agreement (or through “cashless exercise”
as provided for in the Warrant Agreement) at the principal corporate trust office of the Warrant Agent. In the event that upon
any exercise of Warrants evidenced hereby the number of Warrants exercised shall be less than the total number of Warrants evidenced
hereby, there shall be issued to the holder hereof or his, her or its assignee, a new Warrant Certificate evidencing the number
of Warrants not exercised.

 

Notwithstanding anything else in this Warrant
Certificate or the Warrant Agreement, no Warrant may be exercised unless at the time of exercise (i) a registration statement
covering the issuance of the shares of Class A common stock to be issued upon exercise is effective under the Securities Act
and (ii) a prospectus thereunder relating to the shares of Class A common stock is current, except through “cashless
exercise” as provided for in the Warrant Agreement.

 

The Warrant Agreement provides that upon the
occurrence of certain events the number of shares of Class A common stock issuable upon exercise of the Warrants set forth
on the face hereof may, subject to certain conditions, be adjusted. If, upon exercise of a Warrant, the holder thereof would be
entitled to receive a fractional interest in a share of Class A common stock, the Company shall, upon exercise, round down
to the nearest whole number of shares of Class A common stock to be issued to the holder of the Warrant.

 

Warrant Certificates, when surrendered at the
principal corporate trust office of the Warrant Agent by the Registered Holder thereof in person or by legal representative or
attorney duly authorized in writing, may be exchanged, in the manner and subject to the limitations provided in the Warrant Agreement,
but without payment of any service charge, for another Warrant Certificate or Warrant Certificates of like tenor evidencing in
the aggregate a like number of Warrants.

 

Upon due presentation for registration of transfer
of this Warrant Certificate at the office of the Warrant Agent a new Warrant Certificate or Warrant Certificates of like tenor
and evidencing in the aggregate a like number of Warrants shall be issued to the transferee(s) in exchange for this Warrant Certificate,
subject to the limitations provided in the Warrant Agreement, without charge except for any tax or other governmental charge imposed
in connection therewith.

 

The Company and the Warrant Agent may deem
and treat the Registered Holder(s) hereof as the absolute owner(s) of this Warrant Certificate (notwithstanding any notation of
ownership or other writing hereon made by anyone), for the purpose of any exercise hereof, of any distribution to the holder(s)
hereof, and for all other purposes, and neither the Company nor the Warrant Agent shall be affected by any notice to the contrary.
Neither the Warrants nor this Warrant Certificate entitles any holder hereof to any rights of a shareholder of the Company.

 

Election to Purchase 

(To Be Executed Upon Exercise of Warrant)

 

    	 

    	 

    

 

The undersigned hereby irrevocably elects to
exercise the right, represented by this Warrant Certificate, to receive shares of Class A common stock and herewith tenders
payment for such shares of Class A common stock to the order of Avalon Acquisition Inc. (the “Company”)
in the amount of $ in accordance with the terms hereof. The undersigned requests that a certificate for such shares of Class A
common stock be registered in the name of , whose address is and that such shares of Class A common stock be delivered to
whose address is . If said number of shares of Class A common stock is less than all of the shares of Class A common
stock purchasable hereunder, the undersigned requests that a new Warrant Certificate representing the remaining balance of such
shares of Class A common stock be registered in the name of , whose address is and that such Warrant Certificate be delivered
to , whose address is .

 

In the event that the Warrant has been called
for redemption by the Company pursuant to Section 6.2 of the Warrant Agreement and a holder thereof elects to exercise
its Warrant pursuant to a Make-Whole Exercise, the number of shares of Class A common stock that this Warrant is exercisable
for shall be determined in accordance with subsection 3.3.1(c) or Section 6.2 of the Warrant Agreement, as applicable.

 

In the event that the Warrant is a Private
Placement Warrant that is to be exercised on a “cashless” basis pursuant to subsection 3.3.1(c) of the Warrant
Agreement, the number of shares of Class A common stock that this Warrant is exercisable for shall be determined in accordance
with subsection 3.3.1(c) of the Warrant Agreement.

 

In the event that the Warrant is to be exercised
on a “cashless” basis pursuant to Section 7.4 of the Warrant Agreement, the number of shares of Class A
common stock that this Warrant is exercisable for shall be determined in accordance with Section 7.4 of the Warrant
Agreement.

 

In the event that the Warrant may be exercised,
to the extent allowed by the Warrant Agreement, through cashless exercise (i) the number of shares of Class A common
stock that this Warrant is exercisable for would be determined in accordance with the relevant section of the Warrant Agreement
which allows for such cashless exercise and (ii) the holder hereof shall complete the following: The undersigned hereby irrevocably
elects to exercise the right, represented by this Warrant Certificate, through the cashless exercise provisions of the Warrant
Agreement, to receive shares of Class A common stock. If said number of shares is less than all of the shares of Class A
common stock purchasable hereunder (after giving effect to the cashless exercise), the undersigned requests that a new Warrant
Certificate representing the remaining balance of such shares of Class A common stock be registered in the name of , whose
address is and that such Warrant Certificate be delivered to , whose address is .

 

[Signature Page Follows]

 

Date:  , 20

 

	 	(Signature)
	 	(Address)
	 	 
	 	(Tax Identification Number)

 

Signature Guaranteed:

 

THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN
ELIGIBLE GUARANTOR INSTITUTION (BANKS, STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN AN APPROVED
SIGNATURE GUARANTEE MEDALLION PROGRAM, PURSUANT TO S.E.C. RULE 17Ad-15 UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED).

 

    	 

    	 

    

 

EXHIBIT B

LEGEND

 

THE SECURITIES REPRESENTED BY THIS CERTIFICATE
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS, AND MAY NOT BE OFFERED, SOLD,
TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND ANY APPLICABLE STATE SECURITIES
LAWS OR AN EXEMPTION FROM REGISTRATION IS AVAILABLE. IN ADDITION, SUBJECT TO ANY ADDITIONAL LIMITATIONS ON TRANSFER DESCRIBED IN
THE LETTER AGREEMENT BY AND AMONG AVALON ACQUISITION INC. (THE “COMPANY”), AVALON ACQUISITION HOLDINGS LLC AND THE
OTHER PARTIES THERETO, THE SECURITIES REPRESENTED BY THIS CERTIFICATE MAY NOT BE SOLD OR TRANSFERRED PRIOR TO THE DATE UPON WHICH
THE COMPANY COMPLETES ITS INITIAL BUSINESS COMBINATION (AS DEFINED IN THE RECITALS OF THE WARRANT AGREEMENT REFERRED TO HEREIN)
EXCEPT TO A PERMITTED TRANSFEREE (AS DEFINED IN SECTION 2 OF THE WARRANT AGREEMENT) WHO AGREES IN WRITING WITH THE COMPANY TO BE
SUBJECT TO SUCH TRANSFER PROVISIONS.

 

SECURITIES EVIDENCED BY THIS CERTIFICATE AND
SHARES OF CLASS A COMMON STOCK OF THE COMPANY ISSUED UPON EXERCISE OF SUCH SECURITIES SHALL BE ENTITLED TO REGISTRATION RIGHTS
UNDER A REGISTRATION RIGHTS AGREEMENT TO BE EXECUTED BY THE COMPANY.

	 	 
	NO.	WARRANTExhibit 10.1

 

INVESTMENT MANAGEMENT TRUST AGREEMENT

 

This Investment Management
Trust Agreement (this “Agreement”) is made effective as of October 5, 2021 by and between Avalon Acquisition Inc.,
a Delaware corporation (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, No. 333-253654 and No. 333-260077 (collectively, the “Registration Statement”)
and prospectus (the “Prospectus”) for the initial public offering of the Company’s units (the “Units”),
each of which consists of one share of the Company’s Class A common stock, par value $0.0001 per share (the “Common
Stock”), and three-fourths of one redeemable warrant, each full warrant entitling the holder thereof to purchase one share
of Common Stock (such initial public offering hereinafter referred to as the “Offering”), has been declared effective
as of the date hereof by the U.S. Securities and Exchange Commission; and

 

WHEREAS, the Company has
entered into an Underwriting Agreement (the “Underwriting Agreement”) with Maxim Group LLC as representative (the “Representative”)
of the several underwriters (the “Underwriters”) named therein; and

 

WHEREAS,
if a Business Combination (as defined herein) is not consummated within the initial 15 month period following the closing of the
Offering, upon the request of the Company’s sponsor (the “Sponsor”),
the Company may extend such period by two extensions with each extension being three months for up to a maximum of six months in
the aggregate, subject to the Sponsor or its affiliates or permitted designees depositing $1,800,000 (or $2,070,000 if the Underwriters’
over-allotment option is exercised in full) into the Trust Account (as defined below) no later than the 15 month and the 18 month
anniversary of the Offering for each three month extension (each, an “Extension”),
in exchange for which the Sponsor will receive a non-interest bearing, unsecured promissory note for each Extension payable upon
consummation of a Business Combination; and

 

WHEREAS, as described in
the Prospectus, $182,700,000 of the gross proceeds of the Offering and sale of the Private Placement Warrants (as defined in the
Underwriting Agreement) (or $210,105,000 if the Underwriters’ over-allotment option is exercised in full), and the proceeds
from any loans in connection with an Extension, if any, 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 Common Stock included in the Units 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 stockholders
for whose benefit the Trustee shall hold the Property will be referred to as the “Public Stockholders,” and the Public
Stockholders and the Company will be referred to together as the “Beneficiaries”); and

 

WHEREAS, pursuant to the
Underwriting Agreement, a portion of the Property equal to $6,300,000, or $7,245,000 if the Underwriters’ over-allotment
option is exercised in full, is attributable to deferred underwriting discounts and commissions that may be payable by the Company
to the Underwriters upon 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 at J.P.
Morgan Chase Bank, N.A. (or at another U.S. chartered commercial bank with consolidated assets of $100 billion or more) in the
United States, maintained by the Trustee and at a brokerage institution selected by the Trustee that is reasonably satisfactory
to the Company;

 

    	1

    	 

    

 

(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 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; the Trustee may not invest in any other securities or assets, it being understood that the Trust Account will earn
no interest while account funds are uninvested awaiting the Company’s instructions hereunder;
and while the account funds are invested or uninvested 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, President, Chief Financial Officer,
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 Representative, and complete the liquidation of the Trust Account
and distribute the Property in the Trust Account, including interest not previously released to the Company to pay its franchise
and income taxes (less up to $100,000 of interest that may be released to the Company 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 latest of: (1) 15 months
after the closing of the Offering, (2) such later date upon one or more extensions effectuated pursuant to the terms hereof and
the Charter and (3) such later date as may be approved by the Company’s stockholders in accordance with the Charter, 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 not previously released to the Company to pay its franchise and income taxes (less up to $100,000 of
interest that may be released to the Company to pay dissolution expenses) shall be distributed to the Public Stockholders 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 income or franchise 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; 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 so long as there is no reduction in the principal amount per share initially deposited in
the Trust Account; provided, further, that if the tax to be paid is a franchise tax, the written request by the Company
to make such distribution shall be accompanied by a copy of the franchise tax bill from the State of Delaware for the Company and
a written statement from the principal financial officer of the Company setting forth the actual amount payable. 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 (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);

 

    	2

    	 

    

 

(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 “Stockholder Redemption Withdrawal Instruction”), the Trustee shall distribute on behalf of the Company the amount
requested by the Company to be used to redeem shares of Common Stock from Public Stockholders properly submitted in connection
with a stockholder vote to approve an amendment to the Company’s amended and restated certificate of incorporation to (a)
modify the substance or timing of the Company’s obligation to redeem 100% of its public shares of Common Stock in connection
with an initial Business Combination or to redeem 100% of such shares if the Company has not consummated an initial Business Combination
within such time as is described in the Company’s amended and restated certificate of incorporation or (b) with respect to
any other provisions relating to stockholders’ 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.

 

(m)        Upon receipt of an extension
letter (“Extension Letter”) substantially similar to Exhibit E hereto at least five business days
prior to the applicable deadline, signed on behalf of the Company by an executive officer, and receipt of the dollar amount specified
in the Extension Letter on or prior to the applicable deadline, follow the instructions set forth in the Extension Letter.

 

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, President, Chief Executive Officer, Chief
Financial Officer 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 Trustee shall refund to the Company the annual administration fee (on a pro rata basis) with respect to any
period after the liquidation of the Trust Account. 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;

 

    	3

    	 

    

 

(d)        In connection with any
vote of the Company’s stockholders regarding a merger, capital stock exchange, asset acquisition, stock 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 stockholder meeting verifying the vote of such
stockholders 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; and

 

(g)        Within four (4) business
days after the Underwriters exercise the over-allotment option (or any unexercised portion thereof) or such over-allotment 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
$6,300,000.

 

(h)        If applicable, issue
a press release at least three days prior to the applicable deadline announcing that the Company received notice from the Sponsor
that the Sponsor intends to deposit funds into the Trust Account for extending the applicable deadline and the Board has approved
such Extension; and

 

(i)         Promptly following
the applicable deadline, disclose whether or not the deadline for the Company to consummate a Business Combination has been extended.

 

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 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;

 

    	4

    	 

    

 

(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, franchise and income 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) and
1(k) hereof.

  

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 (which section may not be amended under any circumstances) 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.

 

    	5

    	 

    

 

(b)        This 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. 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. 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)        This Agreement or any
provision hereof may only be changed, amended or modified pursuant to Section 6(c) hereof with the Consent of the Stockholders,
it being the specific intention of the parties hereto that each of the Company’s stockholders is, and shall be, a third party
beneficiary of this Section 6(d) with the same right and power to enforce this Section 6(d) as the other parties
hereto. For purposes of this Section 6(d), the “Consent of the Stockholders” means receipt by the Trustee of
a certificate from the inspector of elections of the stockholder meeting certifying that either (i) the Company’s stockholders
of record as of a record date established in accordance with Section 213(a) of the Delaware General Corporation Law, as amended
(“DGCL”) (or any successor rule), who hold fifty percent (50%) or more of all then outstanding shares of the Common
Stock and Class B common stock, par value $0.0001 per share, of the Company voting together as a single class, have voted in favor
of such change, amendment or modification, or (ii) the Company’s stockholders of record as of the record date who hold fifty
percent (50%) or more of all then outstanding shares of the Common Stock and Class B common stock, par value $0.0001 per share,
of the Company voting together as a single class, have delivered to such entity a signed writing approving such change, amendment
or modification. Except for any liability arising out of the Trustee’s gross negligence, fraud or willful misconduct, the
Trustee may rely conclusively on the certification from the inspector or elections referenced above and shall be relieved of all
liability to any party for executing the proposed amendment in reliance thereon.

 

(e)         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.

 

(f) Any notice, consent or
request to be given in connection with any of the terms or provisions of this 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 by facsimile
or email transmission:

 

if to the Trustee, to:

 

Continental Stock Transfer
& Trust Company 

1 State Street, 30th floor

New York, New York 10004 

Attn: Francis Wolf and Celeste
Gonzalez

Email: fwolf@continentalstock.com

 

   cgonzalez@continentalstock.com

 

    	6

    	 

    

 

if to the Company, to:

 

Avalon Acquisition Inc.

2 Embarcadero Center, 8th
Floor 

San Francisco, CA 94111

Attn: S. Craig Cognetti 

Email: ccognetti@avalonspac.com

 

in each case, with copies
to:

 

Venable LLP

1270 Avenue of the Americas 

New York, New York 10020

Attn: William N. Haddad,
Esq. 

Email: WNHaddad@Venable.com

 

and

 

Maxim Group LLC

300 Park Avenue Ave., 16th
Floor 

New York, NY 10022

Attn: Clifford A. Teller,
Executive Managing Director, Investment Banking 

Email: cteller@maximgrp.com

 

and

 

Ellenoff Grossman & Schole
LLP

1345 Avenue of the Americas 

New York, NY 10105

Attn: Barry Grossman, Esq. 

Fax No: 212-370-7889

Email: bigrossman@egsllp.com

 

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

 

(i) 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:	/s/ Francis Wolf
	 	 	Name: Francis Wolf
	 	 	Title: Vice President
	 	 	 
	 	Avalon Acquisition Inc.
	 	 
	 	By:	/s/ S. Craig Cognetti
	 	 	Name: S. Craig Cognetti
	 	 	Title: Chief Executive Officer

 

    	 

    	 

    

 

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, payable by wire transfer or check.	 	$	10,000.00	 
	Transaction processing fee for disbursements to Company under Sections 1(i), 1(j) and 1(k)	 	Billed to the Company following disbursement made to Company under Section 1	 	$	250.00	 
	Paying Agent services as required pursuant to Section 1(i)    	 	Billed to Company upon delivery of service pursuant to Section 1(i)	 	 	Prevailing rates	 

 

    	 

    	 

    

 

EXHIBIT A

 

[Letterhead of Company]

 

[Insert date]

 

Continental Stock Transfer & Trust Company

1 State Street 

New York, New York 10004

Attn: Fran Wolf and Celeste Gonzalez

 

	 	Re:	Trust Account - Termination Letter

 

Ladies and Gentlemen:

 

Pursuant to Section 1(i)
of the Investment Management Trust Agreement between Avalon Acquisition Inc. (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 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 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, we hereby authorize you to commence to liquidate all of the assets of the Trust Account , and to
transfer the proceeds into the trust operating account at J.P Chase Bank, N.A.to the effect that, on the Consummation Date, all
of the funds held in the Trust Account will be immediately available for transfer to the account or accounts that the Company shall
direct on the Consummation Date. It is acknowledged and agreed that while the funds are on deposit in the trust operating checking
account at J.P. Morgan Chase Bank, N.A. awaiting distribution, the Company will not earn any interest or dividends.

 

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 of the Chief Executive Officer of the Company, which verifies that
the Business Combination has been approved by a vote of the Company’s stockholders, if a vote is held and (b) joint written
instructions signed by the Company and Maxim Group LLC with respect to the transfer of the funds held in the Trust Account, including
payment of the Deferred Discount to Maxim Group LLC 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 we have 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 written instruction as soon thereafter as possible.

 

 

	 	Very truly yours,
	 	 
	 	Avalon Acquisition Inc.
	 	 
	 	By:	 
	 	 	Name: 
	 	 	Title:

 

Agreed and acknowledged by:

 

	Maxim Group LLC	 
	 	 
	By:	 	 
	 	Name: 	 
	 	Title:	 

 

    	 

    	 

    

 

EXHIBIT B

 

[Letterhead of Company]

 

[Insert date]

 

Continental Stock Transfer & Trust Company

1 State Street 

New York, New York 10004

Attn: Fran Wolf and Celeste Gonzalez

 

	 	Re:	    Trust Account - Termination Letter

 

Ladies and Gentlemen:

 

Pursuant to Section 1(i)
of the Investment Management Trust Agreement between Avalon Acquisition Inc. (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 within the time frame specified in
the Company’s Amended and Restated Certificate of Incorporation, 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, we hereby authorize you to liquidate all of the assets in the Trust Account and to transfer the total
proceeds into the trust operating account at J.P.Morgan Chase Bank, N.A. to await distribution to the Public Stockholders. The
Company has selected [ ]1 as the effective date for the purpose of determining the Public Stockholders 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 Public Stockholders in accordance with the terms of the Trust Agreement and the
Amended and Restated Certificate of Incorporation 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,
	 	 	 	 
	 	 	 	Avalon Acquisition Inc.
	 	 	 	 	 
	 	 	 	By:	 
	 	 	 	 	Name: 
	 	 	 	 	Title:
	 	 	 	 	 
	cc:	Maxim Group LLC	 	 	 

 

1 21 months from the closing of the Offering.

 

    	 

    	 

    

 

EXHIBIT C

 

[Letterhead of Company]

 

[Insert date]

 

Continental Stock Transfer & Trust Company

1 State Street, 30th floor 

New York, New York 10004

Attn: Fran Wolf and Celeste Gonzalez

 

	 	Re:	Trust Account - Tax Payment Withdrawal
Instruction

 

Ladies and Gentlemen:

 

Pursuant to Section 1(j)
of the Investment Management Trust Agreement between Avalon Acquisition Inc. (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,
	 	 	 	Avalon Acquisition Inc.
	 	 	 	 	 
	 	 	 	By:	 
	 	 	 	 	Name: 
	 	 	 	 	Title:
	 	 	 	 	 
	cc:	Maxim Group LLC	 	 	 

 

    	 

    	 

    

 

EXHIBIT D

 

[Letterhead of Company]

 

[Insert date]

 

Continental Stock Transfer & Trust Company

1 State Street, 30th floor 

New York, New York 10004

Attn: Fran Wolf and Celeste Gonzalez

 

	 	Re:	Trust Account - Stockholder Redemption Withdrawal Instruction

 

Ladies and Gentlemen:

 

Pursuant to Section
1(k) of the Investment Management Trust Agreement between Avalon Acquisition Inc. (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 Stockholders of the Company $ of the principal and 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 its Public Stockholders who have properly elected to have their shares of Common Stock redeemed by the Company in
connection with a stockholder vote to approve an amendment to the Company’s amended and restated certificate of incorporation
to (a) modify the substance or timing of the Company’s obligation to redeem 100% of its public shares of Common Stock in
connection with an initial Business Combination or to redeem 100% of such shares if the Company has not consummated an initial
Business Combination within such time as is described in the Company’s amended and restated certificate of incorporation
or (b) with respect to any other provisions relating to stockholders’ 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
to the redeeming Public Stockholders in accordance with your customary procedures.

 

	 	 	 	Very truly yours,
	 	 	 	Avalon Acquisition Inc.
	 	 	 	 	 
	 	 	 	By:	 
	 	 	 	 	Name: 
	 	 	 	 	Title:
	 	 	 	 	 
	cc:	Maxim Group LLC	 	 	 

 

    	 

    	 

    

 

EXHIBIT E

 

[Letterhead of Company]

 

[Insert date]

 

Continental Stock
Transfer & Trust Company

 

1 State Street, 30th
floor

New York, New York
10004 

Attn: Fran Wolf and
Celeste Gonzalez

 

	 	Re:	Trust Account Extension Letter:

 

Ladies and Gentlemen:

 

Pursuant
to Section 1(m) of Investment Management Trust Agreement between Avalon Acquisition Inc. (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 is extending the time available to consummate a Business Combination for an additional three
(3) months, from ________ to ________ (the “Extension”).

 

This
Extension Letter shall serve as the notice required with respect to the Extension prior to the applicable deadline. Capitalized
words used herein and not otherwise defined shall have the meanings ascribed to them in the Trust Agreement.

 

In
accordance with the terms of the Trust Agreement, we hereby authorize you to deposit $ [(or $[ ] if the underwriters’ over-allotment
option was exercised in full)], which will be wired to you, into the Trust Account investments upon receipt.

 

This
is the ____ of up to two Extension Letters.

 

	 	 	 	Very truly yours,
	 	 	 	Avalon Acquisition Inc.
	 	 	 	 	 
	 	 	 	By:	 
	 	 	 	 	Name: 
	 	 	 	 	Title:
	 	 	 	 	 
	cc:	Maxim Group LLC

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