Exhibit 10.9


 


LEMONADE, INC.

2020 INCENTIVE AWARD PLAN


 


STOCK OPTION GRANT NOTICE AND


STOCK OPTION AGREEMENT


 


Lemonade, Inc.,
a Delaware corporation (the “Company”), pursuant to its 2020 Incentive Award Plan, as amended from time to time
(the “Plan”), hereby grants to the holder listed below (“Participant”) an option to purchase
the number of Shares set forth below (the “Option”). The Option is subject to the terms and conditions set forth
in this Stock Option Grant Notice (the “Grant Notice”), the Plan and the Stock Option Agreement attached hereto
as Exhibit A including any Appendix thereto (the “Agreement”), each of which is incorporated into
this Grant Notice by reference. Unless otherwise defined herein, the terms defined in the Plan shall have the same defined meanings
in this Grant Notice and the Agreement.


 


	Participant:	 
	Grant Date:	 
	Exercise Price Per Share:	 
	Total Exercise Price:	 
	Total Number of Shares Subject to Option:	 
	Expiration Date:	The earlier of (i) ten years as of the Grant Date or (ii) the termination, expiration or cancellation of the Option in accordance with the terms of the Plan.
	Type of Option:	 ̈   Incentive Stock Option   ̈   Non-Qualified Stock Option
	Vesting Schedule:	 


 


By Participant’s
signature below, Participant agrees to be bound by the terms and conditions of the Plan, the Agreement and the Grant Notice. Participant
has reviewed the Plan, the Agreement and the Grant Notice in their entirety, has had an opportunity to obtain the advice of counsel
prior to executing the Grant Notice and fully understands all provisions of the Plan, the Agreement and the Grant Notice. Participant
hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Administrator upon any questions
arising under the Plan, the Agreement and the Grant Notice.


 


	LEMONADE, INC.	 	PARTICIPANT






 


	By:		 	By:	
	Print Name: 	 	 	Print Name:	 
	Title:	 	 	 	 



 






    


     

    

 


EXHIBIT A


TO STOCK OPTION GRANT NOTICE


 


STOCK OPTION AGREEMENT


 


Pursuant to the Grant
Notice to which this Agreement is attached, the Company has granted to Participant an Option under the Plan to purchase the number
of Shares set forth in the Grant Notice.


 


Article I.

general


 


1.1          Defined
Terms. Capitalized terms not specifically defined herein shall have the meanings specified in the Plan or the Grant Notice.
For purposes of this Agreement,


 


(a)            “Cessation
Date” shall mean the date of Participant’s Termination of Service (regardless of the reason for such termination).


 


(b)            “Company
Group” shall mean the Company and its Affiliates.


 


(c)            “Company
Group Member” shall mean each member of the Company Group.


 


(d)            “Disability”
shall have the meaning ascribed to such term in any relevant employment agreement between Participant and a Company Group Member;
provided that, in the absence of such agreement containing such definition, “Disability” shall mean permanent
disability or incapacity as determined in accordance with the Company’s disability insurance policy, if such a policy is
then in effect, or if no such policy is then in effect, such permanent disability or incapacity shall be determined by the Board
in its good faith judgment based upon inability to perform the essential functions of his or her position, with reasonable accommodation
by the Company, for a period in excess of 180 days during any period of 365 calendar days.


 


1.2          Incorporation
of Terms of Plan. Except where this Agreement explicitly states that this Agreement prevails over the Plan, the Option is subject
to the terms and conditions set forth in this Agreement and the Plan, each of which is incorporated herein by reference. In the
event of any inconsistency between the Plan and this Agreement, the terms of the Plan shall control.


 


Article II.

GRANT OF OPTION


 


2.1          Grant
of Option. In consideration of Participant’s past and/or continued employment with or service to any Company Group Member,
and for other good and valuable consideration that the Administrator has determined exceeds the aggregate par value of the Shares
subject to the Award, effective as of the grant date set forth in the Grant Notice (the “Grant Date”), the Company
hereby grants to Participant the Option to purchase any part or all of an aggregate number of Shares set forth in the Grant Notice
upon the terms and conditions set forth in the Grant Notice, the Plan and this Agreement, subject to adjustment as provided in
Article 12 of the Plan.


 


2.2          Exercise
Price. The exercise price per Share of the Shares subject to the Option (the “Exercise Price”) shall be
as set forth in the Grant Notice.


 






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2.3          Consideration
to the Company. In consideration of the grant of the Option by the Company, Participant agrees to render faithful and efficient
services to any Company Group Member. Nothing in the Plan, the Grant Notice or this Agreement shall confer upon Participant any
right to continue in the employ or service of any Company Group Member or shall interfere with or restrict in any way the rights
of the Company Group, which rights are hereby expressly reserved, to discharge or terminate the services of Participant at any
time for any reason whatsoever, with or without Cause, except to the extent expressly provided otherwise in a written agreement
between any Company Group Member and Participant.


 


Article III.

PERIOD OF EXERCISABILITY


 


3.1          Commencement
of Exercisability.


 


(a)            Subject
to Participant’s continued employment with or service to a Company Group Member through the applicable vesting date and subject
to anything in the Grant Notice, the Plan or this Agreement to the contrary, the Option shall become vested and exercisable in
such amounts and at such times as are set forth in the Grant Notice.


 


(b)            Unless
otherwise determined by the Administrator or as set forth in a written agreement between Participant and the Company, any portion
of the Option that has not become vested and exercisable on or prior to the Cessation Date (including, without limitation, pursuant
to any employment or similar agreement by and between Participant and the Company) shall be forfeited on the Cessation Date and
shall not thereafter become vested or exercisable.


 


3.2          Duration
of Exercisability. The installments provided for in the vesting schedule set forth in the Grant Notice are cumulative. Each
such installment that becomes vested and exercisable pursuant to the vesting schedule set forth in the Grant Notice shall remain
vested and exercisable until it becomes unexercisable under Section 3.3 hereof. Once the Option becomes unexercisable,
it shall be forfeited immediately.


 


3.3          Expiration
of Option. The Option may not be exercised to any extent by anyone after the first to occur of the following events:


 


(a)            The
expiration date set forth in the Grant Notice;


 


(b)            Except
as the Administrator may otherwise approve, the expiration of six (6) months from the Cessation Date by reason of Participant’s
Termination of Service due to death or, Disability; and


 


(c)            Except
as the Administrator may otherwise approve, immediately upon the Cessation Date by reason of Participant’s Termination of
Service by the Company Group for Cause.


 


(d)            Except
as the Administrator may otherwise approve, the expiration of ninety (90) days from the date of Participant’s Termination
of Service for any other reason.


 


Article IV.

EXERCISE OF OPTION


 


4.1          Person
Eligible to Exercise. During the lifetime of Participant, only Participant may exercise the Option or any portion thereof.
After the death of Participant, any exercisable portion of the Option may, prior to the time when the Option becomes unexercisable
under Section 3.3 hereof, be exercised by Participant’s personal representative or by any person empowered to
do so under the deceased Participant’s will or under the then Applicable Laws of descent and distribution.


 






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4.2          Partial
Exercise. Subject to Section 5.5, any exercisable portion of the Option or the entire Option, if then wholly exercisable,
may be exercised in whole or in part at any time prior to the time when the Option or portion thereof becomes unexercisable under
Section 3.3 hereof.


 


4.3          Additional
Requirements. In order for the Company to issue Shares upon the exercise of the Option, Participant hereby agrees to sign any
and all documents required by any applicable law and/or reasonably required by the Administrator. Participant further agrees that
in the event that the Company and its counsel deem it necessary or advisable, in their sole discretion, the issuance of Shares
may be conditioned upon certain representations, warranties, and acknowledgements by Participant.


 


4.4          Compliance
with Law. The Company shall not be obligated to issue any Shares upon the exercise of the Option if such issuance, in the opinion
of the Company, might constitute a violation by the Company of any provision of law.


 


Article V.

other provisions


 


5.1          Tax
Withholding. Notwithstanding any other provision of this Agreement:


 


(a)            The
Company Group shall have the authority to deduct or withhold, or require Participant to remit to the applicable Company Group Member,
an amount sufficient to satisfy any applicable federal, state, local and foreign taxes (including the employee portion of any FICA
obligation) required by Applicable Law to be withheld with respect to any taxable event arising pursuant to this Agreement. The
Company Group may withhold or Participant may make such payment in one or more of the forms specified below:


 


(i)            by
a bank wire transfer, an ACH (automated clearing house) mechanism, or any other means of electronic funds transfer made payable
to the Company Group Member with respect to which the withholding obligation arises;


 


(ii)           by
the deduction of such amount from other compensation payable to Participant;


 


(iii)          with
respect to any withholding taxes arising in connection with the exercise of the Option, with the consent of the Administrator,
by requesting that the Company withhold a net number of Shares issuable upon the exercise of the Option having a then current Fair
Market Value not exceeding the amount necessary to satisfy the withholding obligation of the Company Group based on the maximum
statutory withholding rates in Participant’s applicable jurisdictions for federal, state, local and foreign income tax and
payroll tax purposes that are applicable to such taxable income;


 


(iv)         with
respect to any withholding taxes arising in connection with the exercise of the Option, with the consent of the Administrator,
by tendering to the Company vested Shares held for such period of time as may be required by the Administrator in order to avoid
adverse accounting consequences and having a then current Fair Market Value not exceeding the amount necessary to satisfy the withholding
obligation of the Company Group based on the maximum statutory withholding rates in Participant’s applicable jurisdictions
for federal, state, local and foreign income tax and payroll tax purposes that are applicable to such taxable income;


 






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(v)          with
respect to any withholding taxes arising in connection with the exercise of the Option, through the delivery of a notice that Participant
has placed a market sell order with a broker acceptable to the Company with respect to Shares then issuable to Participant pursuant
to the Option, and that the broker has been directed to pay a sufficient portion of the net proceeds of the sale to the Company
Group Member with respect to which the withholding obligation arises in satisfaction of such withholding taxes; provided
that payment of such proceeds is then made to the applicable Company Group Member at such time as may be required by the Administrator,
but in any event not later than the settlement of such sale; or


 


(vi)            in
any combination of the foregoing.


 


(b)            With
respect to any withholding taxes arising in connection with the Option, in the event Participant fails to provide timely payment
of all sums required pursuant to Section 5.1(a), the Company shall have the right and option, but not the obligation,
to treat such failure as an election by Participant to satisfy all or any portion of Participant’s required payment obligation
pursuant to Section 5.1(a)(ii) or Section 5.1(a)(iii) above, or any combination of the foregoing
as the Company may determine to be appropriate. The Company shall not be obligated to deliver any certificate representing Shares
issuable with respect to the exercise of the Option to, or to cause any such Shares to be held in book-entry form by, Participant
or his or her legal representative unless and until Participant or his or her legal representative shall have paid or otherwise
satisfied in full the amount of all federal, state, local and foreign taxes applicable with respect to the taxable income of Participant
resulting from the exercise of the Option or any other taxable event related to the Option.


 


(c)            In
the event any tax withholding obligation arising in connection with the Option will be satisfied under Section 5.1(a)(iii),
then the Company may elect to instruct any brokerage firm determined acceptable to the Company for such purpose to sell on Participant’s
behalf a whole number of Shares from those Shares then issuable upon the exercise of the Option as the Company determines to be
appropriate to generate cash proceeds sufficient to satisfy the tax withholding obligation and to remit the proceeds of such sale
to the Company Group Member with respect to which the withholding obligation arises. Participant’s acceptance of this Option
constitutes Participant’s instruction and authorization to the Company and such brokerage firm to complete the transactions
described in this Section 5.1(c), including the transactions described in the previous sentence, as applicable. The
Company may refuse to issue any Shares to Participant until the foregoing tax withholding obligations are satisfied, provided
that no payment shall be delayed under this Section 5.1(c) if such delay will result in a violation of Section 409A.


 


(d)            In
the event of any broker-assisted sale of Shares in connection with the payment of withholding taxes as provided in Section 5.1(a)(v) or
Section 5.1(c) or the payment of the Exercise Price as provided in Section 4.4(c): (a) any Shares
to be sold through a broker-assisted sale will be sold on the day the tax withholding obligation or exercise of the Option, as
applicable, occurs or arises, or as soon thereafter as practicable; (b) such Shares may be sold as part of a block trade with
other participants in the Plan in which all participants receive an average price; (c) Participant will be responsible for
all broker’s fees and other costs of sale, and Participant agrees to indemnify and hold the Company harmless from any losses,
costs, damages, or expenses relating to any such sale; (d) to the extent the proceeds of such sale exceed the applicable tax
withholding obligation or Exercise Price, the Company agrees to pay such excess in cash to Participant as soon as reasonably practicable;
(e) Participant acknowledges that the Company or its designee is under no obligation to arrange for such sale at any particular
price, and that the proceeds of any such sale may not be sufficient to satisfy the applicable tax withholding obligation or Exercise
Price; and (f) in the event the proceeds of such sale are insufficient to satisfy the applicable tax withholding obligation,
Participant agrees to pay immediately upon demand to the Company Group Member with respect to which the withholding obligation
arises an amount in cash sufficient to satisfy any remaining portion of the applicable Company Group Member’s withholding
obligation.


 






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(e)            Any
tax consequences arising from the grant or exercise of the Option, from the payment for Shares covered thereby or from any other
event or act (of the Company and/or its Affiliates, or Participant), hereunder, shall be borne solely by Participant. Participant
is ultimately liable and responsible for, and, to the extent permitted by Applicable Law, agrees to indemnify and keep indemnified
the Company Group from, all taxes owed in connection with the Option, regardless of any action any Company Group Member takes with
respect to any tax withholding obligations that arise in connection with the Option. No Company Group Member makes any representation
or undertaking regarding the treatment of any tax withholding in connection with the awarding, vesting or exercise of the Option
or the subsequent sale of Shares. The Company Group does not commit and is under no obligation to structure the Option to reduce
or eliminate Participant’s tax liability.


 


(f)            The
receipt of the Option and the acquisition of the Shares to be issued upon the exercise of the Option may result in tax consequences.
PARTICIPANT IS ADVISED TO CONSULT A TAX ADVISOR WITH RESPECT TO THE TAX CONSEQUENCES OF RECEIVING OR EXERCISING THIS OPTION OR
DISPOSING OF THE SHARES.


 


5.2          Obligations
to the Company. Participant agrees to comply with the terms and conditions of that certain Proprietary Information, Assignment
of Inventions Non-Disclosure and Non-Compete Agreement by and between Participant and the Company, which is incorporated by reference
herein, and Participant acknowledges and agrees that the grant of the Option shall be in material part in consideration of Participant’s
reaffirmation of Participant’s agreement to comply with the covenants set forth therein.


 


5.3          Rights
as Stockholder. Neither Participant nor any person claiming under or through Participant will have any of the rights or privileges
of a stockholder of the Company in respect of any Shares purchasable upon the exercise of any part of the Option unless and until
certificates representing such Shares (which may be in book-entry form) will have been issued and recorded on the records of the
Company or its transfer agents or registrars and delivered to Participant (including through electronic delivery to a brokerage
account). No adjustment will be made for a dividend or other right for which the record date is prior to the date of such issuance,
recordation and delivery, except as provided in Section 12.2 of the Plan. Except as otherwise provided herein, after such
issuance, recordation and delivery, Participant will have all the rights of a stockholder of the Company with respect to such Shares,
including, without limitation, the right to receipt of dividends and distributions on such Shares.


 


5.4          Administration.
The Administrator shall have the power to interpret the Plan, the Grant Notice and this Agreement and to adopt such rules for
the administration, interpretation and application of the Plan, the Grant Notice and this Agreement as are consistent therewith
and to interpret, amend or revoke any such rules. All actions taken and all interpretations and determinations made by the Administrator
will be final and binding upon Participant, the Company and all other interested persons. To the extent allowable pursuant to Applicable
Law, no member of the Committee or the Board will be personally liable for any action, determination or interpretation made with
respect to the Plan, the Grant Notice or this Agreement.


 


5.5          Whole
Shares. The Option may only be exercised for whole Shares and in no case may a fraction of a Share be purchased..


 


5.6          Option
Not Transferable. Subject to Section 4.1 hereof, the Option may not be sold, pledged, assigned or transferred in
any manner other than by will or the laws of descent and distribution, unless and until the Shares underlying the Option have been
issued, and all restrictions applicable to such Shares have lapsed. Neither the Option nor any interest or right therein or part
thereof shall be liable for the debts, contracts or engagements of Participant or his or her successors in interest or shall be
subject to disposition by transfer, alienation, anticipation, pledge, encumbrance, assignment or any other means whether such disposition
be voluntary or involuntary or by operation of law by judgment, levy, attachment, garnishment or any other legal or equitable proceedings
(including bankruptcy), and any attempted disposition thereof shall be null and void and of no effect, except to the extent that
such disposition is permitted by the preceding sentence. Notwithstanding the foregoing, with the consent of the Administrator,
if the Option is a Non-Qualified Stock Option, it may be transferred to Permitted Transferees pursuant to any conditions and procedures
the Administrator may require.


 






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5.7          Adjustments.
Participant acknowledges that the Option is subject to adjustment, modification and termination in certain events as provided in
this Agreement and the Plan, including Section 12.2 of the Plan.


 


5.8          Notices.
Any notice to be given under the terms of this Agreement to the Company shall be addressed to the Company in care of the Secretary
of the Company at the Company’s principal office, and any notice to be given to Participant shall be addressed to Participant
at Participant’s last address or email address reflected on the Company’s records. By a notice given pursuant to this
Section 5.8, either party may hereafter designate a different address for notices to be given to that party. Any notice
shall be deemed duly given when sent via email or when sent by certified mail (return receipt requested) and deposited (with postage
prepaid) in a post office or branch post office regularly maintained by the United States Postal Service.


 


5.9          Titles.
Titles are provided herein for convenience only and are not to serve as a basis for interpretation or construction of this Agreement.


 


5.10        Governing
Law. The laws of the State of Delaware shall govern the interpretation, validity, administration, enforcement and performance
of the terms of this Agreement regardless of the law that might be applied under principles of conflicts of laws.


 


5.11        Conformity
to Securities Laws. Participant acknowledges that the Plan, the Grant Notice and this Agreement are intended to conform to
the extent necessary with all Applicable Laws, including, without limitation, the provisions of the Securities Act and the Exchange
Act, and any and all regulations and rules promulgated thereunder by the Securities and Exchange Commission and state securities
laws and regulations. Notwithstanding anything herein to the contrary, the Plan shall be administered, and the Option is granted
and may be exercised, only in such a manner as to conform to Applicable Law. To the extent permitted by Applicable Law, the Plan,
the Grant Notice and this Agreement shall be deemed amended to the extent necessary to conform to Applicable Law.


 


5.12        Amendment,
Suspension and Termination. To the extent permitted by the Plan, this Agreement may be wholly or partially amended or otherwise
modified, suspended or terminated at any time or from time to time by the Administrator or the Board, provided that, except
as may otherwise be provided by the Plan, no amendment, modification, suspension or termination of this Agreement shall adversely
affect the Option in any material way without the prior written consent of Participant.


 


5.13        Successors
and Assigns. The Company may assign any of its rights under this Agreement to single or multiple assignees, and this Agreement
shall inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on transfer set forth in Section 5.6
and the Plan, this Agreement shall be binding upon and inure to the benefit of the heirs, legatees, legal representatives, successors
and assigns of the parties hereto.


 


5.14        Limitations
Applicable to Section 16 Persons. Notwithstanding any other provision of the Plan or this Agreement, if Participant is
subject to Section 16 of the Exchange Act, the Plan, the Option, the Grant Notice and this Agreement shall be subject to any
additional limitations set forth in any applicable exemptive rule under Section 16 of the Exchange Act (including any
amendment to Rule 16b-3 of the Exchange Act) that are requirements for the application of such exemptive rule. To the extent
permitted by Applicable Law, this Agreement shall be deemed amended to the extent necessary to conform to such applicable exemptive
rule.


 






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5.15        No
Other Rights. Participant hereby acknowledges that participation in the Plan is voluntary. The value of the Option is an extraordinary
item of compensation outside the scope of Participant's normal compensation rights, if any. As such, the Option is not part of
normal or expected compensation for purposes of calculating any payments due to severance, resignation, redundancy, end of service,
bonuses, long-service awards, pensions or retirement benefits or similar payments. The Plan is discretionary in nature and may
be amended, cancelled, or terminated by the Company, in its sole discretion, at any time. The grant of the Option under the Plan
is a one-time benefit and does not create any contractual or other right to receive any other grant of the Option or other Awards
under the Plan in the future. Future grants, if any, will be at the sole discretion of the Company, including, but not limited
to, the timing of the grant, the form of the Award, number of Shares subject to an Award, vesting, and exercise or settlement provisions,
as relevant.


 


5.16        Not
a Contract of Employment. Nothing in this Agreement or in the Plan shall confer upon Participant any right to continue to serve
as an Employee or other service provider of any Company Group Member or shall interfere with or restrict in any way the rights
of the Company Group, which rights are hereby expressly reserved, to discharge or terminate the services of Participant at any
time for any reason whatsoever, with or without Cause, except to the extent expressly provided otherwise in a written agreement
between a Company Group Member and Participant.


 


5.17        Entire
Agreement. The Plan, the Grant Notice and this Agreement (including any exhibit hereto) constitute the entire agreement
of the parties and supersede in their entirety all prior undertakings and agreements of the Company and Participant with respect
to the subject matter hereof.


 


5.18        No
Obligation to Exercise the Option. The grant and acceptance of the Option imposes no obligation on Participant to exercise.


 


5.19        Section 409A.
This Award is not intended to constitute “nonqualified deferred compensation” within the meaning of Section 409A.
However, notwithstanding any other provision of the Plan, the Grant Notice or this Agreement, if at any time the Administrator
determines that this Award (or any portion thereof) may be subject to Section 409A, the Administrator shall have the right
in its sole discretion (without any obligation to do so or to indemnify Participant or any other person for failure to do so) to
adopt such amendments to the Plan, the Grant Notice or this Agreement, or adopt other policies and procedures (including amendments,
policies and procedures with retroactive effect), or take any other actions, as the Administrator determines are necessary or appropriate
for this Award either to be exempt from the application of Section 409A or to comply with the requirements of Section 409A.


 


5.20        Agreement
Severable. In the event that any provision of the Grant Notice or this Agreement is held invalid or unenforceable, such provision
will be severable from, and such invalidity or unenforceability will not be construed to have any effect on, the remaining provisions
of the Grant Notice or this Agreement.


 


5.21        Limitation
on Participant’s Rights. Participation in the Plan confers no rights or interests other than as herein provided. This
Agreement creates only a contractual obligation on the part of the Company as to amounts payable and shall not be construed as
creating a trust. Neither the Plan nor any underlying program, in and of itself, has any assets. Participant shall have only the
right to receive Shares as a general unsecured creditor with respect to the Option, as and when exercised pursuant to the terms
hereof.


 






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5.22        Counterparts.
The Grant Notice may be executed in one or more counterparts, including by way of any electronic signature, subject to Applicable
Law, each of which shall be deemed an original and all of which together shall constitute one instrument.


 


5.23        Incentive
Stock Options. Participant acknowledges that to the extent the aggregate Fair Market Value of Shares (determined as of the
time the option with respect to the Shares is granted) with respect to which Incentive Stock Options, including this Option (if
applicable), are exercisable for the first time by Participant during any calendar year exceeds $100,000 or if for any other reason
such Incentive Stock Options do not qualify or cease to qualify for treatment as “incentive stock options” under Section 422
of the Code, such Incentive Stock Options shall be treated as Non-Qualified Stock Options. Participant further acknowledges that
the rule set forth in the preceding sentence shall be applied by taking the Option and other stock options into account in
the order in which they were granted, as determined under Section 422(d) of the Code and the Treasury Regulations thereunder.
Participant also acknowledges that an Incentive Stock Option exercised more than three (3) months after Participant’s
Termination of Service, other than by reason of death or disability, will be taxed as a Non-Qualified Stock Option.


 


5.24        Notification
of Disposition. If this Option is designated as an Incentive Stock Option, Participant shall give prompt written notice to
the Company of any disposition or other transfer of any Shares acquired under this Agreement if such disposition or transfer is
made (a) within two (2) years from the Grant Date or (b) within one (1) year after the transfer of such Shares
to Participant. Such notice shall specify the date of such disposition or other transfer and the amount realized, in cash, other
property, assumption of indebtedness or other consideration, by Participant in such disposition or other transfer.


 






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