Document:

EX-10.4

 Exhibit 10.4 

THE HONEST COMPANY, INC. 

2021 EMPLOYEE STOCK PURCHASE PLAN 

ADOPTED BY THE BOARD OF DIRECTORS:
APRIL 8, 2021 
 APPROVED BY THE STOCKHOLDERS:
______________, 2021 
 IPO DATE: ______________, 2021 

 

	1.	 GENERAL; PURPOSE. 

(a) The Plan provides a means by which Eligible Employees of the Company and Designated Companies may be given an opportunity to
purchase shares of Common Stock. The Plan permits the Company to grant a series of Purchase Rights to Eligible Employees under an Employee Stock Purchase Plan. In addition, the Plan permits the Company to grant a series of Purchase Rights to
Eligible Employees that do not meet the requirements of an Employee Stock Purchase Plan. 
 (b) The Plan includes two components: a
423 Component and a Non-423 Component. The Company intends (but makes no undertaking or representation to maintain) the 423 Component to qualify as an Employee Stock Purchase Plan. The provisions of the 423
Component, accordingly, will be construed in a manner that is consistent with the requirements of Section 423 of the Code. Except as otherwise provided in the Plan or determined by the Board, the Non-423
Component will operate and be administered in the same manner as the 423 Component. 
 (c) The Company, by means of the Plan, seeks to
retain the services of Eligible Employees, to secure and retain the services of new Employees and to provide incentives for such persons to exert maximum efforts for the success of the Company and its Related Corporations. 

2. ADMINISTRATION. 
 (a)
The Board or the Committee will administer the Plan. References herein to the Board shall be deemed to refer to the Committee except where context dictates otherwise. 

(b) The Board will have the power, subject to, and within the limitations of, the express provisions of the Plan: 

(i) To determine how and when Purchase Rights will be granted and the provisions of each Offering (which need not be identical). 

(ii) To designate from time to time (A) which Related Corporations will be eligible to participate in the Plan as Designated 423
Corporations, (B) which Related Corporations or Affiliates will be eligible to participate in the Plan as Designated Non-423 Corporations, and (C) which Designated Companies will participate in each
separate Offering (to the extent that the Company makes separate Offerings). 
 (iii) To construe and interpret the Plan and Purchase
Rights, and to establish, amend and revoke rules and regulations for its administration. The Board, in the exercise of this power, may correct any defect, omission or inconsistency in the Plan, in a manner and to the extent it deems necessary or
expedient to make the Plan fully effective. 

 (iv) To settle all controversies regarding the Plan and Purchase Rights granted under
the Plan. 
 (v) To suspend or terminate the Plan at any time as provided in Section 12. 

(vi) To amend the Plan at any time as provided in Section 12. 

(vii) Generally, to exercise such powers and to perform such acts as it deems necessary or expedient to promote the best interests of
the Company and its Related Corporations and to carry out the intent that the Plan be treated as an Employee Stock Purchase Plan with respect to the 423 Component. 

(viii) To adopt such rules, procedures and sub-plans as are necessary or appropriate to permit
or facilitate participation in the Plan by Employees who are foreign nationals or employed or located outside the United States. Without limiting the generality of, and consistent with, the foregoing, the Board specifically is authorized to adopt
rules, procedures, and sub-plans regarding, without limitation, eligibility to participate in the Plan, the definition of eligible “earnings,” handling and making of Contributions, establishment of
bank or trust accounts to hold Contributions, payment of interest, conversion of local currency, obligations to pay payroll tax, determination of beneficiary designation requirements, withholding procedures and handling of share issuances, any of
which may vary according to applicable requirements, and which, if applicable to a Designated Non-423 Corporation, do not have to comply with the requirements of Section 423 of the Code. 

(c) The Board may delegate some or all of the administration of the Plan to a Committee or Committees. If administration is delegated to
a Committee, the Committee will have, in connection with the administration of the Plan, the powers theretofore possessed by the Board that have been delegated to the Committee, including the power to delegate to a subcommittee any of the
administrative powers the Committee is authorized to exercise (and references in this Plan and any Offering Document to the Board will thereafter be to the Committee or subcommittee), subject, however, to such resolutions, not inconsistent with the
provisions of the Plan, as may be adopted from time to time by the Board. Further, to the extent not prohibited by Applicable Law, the Board or Committee may, from time to time, delegate some or all of its authority under the Plan to one or more
officers of the Company or other persons or groups of persons as it deems necessary, appropriate or advisable under conditions or limitations that it may set at or after the time of the delegation. The Board may retain the authority to concurrently
administer the Plan with the Committee and may, at any time, revest in the Board some or all of the powers previously delegated. Whether or not the Board has delegated administration of the Plan to a Committee, the Board will have the final power to
determine all questions of policy and expediency that may arise in the administration of the Plan. 
 (d) All determinations,
interpretations and constructions made by the Board in good faith will not be subject to review by any person and will be final, binding and conclusive on all persons. 
  

	3.	 SHARES OF COMMON STOCK SUBJECT
TO THE PLAN. 

 (a) Subject to the provisions of Section 11(a)
relating to Capitalization Adjustments, the maximum number of shares of Common Stock that may be issued under the Plan will not exceed ________ shares of Common Stock, plus the number of shares of Common Stock that are automatically added on January
1st of each year for a period of up to ten years, commencing on January 1, 2022 and ending on (and including) January 1, 2031, in an amount equal to the lesser of (i) one percent
(1%) of the total number of shares of Common Stock outstanding on December 31st of the preceding calendar year, and (ii) _______ shares of Common Stock. Notwithstanding the foregoing, the Board
may act prior to the 

  
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first day of any calendar year to provide that there will be no January 1st increase in the share reserve for such calendar year or that the
increase in the share reserve for such calendar year will be a lesser number of shares of Common Stock than would otherwise occur pursuant to the preceding sentence. For the avoidance of doubt, up to the maximum number of shares of Common Stock
reserved under this Section 3(a) may be used to satisfy purchases of Common Stock under the 423 Component and any remaining portion of such maximum number of shares may be used to satisfy purchases of Common Stock under the Non-423 Component. 
 (b) If any Purchase Right granted under the Plan terminates without having
been exercised in full, the shares of Common Stock not purchased under such Purchase Right will again become available for issuance under the Plan. 

(c) The stock purchasable under the Plan will be shares of authorized but unissued or reacquired Common Stock, including shares
repurchased by the Company on the open market. 
  

	4.	 GRANT OF PURCHASE RIGHTS;
OFFERING. 

 (a) The Board may from time to time grant or provide for the grant of Purchase
Rights to Eligible Employees under an Offering (consisting of one or more Purchase Periods) on an Offering Date or Offering Dates selected by the Board. Each Offering will be in such form and will contain such terms and conditions as the Board will
deem appropriate, and, with respect to the 423 Component, will comply with the requirement of Section 423(b)(5) of the Code that all Employees granted Purchase Rights will have the same rights and privileges. The terms and conditions of an
Offering shall be incorporated by reference into the Plan and treated as part of the Plan. The provisions of separate Offerings need not be identical, but each Offering will include (through incorporation of the provisions of this Plan by reference
in the document comprising the Offering or otherwise) the period during which the Offering will be effective, which period will not exceed 27 months beginning with the Offering Date, and the substance of the provisions contained in Sections 5
through 8, inclusive. 
 (b) If a Participant has more than one Purchase Right outstanding under the Plan, unless he or she otherwise
indicates in forms delivered to the Company or a third party designated by the Company (each, a “Company Designee”): (i) each form will apply to all of his or her Purchase Rights under the Plan, and (ii) a Purchase Right
with a lower exercise price (or an earlier-granted Purchase Right, if different Purchase Rights have identical exercise prices) will be exercised to the fullest possible extent before a Purchase Right with a higher exercise price (or a later-granted
Purchase Right if different Purchase Rights have identical exercise prices) will be exercised. 
 (c) The Board will have the
discretion to structure an Offering so that if the Fair Market Value of a share of Common Stock on the first Trading Day of a new Purchase Period within that Offering is less than or equal to the Fair Market Value of a share of Common Stock on the
Offering Date for that Offering, then (i) that Offering will terminate immediately as of that first Trading Day, and (ii) the Participants in such terminated Offering will be automatically enrolled in a new Offering beginning on the first
Trading Day of such new Purchase Period. 
  

	5.	 ELIGIBILITY. 

(a) Purchase Rights may be granted only to Employees of the Company or, as the Board may designate in accordance with Section 2(b),
to Employees of a Related Corporation or an Affiliate. Except as provided in Section 5(b) or as required by Applicable Law, an Employee will not be eligible to be granted Purchase Rights unless, on the Offering Date, the Employee has been in
the employ of the Company or the Related Corporation or an Affiliate, as the case may be, for such continuous period 

  
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preceding such Offering Date as the Board may require, but in no event will the required period of continuous employment be equal to or greater than two years. In addition, the Board may (unless
prohibited by Applicable Law) provide that no Employee will be eligible to be granted Purchase Rights under the Plan unless, on the Offering Date, such Employee’s customary employment with the Company, the Related Corporation, or the Affiliate
is more than 20 hours per week and more than five months per calendar year or such other criteria as the Board may determine consistent with Section 423 of the Code with respect to the 423 Component. The Board may also exclude from
participation in the Plan or any Offering Employees who are “highly compensated employees” (within the meaning of Section 423(b)(4)(D) of the Code) of the Company or a Related Corporation or a subset of such highly compensated
employees. 
 (b) The Board may provide that each person who, during the course of an Offering, first becomes an Eligible Employee
will, on a date or dates specified in the Offering which coincides with the day on which such person becomes an Eligible Employee or which occurs thereafter, receive a Purchase Right under that Offering, which Purchase Right will thereafter be
deemed to be a part of that Offering. Such Purchase Right will have the same characteristics as any Purchase Rights originally granted under that Offering, as described herein, except that: 

(i) the date on which such Purchase Right is granted will be the “Offering Date” of such Purchase Right for all purposes,
including determination of the exercise price of such Purchase Right; 
 (ii) the period of the Offering with respect to such Purchase
Right will begin on its Offering Date and end coincident with the end of such Offering; and 
 (iii) the Board may provide that if
such person first becomes an Eligible Employee within a specified period of time before the end of the Offering, he or she will not receive any Purchase Right under that Offering. 

(c) No Employee will be eligible for the grant of any Purchase Rights under the 423 Component if, immediately after any such Purchase
Rights are granted, such Employee owns stock possessing five percent or more of the total combined voting power or value of all classes of stock of the Company or of any Related Corporation. For purposes of this Section 5(c), the rules of
Section 424(d) of the Code will apply in determining the stock ownership of any Employee, and stock which such Employee may purchase under all outstanding Purchase Rights and options will be treated as stock owned by such Employee. 

(d) As specified by Section 423(b)(8) of the Code, an Eligible Employee may be granted Purchase Rights under the 423 Component only
if such Purchase Rights, together with any other rights granted under all Employee Stock Purchase Plans of the Company and any Related Corporations, do not permit such Eligible Employee’s rights to purchase stock of the Company or any Related
Corporation to accrue at a rate which, when aggregated, exceeds U.S. $25,000 of Fair Market Value of such stock (determined at the time such rights are granted, and which, with respect to the Plan, will be determined as of their respective Offering
Dates) for each calendar year in which such rights are outstanding at any time. 
 (e) Officers of the Company and any Designated
Company, if they are otherwise Eligible Employees, will be eligible to participate in Offerings under the Plan. Notwithstanding the foregoing, the Board may (unless prohibited by Applicable Law) provide in an Offering that Employees who are highly
compensated Employees within the meaning of Section 423(b)(4)(D) of the Code will not be eligible to participate. 

  
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 (f) Notwithstanding anything in this Section 5 to the contrary, in the case of
an Offering under the Non-423 Component, an Eligible Employee (or group of Eligible Employees) may be excluded from participation in the Plan or an Offering if the Board has determined, in its sole discretion,
that participation of such Eligible Employee(s) is not advisable or practical for any reason. 
  

	6.	 PURCHASE RIGHTS; PURCHASE PRICE.

 (a) On each Offering Date, each Eligible Employee, pursuant to an Offering made under the Plan, will be
granted a Purchase Right to purchase up to that number of shares of Common Stock purchasable either with a percentage of earnings (as defined by the Board in each Offering) or with a maximum dollar amount, as designated by the Board, during the
period that begins on the Offering Date (or such later date as the Board determines for a particular Offering) and ends on the date stated in the Offering, which date will be no later than the end of the Offering. 

(b) The Board will establish one or more Purchase Dates during an Offering on which Purchase Rights granted for that Offering will be
exercised and shares of Common Stock will be purchased in accordance with such Offering. 
 (c) In connection with each Offering made
under the Plan, the Board may specify (i) a maximum number of shares of Common Stock that may be purchased by any Participant on any Purchase Date during such Offering, (ii) a maximum aggregate number of shares of Common Stock that may be
purchased by all Participants pursuant to such Offering and/or (iii) a maximum aggregate number of shares of Common Stock that may be purchased by all Participants on any Purchase Date under the Offering. If the aggregate purchase of shares of
Common Stock issuable upon exercise of Purchase Rights granted under the Offering would exceed any such maximum aggregate number, then, in the absence of any Board action otherwise, a pro rata (based on each Participant’s accumulated
Contributions) allocation of the shares of Common Stock (rounded down to the nearest whole share) available will be made in as nearly a uniform manner as will be practicable and equitable. 

(d) The purchase price of shares of Common Stock acquired pursuant to Purchase Rights will be not less than the lesser of: 

(i) an amount equal to 85% of the Fair Market Value of the shares of Common Stock on the Offering Date; or 

(ii) an amount equal to 85% of the Fair Market Value of the shares of Common Stock on the applicable Purchase Date. 

 

	7.	 PARTICIPATION; WITHDRAWAL; TERMINATION.

 (a) An Eligible Employee may elect to participate in an Offering and authorize payroll deductions as the
means of making Contributions by completing and delivering to the Company or a Company Designee, within the time specified for the Offering, an enrollment form provided by the Company or Company Designee. The enrollment form will specify the amount
of Contributions not to exceed the maximum amount specified by the Board. Each Participant’s Contributions will be credited to a bookkeeping account for such Participant under the Plan and will be deposited with the general funds of the Company
except where Applicable Law requires that Contributions be deposited with a third party. If permitted in the Offering, a Participant may begin such Contributions with the first payroll occurring on or after the Offering Date (or, in the case of a
payroll date that occurs after the end of the prior Offering but before the Offering Date of the next new Offering, Contributions from such payroll will be included in the new Offering). If permitted in the Offering, a Participant may thereafter
reduce (including to zero) or increase his or her Contributions. If required under Applicable Law or if specifically provided in the Offering, in addition to or instead of making Contributions by payroll deductions, a Participant may make
Contributions through payment by cash, check or wire transfer prior to a Purchase Date. 

  
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 (b) During an Offering, a Participant may cease making Contributions and withdraw
from the Offering by delivering to the Company or a Company Designee a withdrawal form provided by the Company. The Company may impose a deadline before a Purchase Date for withdrawing. Upon such withdrawal, such Participant’s Purchase Right in
that Offering will immediately terminate and the Company will distribute as soon as practicable to such Participant all of his or her accumulated but unused Contributions and such Participant’s Purchase Right in that Offering shall thereupon
terminate. A Participant’s withdrawal from that Offering will have no effect upon his or her eligibility to participate in any other Offerings under the Plan, but such Participant will be required to deliver a new enrollment form to participate
in subsequent Offerings. 
 (c) Unless otherwise required by Applicable Law, Purchase Rights granted pursuant to any Offering under
the Plan will terminate immediately if the Participant either (i) is no longer an Employee for any reason or for no reason (subject to any post-employment participation period required by Applicable Law) or (ii) is otherwise no longer
eligible to participate. The Company will distribute as soon as practicable to such individual all of his or her accumulated but unused Contributions. 

(d) Unless otherwise determined by the Board, a Participant whose employment transfers or whose employment terminates with an immediate
rehire (with no break in service) by or between the Company and a Designated Company or between Designated Companies will not be treated as having terminated employment for purposes of participating in the Plan or an Offering; however, if a
Participant transfers from an Offering under the 423 Component to an Offering under the Non-423 Component, the exercise of the Participant’s Purchase Right will be qualified under the 423 Component only
to the extent such exercise complies with Section 423 of the Code. If a Participant transfers from an Offering under the Non-423 Component to an Offering under the 423 Component, the exercise of the
Purchase Right will remain non-qualified under the Non-423 Component. The Board may establish different and additional rules governing transfers between separate
Offerings within the 423 Component and between Offerings under the 423 Component and Offerings under the Non-423 Component. 

(e) During a Participant’s lifetime, Purchase Rights will be exercisable only by such Participant. Purchase Rights are not
transferable by a Participant, except by will, by the laws of descent and distribution, or, if permitted by the Company, by a beneficiary designation as described in Section 10. 

(f) Unless otherwise specified in the Offering or as required by Applicable Law, the Company will have no obligation to pay interest on
Contributions. 
  

	8.	 EXERCISE OF PURCHASE RIGHTS.

 (a) On each Purchase Date, each Participant’s accumulated Contributions will be applied to the purchase
of shares of Common Stock, up to the maximum number of shares of Common Stock permitted by the Plan and the applicable Offering, at the purchase price specified in the Offering. No fractional shares will be issued unless specifically provided for in
the Offering. 
 (b) Unless otherwise provided in the Offering, if any amount of accumulated Contributions remains in a
Participant’s account after the purchase of shares of Common Stock on the final Purchase Date of an Offering, then such remaining amount will not roll over to the next Offering and will instead be distributed in full to such Participant after
the final Purchase Date of such Offering without interest (unless otherwise required by Applicable Law). 

  
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 (c) No Purchase Rights may be exercised to any extent unless the shares of Common
Stock to be issued upon such exercise under the Plan are covered by an effective registration statement pursuant to the Securities Act and the Plan is in material compliance with all applicable U.S. federal and state, foreign and other securities,
exchange control and other laws applicable to the Plan. If on a Purchase Date the shares of Common Stock are not so registered or the Plan is not in such compliance, no Purchase Rights will be exercised on such Purchase Date, and the Purchase Date
will be delayed until the shares of Common Stock are subject to such an effective registration statement and the Plan is in material compliance, except that the Purchase Date will in no event be more than 27 months from the Offering Date. If, on the
Purchase Date, as delayed to the maximum extent permissible, the shares of Common Stock are not registered and the Plan is not in material compliance with all Applicable Law, as determined by the Company in its sole discretion, no Purchase Rights
will be exercised and all accumulated but unused Contributions will be distributed to the Participants without interest (unless the payment of interest is otherwise required by Applicable Law). 

 

	9.	 COVENANTS OF THE COMPANY.

 The Company will seek to obtain from each U.S. federal or state, non-U.S. or
other regulatory commission, agency or other Governmental Body having jurisdiction over the Plan such authority as may be required to grant Purchase Rights and issue and sell shares of Common Stock thereunder unless the Company determines, in its
sole discretion, that doing so is not practical or would cause the Company to incur costs that are unreasonable. If, after commercially reasonable efforts, the Company is unable to obtain the authority that counsel for the Company deems necessary
for the grant of Purchase Rights or the lawful issuance and sale of Common Stock under the Plan, and at a commercially reasonable cost, the Company will be relieved from any liability for failure to grant Purchase Rights and/or to issue and sell
Common Stock upon exercise of such Purchase Rights. 
  

	10.	 DESIGNATION OF BENEFICIARY. 

(a) The Company may, but is not obligated to, permit a Participant to submit a form designating a beneficiary who will receive any
shares of Common Stock and/or Contributions from the Participant’s account under the Plan if the Participant dies before such shares and/or Contributions are delivered to the Participant. The Company may, but is not obligated to, permit the
Participant to change such designation of beneficiary. Any such designation and/or change must be on a form approved by the Company. 

(b) If a Participant dies, and in the absence of a valid beneficiary designation, the Company will deliver any shares of Common Stock
and/or Contributions to the executor or administrator of the estate of the Participant. If no executor or administrator has been appointed (to the knowledge of the Company), the Company, in its sole discretion, may deliver such shares of Common
Stock and/or Contributions, without interest (unless the payment of interest is otherwise required by Applicable Law), to the Participant’s spouse, dependents or relatives, or if no spouse, dependent or relative is known to the Company, then to
such other person as the Company may designate. 
  

	11.	 ADJUSTMENTS UPON CHANGES IN
COMMON STOCK; CORPORATE TRANSACTIONS. 

 (a) In the
event of a Capitalization Adjustment, the Board will appropriately and proportionately adjust: (i) the class(es) and maximum number of securities subject to the Plan pursuant to Section 3(a), (ii) the class(es) and maximum number of
securities by which the share reserve is to increase automatically each year pursuant to Section 3(a), (iii) the class(es) and number of securities subject to, and the purchase price applicable to outstanding Offerings and Purchase Rights, and
(iv) the class(es) and number of securities that are the subject of the purchase limits under each ongoing Offering. The Board will make these adjustments, and its determination will be final, binding and conclusive. 

  
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 (b) In the event of a Corporate Transaction, then: (i) any surviving corporation
or acquiring corporation (or the surviving or acquiring corporation’s parent company) may assume or continue outstanding Purchase Rights or may substitute similar rights (including a right to acquire the same consideration paid to the
stockholders in the Corporate Transaction) for outstanding Purchase Rights, or (ii) if any surviving or acquiring corporation (or its parent company) does not assume or continue such Purchase Rights or does not substitute similar rights
for such Purchase Rights, then the Participants’ accumulated Contributions will be used to purchase shares of Common Stock (rounded down to the nearest whole share) within ten business days (or such other period specified by the Board) prior to
the Corporate Transaction under the outstanding Purchase Rights, and the Purchase Rights will terminate immediately after such purchase. 
  

	12.	 AMENDMENT, TERMINATION OR SUSPENSION
OF THE PLAN. 

 (a) The Board may amend the Plan at any time in any
respect the Board deems necessary or advisable. However, except as provided in Section 11(a) relating to Capitalization Adjustments, stockholder approval will be required for any amendment of the Plan for which stockholder approval is required
by Applicable Law. 
 (b) The Board may suspend or terminate the Plan at any time. No Purchase Rights may be granted under the Plan
while the Plan is suspended or after it is terminated. 
 Any benefits, privileges, entitlements and obligations under any outstanding
Purchase Rights granted before an amendment, suspension or termination of the Plan will not be materially impaired by any such amendment, suspension or termination except (i) with the consent of the person to whom such Purchase Rights were
granted, (ii) as necessary to facilitate compliance with Applicable Law, listing requirements, or governmental regulations (including, without limitation, the provisions of Section 423 of the Code and the regulations and other interpretive
guidance issued thereunder relating to Employee Stock Purchase Plans) including without limitation any such regulations or other guidance that may be issued or amended after the date the Plan is adopted by the Board, or (iii) as necessary to
obtain or maintain favorable tax, listing, or regulatory treatment. To be clear, the Board may amend outstanding Purchase Rights without a Participant’s consent if such amendment is necessary to ensure that the Purchase Right and/or the Plan
complies with the requirements of Section 423 of the Code with respect to the 423 Component or with respect to other Applicable Law. Notwithstanding anything in the Plan or any Offering Document to the contrary, the Board will be entitled to:
(i) establish the exchange ratio applicable to amounts withheld in a currency other than U.S. dollars; (ii) permit Contributions in excess of the amount designated by a Participant in order to adjust for mistakes in the Company’s
processing of properly completed Contribution elections; (iii) establish reasonable waiting and adjustment periods and/or accounting and crediting procedures to ensure that amounts applied toward the purchase of Common Stock for each
Participant properly correspond with amounts withheld from the Participant’s Contributions; (iv) amend any outstanding Purchase Rights or clarify any ambiguities regarding the terms of any Offering to enable the Purchase Rights to qualify
under and/or comply with Section 423 of the Code with respect to the 423 Component; and (v) establish other limitations or procedures as the Board determines in its sole discretion advisable that are consistent with the Plan. The actions
of the Board pursuant to this paragraph will not be considered to alter or impair any Purchase Rights granted under an Offering as they are part of the initial terms of each Offering and the Purchase Rights granted under each Offering. 

  
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	13.	 TAX QUALIFICATION; TAX WITHHOLDING.

 (a) Although the Company may endeavor to (i) qualify a Purchase Right for special tax treatment under
the laws of the United States or jurisdictions outside of the United States or (ii) avoid adverse tax treatment, the Company makes no representation to that effect and expressly disavows any covenant to maintain special or to avoid unfavorable
tax treatment, notwithstanding anything to the contrary in this Plan. The Company will be unconstrained in its corporate activities without regard to the potential negative tax impact on Participants. 

(b) Each Participant will make arrangements, satisfactory to the Company and any applicable Related Corporation, to enable the Company
or the Related Corporation to fulfill any withholding obligation for Tax-Related Items. Without limitation to the foregoing, in the Company’s sole discretion and subject to Applicable Law, such
withholding obligation may be satisfied in whole or in part by (i) withholding from the Participant’s salary or any other cash payment due to the Participant from the Company or a Related Corporation; (ii) withholding from the
proceeds of the sale of shares of Common Stock acquired under the Plan, either through a voluntary sale or a mandatory sale arranged by the Company; or (iii) any other method deemed acceptable by the Board. The Company shall not be required to
issue any shares of Common Stock under the Plan until such obligations are satisfied. 
  

	14.	 EFFECTIVE DATE OF PLAN.

 The Plan will become effective immediately prior to and contingent upon the IPO Date. No Purchase Rights will be
exercised unless and until the Plan has been approved by the stockholders of the Company, which approval must be within 12 months before or after the date the Plan is adopted (or if required under Section 12(a) above, materially amended) by the
Board. 
  

	15.	 MISCELLANEOUS PROVISIONS. 

(a) Proceeds from the sale of shares of Common Stock pursuant to Purchase Rights will constitute general funds of the Company. 

(b) A Participant will not be deemed to be the holder of, or to have any of the rights of a holder with respect to, shares of Common
Stock subject to Purchase Rights unless and until the Participant’s shares of Common Stock acquired upon exercise of Purchase Rights are recorded in the books of the Company (or its transfer agent). 

(c) The Plan and Offering do not constitute an employment contract. Nothing in the Plan or in the Offering will in any way alter the at
will nature of a Participant’s employment or amend a Participant’s employment contract, if applicable, or be deemed to create in any way whatsoever any obligation on the part of any Participant to continue in the employ of the Company or a
Related Corporation or an Affiliate, or on the part of the Company, a Related Corporation or an Affiliate to continue the employment of a Participant. 

(d) The provisions of the Plan will be governed by the laws of the State of Delaware without resort to that state’s conflicts of
laws rules. 
 (e) If any particular provision of the Plan is found to be invalid or otherwise unenforceable, such provision will not
affect the other provisions of the Plan, but the Plan will be construed in all respects as if such invalid provision were omitted. 

  
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 (f) If any provision of the Plan does not comply with Applicable Law, such provision
shall be construed in such a manner as to comply with Applicable Law. 
  

	16.	 DEFINITIONS. 

As used in the Plan, the following definitions will apply to the capitalized terms indicated below: 

(a) “423 Component” means the part of the Plan, which excludes the
Non-423 Component, pursuant to which Purchase Rights that satisfy the requirements for an Employee Stock Purchase Plan may be granted to Eligible Employees. 

(b) “Affiliate” means any entity, other than a Related Corporation, whether now or subsequently established,
which is at the time of determination, a “parent” or “subsidiary” of the Company as such terms are defined in Rule 405 promulgated under the Securities Act. The Board may determine the time or times at which “parent” or
“subsidiary” status is determined within the foregoing definition. 
 (c) “Applicable Law” means the
Code and any applicable securities, federal, state, foreign, material local or municipal or other law, statute, constitution, principle of common law, resolution, ordinance, code, edict, decree, rule, listing rule, regulation, judicial decision,
ruling or requirement issued, enacted, adopted, promulgated, implemented or otherwise put into effect by or under the authority of any Governmental Body (or under the authority of the Nasdaq Stock Market or the Financial Industry Regulatory
Authority). 
 (d) “Board” means the board of directors of the Company. 

(e) “Capitalization Adjustment” means any change that is made in, or other events that occur with respect to,
the Common Stock subject to the Plan or subject to any Purchase Right after the date the Plan is adopted by the Board without the receipt of consideration by the Company through merger, consolidation, reorganization, recapitalization,
reincorporation, stock dividend, dividend in property other than cash, large nonrecurring cash dividend, stock split, liquidating dividend, combination of shares, exchange of shares, change in corporate structure or other similar equity
restructuring transaction, as that term is used in Financial Accounting Standards Board Accounting Standards Codification Topic 718 (or any successor thereto). Notwithstanding the foregoing, the conversion of any convertible securities of the
Company will not be treated as a Capitalization Adjustment. 
 (f) “Code” means the Internal Revenue
Code of 1986, as amended, including any applicable regulations and guidance thereunder. 
 (g)
“Committee” means a committee of one or more members of the Board to whom authority has been delegated by the Board in accordance with Section 2(c). 

(h) “Common Stock” means the common stock of the Company. 

(i) “Company” means The Honest Company, Inc., a Delaware corporation, and any successor thereto. 

(j) “Contributions” means the payroll deductions and other additional payments specifically provided for in the
Offering that a Participant contributes to fund the exercise of a Purchase Right. A Participant may make additional payments into his or her account if specifically provided for in the Offering, and then only if the Participant has not already had
the maximum permitted amount withheld during the Offering through payroll deductions. 

  
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 (k) “Corporate Transaction” means the consummation, in a
single transaction or in a series of related transactions, of any one or more of the following events: 
 (i) a sale or other
disposition of all or substantially all, as determined by the Board in its sole discretion, of the consolidated assets of the Company and its subsidiaries; 

(ii) a sale or other disposition of at least 50% of the outstanding securities of the Company; 

(iii) a merger, consolidation or similar transaction following which the Company is not the surviving corporation; or 

(iv) a merger, consolidation or similar transaction following which the Company is the surviving corporation but the shares of Common
Stock outstanding immediately preceding the merger, consolidation or similar transaction are converted or exchanged by virtue of the merger, consolidation or similar transaction into other property, whether in the form of securities, cash or
otherwise. 
 (l) “Designated 423 Corporation” means any Related Corporation selected by the Board to
participate in the 423 Component. 
 (m) “Designated Company” means any Designated Non-423 Corporation or Designated 423 Corporation, provided, however, that at any given time, a Related Corporation participating in the 423 Component shall not be a Related Corporation participating in the Non-423 Component. 
 (n) “Designated Non-423
Corporation” means any Related Corporation or Affiliate selected by the Board to participate in the Non-423 Component. 

(o) “Director” means a member of the Board. 

(p) “Eligible Employee” means an Employee who meets the requirements set forth in the document(s)
governing the Offering for eligibility to participate in the Offering, provided that such Employee also meets the requirements for eligibility to participate set forth in the Plan. 

(q) “Employee” means any person, including an Officer or Director, who is “employed” for
purposes of Section 423(b)(4) of the Code by the Company or a Related Corporation, or solely with respect to the Non-423 Component, an Affiliate. However, service solely as a Director, or payment of a fee
for such services, will not cause a Director to be considered an “Employee” for purposes of the Plan. 
 (r)
“Employee Stock Purchase Plan” means a plan that grants Purchase Rights intended to be options issued under an “employee stock purchase plan,” as that term is defined in Section 423(b) of the Code.

 (s) “Exchange Act” means the Securities Exchange Act of 1934, as amended and the rules and
regulations promulgated thereunder. 

  
 11 

 (t) “Fair Market Value” means, as of any date, the value of
the Common Stock determined as follows: 
 (i) If the Common Stock is listed on any established stock exchange or traded on any
established market, the Fair Market Value of a share of Common Stock will be the closing sales price for such stock as quoted on such exchange or market (or the exchange or market with the greatest volume of trading in the Common Stock) on the date
of determination, as reported in such source as the Board deems reliable. Unless otherwise provided by the Board, if there is no closing sales price for the Common Stock on the date of determination, then the Fair Market Value will be the closing
sales price on the last preceding date for which such quotation exists. 
 (ii) In the absence of such markets for the Common Stock,
the Fair Market Value will be determined by the Board in good faith in compliance with Applicable Law and, to the extent applicable as determined in the sole discretion of the Board, in a manner that complies with Section 409A of the Code. 

(iii) Notwithstanding the foregoing, for any Offering that commences on the IPO Date, the Fair Market Value of the shares of Common
Stock on the Offering Date will be the price per share at which shares are first sold to the public in the Company’s initial public offering as specified in the final prospectus for that initial public offering. 

(u) “Governmental Body” means any: (i) nation, state, commonwealth, province,
territory, county, municipality, district or other jurisdiction of any nature; (ii) federal, state, local, municipal, foreign or other government; (iii) governmental or regulatory body, or quasi-governmental body of any nature (including
any governmental division, department, administrative agency or bureau, commission, authority, instrumentality, official, ministry, fund, foundation, center, organization, unit, body or entity and any court or other tribunal, and for the avoidance
of doubt, any tax authority) or other body exercising similar powers or authority; or (iv) self-regulatory organization (including the Nasdaq Stock Market and the Financial Industry Regulatory Authority). 

(v) “IPO Date” means the date of the underwriting agreement between the Company and the underwriters
managing the initial public offering of the Common Stock, pursuant to which the Common Stock is priced for the initial public offering. 

(w) “Non-423 Component” means the part of the Plan, which excludes the 423 Component,
pursuant to which Purchase Rights that are not intended to satisfy the requirements for an Employee Stock Purchase Plan may be granted to Eligible Employees. 

(x) “Offering” means the grant to Eligible Employees of Purchase Rights, with the exercise of those
Purchase Rights automatically occurring at the end of one or more Purchase Periods. The terms and conditions of an Offering will generally be set forth in the “Offering Document” approved by the Board for that Offering. 

(y) “Offering Date” means a date selected by the Board for an Offering to commence. 

(z) “Officer” means a person who is an officer of the Company or a Related Corporation within the
meaning of Section 16 of the Exchange Act. 
 (aa) “Participant” means an Eligible Employee who
holds an outstanding Purchase Right. 
 (bb) “Plan” means this The Honest Company, Inc. 2021 Employee
Stock Purchase Plan, as amended from time to time, including both the 423 Component and the Non-423 Component. 

  
 12 

 (cc) “Purchase Date” means one or more dates during an
Offering selected by the Board on which Purchase Rights will be exercised and on which purchases of shares of Common Stock will be carried out in accordance with such Offering. 

(dd) “Purchase Period” means a period of time specified within an Offering, generally beginning on the Offering
Date or on the first Trading Day following a Purchase Date, and ending on a Purchase Date. An Offering may consist of one or more Purchase Periods. 

(ee) “Purchase Right” means an option to purchase shares of Common Stock granted pursuant to the Plan.

 (ff) “Related Corporation” means any “parent corporation” or “subsidiary
corporation” of the Company whether now or subsequently established, as those terms are defined in Sections 424(e) and (f), respectively, of the Code. 

(gg) “Securities Act” means the Securities Act of 1933, as amended. 

(hh) “Tax-Related Items” means any income tax, social insurance, payroll
tax, fringe benefit tax, payment on account or other tax-related items arising out of or in relation to a Participant’s participation in the Plan, including, but not limited to, the exercise of a Purchase
Right and the receipt of shares of Common Stock or the sale or other disposition of shares of Common Stock acquired under the Plan. 

(ii) “Trading Day” means any day on which the exchange(s) or market(s) on which shares of Common Stock
are listed, including but not limited to the NYSE, Nasdaq Global Select Market, the Nasdaq Global Market, the Nasdaq Capital Market or any successors thereto, is open for trading. 

  
 13EX-10.5

 Exhibit 10.5 

THE HONEST COMPANY, INC. 

NON-EMPLOYEE DIRECTOR COMPENSATION
POLICY 
  
  

Each member of the Board of Directors (the “Board”) of The Honest Company, Inc. (the
“Company”) who is not also serving as an employee of the Company or any of its subsidiaries (each such member, an “Eligible Director”) will receive the compensation described in this Non-Employee Director Compensation Policy (this “Policy”). An Eligible Director may decline all or any portion of his or her compensation by giving notice to the Company prior to the date
cash is to be paid or equity awards are to be granted, as the case may be. This Policy will be effective upon the execution of the underwriting agreement between the Company and the underwriter(s) managing the initial public offering of the Common
Stock, pursuant to which the Common Stock is priced for the initial public offering (the date of such execution being referred to as the “Effective Date”). This Policy may be amended at any time in the sole discretion of the
Board, or by the Compensation Committee of the Board (the “Compensation Committee”) at the recommendation of the Board. Unless otherwise defined herein, capitalized terms used in this Policy will have the meaning given to
such terms in the Company’s 2021 Equity Incentive Plan or if such plan is no longer in use, the meaning given to such terms or any similar terms in the primary successor to such plan (in either case, the “Plan”). 

 

	I.	 Annual Cash Compensation 

The annual cash compensation amount set forth below is payable to Eligible Directors in equal quarterly installments, payable in arrears on the
last day of each fiscal quarter of the Company (each, a “Quarterly Date”) in which the service occurred. If an Eligible Director joins the Board or a committee of the Board at a time other than effective as of the first day
of a fiscal quarter of the Company, each annual retainer set forth below will be pro-rated based on days served in the applicable fiscal year of the Company, with the
pro-rated amount paid for the first fiscal quarter of the Company in which the Eligible Director provides the service, and regular full quarterly payments to be paid thereafter. All annual cash fees are vested
upon payment. 
  

	 	1.	 Annual Board Service Retainer: 

 

	 	a.	 All Eligible Directors: $50,000 

 

	 	2.	 Annual Board Leadership Retainer (inclusive of Annual Board Service Retainer): 

 

	 	a.	 Non-executive Chair of the Board (if applicable): $125,000

  

	 	b.	 Lead Independent Director (if applicable): $70,000 

 

	 	3.	 Annual Committee Member Service Retainer: 

 

	 	a.	 Member of the Audit Committee: $15,000 

 

	 	b.	 Member of the Compensation Committee: $7,500 

 

	 	c.	 Member of the Nominating and Corporate Governance Committee: $5,000 

 

	 	4.	 Annual Committee Chair Service Retainer (inclusive of Annual Committee Member Service Retainer):

  

	 	a.	 Chair of the Audit Committee: $20,000 

 

	 	b.	 Chair of the Compensation Committee: $15,000 

 

	 	c.	 Chair of the Nominating and Corporate Governance Committee: $10,000 

  
 1 

 The Company will also reimburse each Eligible Director for his or her customary and
documented travel expenses incurred in connection with his or her attendance at Board and committee meetings. Such reimbursements shall be paid on the same date as the annual cash fees are paid. 

 

	II.	 Equity Compensation 

The equity compensation set forth below will be granted under the Plan and the applicable RSU Award Agreement. 

 

	 	1.	 Initial Grant: For each Eligible Director who is first elected or appointed to the Board on or following
the Effective Date, at the close of business on the date of such Eligible Director’s initial election or appointment to the Board, the Eligible Director will be automatically, and without further action by the Board or the Compensation
Committee, granted an RSU Award covering a number of restricted stock units equal to (a) $185,000 divided by (b) the average Fair Market Value of a share of Common Stock for the 30 consecutive market trading days ending on and including the
last market trading day prior to the grant date of such RSU Award (or if such RSU Award is granted on the Effective Date, the initial per share price to the public as set forth in the final prospectus included within the registration statement in
Form S-1 filed with the Securities and Exchange Commission for the initial public offering of the Common Stock (the “IPO Price”)), rounded down to the nearest whole unit (each, an
“Initial Grant”). The Initial Grant will vest in three equal annual installments on the one-, two- and three-year anniversaries of the Eligible
Director’s initial election or appointment to the Board, subject to the Eligible Director’s Continuous Service on each vesting date. 

  

	 	2.	 Annual Grant and Prorated Annual Grant: At the close of business on the date of each annual meeting of
the Company’s stockholders (each, an “Annual Meeting”), each person who is then an Eligible Director will be automatically, and without further action by the Board or the Compensation Committee, granted an RSU Award
covering a number of restricted stock units equal to (a) $185,000 divided by (b) the average Fair Market Value of a share of Common Stock for the 30 consecutive market trading days ending on and including the last market trading day prior to
the grant date of such RSU Award, rounded down to the nearest whole unit (each, an “Annual Grant”). 

In addition, for each Eligible Director who is first elected or appointed to the Board on a date other than the date of an Annual Meeting, at
the close of business on the date of such Eligible Director’s initial election or appointment to the Board, the Eligible Director will be automatically, and without further action by the Board or the Compensation Committee, granted an RSU Award
covering a number of restricted stock units equal to (a) $185,000 multiplied by a fraction, the numerator of which equals 365 minus the total number of days, as of the grant date of such RSU Award, that have occurred since the last Annual Meeting
and the denominator of which equals 365, divided by (b) the average Fair Market Value of a share of Common Stock for the 30 consecutive market trading days ending on and including the last market trading day prior to the grant date of such RSU
Award, rounded down to the nearest whole unit (each, a “Prorated Annual Grant”). 
 Each Annual Grant and Prorated
Annual Grant will vest in full on the earlier of (a) the one-year anniversary of the grant date of the Annual Grant or Prorated Annual Grant, as applicable, and (b) the date immediately prior to the
date of the Annual Meeting next following the grant date of such Annual Grant or Prorated Annual Grant, as applicable, subject to the Eligible Director’s Continuous Service on the vesting date. 

  
 2 

	 	3.	 Interim Annual Grant and Prorated Interim Annual Grant: At the close of business on the Effective Date,
each person who is then an Eligible Director will be automatically, and without further action by the Board or the Compensation Committee, granted an RSU Award (each, an “Interim Annual Grant”). Each Interim Annual Grant will
cover a number of restricted stock units equal to (a) $185,000 multiplied by a fraction, the numerator of which equals the total number of days during the period beginning on the Effective Date and ending on June 1, 2022 (such date, the
“Assumed First Annual Meeting Date”) and the denominator of which equals 365, divided by (b) the IPO Price, rounded down to the nearest whole unit. Each Interim Annual Grant will vest as to 1/13th of the Interim Annual Grant on June 1, 2021, and as to 12/13th of the Interim Annual Grant on the earlier of (a) the date immediately
prior to the date of the Annual Meeting next following the grant date of the Interim Annual Grant and (b) the Assumed First Annual Meeting Date, subject to the Eligible Director’s Continuous Service through each vesting date.

 In addition, each person who is first elected or appointed to the Board following the Effective Date but prior to the
Assumed First Annual Meeting Date will be automatically, and without further action by the Board or the Compensation Committee, granted an RSU Award (each, a “Prorated Interim Annual Grant”) at the close of business on the
date of such Eligible Director’s initial election or appointment to the Board. Each Prorated Interim Annual Grant will cover a number of restricted stock units equal to (a) $185,000 multiplied by a fraction, the numerator of which equals the
total number of days during the period beginning on the date the applicable Eligible Director was first elected or appointed to the Board and ending on the Assumed First Annual Meeting Date and the denominator of which equals 365, divided by
(b) the average Fair Market Value of a share of Common Stock for the 30 consecutive market trading days ending on and including the last market trading day prior to the grant date of such Prorated Interim Annual Grant, rounded down to the
nearest whole unit. Each Prorated Interim Annual Grant will vest in full on the earlier of (a) the date immediately prior to the date of the Annual Meeting next following the grant date of the Prorated Interim Annual Grant and (b) the
Assumed First Annual Meeting Date, subject to the Eligible Director’s Continuous Service through the vesting date. 
  

	 	4.	 Elections to Receive an RSU Award in Lieu of Annual Cash Retainers: 

a. Retainer Grant. For the fiscal year of the Company in which the Effective Date occurs and each fiscal year of the Company thereafter,
each Eligible Director may elect (such election, a “Retainer Grant Election”) to forego receiving payment of all (but not less than all) of the compensation he or she is otherwise eligible to receive in cash under Article I
of this Policy for the period during the fiscal year of the Company to which the Retainer Grant Election applies commencing on the Retainer Grant Measurement Date and ending on the last day of the fiscal year of the Company to which the Retainer
Grant Election applies (each such period, a “Retainer Grant Measurement Period”) and receive an RSU Award instead (each, a “Retainer Grant”) but only if the Retainer Grant Election is timely made in
accordance with the requirements of this Section 4. If an Eligible Director timely makes a Retainer Grant Election pursuant to Section 4.b below, on the Retainer Grant Measurement Date (as defined below), such Eligible Director will be
automatically, and without any further action by the Board or the Compensation Committee, granted a Retainer Grant covering a number of restricted stock units equal to (a) the aggregate amount of cash compensation under Article I of this Policy
that such 

  
 3 

 
Eligible Director is eligible to receive for the applicable Retainer Grant Measurement Period divided by (b) the average Fair Market Value of a share of Common Stock for the 30 consecutive
market trading days ending on and including the last trading day prior to the grant date of such Retainer Grant, rounded down to the nearest whole unit. For purposes of this Policy, “Retainer Grant Measurement Date” means the
first day of the fiscal year of the Company to which the Retainer Grant Election applies, provided that if the Retainer Grant Election is made in the same fiscal year of the Company to which it applies, then the Retainer Grant Measurement Date means
the first day of the fiscal quarter of the Company next following the fiscal quarter of the Company in which the Retainer Grant Election is made. 

Each Retainer Grant will vest as to the Retainer Grant Vesting Percentage on each Quarterly Date following the grant date of the Retainer
Grant, subject to such Eligible Director’s Continuous Service through each vesting date. The “Retainer Grant Vesting Percentage” equals (a) 100% multiplied by (b) a fraction, the numerator of which equals one and
the denominator of which equals the number of Quarterly Dates occurring during the period commencing on the grant date of the applicable Retainer Grant and ending on the last day of the fiscal year of the Company in which such Retainer Grant was
granted. 
 b. Election Mechanics. Unless otherwise determined by the Board or the Compensation Committee, for any Retainer Grant
Election to be effective, it must be submitted to the Company’s General Counsel (or such other individual as the Company designates) (i) on or prior to the last day of the calendar year immediately preceding the first calendar year in
which the Retention Grant Election will be effective, or (ii) within 30 days after the Eligible Director first becomes eligible to participate in this Policy. An Eligible Director may only make a Retainer Grant Election during a period in which
the Company is not in a quarterly or special blackout period and the Eligible Director is not aware of any material non-public information. In addition, an Eligible Director may not make a Retainer Grant
Election that applies to the fiscal year in which he or she first becomes eligible to participate in this Policy after the third Quarterly Date in such fiscal year. Any Retainer Grant Election will be irrevocable, and will be subject to such rules,
conditions and procedures as shall be determined by the Board or the Compensation Committee, in its sole discretion, which rules, conditions and procedures shall at all times comply with the requirements of Code Section 409A, unless otherwise
specifically determined by the Board or the Compensation Committee. Retainer Grant Elections shall be made pursuant to a form of election in substantially the form attached hereto as Exhibit A or such other form as approved by the Board or
the Compensation Committee. An Eligible Director who fails to make a timely Retainer Grant Election will not receive a Retainer Grant and instead will receive the cash compensation under Article I of this Policy. 

 

	III.	 Eligible Director Compensation Limit 

Notwithstanding anything herein to the contrary, the cash compensation and equity compensation that each Eligible Director is entitled to
receive under this Policy shall be subject to the limits set forth in Section 3(d) of the Plan. 
  

	IV.	 Change in Control; Death; Disability 

Each RSU Award held by an Eligible Director that is granted under this Policy will vest in full upon such Eligible Director’s death or
Disability, or immediately prior to the consummation of a Change in Control, in each case, to extent such RSU Award is outstanding as of immediately prior to the occurrence of such event. 

  
 4 

	V.	 Deferral of RSU Awards 

Unless and until otherwise determined by the Board or the Compensation Committee, as applicable, each Eligible Director may elect to defer the
delivery of shares in settlement of any RSU Award granted pursuant to this Policy that would otherwise be delivered to such Eligible Director on or following the date such RSU Award vests pursuant to the terms of this Policy (the
“Deferral Election”). Unless otherwise determined by the Board or the Compensation Committee, for any such Deferral Election to be effective, it must be submitted to the Company’s General Counsel (or such other
individual as the Company designates) (a) on or prior to the last day of the calendar year immediately prior to the calendar year in which the RSU Award to which the Deferral Election relates is granted, or (b) within 30 days after the
applicable Eligible Director first becomes eligible to participate in the Policy. Any Deferral Election will be irrevocable, and will be subject to such rules, conditions and procedures as shall be determined by the Board or the Compensation
Committee, in its sole discretion, which rules, conditions and procedures shall at all times comply with the requirements of Section 409A, unless otherwise specifically determined by the Board or the Compensation Committee. Deferral Elections
shall be made pursuant to a form of deferral election in substantially the form attached hereto as Exhibit A or such other form as approved by the Board or the Compensation Committee. 

Approved by the Board of Directors: April 8, 2021 

Effective Date: 

  
 5 

 EXHIBIT A 

THE HONEST COMPANY, INC. 

NON-EMPLOYEE DIRECTOR COMPENSATION
POLICY 
 Restricted Stock Unit Deferral and Retainer Grant Election Form 

For Eligible Directors 
 Please
complete and return this Restricted Stock Unit Deferral and Retainer Grant Election Form (the “Election Form”), as described below, [for existing non-employee directors making
elections for 2021: within 30 days after the Effective Date of the Policy] [for existing non-employee directors making elections for 2022 or any year thereafter: on or before December 31
of each year] [for new non-employee directors: within 30 days following the date you join the Board] (the “Submission Deadline”), to Brendan Sheehey, General Counsel, The
Honest Company, Inc. 12130 Millennium Drive, #500, Los Angeles, California 90094. 
 Neither the provision of this Election Form nor your completion of this
Election Form represents a commitment by the Company to grant an Award to you. The grant of an Award remains subject to the terms of the Company’s Non-Employee Director Compensation Policy as may be
hereinafter amended (the “Policy”). Terms not otherwise defined herein shall have the meaning set forth in the Policy or the Plan, as applicable. 

I understand that my Election Form will become irrevocable effective as of the Submission Deadline. 

 

	I.	 PERSONAL INFORMATION 

(Please print) 
 Participant Name: (the
“Participant”) 
  

	II.	 RETAINER GRANT ELECTION 

By signing below, I elect to forego receiving payment of all (but not less than all) of the compensation I am otherwise eligible to receive in
cash under Article I of the Policy for the period during the fiscal year of the Company ended [___] commencing on [______]1 and ending on
[______],2 and to receive a Retainer Grant in lieu thereof. If I do not timely submit a properly completed Election Form, I will not receive the applicable Retainer Grant and will instead receive
the applicable cash compensation under Article I of the Policy. 
  

	III.	 RSU AWARD DEFERRAL ELECTION  

By signing below, I elect to defer in accordance with this Article III 100% of my
[_____]3 that may be granted to me, if any, under the Plan and pursuant to the Policy in the calendar year following the calendar year in which I tender this election (or if I first became
eligible to participate in the Policy in the calendar year in which I tender this election, in the calendar year in which I tender this election). If I do not timely 

submit a properly completed Election Form, then my [_____]4 will vest and settle in accordance with the
terms of the Policy, the Plan, and the applicable RSU Award Agreement. 
  

	1 	 Applicate Retainer Grant Measurement Date 

	2 	 Last day of the fiscal year of the Company to which the Retainer Gant Election applies 

	3 	 Awards with respect to which the Eligible Director is making a deferral election to be included.

	4 	 Awards with respect to which the Eligible Director is making a deferral election to be included.

 All Awards that are deferred pursuant to this Section III are referred to as
“Deferred Awards” in this Election Form. 
 By signing below, I elect to have my Deferred Awards settled as follows: 

1. Subject to the following paragraph, my Deferred Awards will be settled in a single lump sum installment in whole shares on the earlier of

 (a) immediately prior to a Change in Control, provided that, for the avoidance of doubt, a transaction will not be deemed a Change in
Control unless the transaction qualifies as a change in control event within the meaning of Section 409A; or 
 (b) [within 60 days
following my Separation Date or my death, whichever is earlier] [OR] [the earlier of (i) the date that is five years after the grant date of the applicable Deferred Award and (ii) the date that is five years after my Separation Date or
death.] 
 For the purposes of the foregoing, “Separation Date” means the date of my retirement or other separation from
service with the Company and all of its Affiliates (as determined in accordance with Section 409A(2)(A)(i) of the Code and Treasury regulation section 1.409A-1(h)). 

2. If a distribution hereunder is triggered because of my Separation Date and I am a “specified employee” within the meaning of
Section 409A at the time of my Separation Date, then the distribution that I would otherwise be entitled to receive upon the Separation Date will not be settled until the date that is 6 months and 1 day following the Separation Date, unless I
die following my Separation Date, in which case, my distribution will commence as soon as practicable following my death. 
 IV. PARTICIPANT
ACKNOWLEDGEMENTS AND SIGNATURE 
 1. I agree to all of the terms and conditions of this Election Form. 

2. I acknowledge that I have received and read a copy of the Plan’s prospectus and that I am familiar with the terms and provisions of
the Plan. 
 3. I agree to the right of the Board or the Compensation Committee to amend or terminate my election under Article III at any
time and for any reason, with or without notice; provided that such termination or amendment is performed in compliance with Section 409A (as determined by Company legal counsel in its sole and absolute discretion). 

4. I understand that the obligation of the Company to settle any Deferred Awards is unfunded and that no assets of any kind have been
segregated in a trust or otherwise set aside to satisfy any obligation under this Election Form. I also understand that any election to defer the settlement of any Awards pursuant to this Election Form will make me only a general, unsecured creditor
of the Company. 
 5. I understand that any amounts deferred will be taxable as ordinary income in the year settled. Notwithstanding, I
agree and understand that the Company does not guarantee in any way whatsoever the tax treatment of any deferrals or payments made under the Policy or this Election Form. I understand that I will be responsible for all taxes and any other costs owed
with respect to any deferrals or payments made with respect to my Awards. 

  
 A-2 

 6. I understand that the Company will be under no obligation to settle any Deferred Awards
until any applicable tax withholding obligations are satisfied and that if I fail to satisfy any such tax withholding obligations I will forfeit my right to receive the shares subject to my Deferred Award. I understand that the Company has the right
(but not the obligation) to withhold taxes from my Deferred Awards (including pursuant to net share withholding) in any amount and through such procedure as the Company deems necessary or desirable to satisfy any income or other tax obligations
incurred with respect to my Awards. 
 7. I understand that, upon receipt of any Deferred Awards, in addition to federal taxes, I may owe
taxes to the state where I resided at the time of vesting in the Deferred Awards and/or to the state where I reside when the Deferred Awards are settled, if different. 

8. I understand, acknowledge and agree that the Board or the Compensation Committee has the discretion to make all determinations and decisions
regarding any elections set forth on this Election Form. 
 9. I understand that this Election Form and the elections made hereunder are
intended to comply with the requirements of Section 409A so that none of [the Deferred Awards or the Retainer Grant] issuable will be subject to the tax acceleration and additional penalty taxes imposed under Section 409A, and any
ambiguities herein will be interpreted to so comply. If applicable, I understand that I am solely responsible for any accelerated income taxes and additional taxes and tax penalties imposed by Section 409A. 

10. I also understand that this Election Form and the elections made hereunder will in all respects be subject to the terms and conditions of
the Policy, the applicable Award Agreement and the Plan, as applicable. Should any inconsistency exist between this Election Form, the Policy, the Plan, the Award Agreement under which an Award was granted, and/or any applicable law, then the
provisions of either the applicable law (including, but not limited to, Section 409A) or the Plan will control, with the Plan subordinated to the applicable law and the Award Agreement and the Policy subordinated to this Election Form. 

  
 A-3 

 By signing this Election Form, I authorize the implementation of the above elections. I understand that my
[deferral election and retainer grant election] are irrevocable effective as of the Submission Deadline and may not be changed in the future, except in accordance with the requirements of Section 409A and the procedures specified by the Board
or the Compensation Committee. 
  

			
	 Signed:________________________
	  	 Date: ___________________________, ______

	 Participant
	  	
		
	Agreed to and accepted:	  	
		
	 The Honest Company, Inc.,
	  	
		
	 By:___________________________
	  	 Date: ___________________________, _______

 IMPORTANT DEADLINE: Please remember that if you wish to make any election set forth on this
Election Form, then the properly completed Election Form must be signed by you and returned ON OR BEFORE THE SUBMISSION DEADLINE to Brendan Sheehey, General Counsel, at The Honest Company, Inc. by e-mail to
bsheehey@thehonestcompany.com.  

  
 A-4

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