SMART ONLINE, INC.
NONQUALIFIED STOCK OPTION AGREEMENT
THIS NONQUALFIED STOCK OPTION AGREEMENT, made and entered into as of the _____
day of ______, by and between Smart Online, Inc., a Delaware corporation (the “ Company ”), and ________
(the “ Participant ”).
WHEREAS, the Board of Directors (the “ Board ”), in accordance with the Smart Online, Inc. 2004
Equity Compensation Plan (the “ Plan ”), granted Participant an option to purchase shares of the Company’s
Common Stock, $0.001 par value per share (the “ Common Stock ”), pursuant to the Plan (capitalized terms
used herein shall have the meanings set out in the Plan unless otherwise specified in this Agreement); and
WHEREAS, this Agreement evidences the grant of such option.
NOW, THEREFORE, in consideration of the foregoing, of the mutual promises set forth below and of
other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties
hereto, intending to be legally bound, agree as follows:
1. Grant of Option . The Board hereby grants Participant an option to purchase from the Company,
during the period specified in Section 2 of this Agreement, a total of ____________ (_____) shares of Common
Stock, at the purchase price of _____________ ($____) per share (the “ Purchase Price ”), in accordance
with the terms and conditions stated in this Agreement. The Purchase Price represents the fair market value of the
Common Stock on the date of this Agreement, and under no circumstances shall the Purchase Price be less than
such fair market value on the date of this Agreement. The shares of Common Stock subject to the option granted
hereby are referred to below as the “Shares,” and the option to purchase such Shares is referred to below as the
2. Vesting and Exercise of Option . The Option shall vest and become exercisable in increments in
accordance with the schedule set forth below, provided that the Option shall vest and become exercisable with