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                                                                    Exhibit 10.7

                               [FIREPOND GRAPHIC]

                     FIREPOND, INC. STOCK OPTION AGREEMENT


THIS OPTION AGREEMENT is made as of the [DATE] (the "Option Date"), between
Firepond, Inc., a Delaware corporation (the "Company"), and [OPTIONEE], [AN
EMPLOYEE] [A DIRECTOR] of the Company or one or more of its Subsidiaries (the
"Optionee").

WHEREAS, the Company desires, by affording the Optionee an opportunity to
purchase shares of its common stock, $.10 par value per share (the "Common
Stock"), as hereinafter provided, to carry out the purpose of the [NAME OF STOCK
OPTION PLAN] (the "Plan") of the Company.

         NOW, THEREFORE, in consideration of the mutual covenants hereinafter
set forth and for other good and valuable consideration, the parties hereto have
agreed, and do hereby agree, as follows:

         1. Grant of Option. The Company hereby grants to the Optionee the right
and Option (hereinafter called the "Option") to purchase from the Company all or
any part of an aggregate amount of [NUMBER OF OPTION SHARES] shares (the "Option
Shares") of Common Stock on the terms and conditions set forth in this Option
Agreement and in the Plan. This Option is not intended to constitute an
incentive stock option, as defined in Section 422 of the Internal Revenue Code
of 1986, as amended (the "Code").

         2. Purchase Price. The purchase price of the Option Shares shall be
$[EXERCISE PRICE] per share.

         3. Term of Option. The term of this Option shall be a period of five
(5) years from the Option Date, subject to earlier termination as hereinafter
provided.

         4. Exercise of Option. Subject to the provisions of Sections 7, 8, 9
and 11 hereof, this Option may be exercised during the term specified in Section
3 hereof as follows: one-third of the Option Shares shall vest and become
exercisable upon the first anniversary of the Option Date and the remaining
Option Shares shall vest and become exercisable in equal amounts on the first
day of each month following the first anniversary of the Option Date with one
hundred percent (100%) of the Option Shares being vested and exercisable upon
the third anniversary of the Option Date. In no event shall this Option be
exercisable for more than the aggregate number of Option Shares.


                                    1     Firepond Confidential And Proprietary
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         5. Non-Transferability. This Option is personal to the Optionee and is
not transferable by the Optionee in any manner other than by will or by the laws
of descent and distribution; provided that this Option may also be transferred
by the Optionee, without consideration for the transfer, to members of his or
her immediate family, to trusts for the benefit of such family members, to
partnerships in which such family members are the only partners, or to limited
liability companies in which such family members are the only members (each a
"Permitted Transferee"), provided that the transferee agrees in writing with the
Company to be bound by all of the terms and conditions of the Plan and this
Option Agreement. This Option may be exercised during the Optionee's lifetime
only by the Optionee (or by the Optionee's legal representative or guardian in
the event of the Optionee's incapacity) or by a Permitted Transferee pursuant to
this Section 5. The Optionee may elect to designate a beneficiary by providing
written notice of the name of such beneficiary to the Company, and may revoke or
change such designation at any time by filing written notice of revocation or
change with the Company; such beneficiary may exercise this Option in the event
of the Optionee's death to the extent provided herein. If the Optionee does not
designate a beneficiary, or if the designated beneficiary predeceases the
Optionee, the executor of the Optionee may exercise this Option to the extent
provided herein in the event of the Optionee's death.

         6. Not a Contract of Employment. Nothing in this Option Agreement shall
confer upon the Optionee any right to continue in the employ or service of the
Company or of any of its Subsidiaries or interfere in any way with the right of
the Company, the shareholders of the Company, the shareholders of the Company or
any such Subsidiary to terminate the employment or service of the Optionee at
any time.

         7. Termination of Employment. Subject to Sections 8, 9 and 11 hereof,
in the event that the Service Relationship of the Optionee shall terminate or be
terminated, the Option may be exercised (to the extent the Optionee shall have
been entitled to do so at the date of such termination pursuant to Section 4
hereof) by the Optionee at any time:

                  (i) within twelve (12) months after such termination if such
         termination was by reason of Disability;

                  (ii) no later than the date of such termination if such
         termination was for Cause; and

                  (iii) within thirty (30) days after such termination if such
         termination was for any reason other than Retirement, Disability, Cause
         or death.

However, in each case, in no event may the Option be exercised later than the
expiration of the term specified in Section 3 hereof. Any portion of this Option
that is not exercisable pursuant to Section 4 on the date of termination of the
Service Relationship shall immediately expire and be null and void.

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         8.       Death. If the Optionee's Service Relationship terminates due
to the Optionee's death, the Option may be exercised (to the extent that the
Optionee shall have been entitled to do so at the date of his or her death
pursuant to Section 4 hereof) by the Optionee's designated beneficiary or the
person to whom the Option is transferred by will or the applicable laws of
descent and distribution, at any time within twelve (12) months after the
Optionee's death, but in no event later than the expiration of the term
specified in Section 3 hereof.

         9.       Effect of Certain Transactions. Upon the effectiveness of a
Transaction, unless provision is made in connection with the Transaction for the
assumption of this Option, or the substitution of this Option with new options
of the successor entity or parent thereof, with appropriate adjustment to the
number of Option Shares and, if appropriate, the Exercise Price, pursuant to the
terms of the Plan (the "Assumption"), all of the remaining Option Shares, to the
extent not vested and exercisable, shall, subject to and conditioned upon the
effectiveness of the Transaction, become vested and exercisable fifteen (15)
days prior to the anticipated effective date of the Transaction, as determined
by the Company. Further, unless there is an Assumption of this Option, this
Option shall terminate upon the effectiveness of the Transaction. In the event
of such termination, the Optionee shall be permitted to exercise this Option for
a period of at least fifteen (15) days prior to the anticipated effective date
of such Transaction to the extent that it is then vested and exercisable (after
giving effect to the acceleration of vesting, if any, provided for in this
Section 9), provided, however, that the exercise of the portion of this Option
that becomes vested and exercisable pursuant to the acceleration provision of
this Section 9 shall be subject to and conditioned upon the effectiveness of the
Transaction. In addition, if there is an Assumption and the Optionee's Service
Relationship with such successor entity is, on or within six (6) months after
such Transaction, (i) terminated by the successor entity without Cause, or (ii)
terminated by the Optionee for Good Reason, then one hundred percent (100%) of
the shares of Common Stock subject to this Option, to the extent not fully
vested and exercisable, shall become fully vested and exercisable. In the event
that the vesting of this Option is accelerated following an Assumption pursuant
to this Section 9, Optionee shall be given a period of three (3) months
following such termination to exercise this Option.

         10.      Method of Exercising Option.

                  (a) Subject to the terms and conditions of this Option
Agreement, this Option may be exercised by written notice (in substantially the
form of Appendix A attached hereto) to the Chief Financial Officer of the
Company at the principal office of the Company. Such notice shall state the
election to exercise the Option and the number of Option Shares in respect of
which it is being exercised, and shall be signed by the person so exercising the
Option. Such notice shall be accompanied by payment of the full purchase price
of such Option Shares, which payment shall be made in cash or by certified check
or bank draft payable to the Company, or, in the sole discretion of the Company
(i) by delivery (or attestation to the ownership) of shares of Common Stock with
a Fair Market Value equal to the total aggregate purchase price (valued as of
the exercise date) which shares were either purchased by the Optionee on the
open market or have been held by the Optionee free of any applicable
restrictions for at least six (6) months, or

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(ii) by delivery to the Company of a properly executed exercise notice together
with irrevocable instructions to a broker to promptly deliver to the Company
cash or a check payable and acceptable to the Company in the amount equal to the
total aggregate purchase price; provided that, in the event that the Optionee
chooses to pay the purchase price as so provided, the Optionee and the broker
shall comply with such procedures and enter into such agreements of indemnity
and other agreements as the Board shall prescribe as a condition of such payment
procedure.

                  (b) Payment instruments will be received subject to
collection. The certificate or certificates for the shares as to which the
Option shall have been so exercised shall be registered in the name of the
person so exercising the Option, or if the Optionee so elects, in the name of
the Optionee or one other person as joint tenants. In the event the Option shall
be exercised by any person other than the Optionee, such notice shall be
accompanied by appropriate proof of the right of such person to exercise the
Option. Certificates for the Option Shares so purchased will be issued and
delivered to the Optionee upon compliance to the satisfaction of the Board with
all requirements under applicable laws or regulations in connection with such
issuance. Until the Optionee shall have complied with the requirements hereof
and of the Plan, including the withholding requirements set forth in Section 13
below, the Company shall be under no obligation to issue the Option Shares
subject to this Option, and the determination of the Board as to such compliance
shall be final and binding on the Optionee. The Company shall not be required to
issue fractional shares upon the exercise of this Option.

         11.      Forfeiture of Unexercised Options. In the event the Optionee
breaches the terms of the Company's standard Employee Agreement (the "Employee
Agreement") as executed by the Optionee and the Company, the terms of which are
expressly incorporated herein by reference, any Options which have vested but
are unexercised at the time of such breach shall immediately be forfeited and
shall not thereafter be exercisable by Optionee. Forfeiture of the unexercised
portion of the Option shall apply to the unexercised portion held by the
Optionee or by any Permitted Transferee of such unexercised portion of the
Option.

         12.      Payment Upon the Sale of Exercised Shares. In the event that
the Optionee breaches any of the terms of the Employee Agreement and prior to
such breach has, or a Permitted Transferee has, sold, transferred or otherwise
disposed of or, following such breach, sells, transfers or otherwise disposes
of, any Exercised Shares, for each Exercised Share so sold, transferred or
disposed of, the Optionee hereby agrees to pay to the Company, in cash, upon
demand, an amount equal to the difference between the Exercise Price per share
of the Exercised Shares and the value per share received by the Optionee, or the
Permitted Transferee, pursuant to such sale of the Exercised Shares.

         13.      Withholding Requirements.

                  (a) Payment by Optionee. Upon exercise of the Option by the
Optionee (or, if applicable, the transfer, in whole or in part of any shares
acquired upon the exercise of the


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Option, the operation of any law or regulation providing for the imputation of
interest related to the Option, or the lapsing of any restriction with respect
to any shares acquired upon exercise of the Option) which exercise (or other
event) gives rise to taxable income and subjects the Company to a tax
withholding obligation, the Company shall have the right to require the Optionee
to remit to the Company cash in an amount sufficient to satisfy applicable
federal, state, foreign and local tax withholding requirements or the Company
may, but will not be required to, withhold such amounts from payroll or any
other amounts payable to the Optionee. The Company shall inform the Optionee as
to whether it will require the Optionee to remit cash for withholding taxes in
accordance with the preceding sentence within two (2) business days after
receiving from the Optionee notice that such Optionee intends to exercise, or
has exercised, all or a portion of the Option.

                  (b) Payment in Common Stock. Subject to approval by the
Company, the Optionee may elect to have the minimum tax withholding obligation
satisfied, in whole or in part, by (i) authorizing the Company to withhold from
shares of Common Stock to be issued a number of shares of Common Stock with an
aggregate Fair Market Value (as of the date the withholding is effected) that
would satisfy the withholding amount due or (ii) transferring to the Company
shares of Common Stock owned by the Optionee with an aggregate Fair Market Value
(as of the date the withholding is effected) that would satisfy the withholding
amount due. The Fair Market Value of any shares of Common Stock withheld or
tendered to satisfy any such tax withholding obligation shall not exceed the
amount determined by the applicable minimum statutory withholding rates.

         14. Stock Plan. This Option is subject to all of the terms and
conditions set forth in the Plan; provided, that, notwithstanding anything in
this Option Agreement to the contrary, to the extent of any conflict between the
terms of the Plan and this Option Agreement, the terms of the Plan shall
control. By acceptance hereof, Optionee acknowledges receipt of a copy of the
Plan and agrees to and accepts this Option subject to the terms of the Plan. A
copy of the Plan is on file with the Chief Financial Officer of the Company.

         15. No Distribution; Compliance with Legal Requirements. The grant of
this Option and the issuance of shares of Common Stock upon exercise of this
Option shall be subject to compliance with all applicable requirements of
federal, state and foreign law with respect to such securities. This Option may
not be exercised if the issuance of shares of Common Stock upon exercise would
constitute a violation of any applicable federal, state or foreign securities
laws or other law or regulations or the requirements of any stock exchange or
market system upon which the Common Stock may then be listed. Further, no shares
of Common Stock shall be issued pursuant to this Option until all applicable
securities law and other legal and stock exchange or similar requirements have
been satisfied. The Board may require the placing of such stop orders and
restrictive legends on certificates for Common Stock received pursuant to this
Option, as it deems appropriate. The inability of the Company to obtain from any
regulatory body having jurisdiction the authority, if any, deemed by the
Company's legal counsel to be necessary to the lawful issuance and sale of any
shares hereunder shall relieve the Company of any liability in


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respect of the failure to issue or sell such shares as to which such requisite
authority shall not have been obtained. As a condition to the exercise of this
Option, the Company may require the Optionee to satisfy any qualifications that
may be necessary or appropriate, to evidence compliance with any applicable law
or regulation and to make any representation or warranty with respect thereto as
may be requested by the Company and may require the Optionee to represent to and
agree with the Company in writing that such person is acquiring the shares
without a view to distribution thereof.

         16. Lock-up Provision. The Optionee agrees, if requested by the Company
and any underwriter engaged by the Company, not to offer, sell, contract to
sell, pledge, hypothecate, grant any option to purchase or make any short sale
of, or otherwise dispose of any securities (including the right to acquire any
Common Stock) of the Company (including, without limitation, pursuant to Rule
144 under the Securities Act of 1933, as amended (the "Securities Act")) held by
him or her for such period following the effective date of any registration
statement of the Company filed under the Securities Act as the Company or such
underwriter shall specify reasonably and in good faith, not to exceed ninety
(90) days.

         17. Status. Neither the Optionee nor the Optionee's executor,
administrator, heirs or legatees shall be or have any rights or privileges of a
shareholder of the Company in respect of the shares transferable upon exercise
of the Option granted hereunder, unless and until certificates representing such
shares shall be endorsed, transferred, and delivered and the transferee has
caused the Optionee's name to be entered as the shareholder of record on the
books of the Company.

         18. Company Authority. The existence of the Option herein granted shall
not affect in any way the right or power of the Company or its shareholders to
make or authorize any or all adjustments, recapitalizations, reorganizations or
other changes in the Company's capital structure or its business, or any merger
or consolidation of the Company, or any issue of bonds, debentures, preferred or
prior preference stock ahead of or affecting the Common Stock of the Company or
the rights thereof, or dissolution or liquidation of the Company, or any sale or
transfer of all or any part of its assets or business, or any other corporate
act or proceeding, whether of a similar character or otherwise.

         19. Disputes. As a condition of the granting of the Option herein
granted, the Optionee agrees, for the Optionee, any Permitted Transferees and
the Optionee's personal representatives, that any interpretation which may arise
under or as a result of or pursuant to this Option Agreement shall be determined
by the Board, in its sole discretion, and that any interpretation by the Board
of the terms of this Option Agreement shall be final, binding and conclusive.

         20. Equitable Relief. The parties hereto agree and declare that legal
remedies may be inadequate to enforce the provisions of this Option Agreement
and that equitable relief, including


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specific performance and injunctive relief, may be used to enforce the
provisions of this Option Agreement.

         21. Binding Effect. This Option Agreement shall be binding upon the
heirs, executors, administrators, successors and assigns of the parties hereto.

         22. Integrated Agreement. This Option Agreement and the Plan constitute
the entire understanding and agreement between the Optionee and the Company with
respect to the subject matter contained herein and supercedes any prior
agreements, understandings, restrictions, representations, or warranties among
the Optionee and the Company with respect to such subject matter except as
provided for herein. To the extent contemplated herein, the provisions of this
Option Agreement shall survive any exercise of this Option and shall remain in
full force and effect.

         23. Saving Clause. If any provision(s) of this Option Agreement shall
be determined to be illegal or unenforceable, such determination shall in no
manner affect the legality or enforceability of any other provision hereof.

         24. Headings. The headings used herein are intended only for
convenience in finding the subject matter hereof and do not constitute part of
the text of this Option Agreement and shall not be considered in the
interpretation of this Option Agreement.

         25. Notices. All notices, requests, consents and other communications
shall be in writing and be deemed given when delivered personally, by telex or
facsimile transmission or two (2) days after deposit in the mail if mailed by
first class registered or certified mail, postage prepaid or one (1) business
day after deposit with a nationally recognized overnight carrier. Notices to the
Company or the Optionee shall be addressed to such address or addresses as may
have been furnished by such party in writing to the other.

         26. Governing Law. This Option Agreement is a Massachusetts contract
and shall be construed under and be governed in all respects by the laws of the
Commonwealth of Massachusetts, without regard to conflict of law principles. Any
legal action or suit related to this Agreement shall be brought exclusively in
the courts of Massachusetts. Both parties agree that the courts of Massachusetts
are a convenient forum for the resolution of disputes.

         27. Definitions. Capitalized terms used herein and not otherwise
defined shall have their respective meanings set forth in the Plan. For purposes
of this Option Agreement, the following terms shall be defined as set forth
below:

             "Cause" means (i) any material breach by the Optionee of any
agreement to which the Optionee and the Company or its Subsidiaries are parties,
including breach of covenants not to compete and covenants relating to the
protection of confidential information and proprietary rights of the Company or
its Subsidiaries which breach is not cured pursuant to the terms of such


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agreement, (ii) any act (other than retirement) or omission to act by the
Optionee which would reasonably be likely to have a material adverse effect on
the business of the Company or its Subsidiaries or on the Optionee's ability to
perform services for the Company or its Subsidiaries, including, without
limitation, the conviction or plea of guilty or nolo contendre to any crime
(other than ordinary traffic violations) which impairs the Optionee's ability to
perform his or her duties, (iii) any material misconduct or willful and
deliberate non-performance of duties by the Optionee in connection with the
business or affairs of the Company or its Subsidiaries, (iv) the Optionee's
theft, dishonesty, or falsification of the Company's or its Subsidiaries'
documents or records, or (v) the Optionee's improper use or disclosure of the
Company's or its Subsidiaries' confidential or proprietary information. All
references herein to the Company or its Subsidiaries shall include any successor
entity thereof.

                  "Disability" means permanent and total disability as
determined by the Board.

                  "Early Retirement" means retirement, with consent of the Board
at the time of retirement, from active employment with the Company and any
Subsidiary or Parent Corporation.

                  "Exercised Shares" means all shares of Common Stock purchased
by Optionee upon exercise of this Option, or any portion thereof.

                  "Good Reason" means the occurrence of any of the following
events: (i) a substantial adverse change in the nature or scope of the
Optionee's responsibilities, authorities, powers, functions or duties; (ii) a
reduction in the Optionee's annual base salary except for across-the-board
salary reductions similarly affecting all, or substantially all, management
employees; or (iii) the relocation of the offices at which the Optionee is
principally employed to a location more than fifty (50) miles from such offices.

                  "Normal Retirement" means retirement from active employment
with the Company and any Subsidiary or Parent Corporation on or after age 65.

                  "Retirement" means Normal Retirement or Early Retirement.

                  "Service Relationship" means the Optionee's employment or
service with the Company or its Subsidiary, whether in the capacity of an
employee, director or a consultant; provided that, if this Option was granted
under the 1999 Director Plan, then "Service Relationship" shall mean any
relationship as a non-employee director of the Company or any Subsidiary of the
Company. Unless otherwise determined by the Company, the Optionee's Service
Relationship shall not be deemed to have terminated merely because of a transfer
between locations of the Company or its Subsidiaries or a transfer between the
Company and any Subsidiary, provided that there is no interruption or other
termination of the Service Relationship. Subject to the foregoing, the Company,
in its discretion, shall determine whether the Optionee's Service Relationship
has terminated and the effective date of such termination. The Company shall
have the sole discretion to determine the reason for the termination of the
Optionee's Service Relationship.



                                       8   Firepond Confidential And Proprietary

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         IN WITNESS WHEREOF, the Company has caused this Option Agreement to be
duly executed by an officer thereunto duly authorized, and the Optionee has
hereunto set his or her hand, as of the date(s) set forth below.


                                                     FIREPOND, INC.


                                                     By:_____________________
                                                        Name:  Christian Misvaer
                                                        Title: Secretary

                                                     ________________________
                                                     Date

                                                     OPTIONEE


                                                     ________________________
                                                     Optionee Signature

                                                     ________________________
                                                     Date




                                       9   Firepond Confidential And Proprietary