vim - what's a smarttab?

[7stud]

Is smarttab one of these:

1) Expands tabs into the number of spaces set with tabstop at the
start of a line, and uses a tabstop sized tab elsewhere.

2) Expands tabs into the number of spaces set with shiftwidth at the
start of a line, and expands tabs into the number spaces set with
tabstop elsewhere.

3) Doesn't do any expanding: uses shiftwidth sized tabs at beginning
of line, and tabstop sized tabs elsewhere.

Alternatively, what is a smarttab?

Thanks.