INTERNET AMERICA INC
10KSB40, EX-10.4, 2000-09-26
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                                                                    EXHIBIT 10.4


                          [INTERNET AMERICA LETTERHEAD]


                                September 5, 2000



Mr. Jack T. Smith
100 Crescent Court, Suite 1620
Dallas, Texas  75201

Dear Jack:

         On behalf of Internet America, Inc. (the "Company"), we are delighted
to offer you the following terms of employment. This letter, upon your
acceptance, sets forth our joint understanding of the terms of your employment.


         Position:                      Chief Executive Officer.

         Salary:                        $200,000 per year, paid in accordance
                                        with the Company's payroll practices.

         Benefits:                      You shall be entitled to receive such
                                        group benefits as the Company may
                                        provide to its other senior executive
                                        officers from time to time.

         Stock Purchase:                The Company will sell to you 200,000
                                        shares of its common stock pursuant to a
                                        Stock Purchase Agreement, of even date
                                        herewith, by and between you and the
                                        Company.

         Office Expenses:               The Company shall pay the pro rata costs
                                        of Beth Prothro, your administrative
                                        assistant (pro rata being based on the
                                        amount of time Ms. Prothro spends on the
                                        Company's business).

         We understand that you will commence employment immediately. You also
agree that you are an employee-at-will, and your employment may be terminated by
the Company at any time and for any reason.


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Mr. Jack T. Smith
September 5, 2000
Page 2



         If you agree with the foregoing terms of this letter, please execute
and forward to me the enclosed counterpart of this letter.

                                      Very truly yours,

                                      INTERNET AMERICA, INC.


                                      By:          /s/ WILLIAM O. HUNT
                                          --------------------------------------
                                          William O. Hunt, Chairman of the Board


AGREED TO AND ACCEPTED
as of the date first set forth above:


By:        /s/ JACK T. SMITH
    --------------------------------
             Jack T. Smith




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