Exhibit 10.3

 

CONSULTATION AGREEMENT

 

THIS CONSULTATION AGREEMENT made as of the 19th day of September, 2003, between
Internet America, Inc., a Texas corporation, with its principal operating
offices located in Dallas, Texas (the “Company”), and Jack T. Smith, residing in
Dallas, Texas (the “Consultant”),

 

W I T N E S S E T H

 

WHEREAS, the Board of Directors of the Company (the “Board”) desires to obtain
the services of the Consultant, and the Consultant has expertise that is
pertinent to the business of the Company;

 

WHEREAS, the Board and the Company each desire that the services of the
Consultant be provided to the Company upon the terms and conditions hereinafter
set forth;

 

NOW, THEREFORE, in consideration of the premises, the agreements herein
contained and other good and valuable consideration, receipt of which is hereby
acknowledged, the parties hereto agree as follows:

 

1. Services. Subject to the terms and conditions hereinafter set forth, the
Consultant hereby agrees to advise the Board and the Company, in the capacity
and for the Term hereof (as hereinafter defined).

 

2. Scope of Consultation. During the Term hereof, the Consultant shall serve as
a general advisor and consultant to the Company and the Board on any matters
pertaining to the business of the Company with respect to which the Board or the
Chief Executive Officer of the Company seeks the Consultant’s advice.

 

3. Compensation. As compensation for his services hereunder, the Company shall
pay the Consultant, subject to the terms and conditions of this Agreement,
$10,000.00 per month during the Term hereof, with such payment beginning October
1 and continuing on the first day of each month of the Term thereafter.

 

4. Term. The “Term,” as used herein, shall mean a period commencing on the date
hereof and ending on the first anniversary of the date hereof, unless sooner
terminated by the Company upon a breach by Consultant of any term of this
Agreement or by the Consultant upon written notice to the Company. At the end of
the Term of this Agreement, the Company and the Consultant may agree to continue
this Agreement under mutually acceptable terms.

 

5. Limitation on Authority. It is expressly understood and agreed that during
the Term hereof and thereafter, Consultant shall not be authorized to enter into
any contract on behalf of the Company or in any other manner whatsoever bind the
Company without the prior written approval of the Board. Consultant agrees to
make no representation to any person, corporation or firm inconsistent in any
manner with the provisions of this Section 5.

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6. Independent Contractor. The Consultant shall employ his own means and methods
of accomplishing the projects assigned to him by the Board of the Company from
time to time and shall not be subjected to the control of the Company in respect
to the details of such work. During the Term, the Consultant may request the
services of Beth Prothro to aid him in the completion of his duties and in
transition from his former position as an officer of the Company, provided that
such services do not interfere with the performance of her regular duties to the
Company. Subject to the CEO’s prior approval, the Consultant may have contact
with officers of the Company in fulfilling his duties hereunder as may be
requested from time to time. It is understood and agreed that the Consultant
shall act as an independent contractor in the undertaking of this Agreement. It
is expressly understood and stipulated that no employer-employee relationship
exists between the Company and the Consultant.

 

7. Advisory Board Member. The Board will appoint Consultant and Consultant will
agree to serve during the Term as an Advisory Director to the Company pursuant
to the Company’s Bylaws or until sooner terminated upon Consultant’s death,
disability, resignation or removal. For so long as Consultant serves as an
Advisory Director, Consultant may participate in the Company’s health insurance
plan, subject to the terms and limitations of such plan and payment of the
related premium by Consultant.

 

8. Assignment. This Agreement is a personal contract and the rights and
interests of the Consultant hereunder may not be sold, transferred, assigned,
pledged or hypothecated.

 

9. Successors. This Agreement shall inure to the benefit of and be binding upon
the Company and its successors and assigns and upon the Consultant and his legal
representatives.

 

10. Entire Agreement. This Agreement, which contains the entire contractual
understanding between the parties, may not be changed orally but only by a
written instrument signed by the Consultant and the Chairman of the Board of the
Company.

 

11. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.

 

12. Notices. Any notices or other communications required or permitted hereunder
shall be sufficiently given if sent by registered mail, postage prepaid, and if
to the Consultant, addressed to him at 100 Crescent Ct., Suite 1620, Dallas, TX
75201, and if to the Company, addressed to it at One Dallas Centre, 350 N. St.
Paul, Suite 3000, Dallas, Texas 75201 (Attention: CEO and Legal Dept.), or such
other address as the party to whom or to which such notice or other
communication is to be given shall have specified in writing to the other party,
and any such notice or communication shall be deemed to have been given as of
the date so mailed.

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IN WITNESS WHEREOF, the Company has caused this Agreement to be executed by its
duly authorized officer, and the Consultant has executed this Agreement as of
the date first above written.

 

INTERNET AMERICA, INC.

 

By /s/ William E. Ladin, Jr.

        William E. Ladin, Jr.

        Chairman of the Board

 

CONSULTANT

 

/s/ Jack T. Smith

Jack T. Smith