IBAS » Topics » Deductibility of Executive Compensation

This excerpt taken from the IBAS DEF 14A filed Mar 23, 2006.

Deductibility of Executive Compensation

Section 162(m) of the Internal Revenue Code of 1986, as amended (the “Code”), limits the tax deduction to $1 million for compensation paid to certain executives of public companies. This deduction limitation does not apply to compensation that constitutes “qualified performance-based compensation” within the meaning of Section 162(m) of the Code and the regulations promulgated thereunder. In any case, the combined salary and bonus of each executive officer has been below the $1 million limit. The Compensation Committee’s present intention is to structure executive compensation to minimize the application of the deduction limitation of Section 162(m) of the Code unless the Compensation Committee feels that the necessary changes in iBasis’ accounting methods in order to do so would not be in the best interest of iBasis or its shareholders.

Respectfully Submitted by the Compensation Committee,

 

Charles N. Corfield

 

Charles Skibo

 

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