SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT

SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934

Filed by Registrant [X]

Filed by a Party other than the Registrant [_]

Check the appropriate box:

[_] Preliminary Proxy Statement

[X] Definitive Proxy Statement

[_] Confidential, For Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))

[_] Definitive Additional Materials

[_] Soliciting Material Under Rule 14a-12

iBASIS, INC.
(Name of Registrant as Specified in Its Charter)

------------------------------------------------------------------------
(Name of Person[s] Filing Proxy Statement, if Other Than the Registrant)

Payment of Filing Fee (Check the appropriate box):

[X] No fee required

[_] Fee computed on table below per Exchange Act Rules
14a-(6)(i)(1) and 0-11.

(1) Title of each class of securities to which transaction
applies:

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(2) Aggregate number of securities to which transactions applies:

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(3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (set forth the
amount on which the filing fee is calculated and how it was
determined):

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(4) Proposed maximum aggregate value of transaction:

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(5) Total fee paid:

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[__] Fee paid previously with preliminary materials.

[__] Check box if any part of the fee is offset as provided by
Exchange Act Rule 0-11(a)(2) and identify the filing for which
the offsetting fee was paid previously. Identify the previous
filing by registration statement number, or the form or
schedule and the date of its filing.

(1) Amount previously paid:

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(2) Form, Schedule or Registration Statement No.:

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(3) Filing Party:

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(4) Date Filed:

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May 3, 2001

Dear Shareholder:

You are cordially invited to attend the 2001 Annual Meeting of Shareholders
of iBasis, Inc., which will be held at our offices, 20 Second Avenue,
Burlington, Massachusetts 01803, on Thursday, May 31, 2001 at 10:00 a.m., local
time.

The Notice of Annual Meeting of Shareholders and a Proxy Statement, which
describe the formal business to be conducted at the meeting, accompany this
letter. Our 2000 Annual Report to Shareholders is also enclosed for your
information.

All shareholders are invited to attend the Annual Meeting. However, to
ensure your representation at the Annual Meeting, you are urged to complete,
date, sign and return the enclosed Proxy Card (a postage-prepaid envelope is
enclosed for that purpose).

YOUR SHARES CANNOT BE VOTED UNLESS YOU DATE, SIGN, AND RETURN THE ENCLOSED
PROXY CARD, VOTE ELECTRONICALLY VIA THE INTERNET, VOTE BY TELEPHONE, OR ATTEND
THE ANNUAL MEETING IN PERSON. Regardless of the number of shares you own, your
careful consideration of, and vote on, the matters before the shareholders is
important.

Sincerely,

[LOGO]

Ofer Gneezy
President, Chief Executive Officer
and Treasurer

IBASIS, INC.
20 SECOND AVENUE
BURLINGTON, MASSACHUSETTS 01803
------------------------

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON MAY 31, 2001
---------------------

TO OUR SHAREHOLDERS:

The 2001 Annual Meeting of Shareholders of iBasis, Inc., a Delaware
corporation, will be held on Thursday, May 31, 2001 at 10:00 a.m., local time,
at our offices, 20 Second Avenue, Burlington, Massachusetts 01803. The purposes
of the Annual Meeting are:

1. To elect one Class 2 director to hold office for a three year term and
until the director's successor has been duly elected and qualified;

2. To ratify the appointment of the firm of Arthur Andersen LLP, as
independent auditors for iBasis for the fiscal year ending December 31,
2001; and

3. To transact such other business as may properly come before the meeting
or any adjournment thereof.

Shareholders of record on the books of iBasis at the close of business on
April 23, 2001 will be entitled to notice of and to vote at the Annual Meeting.

Please sign, date, and return the enclosed proxy card in the enclosed
postage-paid envelope, or vote via the Internet or by telephone, as instructed
in the proxy materials, at your earliest convenience. If you return the proxy,
you may nevertheless attend the Annual Meeting and vote your shares in person.

All of our shareholders are cordially invited to attend the Annual Meeting.

By Order of the Board of Directors,

[LOGO]

Jonathan Draluck
Secretary

Burlington, Massachusetts
May 3, 2001

IT IS IMPORTANT THAT YOUR SHARES BE REPRESENTED AT THE ANNUAL MEETING. WHETHER
OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING, PLEASE SIGN, DATE, AND RETURN THE
ENCLOSED PROXY CARD IN THE ENCLOSED ENVELOPE, WHICH REQUIRES NO POSTAGE IF
MAILED FROM WITHIN THE UNITED STATES, OR VIA THE INTERNET OR BY TELEPHONE, AS
INSTRUCTED IN THE PROXY MATERIALS.

IBASIS, INC.
20 SECOND AVENUE
BURLINGTON, MASSACHUSETTS 01803
------------------------

PROXY STATEMENT
------------------------

ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON THURSDAY, MAY 31, 2001

Proxies enclosed with this Proxy Statement are solicited by the Board of
Directors of iBasis, Inc., a Delaware corporation, for use at the Annual Meeting
of Shareholders to be held on Thursday, May 31, 2001 at 10:00 a.m., local time,
at our offices, 20 Second Avenue, Burlington, Massachusetts 01803, and any
adjournments thereof.

Registered shareholders can vote their shares by mailing their signed proxy
card, via the Internet, or by telephone, as directed in the proxy materials. We
believe that the procedures that have been put in place are consistent with the
requirements of applicable law.

Shares represented by duly executed proxies received by iBasis prior to the
Annual Meeting will be voted as instructed in the proxy on each matter submitted
to the vote of shareholders. If any duly executed proxy is returned without
voting instructions, the persons named as proxies thereon intend to vote all
shares represented by such proxy FOR the election of the nominee for director
named below and FOR the ratification of the appointment of Arthur Andersen LLP
as independent auditors of iBasis. The Board of Directors of iBasis is not aware
of any other matters to be presented at the Annual Meeting. If any other matter
should be presented at the Annual Meeting upon which a vote properly may be
taken, shares represented by all duly executed proxies received by iBasis will
be voted with respect thereto in accordance with the best judgment of the
persons named in the proxies.

Any shareholder may revoke a proxy at any time prior to its exercise by
delivering a later-dated proxy, by written notice of revocation to our Secretary
at the address set forth below, or by voting in person at the Annual Meeting. If
a shareholder does not intend to attend the Annual Meeting, any written proxy or
notice should be returned for receipt by iBasis, not later than the close of
business on Wednesday, May 30, 2001. We have retained EquiServe Trust Company
N.A. and Corporate Investor Communications, Inc. to organize the distribution
and return of the proxy materials. EquiServe is paid $15,000 annually for
various services, including those rendered in connection with our Annual
Meeting. Corporate Investor Communications will be paid a $1,500 fee to
distribute the proxy materials. iBasis will bear the cost of solicitation of
proxies relating to the Annual Meeting.

Only shareholders of record as of the close of business on April 23, 2001,
the record date, will be entitled to notice of and to vote at the Annual Meeting
and any adjournments thereof. As of the record date there were 44,939,730 shares
(excluding treasury shares) of common stock, $0.001 par value, issued and
outstanding. These shares of common stock are the only securities of iBasis
entitled to vote at the Annual Meeting. Shareholders are entitled to cast one
vote for each share of common stock held of record on the record date.

An Annual Report to Shareholders, containing financial statements for the
fiscal year ended December 31, 2000, accompanies this Proxy Statement. The
mailing address of iBasis' principal executive offices is 20 Second Avenue,
Burlington, Massachusetts 01803.

This Proxy Statement and the proxy enclosed herewith were first mailed to
shareholders on or about May 5, 2000.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth certain information regarding beneficial
ownership of our common stock as of March 31, 2001 by:

- each person we know owns beneficially more than five percent (5%) of our
common stock;

- each of our directors;

- each of our executive officers; and

- all directors and executive officers as a group.

Beneficial ownership is determined in accordance with the rules and
regulations of the Securities and Exchange Commission. In computing the number
of shares beneficially owned by a person and the percentage of ownership of that
person, shares of common stock subject to options held by that person that are
currently exercisable or exercisable within 60 days of March 31, 2001 are deemed
outstanding. These shares, however, are not deemed outstanding for the purposes
of computing the percentage ownership of any other person. Except as indicated
in the footnotes to this table and pursuant to applicable community property
laws, each shareholder named in the table has sole voting and investment power
with respect to the shares set forth opposite such shareholder's name. Unless
otherwise indicated, the address for each of the following shareholders is c/o
iBasis, Inc., 20 Second Avenue, Burlington, Massachusetts 01803.

SHARES BENEFICIALLY
OWNED
---------------------
DIRECTORS, OFFICERS AND 5% SHAREHOLDERS NUMBER PERCENT
- --------------------------------------- ---------- --------

Summit Ventures IV, L.P. and affiliated entities(1)......... 3,984,330 8.87%
Ofer Gneezy(2).............................................. 3,646,933 8.10
Menlo Ventures VII, L.P. and affiliated entities(3)......... 3,440,351 7.65
John Jarve(3)............................................... 3,440,351 7.65
Daniel Price(4)............................................. 1,708,873 3.80
Gordon J. VanderBrug(5)..................................... 1,686,582 3.75
Charles N. Corfield(6)...................................... 1,324,416 2.95
Michael J. Hughes(7)........................................ 152,701 *
Charles Giambalvo(8)........................................ 56,250 *
Carl Redfield(9)............................................ 61,800 *
Charles Skibo(10)........................................... 20,000 *
ALL EXECUTIVE OFFICERS AND DIRECTORS AS A GROUP (9
PERSONS)(11).............................................. 12,097,906 26.83

- ------------------------

* Represents less than 1% of the outstanding shares of common stock.

(1) Includes shares of common stock held by Summit Ventures V, L.P., Summit
Ventures IV, L.P., Summit V Companion Fund, L.P., Summit V Advisors Fund,
L.P., Summit V Advisors Fund (QP) L.P., and Summit Investors III, L.P. The
sole general partner for Summit Ventures IV, L.P. is Summit Partners IV,
L.P., the sole general partner of which is Stamps, Woodsum & Co. IV. The
general partner for each of Summit Ventures V, L.P., Summit V Companion
Fund, L.P., Summit V Advisors Fund, L.P., and Summit V Advisors (QP) L.P. is
Summit Partners V, L.P., the general partner of which is Summit Partners
LLC. Summit Partners LLC, through an investment committee, exercises sole
voting and investment power with respect to the shares owned by these
entities, Summit Investors III, L.P., and Summit Ventures IV, L.P.;
individually no member of Summit Partners LLC is deemed to have or share
such voting or investment power and such members expressly disclaim
beneficial ownership of these shares, except to the extent of their
respective pecuniary interests therein. The address of the Summit
partnerships is 600 Atlantic Avenue, Suite 2800, Boston, Massachusetts
02210.

(2) Includes 54,999 shares of common stock issuable upon exercise of options
within 60 days of March 31, 2001. Also includes 50,000 shares held by The
Ofer Gneezy 1999 Family Trust for the benefit of Mr. Gneezy's children.
Mr. Gneezy disclaims beneficial ownership of the shares held be the Ofer
Gneezy 1999 Family Trust. Mr. Gneezy is our President, CEO and Treasurer,
and one of our directors.

(3) Includes 3,292,083 shares held by Menlo Ventures VII, L.P. and 138,268 held
by Menlo Entrepreneurs Fund VII, L.P. Also includes 10,000 shares of common
stock issuable to Mr. Jarve upon exercise of options within 60 days of
March 31, 2001. Mr. Jarve, one of our directors, is managing director of MV
Management VII, LLC, the general partner of Menlo Ventures VII, L.P. and
Menlo Entrepreneurs Fund VII, L.P. Mr. Jarve disclaims beneficial ownership
of the shares held by the entities affiliated with Menlo Ventures, except to
the extent of his pecuniary interest therein. The address for Menlo Ventures
and Mr. Jarve is 3000 Sand Hill Road, Building 4, Suite 100, Menlo Park,
California 94025.

(4) Mr. Price is our Senior Vice President, Speech Solutions and one of our
directors.

(5) Includes 41,250 shares of common stock issuable upon exercise of options
within 60 days of March 31, 2001. Also includes 1,317,345 shares held by the
G.J. & C.E. VanderBrug Family Limited Partnership. Dr. VanderBrug disclaims
beneficial ownership of the shares held by the G.J. & C.E. VanderBrug Family
Limited Partnership, except to the extent of his pecuniary interest therein.
Does not include 29,230 shares of common stock held by Dr. VanderBrug's
spouse. Dr. VanderBrug disclaims beneficial ownership of the shares held by
his spouse. Dr. VanderBrug is our Executive Vice President and Assistant
Secretary and one of our Directors.

(6) Includes of 1,114,416 shares held by the Charles N. Corfield Trust u/a/d
12/19/91, a revocable trust of which Mr. Corfield is the sole trustee and
200,000 shares held by Mr. Corfield, individually. Also includes 10,000
shares of common stock issuable upon exercise of options within 60 days of
March 31, 2001. Mr. Corfield is one of our directors.

(7) Includes 60,624 shares of common stock issuable upon the exercise of options
within 60 days of March 31, 2001. Mr. Hughes is our Vice President, Finance
and Administration and Chief Financial Officer.

(8) Consists entirely of 56,250 shares of common stock issuable upon the
exercise of options within 60 days of March 31, 2001. Mr. Giambalvo is our
Senior Vice President of Worldwide Sales.

(9) Includes 20,000 shares of common stock exercisable within 60 days of
March 31, 2001. Mr. Redfield is one of our directors.

(10) Includes 20,000 shares of common stock exercisable within 60 days of
March 31, 2001. Mr. Skibo is one of our directors.

(11) Includes 273,123 shares of common stock issuable upon the exercise of
options within 60 days of March 31, 2001 and certain shares held by
affiliates of such directors and executive officers.

EXECUTIVE COMPENSATION AND OTHER INFORMATION
CONCERNING DIRECTORS AND EXECUTIVE OFFICERS

EXECUTIVE OFFICERS

The executive officers of iBasis, and their ages as of April 30, 2001, are
as follows.

NAME AGE POSITION
- ---- -------- --------

EXECUTIVE OFFICERS

Ofer Gneezy........................ 49 President, Chief Executive Officer, Treasurer
Gordon J. VanderBrug............... 58 Executive Vice President, Assistant Secretary
Michael J. Hughes.................. 38 Vice President, Finance and Chief Financial Officer
Charles Giambalvo.................. 45 Senior Vice President of Worldwide Sales
Daniel Price....................... 43 Senior Vice President of Speech Solutions

MR. GNEEZY. See "Proposal No. 1--Election of Directors" for Mr. Gneezy's
biography.

DR. VANDERBRUG. See "Proposal No. 1--Election of Directors" for
Dr. VanderBrug's biography.

MR. HUGHES has served as Vice President of Finance and Administration and
Chief Financial Officer of iBasis since August 1998. From 1995 to 1998, Mr.
Hughes was Director of Finance/Controller at Teleport Communications Group, a
provider of local and long distance telecommunications services, including
voice, data, and Internet services. Prior to joining TCG in 1995, Hughes held
various financial positions at Houghton Mifflin Company and previously served as
an auditor at KPMG Peat Marwick. Mr. Hughes received a B.S. in accounting from
Bentley College and an M.B.A. in finance from Babson College. Mr. Hughes is a
certified public accountant.

MR. GIAMBALVO has served as Senior Vice President of Worldwide Sales of
iBasis since January 2000. From 1998 to 1999, Mr. Giambalvo was the president of
VocalTec Communications, Inc., a company that helped pioneer commercial Internet
telephony. Prior to joining VocalTec, in 1998, Mr. Giambalvo was vice president
of sales at Stratus Computer, a computer maker. From 1990 to 1998,
Mr. Giambalvo was the senior vice president of sales and customer service at ECI
Telecom, Inc., a leading manufacturer of telecommunications transmission
equipment. Mr. Giambalvo received an M.S. in telecommunications management from
Golden Gate University and a B.S. in electrical engineering and a B.F.A in
communications from The New York Institute of Technology.

MR. PRICE. See "Proposal No. 1--Election of Directors" for Mr. Price's
biography.

SUMMARY COMPENSATION

The following table sets forth information concerning the annual and
long-term compensation in each of the last three fiscal years for our Chief
Executive Officer and the next four most highly compensated executive officers.

LONG-TERM
COMPENSATION
ANNUAL COMPENSATION (1) AWARDS
--------------------------------------------- SECURITIES
OTHER ANNUAL ------------------ ALL OTHER
YEAR SALARY BONUS COMPENSATION UNDERLYING OPTIONS COMPENSATION
-------- -------- -------- ------------ ------------------ ------------

Ofer Gneezy..................... 2000 $203,846 $100,000 $ -- 40,000 --
President, Chief Executive 1999 150,000 135,000 -- -- --
Officer and Treasurer 1998 134,866 37,500 -- 80,000 --

Gordon J. VanderBrug............ 2000 183,462 90,000 -- 30,000 --
Executive Vice President and 1999 135,000 122,400 -- -- --
Assistant Secretary 1998 122,240 33,750 -- 60,000 --

Michael J. Hughes (2)
Vice President, Finance and 2000 142,692 60,000 -- 25,000 --
Administration and 1999 120,000 75,750 -- 50,000 --
Chief Financial Officer 1998 67,898 30,000 -- 200,000 --

Charles Giambalvo (3)........... 2000 185,000 0 331,950(4) -- --
Senior Vice President of 1999 15,417 -- -- 150,000 --
Worldwide Sales

John G. Henson, Jr. (5)......... 2000 142,693 60,000 -- 25,000 --
Vice President, 1999 125,000 85,600 -- 50,000 --
Engineering & Operations 1998 67,898 30,000 -- 200,000 --

- ------------------------

(1) Excludes certain perquisites and other benefits, in the amount of which did
not exceed 10% of the employee's total salary and bonus.

(2) Mr. Hughes became Vice President, Finance and Chief Financial Officer in
August 1998.

(3) Mr. Giambalvo became Senior Vice President of Worldwide Sales in
January 2000.

(4) Mr. Giambalvo received $226,335 in sales commissions, $75,000 in moving and
re-location expenses, and $30,615 in interest on a $500,000 loan associated
with Mr. Giambolvo's re-location which was paid by iBasis.

(5) Mr. Henson was our Vice President, Engineering and Operations prior to his
resignation from iBasis effective November 30, 2000.

The following table contains information concerning options to purchase
common stock that we granted during the year ended December 31, 2000 to each of
the officers named in the summary compensation table.

POTENTIAL REALIZABLE
VALUE AT
INDIVIDUAL GRANTS ASSUMED ANNUAL
----------------------------------------------------------------- RATES OF
PERCENT OF TOTAL STOCK APPRECIATION
NUMBER OF OPTIONS GRANTED EXERCISE FOR OPTION TERM(3)
SECURITIES UNDERLYING TO EMPLOYEES PRICE PER EXPIRATION ---------------------
OPTIONS GRANTED(1) IN 2000 SHARE ON DATE 5% 10%
--------------------- ---------------- --------- ---------- --------- ---------

Ofer Gneezy................ 40,000 1.86% $14.85 5/25/05 285,603 806,621
Gordon J. VanderBrug....... 30,000 1.40 13.50 5/25/10 254,702 645,466
Michael J. Hughes.......... 25,000 1.16 13.50 5/25/10 212,252 537,888
Charles Giambalvo.......... -- -- -- -- -- --
John G. Henson, Jr. (2).... 25,000 1.16 13.50 5/25/10 212,252 537,888

- ------------------------

(1) Shares underlying options generally vest over a four-year period, with 6.25%
of the shares vesting on each of the first sixteen three-month anniversaries
after the grant date. However, during the first year of employment, no
shares underlying an option vest until the first anniversary of the
optionee's employment when all shares that would have vested before such
date become exercisable.

(2) Following Mr. Henson's resignation from iBasis in November 2000, this option
expired unexercised 90 days thereafter.

(3) The 5% and 10% assumed annual rates of compounded stock price appreciation
are mandated by the Securities and Exchange Commission rules and do not
represent an estimate or projection of our future stock prices. Actual
gains, if any, on stock option exercises and common stock holdings are
dependent on future performance of our common stock and overall stock market
conditions. There can be no assurance that the amounts reflected in the
table will be achieved.

AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END OPTION
VALUES

The following table contains information concerning option holdings for the
year ended December 31, 2000 and such date with respect to each of the officers
named in the summary compensation table.

NUMBER OF SHARES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY
OPTIONS AT YEAR END OPTIONS AT YEAR END(1)
--------------------------- ---------------------------
EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
----------- ------------- ----------- -------------

Ofer Gneezy.................................... 45,000 75,000 $121,000 $ 121,000
Gordon J. VanderBrug........................... 33,730 56,250 90,750 90,750
Michael J. Hughes.............................. 34,375 180,000 45,156 318,219
Charles Giambalvo.............................. 37,500 112,500 -- --
John G. Henson, Jr. (2)........................ 162,500 35,000 421,172 1,641

- ------------------------

(1) Value is determined by subtracting the exercise price from $4.125, the
closing price of our common stock on the Nasdaq National Market on
December 29, 2000, multiplied by the number of shares underlying the
options.

(2) Following Mr. Henson's resignation from iBasis in November 2000, options
totaling an aggregate of 38,125 shares expired without being exercised.

EMPLOYMENT AGREEMENTS

We currently have employment contracts in effect with Mr. Gneezy, our
President, Chief Executive Officer and Treasurer, Dr. VanderBrug, our Executive
Vice President and Assistant Secretary, Mr. Hughes,

our Vice President, Finance and Administration and Chief Financial Officer,
Mr. Giambalvo, our Senior Vice President of Worldwide Sales, and Mr. Price, our
Senior Vice President of Speech Solutions. Mr. Price became an executive officer
of iBasis on February 27, 2001.

iBasis and Mr. Gneezy are parties to an employment agreement, dated as of
August 11, 1997, governing his employment with iBasis as President and Chief
Executive Officer. Under the terms of the employment agreement, Mr. Gneezy is
paid a base salary of $125,000, and is eligible to receive an annual bonus at
the discretion of the Board of Directors. iBasis and Dr. VanderBrug are parties
to an employment agreement, dated as of August 11, 1997, governing his
employment with iBasis as Executive Vice President. Under the terms of the
employment agreement, Dr. VanderBrug is to be paid a base salary of $115,000,
and is eligible to receive an annual bonus at the discretion of the Board of
Directors. iBasis and Mr. Hughes are parties to an employment agreement dated as
of August 17, 1999 governing his employment with iBasis as Vice President,
Finance and Chief Financial Officer. Under the terms of the employment
agreement, Mr. Hughes is to be paid a base salary of $120,000, and is eligible
to receive an annual bonus at the discretion of the chief executive officer or
the Board of Directors. iBasis and Mr. Giambalvo are parties to an employment
agreement, dated as of February 8, 2000, governing his employment with iBasis as
Senior Vice President of Worldwide Sales. Under the terms of the employment
agreement, Mr. Giambalvo is to be paid a base salary of $185,000, and is
eligible to receive an annual bonus at the discretion of the Board of Directors.
iBasis and Mr. Price are parties to an employment agreement, dated as of
February 28, 2001, governing his employment with iBasis. Under the terms of the
employment agreement, Mr. Price is to be paid a base salary in accordance with
iBasis' practices and policies.

We may terminate the employment agreements with Messrs. Gneezy, VanderBrug,
Hughes, and Giambalvo "for cause" or at any time upon at least thirty days prior
written notice, and Messrs. Gneezy, VanderBrug, Hughes, and Giambalvo may
terminate their employment agreements "for good reason" or at any time upon at
least thirty days prior written notice. We may terminate the employment
agreement with Mr. Price at any time and Mr. Price may terminate his employment
agreement at any time. If we terminate either of Messrs. Gneezy and VanderBrug
without cause or if either resigns for good reason, we must continue to pay his
base salary for one year and continue to provide health benefits for one year.
If, within six months following an acquisition or change of control, we
terminate either Messrs. Hughes, and Giambalvo without cause or if either
resigns for good reason, we must continue to pay his base salary for nine months
and continue to provide health benefits for nine months. If, within six months
following our acquisition of PriceInteractive, Inc., or another acquisition or a
change of control of iBasis, we terminate Mr. Price's employment without cause
or if he resigns for good reason, we must continue to pay Mr. Price's salary for
nine months and continue to provide health benefits for nine months.

The employment agreements with Messrs. Gneezy, VanderBrug, Hughes, and
Giambalvo entitle them to life insurance, health insurance and other employee
fringe benefits to the extent that we make benefits of this type available to
our other executive officers. All intellectual property that Messrs. Gneezy,
VanderBrug, Hughes, Giambalvo and Price may invent, discover, originate or make
during their term of their employment shall be the exclusive property of iBasis.
Each of Messrs. Gneezy, VanderBrug, Hughes, Giambalvo and Price may not, during
or after the term of his employment, disclose or communicate any confidential
information without iBasis' prior written consent. Each employment agreement
also contains a non-competition provision that is intended to survive the
termination of each officer's employment for a period of one year. The
non-competition provision in Mr. Price's employment agreement is for the later
of 25 months of the PriceInteractive, Inc. acquisition or two years following
the termination of his employment agreement. The agreements with Messrs. Gneezy
and VanderBrug also provide that in the event of an acquisition or change in
control, each of their options and restricted shares, if any, shall
automatically become fully vested immediately prior to such event, and each such
option shall remain exercisable until the expiration of such option or until it
sooner terminates in accordance with its terms. The agreements with
Messrs. Hughes, and Giambalvo provide that in the event that we terminate the

employment of the officer without cause, or the officer terminates his
employment with "good reason," in either case within six months after the
occurrence of an acquisition or change in control, then his options and
restricted stock, if any, shall immediately vest and become exercisable, and
each option shall remain exercisable until the expiration of the option or until
it sooner terminates in accordance with its terms.

In general, "good reason" as used in employment agreements of
Messrs. Gneezy, VanderBrug, Hughes, Giambalvo, and Price means any material
change in the compensation, position, location of employment or responsibilities
of the employee. "For cause" generally means gross negligence or willful
misconduct of the employee, a breach of the employment agreement or the
commission of a crime.

Our employment agreement with Mr. Giambalvo also contains provisions
relating to Mr. Giambalvo's relocation to the Boston area. Under the terms of
Mr. Giambalvo's employment agreement, we provided Mr. Giambalvo with $75,000 to
cover his relocation expenses. In addition, we have guaranteed a loan of up to
$500,000 to Mr. Giambalvo for a period of six months, in the event he purchases
a home in the Boston area before he sells his existing home and we have paid
$30,615 in interest on that loan during the fiscal year ended December 31, 2000.

COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION

Our executive compensation program is administered by the Compensation
Committee of the Board of Directors. The Compensation Committee, which is
composed of three directors, establishes and administers our executive
compensation policies and plans and administers the our stock option and other
equity-related employee compensation plans. The Compensation Committee considers
internal and external information in determining officers' compensation,
including outside survey data.

COMPENSATION PHILOSOPHY

iBasis' compensation policies for executive officers are based on the belief
that the interests of executives should be closely aligned with those of the
shareholders. The compensation policies are designed to achieve the following
objectives:

- Offer compensation opportunities that attract highly qualified executives,
reward outstanding initiative and achievement, and retain the leadership
and skills necessary to build long-term shareholder value.

- Maintain a significant portion of executives' total compensation at risk,
tied to both the annual and long-term financial performance of iBasis and
the creation of shareholder value.

- Further the iBasis' short and long-term strategic goals and values by
aligning compensation with business objectives and individual performance.

COMPENSATION PROGRAM

iBasis' executive compensation program has three major integrated
components, base salary, annual incentive awards, and long term incentives.

BASE SALARY. Base salary levels for executive officers are determined
annually by reviewing the competitive pay practices of Internet telephony
companies of similar size and market capitalization, the skills, performance
level, and contribution to the business of individual executives, and the needs
of the company. Overall, the Compensation Committee believes that base salaries
for executive officers are approximately competitive with median base salary
levels for similar positions in these Internet telephony companies.

INCENTIVE AWARDS. iBasis' executive officers are eligible to receive cash
bonus awards designed to motivate executives to attain short-term and
longer-term corporate and individual management goals. The Compensation
Committee establishes quarterly and annual incentive opportunities for each
executive

officer in relation to his or her base salary. Awards under this program are
based on the attainment of specific company performance measures established by
the Compensation Committee early in the fiscal year, and by the achievement of
specified individual objectives and the degree to which each executive officer
contributes to the overall success of the company and the management team. In
2000 the formula for these bonuses was based on a combination of individual
objectives and company financial performance objectives. iBasis' performance
generally met the objectives set by the Committee in 2000.

LONG TERM INCENTIVES. The Compensation Committee believes that stock
options are an excellent vehicle for compensating its officers and employees.
iBasis provides long term incentives through its 1997 Stock Incentive Plan, as
amended, the purpose of which is to create a direct link between executive
compensation and increases in shareholder value. Stock options are granted at
fair market value and vest in installments, generally over four years. When
determining option awards for an executive officer, the Compensation Committee
considers the executive's current contribution to company performance, the
anticipated contribution to meeting the iBasis' long-term strategic performance
goals, and industry practices and norms. Long-term incentives granted in prior
years and existing levels of stock ownership are also taken into consideration.
Because the receipt of value by an executive officer under a stock option is
dependent upon an increase in the price of iBasis' common stock, this portion of
the executive's compensation is directly aligned with an increase in shareholder
value.

CHIEF EXECUTIVE OFFICER COMPENSATION

The Chief Executive Officer's base salary, annual incentive award and
long-term incentive compensation are determined by the Compensation Committee
based upon the same factors as those employed by the Compensation Committee for
executive officers generally. Mr. Gneezy's annualized base salary for the year
ended December 31, 2000 was $203,846. The Chief Executive Officer may also be
entitled to an annual cash bonus depending on iBasis' achievement of certain
performance objectives, including certain growth milestones in sales and
financial performance during a fiscal year, as compared to the preceding fiscal
year. Any such cash bonus will be computed on a formula basis established by the
Compensation Committee. For the year ended December 31, 2000, Mr. Gneezy was
paid a cash bonus $100,000.

Section 162(m) of the Internal Revenue Code limits the tax deduction to
$1 million for compensation paid to certain executives of public companies.
Having considered the requirements of Section 162(m), the Compensation Committee
believes that grants made pursuant to iBasis' 1997 Stock Incentive Plan meet the
requirement that such grants be "performance based" and are, therefore, exempt
from the limitations on deductibility. Historically, the combined salary and
bonus of each executive officer has been well below the $1 million limit. The
Compensation Committee's present intention is to comply with Section 162(m)
unless the Compensation Committee feels that required changes would not be in
the best interest of iBasis or its shareholders.

Respectfully Submitted by the Compensation
Committee,

Ofer Gneezy
John Jarve
Charles Skibo

AUDIT COMMITTEE REPORT

The Audit Committee of the Board of Directors is composed of three
directors, each of whom is independent as defined by the Nasdaq National Market
listing rules. The Board of Directors had adopted a written Audit Committee
Charter, a copy of which is attached as Appendix A.

The Audit Committee is responsible for, among other things, monitoring the
integrity and adequacy of iBasis' financial information, control systems, and
reporting practices, and for recommending to the Board of Directors for adoption
by the shareholders the Audit Committee's selection of independent auditors for
iBasis.

The Audit Committee has reviewed and discussed the company's audited
financial statements with management, which has primary responsibility for the
financial statements. The Audit Committee has discussed with Arthur Andersen
LLP, iBasis' independent auditors, the matters that are required to be discussed
by Statement on Auditing Standards No. 61, "Communication with Audit
Committees." In addition, the Audit Committee discussed their independence with
the Arthur Andersen LLP and the Committee received written disclosures from
Arthur Andersen LLP as required by Independence Standards Board Standard No. 1,
"Independence Discussions with Audit Committees."

AUDIT FEES. The aggregate fees billed by Arthur Andersen for professional
services for audit of iBasis' annual consolidated financial statements for
fiscal 2000 and the review of the consolidated financial statements included in
our Forms 10-Q for fiscal 2000 were $172,450.

FINANCIAL INFORMATION SYSTEMS DESIGN AND IMPLEMENTATION FEES. There were no
services rendered by Arthur Andersen LLP for financial information systems
design and implementation for fiscal 2000.

ALL OTHER FEES. The aggregate fees billed for all other services rendered
by Arthur Andersen LLP, other than the services covered in the two previous
paragraphs, for fiscal year 2000 were $882,681, for services rendered in
connection with iBasis' secondary public offering and the
PriceInteractive, Inc. acquisition.

The Audit Committee has considered whether the services provided by Arthur
Andersen LLP are compatible with maintaining the independence of Arthur Andersen
and has concluded that the independence of Arthur Andersen is maintained and not
compromised by the services provided.

Based on the review and discussion referred to above, the Audit Committee
recommended to the Board of Directors, and the Board of Directors has approved,
that the audited financial statements be included in iBasis' Annual Report on
Form 10-K for the year ended December 31, 2000, for filing with the Securities
and Exchange Commission.

Respectfully Submitted by the Audit
Committee,

John Jarve
Charles Corfield
Carl Redfield

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

With the exception of Mr. Gneezy, no member of the Compensation Committee is
or has been an officer or employee of ours. All decisions regarding the
compensation of our executive officers for the fiscal year ended December 31,
2000 were made by the Committee, except that Mr. Gneezy did not participate in
deliberations or decisions regarding his own compensation. None of our executive
officers serves as a member of the board of directors or compensation committee
of any other entity that has one or more executive officers serving as a member
of our Board of Directors or the Committee.

COMPENSATION OF DIRECTORS

Our directors do not receive cash compensation for their services as
directors. However, non-employee directors are reimbursed for travel expenses.
We maintain directors' and officers' liability insurance and our by-laws provide
for mandatory indemnification of directors and officers to the fullest extent
permitted by Delaware law. In addition, our certificate of incorporation limits
the liability of our directors to either iBasis or its shareholders for breaches
of the directors' fiduciary duties to the fullest extent permitted by Delaware
law.

Messrs. Gneezy and VanderBrug, each of whom is both a director and executive
officer of iBasis received a stock option grant in 1998 for their service as
officers of iBasis. See "Executive Compensation." In addition, in
September 1999, each of Messrs. Skibo and Redfield received an option to
purchase 80,000 shares of common stock under the 1997 Stock Incentive Plan, with
such options vesting in equal 25% increments on the date of each of the next
four annual meetings of our shareholders following our initial public offering,
beginning with last year's annual meeting, provided that the director is
re-elected to the Board of Directors during such meetings. Each of the other
non-employee directors, including Messrs. Jarve and Corfield received an option
to purchase 40,000 shares of common stock on the same terms. The vesting of each
of the options will accelerate by 12 months, or 25% of the total grant, in the
event of a change of control of iBasis. Any vested options are forfeited if not
exercised within nine months from termination of services as a director.

SECTION 16(a)--BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Securities and Exchange Act of 1934, as amended,
requires our officers, directors, and persons who own more than ten percent
(10%) of a registered class of the Company's equity securities to file reports
of ownership on Forms 3, 4, and 5 with the Securities and Exchange Commission
and the Company. Based on the Company's review of copies of such forms, all
officers, directors and 10% holders complied with his/her obligations in a
timely fashion with respect to transactions in securities of the Company during
the year ended December 31, 2000, except that Mr. Giambalvo filed a Form 3 late
in February 2000.

STOCK PERFORMANCE GRAPH

The following graph compares the percentage change in the cumulative total
shareholder return on the Company's Common Stock with the cumulative total
return of the Nasdaq Stock Market (U.S.) Composite Index and the Nasdaq Stock
Market Telecommunications Index (IXTC-O) for the period from November 10, 1999
(the date on which the Common Stock was first publicly traded) through
December 31, 2000. For purposes of the graph, it is assumed that the value of
the investment in iBasis Common Stock and each index was 100 on November 9, 1999
and that all dividends were reinvested. The first datapoint reflected for the
Company is the initial public offering price of the Common Stock.

COMPARISON OF 14 MONTH CUMULATIVE TOTAL RETURN AMONG IBASIS, THE NASDAQ STOCK
MARKET (U.S.) COMPOSITE INDEX AND THE NASDAQ STOCK MARKET TELECOMMUNICATIONS
INDEX*

EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC

IBASIS NASDAQ NASDAQ TELECOMM INDEX

11/9/99 100 100 100
11/10/99 251.56 100.99 101.09
11/11/99 226.56 102.31 102.32
11/12/99 217.19 103.08 105.23
11/15/99 227.34 103.03 105.74
11/16/99 217.58 105.46 108.57
11/17/99 199.61 104.63 106.91
11/18/99 207.81 107.11 110.04
11/19/99 218.36 107.82 110.13
11/22/99 210.94 108.57 109.25
11/23/99 199.22 106.98 106.88
11/24/99 197.66 109.46 110.03
11/26/99 211.33 110.34 110.87
11/29/99 243.75 109.5 108.43
11/30/99 211.72 106.77 103.81
12/1/99 228.13 107.33 102.94
12/2/99 237.11 110.51 105.96
12/3/99 246.88 112.68 108.32
12/6/99 230.86 113.49 108.36
12/7/99 231.25 114.8 109.96
12/8/99 227.34 114.77 110.13
12/9/99 228.13 115.03 110.37
12/10/99 225.39 115.87 111.55
12/13/99 230.86 117.08 113.58
12/14/99 212.89 114.32 111.83
12/15/99 194.14 115.93 111.31
12/16/99 185.16 118.91 113.9
12/17/99 170.31 120.13 114.88
12/20/99 160.16 121.12 115.35
12/21/99 178.91 125.19 119.23
12/22/99 174.22 126.03 119.44
12/23/99 187.5 127.06 121.8
12/27/99 195.31 127.25 121.59
12/28/99 214.84 127.15 122.26
12/29/99 198.44 129.37 126.46
12/30/99 198.44 129.23 125.27
12/31/99 179.69 130.26 128.41
1/3/00 196.48 132.24 129.43
1/4/00 205.47 124.9 121.82
1/5/00 199.61 124.13 120.38
1/6/00 197.27 119.31 114.74
1/7/00 191.8 124.29 119.29
1/10/00 199.22 129.64 125.62
1/11/00 218.36 125.53 119.15
1/12/00 222.66 123.25 119.57
1/13/00 237.5 126.68 125.22
1/14/00 263.28 130.11 125.5
1/18/00 288.28 132.24 127.35
1/19/00 338.28 132.89 130.27
1/20/00 374.22 134.12 132.86
1/21/00 435.94 135.59 134.45
1/24/00 443.75 131.13 130.07
1/25/00 471.88 133.41 131.45
1/26/00 471.09 130.29 126.77
1/27/00 501.56 129.32 125.6
1/28/00 526.56 124.44 120.36
1/31/00 466.41 126.15 124.88
2/1/00 473.83 129.72 127.61
2/2/00 494.92 130.43 128.63
2/3/00 565.63 134.82 131.29
2/4/00 559.38 135.88 132.29
2/7/00 506.64 138.36 134.34
2/8/00 547.66 141.75 139.46
2/9/00 541.41 139.69 136.42
2/10/00 500.39 143.61 139.56
2/11/00 471.88 140.73 137.36
2/14/00 451.17 141.47 136.9
2/15/00 425.78 141.54 136.29
2/16/00 468.75 141.76 136.03
2/17/00 450 145.64 139.94
2/18/00 406.25 141.25 135.38
2/22/00 461.72 140.3 135.29
2/23/00 457.81 145.69 140.13
2/24/00 434.38 147.85 141.84
2/25/00 487.5 146.98 141.1
2/28/00 464.06 146.57 141.72
2/29/00 503.13 150.38 144.31
3/1/00 500.78 153.18 148.38
3/2/00 482.81 152.23 148.16
3/3/00 475 157.36 151.34
3/6/00 496.09 157.05 151.19
3/7/00 503.13 155.22 148.05
3/8/00 459.38 156.8 149.44
3/9/00 456.74 161.6 153.38
3/10/00 465.63 161.65 155.56
3/13/00 450 157.13 148.94
3/14/00 443.85 150.71 143.72
3/15/00 455.47 146.74 139.5
3/16/00 459.38 151.06 144.46
3/17/00 452.34 153.64 145.92
3/20/00 433.2 147.62 138.63
3/21/00 431.25 150.87 141.4
3/22/00 420.31 155.78 145.32
3/23/00 420.31 158.21 146.93
3/24/00 360.94 158.92 147.66
3/27/00 342.19 158.78 147.6
3/28/00 325 154.79 144.86
3/29/00 303.13 148.73 140.56
3/30/00 275 142.75 135.22
3/31/00 256.64 146.43 139.37
4/3/00 234.38 135.26 129.67
4/4/00 181.35 132.86 125.47
4/5/00 198.05 133.51 124.94
4/6/00 229.69 136.66 127.45
4/7/00 321.88 142.39 133.33
4/10/00 284.38 134.12 124.72
4/11/00 239.45 129.89 119.5
4/12/00 205.47 120.72 109.82
4/13/00 165.63 117.75 108.24
4/14/00 122.66 106.36 97.53
4/17/00 134.77 113.34 103.55
4/18/00 173.44 121.49 109
4/19/00 185.94 118.7 108.26
4/20/00 168.75 116.69 104.51
4/24/00 149.22 111.52 99
4/25/00 158.59 118.85 106.11
4/26/00 149.22 116.25 103.13
4/27/00 137.89 120.86 109.01
4/28/00 141.41 123.64 112.63
5/1/00 150.39 126.76 116.18
5/2/00 137.5 121.23 110.3
5/3/00 145.31 118.73 108.12
5/4/00 138.28 119.15 109.19
5/5/00 138.28 122.24 110.82
5/8/00 124.61 117.52 107.41
5/9/00 118.75 114.82 104.94
5/10/00 110.94 108.41 98.59
5/11/00 116.41 112.09 101.42
5/12/00 112.5 113.03 101.24
5/15/00 115.63 115.55 103.68
5/16/00 128.13 119.07 108.11
5/17/00 123.83 116.74 105.37
5/18/00 119.14 113.34 101.76
5/19/00 108.59 108.59 95.23
5/22/00 101.56 107.75 94.07
5/23/00 85.94 101.36 87.99
5/24/00 87.5 104.76 89.74
5/25/00 84.37 102.67 89.34
5/26/00 97.27 102.66 88.43
5/30/00 92.58 110.81 97.03
5/31/00 87.89 108.93 95.46
6/1/00 107.81 114.75 100.35
6/2/00 134.38 122.15 108.55
6/5/00 134.38 122.42 108.39
6/6/00 126.56 120.32 106.47
6/7/00 139.84 122.98 108.51
6/8/00 146.88 122.54 107.87
6/9/00 158.59 124.12 109.65
6/12/00 205.47 120.7 108.51
6/13/00 181.25 123.36 110.54
6/14/00 209.38 121.65 108.05
6/15/00 201.56 123.2 109.43
6/16/00 192.19 123.67 109.68
6/19/00 179.69 127.81 112.7
6/20/00 203.13 128.57 111.79
6/21/00 232.81 130.19 112.69
6/22/00 226.56 126.12 109.37
6/23/00 214.06 123.19 106.38
6/26/00 232.81 125.32 108.19
6/27/00 236.72 123.62 106.93
6/28/00 266.8 126.23 109.89
6/29/00 287.5 124.21 106.87
6/30/00 269.14 127.06 110.13
7/3/00 257.81 127.89 110.88
7/5/00 245.31 123.76 107.46
7/6/00 237.11 126.89 110.05
7/7/00 235.55 128.89 111.03
7/10/00 250 127.52 108.64
7/11/00 243.36 126.75 108.19
7/12/00 239.84 131.34 112.79
7/13/00 233.59 133.75 115.89
7/14/00 217.97 136.04 118.37
7/17/00 216.02 136.95 118.06
7/18/00 209.38 133.83 114.79
7/19/00 193.75 129.93 111.72
7/20/00 195.31 134.06 116.86
7/21/00 182.81 131.18 114.43
7/24/00 157.42 127.56 110.54
7/25/00 154.69 129.1 113.43
7/26/00 154.3 127.76 112.66
7/27/00 136.33 123.1 104.92
7/28/00 117.97 117.36 98.31
7/31/00 112.5 120.69 101.36
8/1/00 118.75 118.08 98.97
8/2/00 117.19 117.21 97.74
8/3/00 121.88 120.47 100.81
8/4/00 139.06 121.35 101.35
8/7/00 148.44 123.77 103.09
8/8/00 131.64 123.31 100.85
8/9/00 131.25 123.47 100.65
8/10/00 122.27 120.48 98.5
8/11/00 127.34 121.42 98.6
8/14/00 125 123.35 100.49
8/15/00 125 123.41 100.27
8/16/00 129.69 123.72 100.1
8/17/00 121.48 126.27 102.86
8/18/00 117.97 125.94 102.41
8/21/00 119.53 126.67 102.04
8/22/00 117.19 126.83 101.46
8/23/00 113.67 128.52 101.61
8/24/00 110.55 129.88 102.16
8/25/00 110.16 129.54 102.44
8/28/00 116.41 130.43 103.33
8/29/00 116.8 130.8 102.39
8/30/00 137.5 131.5 102.62
8/31/00 129.69 134.79 105.17
9/1/00 143.65 135.68 107.26
9/5/00 154.69 132.76 104.3
9/6/00 153.13 128.61 101.45
9/7/00 145.31 131.33 102.3
9/8/00 143.75 127.49 98.62
9/11/00 131.25 124.86 96.18
9/12/00 123.83 123.36 94.83
9/13/00 127.73 124.79 96.78
9/14/00 131.64 125.43 97.04
9/15/00 121.48 122.91 94.74
9/18/00 114.84 119.43 91.53
9/19/00 117.19 123.88 94.99
9/20/00 113.96 124.91 92.62
9/21/00 110.16 122.71 91
9/22/00 106.25 121.9 92.3
9/25/00 98.44 119.9 91.94
9/26/00 94.53 118.23 90.4
9/27/00 92.58 117.18 89.08
9/28/00 102.34 121.09 92.56
9/29/00 99.22 117.71 92.33
10/2/00 82.42 114.38 90.1
10/3/00 71.09 110.76 87.92
10/4/00 76.95 112.92 89.98
10/5/00 71.87 111.28 88.6
10/6/00 66.8 107.72 84.4
10/9/00 75.78 107.55 85.22
10/10/00 80.47 103.86 83.13
10/11/00 71.09 101.55 79.46
10/12/00 62.5 98.55 75.83
10/13/00 67.19 106.31 82.21
10/16/00 63.67 105.46 81.55
10/17/00 58.2 103.01 78.58
10/18/00 57.03 101.65 75.37
10/19/00 55.47 109.57 81.28
10/20/00 56.25 111.64 83.01
10/23/00 57.42 111.18 82.91
10/24/00 54.1 109.61 82.39
10/25/00 48.44 103.51 74.97
10/26/00 45.31 104.88 74.32
10/27/00 42.38 105.08 76.33
10/30/00 43.75 102.29 74.53
10/31/00 48.44 108.01 78.95
11/1/00 56.25 106.85 76.82
11/2/00 53.12 109.91 77.86
11/3/00 53.91 110.64 78.56
11/6/00 53.12 109.5 76.69
11/7/00 58.98 109.49 76.87
11/8/00 54.1 103.59 73.39
11/9/00 48.44 102.59 72.8
11/10/00 47.07 97.1 69.46
11/13/00 44.53 95.1 69.24
11/14/00 47.27 100.6 73.51
11/15/00 45.7 101.47 73.88
11/16/00 42.58 97.19 70.94
11/17/00 38.28 97.04 70.28
11/20/00 37.11 92.18 66.84
11/21/00 31.64 92.05 66.46
11/22/00 27.34 88.33 62.85
11/24/00 37.11 93.11 66.58
11/27/00 32.81 92.34 65.89
11/28/00 33.59 87.68 62.14
11/29/00 30.86 86.78 60.87
11/30/00 26.76 83.29 58.61
12/1/00 28.91 84.81 61.28
12/4/00 30.08 83.86 61.51
12/5/00 28.91 92.65 67.6
12/6/00 31.45 89.66 66.69
12/7/00 28.52 88.25 66.05
12/8/00 29.69 93.54 70.15
12/11/00 35.55 96.67 72.1
12/12/00 41.8 94 70.08
12/13/00 46.87 90.51 69.63
12/14/00 42.77 87.49 66.68
12/15/00 41.41 85.07 65.16
12/18/00 37.89 84.15 64.34
12/19/00 31.25 80.54 60.26
12/20/00 29.3 74.8 55.46
12/21/00 27.73 75.04 53.95
12/22/00 31.25 80.71 57.93
12/26/00 27.73 79.96 57.43
12/27/00 26.76 81.43 59.52
12/28/00 26.17 82.02 59.9
12/29/00 25.78 79.22 58.63

* $100 invested on 11/9/99 in stock or index--including reinvestment of
dividends. Fiscal year ending December 31.

CUMULATIVE TOTAL RETURN 11/09/99 12/99 03/00 06/00 09/00 12/00
- ----------------------- -------- -------- -------- -------- -------- --------

iBasis...................................... 100 179.69 256.64 269.14 99.22 25.78
NASDAQ STOCK MARKET (U.S.)
COMPOSITE INDEX............................. 100 130.26 146.43 127.06 117.71 79.22
NASDAQ STOCK MARKET
TELECOMMUNICATIONS INDEX.................... 100 128.41 139.37 110.13 92.33 58.63

For purposes of this comparison, we have used a different published industry
index, the Nasdaq Stock Market Telecommunications Index (IXTC-O) rather than the
industry index that appeared in our proxy statement for our 2000 Annual Meeting,
which took place on May 24, 2000. In light of the industries in which the
Company participates, we believe that the previously-used index, the Nasdaq
Electronic Components Stock Index (SIC Code 4813), does not provide a meaningful
benchmark for an assessment of the cumulative total returns for our common
stock.

PROPOSAL NO. 1--ELECTION OF DIRECTORS

The Board of Directors is divided into three classes. Each class serves a
three-year term. The Class 2 Directors' term will expire at the Annual Meeting.
All directors will hold office until their successors have been duly elected and
qualified.

The Board of Directors has nominated Charles M. Skibo for re-election as a
Class 2 Director, to hold office until the Annual Meeting of Shareholders to be
held in 2004 and until his respective successor is duly elected and qualified.
Shares represented by all proxies received by the Board of Directors and not
marked so as to withhold authority to vote for Mr. Skibo will be voted FOR his
election.

Mr. John Jarve will be resigning as a Class 2 Director at the end of his
term, May 31, 2001. The Board of Directors is currently seeking qualified
candidates to serve as a Class 2 Director. Mr. Jarve's resignation is not due to
a disagreement with iBasis, its operations, policies or management. The by-laws
of iBasis provide that the majority of the Board of Directors may fill a vacancy
on the Board of Directors. The Board of Directors, after suitable search,
intends to fill the Class 2 Director vacancy left by Mr. Jarve's resignation
with a qualified candidate that shall hold office until 2004.

The following table sets forth for the nominee to be elected at the Annual
Meeting and for each director whose term of office will extend beyond the Annual
Meeting, his age, the position(s) currently held by each nominee or director
with iBasis, the year such nominee or director was first elected a director, the
year each nominee's or director's term will expire and the class of director of
each nominee or director.

YEAR TERM
WILL CLASS OF
NOMINEE OR DIRECTOR'S NAME AGE POSITION(S) HELD DIRECTOR SINCE EXPIRE DIRECTOR
- -------------------------- -------- ------------------------------- -------------- --------- --------

Ofer Gneezy (1).......... 49 President, Chief Executive 1996 2002 3
Officer, Treasurer, Director
Gordon J. VanderBrug..... 58 Executive Vice President, 1996 2003 1
Assistant Secretary, Director
Charles N. Corfield (2)... 41 Director 1997 2002 3
John Jarve (3)........... 45 Director 1998 2001 2
Carl Redfield (2)........ 54 Director 1999 2002 3
Charles M. Skibo (1)..... 62 Director 1999 2001 2
Daniel Price............. 43 Senior Vice President of Speech 2001 2003 1
Solutions, Director

- ------------------------

(1) Member of the Compensation Committee

(2) Member of the Audit Committee

(3) Mr. Jarve does not seek, and has not been nominiated for, re-election as a
Class 2 Director. Mr. Jarve's term as director will end May 31, 2001.

MR. GNEEZY has served as the President, Chief Executive Officer and as
director of iBasis since our formation in August 1996. From 1994 to 1996,
Mr. Gneezy was President of Acuity Imaging, Inc., a multinational public company
focused on the industrial automation industry. From 1980 to 1994, prior to being
renamed Acuity Imaging in connection with a merger with Itran, Mr. Gneezy was an
executive of Automatrix, Inc., a public industrial automation company, serving
as its President and Chief Executive Officer. Since July 2000, Mr. Gneezy has
been a director of Natural MicroSystems Corporation, and in 2001 Mr. Gneezy
became a member of their Audit Committee. Mr. Gneezy graduated from Tel-Aviv
University, obtained his Masters of Science from the Massachusetts Institute of
Technology and is a graduate of the Advanced Management Program of the Harvard
Business School.

DR. VANDERBRUG has served as Executive Vice President and as a director of
iBasis since October 1996. From 1991 to 1996, Dr. VanderBrug was the Director of
Marketing, Electronic Imaging Systems of Polaroid Corporation. In 1980
Dr. VanderBrug co-founded Automatrix, Inc. Dr. VanderBrug received his B.A. in
mathematics from Calvin College, an M.A. in mathematics from Wayne State
University, and his Ph.D. in computer science from the University of Maryland.

MR. CORFIELD has been a director of iBasis since September 1997. Since 1999,
Mr. Corfield has been a director of BeVocal and since 2000, the Chief Executive
Officer of SandCherry Networks. Mr. Corfield serves on the board of directors of
Liberate Technologies, a web-based, enhanced television company. Mr. Corfield
co-founded Frame Technology, a software company, in 1986 and was a member of its
board of directors and its Chief Technology Officer until it was acquired by
Adobe Systems in 1995.

MR. JARVE has been a director of iBasis since August 1998. Mr. Jarve has
been employed by Menlo Ventures, a venture capital firm focused on the software,
communications, health care, and Internet sectors, where he currently serves as
a general partner and managing director. Mr. Jarve received a B.S. and M.S. in
electrical engineering from the Massachusetts Institute of Technology and an
M.B.A. from Stanford University.

MR. SKIBO has been a director of iBasis since September 1999. Currently,
Mr. Skibo is the Chief Executive Officer and Chairman of Colo.com, a provider of
facilities and co-location services to communication and information technology
industries. Since 1994, Mr. Skibo has served as Chairman and Chief Executive
Officer of Strategic Enterprises and Communications, Inc., a venture capital
firm. Mr. Skibo also serves as Chairman and Chief Executive Officer of Allied
Telecommunications, a communications company. From 1985 to 1987, Mr. Skibo was
President and CEO of US Sprint and its predecessor company, U.S. Telecom.

MR. REDFIELD has been a director of iBasis since September 1999.
Mr. Redfield has been Senior Vice President, Manufacturing and Logistics of
Cisco since February 1997. From September 1993 to February 1997, Mr. Redfield
was Vice President of Manufacturing at Cisco. Mr. Redfield also is a director of
CTC Communications Corp., and VA Linux Systems, Inc. Mr. Redfield received a
B.S. in Materials Engineering from Renselaer Polytechnic Institute.

MR. PRICE has been a director of iBasis since February 2001, after iBasis'
acquisition of PriceInteractive, Inc. Mr. Price replaced Charles M. Houser on
the Board of the Directors. Mr. Price has served as iBasis' Senior Vice
President of Speech Solutions since February 2001. From 1997 to February 2001,
Mr. Price was the co-founder and Chief Executive Officer of PriceInteractive.
Prior to founding PriceInteractive, Mr. Price served as President of SAS
Corporation, an automated telemessaging services company that he co-founded in
1991. Mr. Price received a B.S. degree from the University of Maryland and an
M.B.A. from Harvard University.

BOARD MEETINGS AND COMMITTEES

The Board of Directors held a total of nine meetings during the year ended
December 31, 2000. During that period the Audit Committee of the Board held four
meetings and the Compensation Committee of the Board held six meetings. Each of
the directors attended at least seventy-five percent (75%) of the meetings of
the Board of Directors and committees of the Board on which the director served
during the year.

The Compensation Committee consists of Messrs. Gneezy, Jarve, and Skibo. The
Compensation Committee determines the compensation of the iBasis' senior
management and administers the stock option plans. The Audit Committee consists
of Messrs. Jarve, Corfield, and Redfield. The Audit Committee recommends
engagement of the iBasis' independent auditors, consults with the iBasis'
auditors concerning the scope of the audit, reviews the results of their
examination, reviews and approves any

material accounting policy changes affecting the company's operating results,
and reviews the company's financial controls.

The Board of Directors has no standing nominating committee.

CERTAIN TRANSACTIONS

On February 27, 2001, iBasis acquired PriceInteractive, Inc. for
approximately $46.0 million in cash and 10.2 million shares of iBasis' common
stock. As a part of the consideration for the acquisition, we issued $8,145,733
and 1,708,873 shares of common stock to Daniel Price, co-founder and shareholder
of PriceInteractive, Inc.

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE "FOR" THE ELECTION OF
THE NOMINEE LISTED ABOVE.

PROPOSAL NUMBER 2--RATIFICATION OF SELECTION OF AUDITORS

The Board of Directors has appointed the firm of Arthur Andersen LLP,
certified public accountants, to serve as independent auditors for the fiscal
year ending December 31, 2001. Arthur Andersen LLP has served as iBasis'
independent auditors since 1996. It is expected that a member of the firm of
Arthur Andersen LLP will be present at the Annual Meeting and will be available
to make a statement and to respond to appropriate questions. If the shareholders
do not ratify the selection of Arthur Andersen LLP, the Board of Directors may
consider selection of other independent certified public accountants to serve as
independent auditors, but no assurances can be made that the Board of Directors
will do so or that any other independent certified public accountants would be
willing to serve.

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE "FOR" THE RATIFICATION
OF THE APPOINTMENT OF IBASIS' AUDITORS.

VOTING PROCEDURES

The affirmative vote of a plurality of the shares of iBasis' common stock
present or represented at the Annual Meeting and entitled to vote is required
for the election of the Class 2 Director and the affirmative vote of a majority
of such shares is required for the ratification of the appointment of the
company's auditors. For purposes of determining whether a proposal has received
a majority vote, abstentions will be included in the vote totals, with the
results that an abstention will have the same effect as a negative vote. In
instances where brokers are prohibited from exercising discretionary authority
for beneficial holders who have not returned a proxy (so-called "broker
non-votes"), those shares will not be included in the vote totals and,
therefore, will have no effect on the outcome of the vote. Shares that abstain
or for which the authority to vote is withheld on certain matters will, however,
be treated as present for quorum purposes on all matters.

OTHER BUSINESS

The Board of Directors knows of no business which will be presented for
consideration at the Annual Meeting other than that stated above. If other
business should come before the Annual Meeting, the persons named in the proxies
solicited hereby, each of whom is an iBasis employee, may vote all shares
subject to such proxies with respect to any such business in the best judgment
of such persons.

SHAREHOLDER PROPOSALS

It is currently contemplated that the 2002 Annual Meeting of Shareholders
will be held on or about May 31, 2001. Proposals of shareholders intended for
inclusion in the proxy statement to be furnished to all shareholders entitled to
vote at the next annual meeting of the Company must be received at the

Company's principal executive offices not later than December 15, 2001. It is
suggested that proponents submit their proposals by certified mail, return
receipt requested.

Dated: May 3, 2001

ANNUAL REPORT ON FORM 10-K

A copy of iBasis' Annual Report on Form 10-K for the year ended
December 31, 2000 will be furnished without charge (except for exhibits) to
beneficial owners or shareholders of record upon request to Investor Relations,
iBasis, Inc. 20 Second Avenue, Burlington, MA 01803.

Appendix A

IBASIS, INC.
AUDIT COMMITTEE CHARTER

ORGANIZATION

There shall be a committee of the board of directors to be known as the
audit committee (the "Audit Committee") and that the members of the Audit
Committee shall be composed of directors who are not officers or employees of
the corporation or its subsidiaries and are free of any relationship that, in
the opinion of the board of directors, would interfere with their exercise of
independent judgment as a committee member. At least three members of the Audit
Committee shall be conversant with the terms and terminology of finance, of
which at least one member shall have accounting or related financial management
expertise.

STATEMENT OF POLICY

The Audit Committee shall provide assistance to the corporate directors in
fulfilling their responsibility to the stockholders, potential stockholders, and
investment community relating to corporate accounting, reporting practices of
the corporation, and the quality and integrity of the financial reports of the
corporation. In so doing, it is the responsibility of the Audit Committee to
maintain free and open means of communication between the directors, the
independent auditors, the internal auditors, and the financial management of the
corporation. Independent auditors of the corporation shall be primarily
accountable to the Audit Committee.

RESPONSIBILITIES

In carrying out its responsibilities, the Audit Committee believes its
policies and procedures should remain flexible, in order to best react to
changing conditions and to ensure to the directors and stockholders that the
corporate accounting and reporting practices of the corporation are in
accordance with all requirements and are of the highest quality.

In carrying out these responsibilities, the Audit Committee will:

1. Review and recommend to the directors the independent auditors to be
selected to audit the financial statements of the corporation and its
divisions and subsidiaries and receive from any potential auditor a written
statement of all relationships of the auditor to the corporation.

2. Meet with the independent auditors and financial management of the
corporation to review the scope of the proposed audit for the current year
and the audit procedures to be utilized, and at the conclusion thereof
review such audit, including any comments or recommendations of the
independent auditors.

3. Obtain satisfaction that the audit fee is appropriate and that the
corporation will receive a complete and comprehensive audit for such fee.

4. Review with independent auditors and the corporation's financial and
accounting personnel the adequacy and effectiveness of the accounting and
financial controls of the corporation, and elicit any recommendations for
the improvement of such internal control procedures or particular areas
where new or more detailed controls or procedures are desirable. Particular
emphasis should be given to the adequacy of such internal controls to expose
any payments, transactions, or procedures that might be deemed illegal or
otherwise improper.

5. Review the internal audit function of the corporation including the
independence and authority with respect to its reporting obligations, the
proposed audit plans for the coming year, and the coordination of such plans
with the independent auditors.

A-1

6. Receive prior to each Audit Committee meeting, a summary of findings from
completed internal audits and a progress report on the proposed internal
audit plan, with explanations for any deviations from the original plan.

7. Review the financial statements contained in the annual report to
stockholders and, upon request of the Chief Financial Officer or Chief
Accounting Officer, or when they deem it appropriate, quarterly reports on
Form 10-Q, prior to their issuance, with management and the independent
auditors to determine that the independent auditors are satisfied with the
disclosure and content of the financial statements to be presented to the
stockholders. Any changes in accounting principles should be reviewed.

8. Review with the independent auditors any significant disputes between
management and the independent auditors that arose in connection with the
preparation of the financial statements.

9. Provide sufficient opportunity for the internal and independent auditors to
meet with the members of the Audit Committee without members of management
present. Among the items to be discussed in these meetings are the
independent auditors' evaluation of the corporation's financial, accounting,
and auditing personnel, and the cooperation that the independent auditors
received during the course of the audit.

10. Review the corporation's compliance with law and significant corporate
policies, including its code of conduct.

11. Review accounting and financial human resources and succession planning
within the corporation.

12. Submit the minutes of all meetings of the Audit Committee to, or discuss the
matters discussed at each committee meeting with, the board of directors.

13. Investigate any matter brought to its attention within the scope of its
duties, with the power to retain outside counsel for this purpose if, in its
judgment, that is appropriate.

A-2

IBS48B DETACH HERE

PROXY

iBASIS, INC.

PROXY FOR 2001 ANNUAL MEETING OF SHAREHOLDERS

THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS

The undersigned shareholder of iBASIS, INC., a Delaware corporation, hereby
acknowledges receipt of the Notice of Annual Meeting of Shareholders and
Proxy Statement, each dated May 3, 2001, and hereby appoints Ofer Gneezy and
Gordon VanderBrug, and each of them, jointly and severally, as proxies and
attorneys-in-fact, with full power of substitution, on behalf and in the name
of the undersigned, to represent the undersigned at the 2001 Annual Meeting
of Shareholders of iBasis, Inc. to be held on Thursday, May 31, 2001 at 10:00
a.m., local time, at our offices, 20 Second Avenue, Burlington, Massachusetts
01803 and at any adjournment or adjournments thereof, and to vote all shares
of Common Stock which the undersigned would be entitled to vote, if
personally present, on the matters set forth on the reverse side and, in
accordance with their discretion, on any other business that may come before
the meeting, and revokes all proxies previously given by the undersigned with
respect to the shares covered hereby.

THIS PROXY WILL BE VOTED AS DIRECTED, OR IF NO CONTRARY DIRECTION IS
INDICATED, WILL BE VOTED FOR THE ELECTION OF THE DIRECTOR, FOR THE
APPOINTMENT OF ARTHUR ANDERSEN LLP AS INDEPENDENT AUDITORS FOR iBASIS, AND AS
SAID PROXIES DEEM ADVISABLE ON SUCH OTHER MATTERS AS MAY PROPERLY COME BEFORE
THE MEETING.

- ------------------------------------ ---------------------------------------
VOTE BY TELEPHONE VOTE BY INTERNET
- ------------------------------------ ---------------------------------------

It's fast, convenient and immediate! It's fast, convenient and your
Call Toll-Free on a Touch-Tone Phone vote is immediately confirmed
1-877-PRX-VOTE (1-877-779-8683). and posted.

- ------------------------------------ ---------------------------------------
Follow these four easy steps: Follow these four easy steps:
1. Read the accompanying Proxy 1. Read the accompanying Proxy
Statement and Proxy Card. Statement and Proxy Card.

2. Call the toll-free number 2. Go to the Website
1-877-PRX-VOTE (1-877-779-8683). http://www.eproxyvote.com/ibas

3. Enter your 14-digit Voter Control 3. Enter your 14-digit Voter Control
Number located on your Proxy Card Number located on your Proxy Card
above your name. above your name.

4. Follow the recorded instructions. 4. Follow the instructions provided.
- ------------------------------------ ---------------------------------------
YOUR VOTE IS IMPORTANT! YOUR VOTE IS IMPORTANT!
Call 1-877-PRX-VOTE anytime! Go to http://www.eproxyvote.com/ibas
anytime!

DO NOT RETURN YOUR PROXY CARD IF YOU ARE VOTING BY TELEPHONE OR INTERNET

DETACH HERE
IBS48A

1. ELECTION OF THE DIRECTOR
FOR AGAINST ABSTAIN
NOMINEE: (01) Charles M. Skibo 2. PROPOSAL TO RATIFY AND --- --- ---
APPOINT ARTHUR ANDERSEN | | | | | |
LLP AS INDEPENDENT | | | | | |
AUDITORS. --- --- ---
FOR WITHHELD
---- ----
| | | |
| | | |
---- ----

Please sign exactly as your name(s) appear(s) hereon. All
holders must sign.

Corporation or partnership, please sign in full corporate
or partnership name by authorized person.

Signature: ________________________ Date: _________ Signature: ________________________ Date: _________