On September 30, 2008, iBasis, Inc. ("iBasis") and Silicon Valley Bank (the "Lender") entered into a Second Loan Modification Agreement (the "Second Loan Modification Agreement") to that certain Second Amended and Restated Loan and Security Agreement, as amended by that certain First Loan Modification Agreement dated as of April 28, 2008 (as amended by the Second Loan Modification Agreement, the "Amended Loan Agreement") . iBasis entered into the Second Loan Modification Agreement to, among other things, i) increase the interest rate payable on amounts drawn under its credit facilities by 100 basis points, ii) replace a minimum cash availability financial requirement with a requirement to maintain, as of the last day of each month, a minimum liquidity amount, defined as unrestricted cash at Lender plus the amount available under the Amended Loan Agreement, of $10 million for the months ended September 30, 2008 through and including February 28, 2009, and $15 million for each month thereafter, iii) modify the adjusted quick ratio financial requirement to require a minimum adjusted quick ratio of 0.80 to 1.00 for the period from September 30, 2008 through February 28, 2009 and 0.85 to 1.00 thereafter, and iv) reduced the minimum quarterly consolidated EBITDA requirement to $7 million for quarter ending September 30, 2008, increasing to $10 million for each quarter thereafter. iBasis is also paying the Lender an up-front, one-time supplemental modification fee equal to $125,000. In addition, as a condition to the Second Loan Modification Agreement, iBasis entered into an agreement with its principal stockholder, KPN B.V. ("KPN"), to increase from 6% to 7% the interest rate payable on the KPN promissory note entered into in connection with the $15.5 million post-closing purchase price adjustment due to KPN for the October 1, 2007 transactions between the parties and to extend the payment dates for the final two installment payments due under the promissory note until March 31, 2009 and June 30, 2009. See iBasis' Form 10-Q for the fiscal period ending June 30, 2008 filed on August 7, 2008 for further information regarding the promissory note and post-closing purchase price adjustment.

Pursuant to the Amended Loan Agreement, iBasis may borrow up to $50 million from time to time under a secured revolving credit facility for a two-year period which commenced October 2, 2007. The interest payable on amounts drawn under this revolving credit facility are based on either the Lender's prime rate, plus a margin, or LIBOR, plus a margin. The revolving credit facility is also guaranteed by iBasis Global, Inc., iBasis Retail, Inc., iBasis Securities Corporation and KPN International Network Services, Inc., all of which are wholly-owned subsidiaries of iBasis. The revolving credit facility is secured by a first priority lien and security interest in the assets of iBasis and such guarantors. In addition, iBasis has pledged two-thirds of all its shares of iBasis Netherlands B.V. (formerly KPN Global Carrier Services B.V.), which is a wholly-owned subsidiary of iBasis, as collateral for the revolving credit facility. Proceeds from the credit facility may be used solely as (i) working capital, (ii) to fund general business requirements, and (iii) to fund the dividend declared by iBasis in connection with the transactions with KPN.

(d) Exhibits

Exhibit No.            Description
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99.1                   Second Loan Modification Agreement dated as of September
                       30, 2008 between Silicon Valley Bank and iBasis, Inc.