Minutes Meeting of the Executive Committee 16 October 2001

INTERNET CORPORATION FOR ASSIGNED NAMES AND NUMBERS
MINUTES OF MEETING OF EXECUTIVE COMMITTEE
16 October 2001

A meeting of the Executive Committee of the Board of Directors of the Internet Corporation for Assigned Names and Numbers ("ICANN") was held by teleconference on 16 October 2001. The following members of the Committee were present by telephone: Vint Cerf, Hans Kraaijenbrink, Sang-Hyon Kyong, Stuart Lynn, Alejandro Pisanty, and Nii Quaynor. Also present on the teleconference was Louis Touton, ICANN's Vice-President, Secretary, and General Counsel.

The meeting was called to order by Dr. Cerf at 12:09 UTC (8:09 am U.S. Eastern Standard Time).

Approval of Minutes

Dr. Cerf noted that the minutes of the committee's meetings held 6 January and 16 August 2001 had been prepared and circulated to the committee. These bring the committee's minutes up to date. Upon motion of Dr. Kyong, seconded by Mr. Kraaijenbrink, the committee unanimously adopted the following motion:

Resolved [EC01.15] that the Minutes of the Meetings of the Executive Committee held on 6 January 2001 and 16 August 2001 are hereby approved and adopted as presented.

Repayment of Loan

The committee discussed repayment of a loan made to the corporation by Deusche Telekom. In 1999, ICANN received one-year loans from Cisco Systems, MCI WorldCom, 3Com, and Deutsch Telekom totalling $1,025,000. These loans, which were extended for varying periods, have all been repaid with the Executive Committee's authorization except the loan made by Deutsche Telekom.

The Deutsche Telekom loan has a principal amount of US$ 200,000. It became due on 12 October, but ICANN has informally obtained a short extension to allow the Executive Committee to take up the issue on 16 October 2001. The unpaid interest as of 16 October will be US$ $14,906.

Mr. Kraaijenbrink made the following motion, which was seconded by Mr. Quaynor:

Whereas, Deutsche Telekom has loaned ICANN a principal amount of US$ 200,000, which was due for repayment on 12 October 2001;

Whereas, the principal due to Deutsche Telekom for repayment is US$ 200,000 and the unpaid interest that will be accrued through 16 October 2001 is US$ 14,906;

Whereas, in resolution 99.121 the Board delegated to the Executive Committee the authority (with exceptions not here relevant) to exercise all the Board's powers in the oversight of the management of the affairs of ICANN, specifically including in financial matters;

Resolved [EC01.16], that the President is authorized to disburse, on or about 16 October 2001, US$ 214,906 to Deutsche Telekom in full repayment of its loan to ICANN.

The motion passed unanimously.

Payment of Legal Expenses

The committee discussed the payment of a bill for legal services rendered in July 2001 in connection with the design of the legal documentation of ICANN's relationships concerning ccTLDs (particularly ccTLD agreements). At ICANN's Stockholm meeting in June 2001, Dr. Lynn made a commitment to the Board and the community to put in place the ability to process up to five ccTLD agreements per month. To meet this commitment, ICANN arranged for its outside counsel, Jones, Day, Reavis & Pogue, to perform a variety of tasks, including legal research on several related topics and assistance in preparation of model agreements. As a result, ICANN management now believes ICANN has the promised capability to process up to five agreements per month.

A team of attorneys, with significant experience in international legal transactions involving technology matters, worked 358.75 hours on this project during the month of July, for which the fee is US$ 78,261.56, leading to an effecive rate of US$ 218 per hour. This is less than the rates commonly charged by attorneys of similar experience and credentials. In addition to the fees, the bill includes US$ 10,450.12 for expenses. These two amounts total to the US$ 88,711.68 amount of the bill.

The committee discussed how payment of this fee would affect ICANN's finances. Dr. Lynn reported that ICANN now had sufficient funds to pay the bill. In a case such as this, the request for approval to make the payment is presented to the committee only when ICANN is ready (or nearly ready) to make the payment. The question presented to the committee at this point is not whether to authorize ICANN to obtain the legal services; those issues are addressed by the Board as part of the budget process.

Upon motion made by Mr. Kraaijenbrink and seconded by Dr. Kyong, the following motion was passed unanimously:

Whereas, ICANN had significant needs for legal services in the month of July 2001 concerning ccTLD agreements, including preparation of a program under which ICANN would be capable of negotiating and entering up to five ccTLD agreements per month;

Whereas, Jones, Day, Reavis & Pogue provided extensive legal services to meet these needs;

Whereas, ICANN received an invoice from Jones, Day for US$ 88,711.68 for these legal services rendered in July 2001;

Whereas, the President reviewed the invoice and determined that in his opinion it represents a proper indebtedness of ICANN, is for authorized services, and should be paid;

Whereas, the President has advised the Executive Committee that ICANN has adequate funds to pay this invoice;

Whereas, in resolution 99.121 the Board delegated to the Executive Committee the authority (with exceptions not here relevant) to exercise all the Board's powers in the oversight of the management of ICANN's affairs, including in financial matters;

Whereas, the President advised the Executive Committee's members of his opinion that the invoice should be paid;

Resolved [EC01.17] that payment to Jones, Day, Reavis & Pogue of US$ 88,711.68 for legal services provided to ICANN in ccTLD agreements during the month of July 2001 is hereby approved and authorized.

Reimbursement of President's Expenses

At its 16 August 2001 meeting, the Executive Committee adopted procedures for approvals of reimbursement of the President's expenses. Since that time, two advances were made to Dr. Lynn for expenses he had incurred, totalling US$ 16,417.84. As provided in the procedures, Mr. Touton requested that the Executive Committee now formally authorize reimbursement of this amount.

Mr. Pisanty noted that the expenses were partly for Dr. Lynn's stay in Latin America after the Montevideo meeting, which had been extended by disruptions in air travel related to the events of 11 September 2001.

Mr. Pisanty made the following motion, which was seconded by Dr. Kyong:

Whereas, under resolution EC01.13 the Vice-President and General Counsel has approved advances to the President toward expenses he has incurred in connection with performance of his duties in the amounts of US$ 7524.21 (on 30 August 2001) and US$ 8893.63 (on 8 October 2001);

Whereas, the Executive Committee has considered whether to approve the reimbursement of those expenses;

Resolved [EC01.18] that the Executive Committee, acting under the authority delegated to it by the Board in resolution 99.121, approves reimbursement to the President of the expenses incurred amounts of US$ 7524.21 and US$ 8893.63.

The motion passed 5-0-1, with Dr. Lynn abstaining because of his financial interest.

Miscellaneous

The Executive Committee discussed plans for the annual meeting, to be held in November 2001 in Marina del Rey. It was noted that the security focus of the meeting was intended primarily to educate the Board and the community as a basis for more informed policy development in the future, rather than to result in any immediate policies.

The committee also discussed the desirability of receiving reports from Directors who attend relevant meetings of other groups.

There being no further business, the meeting was adjourned at 12:28 UTC (8:28 am U.S. Eastern Standard Time).

_______________________
Louis Touton
Secretary