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Draft
Minutes
Meeting of the Executive Committee
16 August
2001 |
INTERNET CORPORATION FOR
ASSIGNED NAMES AND NUMBERS
MINUTES OF MEETING OF EXECUTIVE
COMMITTEE
16 August 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
August 2001. The following members of the Committee were present by
telephone: Vint Cerf, Hans Kraaijenbrink, Sang-Hyon Kyong, Alejandro
Pisanty, and Nii Quaynor. (Mr. Pisanty and Mr. Quaynor joined the meeting
shortly after it began.) Also present on the teleconference were M. Stuart
Lynn, ICANN's President and Chief Executive Officer, and Louis Touton,
ICANN's Vice-President, Secretary, and General Counsel.
The meeting was called to
order by Dr. Cerf at 8:10 am U.S. Eastern Standard Time.
APPROVAL OF MINUTES
Dr. Cerf noted that minutes
of the Executive Committee's last meeting, which was held on 30 January
2001, had been prepared and distributed to the Committee. Dr. Pisanty
joined the meeting during this discussion. Dr. Kyong made the following
motion, which Mr. Kraaijenbrink seconded:
Resolved [EC01.7] that the Minutes of the Meeting of the Executive Committee held on 30 January
2001 are hereby approved and adopted as
presented.
The motion carried
unanimously, with Dr. Quaynor not yet present.
REPAYMENT OF LOANS
The Executive Committee next
considered whether to authorize repayment of loans ICANN had received from
MCI WorldCom, Inc. (since renamed WorldCom, Inc.) and 3Com Corporation.
Mr. Touton explained that
ICANN received loans from four companies in 1999 totalling US$1,025,000,
which greatly assisted ICANN in paying its operating costs prior to the
time ICANN attained sufficient regular funding sources. The loans were for
one year and could be extended by up to one additional year at the
lenders' options. At the time of the meeting, the extended terms of two of
the loans had just expired or would soon expire. ICANN has sufficient
funds to repay these loans and it is recommended that it do so.
During this discussion, Dr.
Quaynor joined the meeting.
Upon motion by Mr.
Kraaijenbrink, seconded by Dr. Pisanty, the Executive Committee adopted
the following resolution, with Dr. Cerf not participating due to his
employment by WorldCom:
Whereas, MCI WorldCom, Inc.
has loaned ICANN a principal amount of US$500,000, which was due for
repayment on 28 July 2001;
Whereas, the principal due
to MCI WorldCom for repayment is US$500,000 and the unpaid interest that
will be accrued through 21 August 2001 is US$31,958;
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; and
Resolved [EC01.8], that the President is authorized to
disburse, on or about 21 August 2001, US$531,958 to MCI WorldCom, Inc.
in full repayment of its loan to ICANN.
Upon motion by Mr.
Kraaijenbrink, seconded by Dr. Pisanty, the Executive Committee adopted
the following resolution:
Whereas, 3Com Corporation
has loaned the Corporation a principal amount of US$175,000, which will
be due for repayment on 23 August 2001;
Whereas, the principal due
to 3Com for repayment is US$175,000 and the unpaid interest that will be
accrued through 23 August 2001 is US$11,375; and
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;
Resolved [EC01.9], that the President is authorized to
disburse, on or about 21 August 2001, US$186.375 to 3Com Corporation in
full repayment of its loan to ICANN.
PAYMENT OF LEGAL
EXPENSES
Mr. Touton noted that during
2001 ICANN has been involved in several intensive negotiations of
appropriate contractual arrangements with the operators and sponsors of
the seven new TLDs selected by the ICANN Board in November 2000. These
agreements are complex (in large part due to the likelihood that they will
serve as models for future agreements and therefore should be sufficiently
robust and flexible to allow them to be used in those situations as well).
To meet the need to move forward with negotiating several agreements at
once and to handle disputes arising from the selection process, it has
been necessary to enlist the assistance of ICANN's outside lawyers, Jones,
Day, Reavis & Pogue.
During the months of February
and May 2001, the fees associated with these outside services were
US$105,209.90 and US$78,650.70, respectively. Given the discounts ICANN
receives from Jones Day in recognition of its non-profit character, the
effective hourly rate for the legal services covered by these two invoices
is approximately US$200, well under the rates ordinarily charged by
lawyers with comparable experience and credentials for work of this
type.
Under exisitng Board
resolutions, payments in excess of US$50,000 must be approved by the
Board. The Board has delegated approval authority to the Executive
Committee. There are three general considerations that the Executive
Committee applies in making these approvals:
1. Is the payment for a
valid indebtedness of ICANN?
2. Was the indebtedness
incurred on behalf of ICANN according to actual, implied, or apparent
authority?
3. Does ICANN have
sufficient funds so that it can responsibly pay its
debt?
It was noted that both Dr.
Lynn and Mr. Touton reviewed the two invoices, concluded that these three
conditions were satisfied, and have recommend that the two invoices be
paid. After further discussion, Mr. Kraaijenbrink moved and Dr. Kyong
seconded the following resolution:
Whereas, ICANN had
significant needs for legal services in the months of February and May
2001 concerning implementation of the new TLD program
authorized by resolutions 00.46 through 00.51;
Whereas, Jones, Day, Reavis
& Pogue provided extensive legal services to meet these
needs;
Whereas, ICANN received
invoices from Jones, Day for US$105,209.90 and US$78,650.70 for legal
services provided to ICANN in connection with the introduction of new
TLDs and related matters during the months of February and May 2001;
Whereas, the President
reviewed the invoices and determined that in his opinion they represent
a proper indebtedness of ICANN, are for authorized services, and should
be paid;
Whereas, the President has
advised the Executive Committee that ICANN has adequate funds to pay
these expenses; and
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 the Corporation;
Whereas, the President
advised the Executive Committee's members of his opinion that the
invoices should be paid;
Resolved [EC01.10] that the payment to Jones, Day,
Reavis & Pogue of US$105,209.90 and US$78,650.70 for legal services
provided to ICANN in connection with the introduction of new TLDs and
related matters during the months of February and May 2001 is hereby
approved and authorized.
The resolution passed
unanimously.
DIRECTOR/OFFICER TRAVEL
REIMBURSEMENT
The Executive Committee then
took up the topic of reimbursement of travel expenses incurred by ICANN
Directors and Officers. Three aspects were discussed:
1. A statement of travel-reimbursement procedures prepared
by Diane Schroeder, ICANN's Business Manager. An earlier version of this
statement has been followed administratively for some time, but the
statement has been updated recently. The Executive Committee discussed
the procedures in detail, considering particularly whether the principle
that business-class air travel should be reimbursed for flights of
greater than five hours' duration should be refined in various ways.
After evaluating various proposals for refinements, the Executive
Committee concluded that the refinements led to inequities or
significant complexities in ICANN's international context and should not
be made at this time. The Executive Committee requested the President to
provide a report of experience under the procedures in approximately six
months.
2. Approval of
reimbursement of US$45,754.29 in travel expenses incurred by Dr. Lynn.
The Executive Committee reviewed the nature of these expenses and
concluded they were appropriate for reimbursement.
3. The ICANN Bylaws require
that reimbursement of the President's expenses be authorized by the
Board or an authorized Committee of the Board. Obtaining approval,
however, ordinarily takes considerable time, which requires Dr. Lynn to
bear a significant float in view of his extensive travel
responsibilities. Accordingly, the Board discussed a procedure
(described in item 8 of the travel-reimbursement procedures) under
which the Vice-President and General Counsel may authorize payment to
the President of an advance, not to exceed US $20,000 at any time,
toward expenses already incurred by the President but for which
reimbursement has not yet been authorized by the Board, with the
reimbursement to be later approved by the Board or Executive Committee.
During this discussion, Dr. Lynn stated that he would provide written
assurance that he would promptly repay any amounts advanced where the
Board or Executive Committee declined to approve the reimbursement. With
this commitment, the Executive Committee concluded that the procedure
was appropriate.
Upon a motion by Dr. Kyong
and a second by Dr. Pisanty, the Executive Committee unanimously adopted
the following resolutions:
Whereas, Article V, Section 22 and Article VII, Section 7 of the ICANN bylaws authorize
the Board to authorize the reimbursement of actual and necessary
reasonable expenses incurred by Directors performing duties as Directors
and Committee Members;
Whereas, Article VIII, Section 9 of the ICANN bylaws provides
that expenses incurred by ICANN Officers in connection with performance
of their Officer duties may be reimbursed to Officers of the President
(in the case of Officers other than the President) or the
Board;
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 the Corporation;
Whereas, the Executive
Committee has considered a statement of 'Administrative Procedures for Reimbursement of
Expenses' presented by Diane Schroeder, ICANN Business Manager,
dated 16 August 2001;
Whereas, the Executive
Committee believes that it is appropriate to approve formal procedures
for the reimbursement of Director's and Officer's expenses;
Whereas, the President has
incurred and requested reimbursement for US$45,754.29 in expenses in the
course of his duties as President;
Resolved [EC01.11] that the procedures for
reimbursement of expenses of Directors and Officers stated in the 16
August 2001 'Administrative Procedures for Reimbursement of
Expenses' are hereby adopted;
Resolved [EC01.12] that the payment of US$45,754.29 to
M. Stuart Lynn in reimbursement of expenses he incurred as President is
hereby approved and ratified; and
Resolved [EC01.13] that, as stated in item 8 of the
'Administrative Procedures for Reimbursement of Expenses', the
Vice-President and General Counsel may authorize payment to the
President of an advance, not to exceed US $20,000 at any time, toward
expenses already incurred by the President but not yet authorized by the
Board, with the expenses to be later approved by the Board (or an
authorized Committee of the Board).
It was noted that Mr.
Kraajenbrink had recently attended the PSO General Assembly and the London
meeting of the Internet Engineering Task Force on behalf of ICANN. His
assistance in this regard allowed ICANN staff to attend to other matters,
including the intensive work on various agreements ICANN is negotiating
with registry operators and sponsors. Upon Dr. Pisanty's motion, with a
second by Dr. Kyong, the Executive Committee adopted the following
resolution:
Resolved [EC01.14] that the Executive Committee
approves reimbursement of the expenses of Director Hans Kraaijenbrink
for trips he made, prior to adoption of the Administrative Procedures for Reimbursement of
Expenses, on behalf of ICANN to the 11 July 2001 PSO General
Assembly in Sophia Antipolis, France and to the 5-10 August 2001
Internet Engineering Task Force meeting in London,
England.
Mr. Kraaijenbrink did not
participate in this action of the Executive Committee in view of his
financial interest in the resolution.
At this point, Mr. Touton
left the meeting.
EXECUTIVE COMMITTEE
COMPOSITION
It was noted that in resolution 00.95, the Board appointed the members of the
Executive Committee including Michael M. Roberts, then ICANN's President.
With Mr. Roberts' March 2001 retirement as President, he became ineligible
to remain a member of the Executive Committee, but no resolution appointed
Dr. Lynn to serve on the Committee in Mr. Roberts' place. The Executive
Committee discussed the situation and concluded that the Board should be
requested to appoint Dr. Lynn as an additional member of the Executive
Committee.
PERSONNEL MATTERS
The Executive Committee
discussed various personnel matters. Pursuant to Article III, Section 2(c) of the bylaws, a record of this
discussion is not included in these minutes.
There being no further
business, the meeting was adjourned at 9:00 pm U.S. Eastern Standard
Time.
_______________________
Louis Touton
Secretary
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