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Exhibit 10.9    
    

 
  EMPLOYMENT AGREEMENT    
    

        THIS EMPLOYMENT AGREEMENT (the "Agreement") is made this 15th day of August, 2007, by and between MTR Gaming Group, Inc./Presque Isle Downs, Inc.
("MTR/PIDI" or the "Company"), having an address of State Route 2, South, Chester, West Virginia 26034, and Patrick J. Arneault, having an address of c/o MTR Gaming Group, Inc., State Route 2
South, Chester, WV 26034 ("Executive"). 

        WHEREAS,
Executive is currently an at-will employee of the Company serving as Executive Vice President of Development; and 

        WHEREAS,
the Company wishes to continue to employ Executive in Executive's current capacity and further wishes to enter into an agreement with Executive in order to afford Executive
certain long-term benefits as well as to reflect the terms and conditions of Executive's employment relationship to the Company: 

        NOW
THEREFORE, the parties, in reliance upon the mutual promises and covenants herein contained, do hereby agree as follows: 

        1.    Term.    The Company hereby agrees to employ Executive, and Executive agrees to serve the Company, in the
capacity indicated above for a two year period commencing on January 1, 2007 (the "Employment Date"), and ending on January 1, 2009 (such period, subject to earlier termination as
provided herein, being referred to as the "Period of Employment"); provided, however, that Executive's
employment hereunder may be terminated by the Company at any time within ninety (90) days after the date first written above in the Company's sole discretion. 

        2.    Duties and Services.    During the Period of Employment, Executive agrees to serve the Company as its Executive
Vice President of Development, and in such other office of MTR/PIDI and/or its Affiliates to which Executive may be elected or appointed, and to perform such other reasonable and appropriate
duties as may be requested of Executive by the President and CEO of the Company (the "CEO"), in accordance with the terms herein set forth. Executive shall devote such of his/her time, energy and
skill during regular business hours to the business and affairs of the Company and its Affiliates and to the promotion of their interests as is required. Executive shall report directly to and shall
be subject to the direction of Edson R. Arneault. 

        3.    Compensation.    

        (a)    Base Salary.    The base salary of the Executive for services pursuant to the terms of this Agreement shall be
$351,979.00 per year, payable in bi-monthly installments or on such other terms as may mutually be agreed upon by the Company and Executive. Executive's base salary shall be subject to an
automatic cost-of-living increase of five percent (5%) on the first anniversary of this Agreement, and shall be subject to periodic increase by the Company's Compensation
Committee in its sole discretion. 

        (b)    Discretionary Cash Bonus.    Executive shall be entitled to periodic cash bonuses in the sole discretion of the
Company's Compensation Committee. 

        (c)    Benefit Plans and Fringe Benefits.    Executive shall receive such employment fringe benefits and shall be
entitled to participate in other employee benefit plans, including without limitation any health insurance, pension plan, profit-sharing plan, savings plan, life insurance and disability insurance
plans and the like made available by the Company now or in the future to its executives as the Company's Compensation Committee may periodically award in its discretion based on the Executive's
performance, subject to and on a basis consistent with the terms, conditions and overall administration of such benefit plans. 

        (d)    Long Term Incentives.    In connection with this Agreement, on April 27, 2007 MTR Gaming
Group, Inc. issued to Executive non-qualified options to purchase 20,000 shares of MTR's common stock. The exercise price of those options was $16.27, the Nasdaq Official Close
Price of 

 

the
stock on the date of grant as evidenced by a resolution of the Compensation Committee of MTR Gaming Group, Inc., as disclosed to Executive on or about April 27, 2007. Provided that
this Agreement has not been terminated pursuant to Section 2, Section 4(a), or Section 4(b), and provided further that Executive shall not have resigned his/her employment, then
the options will vest on the second anniversary of the Employment Date. This section 3(d) is intended only to provide a summary of the terms of the options; all of the terms and conditions will
be set forth in a separate Non-Qualified Incentive Stock Option Agreement ("NQSO") in a form acceptable to the Company and Executive. In the event the shareholders of MTR Gaming
Group, Inc. approve that company's 2007 Stock Incentive Plan (the matter is scheduled to be voted upon at the annual meeting of shareholders on June 19, 2007), and provided that this
Agreement shall not have been terminated, then on a date chosen by the Compensation Committee of MTR Gaming Group, Inc., the Company will cause MTR Gaming Group to issue to Executive
non-qualified options to purchase 20,000 shares of MTR's common stock (the "Second Tranche"). The exercise price of those options will be the Nasdaq Official Close Price of the stock on
the date of grant as evidenced by a resolution of the Compensation Committee of MTR Gaming Group, Inc. Provided that this Agreement has not been terminated pursuant to Section 2,
Section 4(a), or Section 4(b), and provided further that Executive shall not have resigned his/her employment, then the options will vest on the second anniversary of the Employment
Date. This section 3(d) is intended only to provide a summary of the terms of the options; all of the terms and conditions will be set forth in a separate Non-Qualified Incentive
Stock Option Agreement ("NQSO") in a form acceptable to the Company and Executive. In the event the shareholders do not approve the 2007 Stock Incentive Plan, then the Company shall have no further
obligation pursuant to this Section 3(d) with respect to the Second Tranche. 

        (e)    Automobile Allowance.    During the Period of Employment, Executive shall be entitled to $600 per month toward
the lease or purchase, insurance and maintenance of an automobile. 

        (f)    Vacation.    Executive shall be entitled to four (4) weeks of paid vacation annually to be taken at a
time or times mutually satisfactory to Executive and the Company. Accrued vacation time not utilized by Executive due to business commitments may be carried over to the following year (provided,
however, that Executive shall not in any event utilize more than six weeks of vacation in any twelve month period) or paid to Executive at the end of the year as additional compensation at Executive's
election. 

        (g)    Expenses.    All travel and other expenses incident to the rendering of services by Executive hereunder,
including the expenses associated with gaming licensing in any state in which the Company or one of its affiliates requests Executive to become licensed, shall be paid by the Company. The Company
shall also provide Executive a Company cellular telephone, or, at the Company's election, reimburse Executive for the cost of a cellular phone and monthly service charges maintained by Executive. If
any such expenses are paid in the first instance by Executive, the Company shall reimburse him/her therefore on presentation of the appropriate documentation required by the Internal Revenue Code of
1986, as amended (the "Code"), or Treasury Regulations promulgated thereunder, or otherwise required under the Company's policy with respect to such expenses. 

        (h)    Working Facilities.    The Company shall provide Executive with an office, secretarial, administrative and
other assistance, and such other facilities and services as shall be suitable to his/her position and appropriate for the performance of his/her duties. 

        4.    Early Termination.    

        (a)   This
Agreement will terminate automatically, and neither party shall have any further obligations or duties under this Agreement, in the event that state regulatory
authorities find 

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Executive
unsuitable to hold the position provided herein, except for obligations accrued under Section 3(a) and 3(b) as of the date of termination. 

        (b)   Notwithstanding
the provisions of Section 2 hereof, Executive may be discharged by the Company for Cause (as defined in Section 4(d) hereof), in which
event the Period of Employment hereunder shall cease and terminate and neither party shall have any further obligations or duties under this Agreement, except for obligations accrued under
Section 3(a) and 3(b) as of the date of termination. In addition, the Period of Employment shall cease and terminate upon the earliest to occur of the following events: (i) the death of
Executive or (ii) at the election of the CEO (subject to the Americans With Disabilities Act), the inability of Executive by reason of physical or mental disability to continue the proper
performance of his/her duties hereunder for a period of 180 consecutive days. Upon termination of the Period of Employment as a result of the Executive's death or disability, in consideration for
Executive or his/her heirs and beneficiaries releasing the Company from any claims, damages or causes of action, the Company shall pay to Executive or his/her estate, as the case may be, a lump sum
amount equal to the lesser of (i) the base salary described in Section 3(a) hereof for the remaining term of the Agreement, or (ii) the amount of base salary to which Executive
would have been entitled to receive for the one (1) year following his/her death or disability. 

        (c)   In
the event Executive is discharged by the Company other than for the reasons set forth in Paragraph 4(b) above, Executive shall have no further obligations or
duties under this Agreement, provided, however, that Executive shall continue to be bound by the
provisions of Section 5 hereof if the Company performs its obligations under this Section 4(c). In the event of termination of the Period of Employment pursuant to the preceding
sentence, unless such termination is in connection with a change in control of the Company or a sale of all or substantially all of the assets of MTR Gaming Group, Inc. (individually or
collectively, a "Change in Control") (in which case Executive's severance will be as set forth in the last sentence of this Paragraph 4(c)), in consideration for Executive or his/her heirs and
beneficiaries releasing the Company from any claims, damages or causes of action, the Company shall continue to pay Executive the entire compensation otherwise payable to him/her under the provisions
of Section 3 hereof for the otherwise remaining Period of Employment without any duty on the part of Executive to mitigate such payments; provided, however, that if Executive should die prior
to the end of such period, the provisions of Section 4(b) hereof shall be applicable as though Executive's employment hereunder had not been so terminated. In the event such termination is in
connection with a Change in Control, then the Company shall pay Executive severance in an amount equal to the greater of (i) the entire compensation otherwise payable to him/her under the
provisions of
Section 3 hereof for the remainder of the Period of Employment hereof; and (ii) one year's salary—in either case without any duty on the part of Executive to mitigate such
payments, in consideration for a mutual release from any further obligations of either party hereunder. 

        (d)   For
purposes of this Section 4, the term "Cause" shall mean (i) conviction of a felony, (ii) embezzlement or misappropriation of funds or property
of the Company or any of its affiliates (the "Affiliates"), (iii) Executive's consistent refusal to substantially perform, or willful misconduct in the substantial performance of, his/her
duties and obligations hereunder; (iv) Executive's engaging in activity that the CEO determines in his reasonable judgment would result in the suspension or revocation of any video lottery,
parimutuel, or other gaming license or permit held by MTR or any of its subsidiaries; or (v) a determination by any state gaming regulatory agency that Executive is not suitable to hold his/her
position or otherwise to participate in a gaming enterprise in the state in question. 

        5.    Confidentiality and Non-Competition:    

        (a)   The
Company and Executive acknowledge that the services to be performed by Executive under this Agreement are unique and extraordinary and, as a result of such
employment, Executive 

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will
be in possession of confidential information and trade secrets (collectively, "Confidential Material") relating to the business practices of the Company and its Affiliates. Executive agrees that
he/she will not, directly or indirectly, (i) disclose to any other person or entity either during or after his/her employment by the Company or (ii) use, except during his/her employment
by the Company in the business and for the benefit of the Company or any of its Affiliates, any Confidential Material acquired by Executive during his/her employment by the Company, without the prior
written consent of the Company or otherwise than as required by law or any rule or regulation of any federal or state authority. Upon termination of his/her employment with the Company for any reason,
Executive agrees to return to the Company all tangible manifestations of Confidential Materials and all copies thereof, not to disparage the Company, and for a period of two (2) years from the
date of such termination not to solicit for employment any employee of the Company. All programs, ideas, strategies approaches, practices or inventions created, developed, obtained or conceived of by
Executive during the term hereof by reason of his/her engagement by the Company, shall be owned by and belong exclusively to the Company, provided that they are related in any manner to the Company's
business or that of any of its Affiliates. Executive shall (i) promptly disclose all such programs, ideas, strategies, approaches, practices, inventions or business opportunities to the
Company, and (ii) execute and deliver to the Company, without additional compensation, such instruments as the Company may require from time to time to evidence its ownership of any such items. 

        (b)   Executive
agrees that during the term hereof he/she will not become a stockholder, director, officer, employee or agent of or consultant to any corporation, or member of
or consultant to any partnership or other entity, or engage in any business as a sole proprietor or act as a consultant to any such entity, or otherwise engage, directly or indirectly, in any
enterprise, in each case which competes with any business or activity engaged in, or known by Executive to be contemplated to be engaged in, by the Company or any of its Affiliates within one hundred
(100) miles of any location in which the Company
or any Affiliate does business or in which Executive has knowledge that the Company or any of its Affiliates contemplates doing business; provided,  however,
 that competition shall not include the ownership (solely as an investor and without any other participation in or contact with the management
of the business) of less than five percent (5%) of the outstanding shares of stock of any corporation engaged in any such business, which shares are regularly traded on a national securities exchange
or in an over-the-counter market. 

        (c)   Executive
agrees that the remedy at law for any breach by him/her of this Section 5 will be inadequate and that the Company shall be entitled to injunctive
relief. 

        6.    General.    This Agreement is further governed by the following provisions: 

        (a)    Notices.    Any notice or other communication required or permitted to be given hereunder shall be made in
writing and shall be delivered in person, by facsimile transmission or mailed by prepaid registered or certified mail, return receipt requested, addressed to the parties at the address stated above or
to such other address as either party shall have furnished in writing in accordance with this Section. Such notices or communications shall be effective upon delivery if delivered in person or by
facsimile and either upon actual receipt or three (3) days after mailing, whichever is earlier, if delivered by mail. 

        (b)    Parties In Interest.    This Agreement shall be binding upon and inure to the benefit of Executive and his/her
heirs and beneficiaries, and it shall be binding upon and inure to the benefit of the Company and any corporation succeeding to all or substantially all of the business and assets of the Company by
merger, consolidation, purchase of assets or otherwise. 

        (c)    Arbitration.    Any disputes arising under the terms of this Agreement shall be settled by binding arbitration
between the parties in the Weirton/Chester, West Virginia area in a proceeding 

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held
under the rules of the American Arbitration Association. In such proceeding, each party shall choose one arbitrator and the two so chosen shall choose a third arbitrator. The vote of two of the
arbitrators shall be sufficient to determine an award. Arbitration proceedings shall be commenced within thirty (30) days from the date of the claimant's request for arbitration to the other
party. Notwithstanding anything herein to the contrary, the arbitrators shall have no authority to grant either party any consequential, incidental, punitive or special damages. 

        (d)    Entire Agreement.    This Agreement supersedes any and all other agreements, either oral or in writing, between
the parties hereto with respect to the employment of Executive by the Company and contains all of the covenants and agreements between the parties with respect to such employment in any
manner whatsoever. Any modification of this Agreement will be effective only if it is in writing signed by the parties. 

        (e)    Governing Law.    This Agreement shall be governed by and construed in accordance with the laws of the State of
West Virginia without giving effect to the choice of law or conflicts of law rules and laws of such jurisdiction. 

        (f)    Severability.    In the event that any term or condition contained in this Agreement shall for any reason be
held by a court of competent jurisdiction to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other term or condition of this
Agreement, but this Agreement shall be construed as if such invalid or illegal or unenforceable term or condition had never been contained herein. 

        (g)    No Breach.    Executive warrants and represents to the Company that neither his/her entering nor performing
this Agreement will violate the terms of any contract or covenant to which Executive is a party or by which he/she is bound. 

        (h)    Indemnification.    The Company shall indemnify, defend and hold the Executive harmless, to the extent
permitted by law, including the payment of reasonable attorneys' fees, if the Company does not directly provide Executive's defense, from and against any and all civil claims made by anyone,
including, but not limited to, a corporate entity, company, other employee, agent, patron or member of the general public with respect to any claims that assert as a basis, any acts, omissions or
other circumstances involving the performance of Executive's employment duties hereunder unless such claim is finally determined by a court of competent jurisdiction to arise from Executive's gross
negligence or willful, intentional and/or wanton act. 

[signature
page follows] 

5

 

        IN
WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year first above written. 

	 	 	MTR Gaming Group, Inc./Presque Isle Downs, Inc.
	

 	
 	

By:	

/s/ Edson R. Arneault

	 	 	Its:	 
	

 	
 	

/s/ Patrick J. Arneault
 Patrick J. Arneault

6

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Exhibit 10.9

EMPLOYMENT AGREEMENTQuickLinks
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Exhibit 10.2    
    

        Option No.              

 
 

iBASIS, INC.
  Stock Option Grant Notice
  Stock Option Grant under the Company's
  2007 Stock Plan    

	1.	 	Name and Address of Participant:	 	

	2.	 	Date of Option Grant:	 	

	3.	 	Type of Grant:	 	

	4.	 	Maximum Number of Shares for which this Option is exercisable:	 	

	5.	 	Exercise (purchase) price per share:	 	

	6.	 	Option Expiration Date:	 	

	7.	 	Vesting Start Date:	 	

	8.	 	Vesting Schedule: This Option shall become exercisable (and the Shares issued upon exercise shall be vested) as follows:

[Insert Vesting Schedule]

        The
Company and the Participant acknowledge receipt of this Stock Option Grant Notice and agree to the terms of the Stock Option Agreement attached hereto and incorporated by reference
herein, the Company's 2007 Stock Plan and the terms of this Option Grant as set forth above. 

	 	 	BASIS, INC.
	

 	
 	

By:	

	 	 	 	Name:	

	 	 	 	Title:	

	

 	
 	

	 	 	Participant

 
 
 

iBASIS, INC.
  STOCK OPTION AGREEMENT—INCORPORATED TERMS AND CONDITIONS    
    

        AGREEMENT made as of the date of grant set forth in the Stock Option Grant Notice between iBasis, Inc. (the "Company"), a Delaware corporation, and
                        (the "Participant"). 

        WHEREAS,
the Company desires to grant to the Participant an Option to purchase shares of its common stock, $0.001 par value per share (the "Shares"), under and for the purposes set forth
in the Company's 2007 Stock Plan (the "Plan"); 

        WHEREAS,
the Company and the Participant understand and agree that any terms used and not defined herein have the same meanings as in the Plan; and 

        WHEREAS,
the Company and the Participant each intend that the Option granted herein shall be of the type set forth in the Stock Option Grant Notice. 

        NOW,
THEREFORE, in consideration of the mutual covenants hereinafter set forth and for other good and valuable consideration, the parties hereto agree as follows: 

1. GRANT OF OPTION.  

        The Company hereby grants to the Participant the right and option to purchase all or any part of an aggregate of the number of shares set forth in the Stock
Option Grant Notice, on the terms and conditions and subject to all the limitations set forth herein, under United States securities and tax laws, and in the Plan, which is incorporated herein by
reference. The Participant acknowledges receipt of a copy of the Plan. 

2. EXERCISE PRICE.  

        The exercise price of the Shares covered by the Option shall be the amount per Share set forth in the Stock Option Grant Notice, subject to adjustment, as
provided in the Plan, in the event of a stock split, reverse stock split or other events affecting the holders of Shares after the date hereof (the "Exercise Price"). Payment shall be made in
accordance with Paragraph 9 of the Plan. 

3. EXERCISABILITY OF OPTION.  

        Subject to the terms and conditions set forth in this Agreement and the Plan, the Option granted hereby shall become exercisable as set forth in the Stock Option
Grant Notice which rights are cumulative and are subject to the other terms and conditions of this Agreement and the Plan. 

4. TERM OF OPTION.  

        This Option shall terminate ten years from the date of this Agreement or, if this Option is designated in the Stock Option Grant Notice as an ISO and the
Participant owns as of the date hereof more than 10% of the total combined voting power of all classes of capital stock of the Company or an Affiliate, five years from the date of this Agreement, but
shall be subject to earlier termination as provided herein or in the Plan. 

        If
the Participant ceases to be an employee, director or consultant of the Company or of an Affiliate for any reason other than the death or Disability of the Participant, or termination
of the Participant for Cause, the Option may be exercised, if it has not previously terminated, within three months after the date the Participant ceases to provide service to the Company or an
Affiliate, or within the originally prescribed term of the Option, whichever is earlier, but may not be exercised thereafter except as set forth below. In such event, the Option shall be exercisable
only to the extent that the Option has become exercisable and is in effect at the date of such cessation of service.

2

 

        If
this Option is designated in the Stock Option Grant Notice as an ISO and the Participant ceases to be an employee of the Company or of an Affiliate but continues after termination of
employment to provide service to the Company or an Affiliate as a consultant, this Option shall continue to vest in accordance with Section 3 above as if this Option had not terminated until
the Participant is no longer providing services to the Company. In such case, this Option shall automatically convert and be deemed a Non-Qualified Option as of the date that is three
months from termination of the Participant's employment and this Option shall continue on the same terms and conditions set forth herein until such Participant is no longer providing service to the
Company or an Affiliate. 

        Notwithstanding
the foregoing, in the event of the Participant's Disability or death within three months after the termination of service, the Participant or the Participant's Survivors
may exercise the Option
within one year after the date of the Participant's termination of service, but in no event after the date of expiration of the term of the Option. 

        In
the event the Participant's service is terminated by the Company or an Affiliate for Cause, the Participant's right to exercise any unexercised portion of this Option shall, unless
otherwise determined by the Board of Directors, cease immediately as of the time the Participant is notified his or her service is terminated for Cause, and this Option shall thereupon terminate.
Notwithstanding anything herein to the contrary, if subsequent to the Participant's termination, but prior to the exercise of the Option, the Board of Directors of the Company determines that, either
prior or subsequent to the Participant's termination, the Participant engaged in conduct which would constitute Cause, then the Participant shall immediately cease to have any right to exercise the
Option and this Option shall thereupon terminate. 

        In
the event of the Disability of the Participant, as determined in accordance with the Plan, the Option shall be exercisable within one year after the Participant's termination of
service or, if earlier, within the term originally prescribed by the Option. In such event, the Option shall be exercisable: 

	(a)
	to
the extent that the Option has become exercisable but has not been exercised as of the date of Disability; and

	(b)
	in
the event rights to exercise the Option accrue periodically, to the extent of a pro rata portion through the date of Disability of any additional vesting rights that would have
accrued on the next vesting date had the Participant not become Disabled. The proration shall be based upon the number of days accrued in the current vesting period prior to the date of Disability. 

        In
the event of the death of the Participant while an employee, director or consultant of the Company or of an Affiliate, the Option shall be exercisable by the Participant's Survivors
within one year after the date of death of the Participant or, if earlier, within the originally prescribed term of the Option. In such event, the Option shall be exercisable: 

	(x)
	to
the extent that the Option has become exercisable but has not been exercised as of the date of death; and

	(y)
	in
the event rights to exercise the Option accrue periodically, to the extent of a pro rata portion through the date of death of any additional vesting rights that would have accrued
on the next vesting date had the Participant not died. The proration shall be based upon the number of days accrued in the current vesting period prior to the Participant's date of death. 

        The
Participant acknowledges and agrees that neither the Company, its shareholders nor its directors and officers, has any duty or obligation to disclose to the Participant any material
information regarding the business of the Company or affecting the value of the Shares before, at the time of, or following a termination of the employment of the Participant by the Company,
including, without 

3

 

limitation,
any information concerning plans for the Company to make a public offering of its securities or to be acquired by or merged with or into another firm or entity. 

5. METHOD OF EXERCISING OPTION.  

        Subject to the terms and conditions of this Agreement, the Option may be exercised by written notice to the Company or its designee, in substantially the form of  Exhibit A attached hereto or by such other form or manner as may be prescribed by the Company or its designee from time to time. Such notice
shall state the number of Shares with respect to which the Option is being exercised and shall be signed by the person exercising the Option. Payment of the Exercise Price for such Shares shall be
made in accordance with Paragraph 9 of the Plan. The Company shall deliver such Shares as soon as practicable after the notice shall be received, provided, however, that the Company may delay
issuance of such Shares until completion of any action or obtaining of any consent, which the Company deems necessary under any applicable law (including, without limitation, state securities or "blue
sky" laws). The Shares as to which the Option shall have been so exercised shall be registered in the Company's share register in the name of the person so exercising the Option (or, if the Option
shall be exercised by the Participant and if the Participant shall so request in the notice exercising the Option, shall be registered in the Company's share register in the name of the Participant
and another person jointly, with right of survivorship) and shall be delivered as provided above to or upon the written order of the person exercising the Option. In the event the Option shall be
exercised, pursuant to Section 4 hereof, by any person other than the Participant, such notice shall be accompanied by appropriate proof of the right of such person to exercise the Option. All
Shares that shall be purchased upon the exercise of the Option as provided herein shall be fully paid and nonassessable. 

6. PARTIAL EXERCISE.  

        Exercise of this Option to the extent above stated may be made in part at any time and from time to time within the above limits, except that no fractional share
shall be issued pursuant to this Option. 

7. NON-ASSIGNABILITY.  

        The Option shall not be transferable by the Participant otherwise than by will or by the laws of descent and distribution. If this Option is a
Non-Qualified Option then it may also be transferred pursuant to a qualified domestic relations order as defined by the Code or Title I of the Employee Retirement Income Security Act or
the rules thereunder and the Participant, with the approval of the Administrator, may transfer the Option for no consideration to or for the benefit of the Participant's Immediate Family (including,
without limitation, to a trust for the benefit of the Participant's Immediate Family or to a partnership or limited liability company for one or more members of the Participant's Immediate Family),
subject to such limits as the Administrator may establish, and the transferee shall remain subject to all the terms and conditions applicable to the Option prior to such transfer and each such
transferee shall so acknowledge in writing as a condition precedent to the effectiveness of such transfer. The term "Immediate Family" shall mean the Participant's spouse, former spouse, parents,
children, stepchildren, adoptive relationships, sisters, brothers, nieces, nephews and grandchildren (and, for this purpose, shall also include the Participant). Except as provided above in this
paragraph, the Option shall be exercisable, during the Participant's lifetime, only by the Participant (or, in the event of legal incapacity or incompetency, by the Participant's guardian or
representative) and shall not be assigned, pledged or hypothecated in any way (whether by operation of law or otherwise) and shall not be subject to execution, attachment or similar process. Any
attempted transfer, assignment, pledge, hypothecation or other disposition of the Option or of any rights granted hereunder contrary to the provisions of this Section 7, or the levy of any
attachment or similar process upon the Option shall be null and void. 

4

 

8. NO RIGHTS AS STOCKHOLDER UNTIL EXERCISE.  

        The Participant shall have no rights as a stockholder with respect to Shares subject to this Agreement until registration of the Shares in the Company's share
register in the name of the Participant. Except as is expressly provided in the Plan with respect to certain changes in the capitalization of the
Company, no adjustment shall be made for dividends or similar rights for which the record date is prior to the date of such registration. 

9. ADJUSTMENTS.  

        The Plan contains provisions covering the treatment of Options in a number of contingencies such as stock splits and mergers. Provisions in the Plan for
adjustment with respect to stock subject to Options and the related provisions with respect to successors to the business of the Company are hereby made applicable hereunder and are incorporated
herein by reference. 

10. TAXES.  

        The Participant acknowledges that any income or other taxes due from him or her with respect to this Option or the Shares issuable pursuant to this Option shall
be the Participant's responsibility. The Participant acknowledges and agrees that (i) the Participant was free to use professional advisors of his or her choice in connection with this
Agreement, has received advice from his or her professional advisors in connection with this Agreement, understands its meaning and import, and is entering into this Agreement freely and without
coercion or duress; (ii) the Participant has not received and is not relying upon any advice, representations or assurances made by or on behalf of the Company or any Affiliate or any employee
of or counsel to the Company or any Affiliate regarding any tax or other effects or implications of the Option, the Shares or other matters contemplated by this Agreement and (iii) neither the
Company its Affiliates, nor any of its officers or directors, shall be held liable for any applicable costs, taxes, or penalties associated with the Option if, in fact, the Internal Revenue Service
were to determine that the Option constitutes deferred compensation under Section 409A of the Code. 

        If
this Option is designated in the Stock Option Grant Notice as an ISO and there is a Disqualifying Disposition (as defined in Section 14 below) or if the Option is converted
into a Non-Qualified Option and such Non-Qualified Option is exercised, the Participant agrees that the Company may withhold from the Participant's remuneration, if any, the
minimum statutory amount of federal, state and local withholding taxes attributable to such amount that is considered compensation includable in such person's gross income. At the Company's
discretion, the amount required to be withheld may be withheld in cash from such remuneration, or in kind from the Shares otherwise deliverable to the Participant on exercise of the Option. The
Participant further agrees that, if the Company does not withhold an amount from the Participant's remuneration sufficient to satisfy the Company's income tax withholding obligation, the Participant
will reimburse the Company on demand, in cash, for the amount under-withheld. 

11. PURCHASE FOR INVESTMENT.  

        Unless the offering and sale of the Shares to be issued upon the particular exercise of the Option shall have been effectively registered under the Securities Act
of 1933, as now in force or hereafter amended (the "1933 Act"), the Company shall be under no obligation to issue the Shares covered by such exercise unless and until the following conditions have
been fulfilled: 

	(a)
	The
person(s) who exercise the Option shall warrant to the Company, at the time of such exercise, that such person(s) are acquiring such Shares for their own respective accounts, for
investment, and not with a view to, or for sale in connection with, the distribution of any such Shares, in which event the person(s) acquiring such Shares shall be bound by the provisions of 

5

 

the
following legend which shall be endorsed upon any certificate(s) evidencing the Shares issued pursuant to such exercise: 

"The
shares represented by this certificate have been taken for investment and they may not be sold or otherwise transferred by any person, including a pledgee, unless (1) either (a) a
Registration Statement with respect to such shares shall be effective under the Securities Act of 1933, as amended, or (b) the Company shall have received an opinion of counsel satisfactory to
it that an exemption from registration under such Act is then available, and (2) there shall have been compliance with all applicable state securities laws;" and 

	(b)
	If
the Company so requires, the Company shall have received an opinion of its counsel that the Shares may be issued upon such particular exercise in compliance with the 1933 Act
without registration thereunder. Without limiting the generality of the foregoing, the Company may delay issuance of the Shares until completion of any action or obtaining of any consent, which the
Company deems necessary under any applicable law (including without limitation state securities or "blue sky" laws). 

12. NO OBLIGATION TO MAINTAIN RELATIONSHIP.  

        The Company is not by the Plan or this Option obligated to continue the Participant as an employee, director or consultant of the Company or an Affiliate. The
Participant acknowledges: (i) that the Plan is discretionary in nature and may be suspended or terminated by the Company at any time; (ii) that the grant of the Option is a
one-time benefit which does not create any contractual or other right to receive future grants of options, or benefits in lieu of options; (iii) that all determinations with respect
to any such future grants, including, but not limited to, the times when options shall be granted, the number of shares subject to each option, the option price, and the time or times when each option
shall be exercisable, will be at the sole discretion of the Company; (iv) that the Participant's participation in the Plan is voluntary; (v) that the value of the Option is an
extraordinary item of compensation which is outside the scope of the Participant's employment or consulting contract, if any; and (vi) that the Option is not part of normal or expected
compensation for purposes of calculating any severance, resignation, redundancy, end of service payments, bonuses, long-service awards, pension or retirement benefits or similar payments. 

13. IF OPTION IS INTENDED TO BE AN ISO.  

        If this Option is designated in the Stock Option Grant Notice as an ISO so that the Participant (or the Participant's Survivors) may qualify for the favorable tax
treatment provided to holders of Options that meet the standards of Section 422 of the Code then any provision of this Agreement or the Plan which conflicts with the Code so that this Option
would not be deemed an ISO is null and void and any ambiguities shall be resolved so that the Option qualifies as an ISO. Nonetheless, if the Option is determined not to be an ISO, the Participant
understands that neither the Company nor any Affiliate is responsible to compensate him or her or otherwise make up for the treatment of the Option as a Non-Qualified Option and not as an
ISO. The Participant should consult with the Participant's own tax advisors regarding the tax effects of the Option and the requirements necessary to obtain favorable tax treatment under
Section 422 of the Code, including, but not limited to, holding period requirements. 

        Notwithstanding
the foregoing, to the extent that the Option is designated in the Stock Option Grant Notice as an ISO and is not deemed to be an ISO pursuant to Section 422(d) of
the Code because the aggregate fair market value (determined as of the date hereof) of any of the Shares with respect to which this ISO is granted becomes exercisable for the first time during any
calendar year in excess of $100,000, the portion of the Option representing such excess value shall be treated as a Non-Qualified Option and the Participant shall be deemed to have taxable
income measured by the 

6

 

difference
between the then fair market value of the Shares received upon exercise and the price paid for such Shares pursuant to this Agreement. 

14. NOTICE TO COMPANY OF DISQUALIFYING DISPOSITION OF AN ISO.  

        If this Option is designated in the Stock Option Grant Notice as an ISO then the Participant agrees to notify the Company in writing immediately after the
Participant makes a Disqualifying Disposition of any of the Shares acquired pursuant to the exercise of the ISO. A Disqualifying Disposition is defined in Section 424(c) of the Code and
includes any disposition (including any sale) of such Shares before the later of (a) two years after the date the Participant was granted the ISO or (b) one year after the date the
Participant acquired Shares by exercising the ISO, except as otherwise provided in Section 424(c) of the Code. If the Participant has died before the Shares are sold, these holding period
requirements do not apply and no Disqualifying Disposition can occur thereafter. 

15. NOTICES.  

        Any notices required or permitted by the terms of this Agreement or the Plan shall be given by recognized courier service, facsimile, registered or certified
mail, return receipt requested, addressed as follows: 

If
to the Company: 

iBasis, Inc.

20 Second Avenue

Burlington, MA 01803

Attention: Chief Legal Officer 

        If
to the Participant at the address set forth on the Stock Option Grant Notice or to such other address or addresses of which notice in the same manner has previously been given. Any
such notice shall be deemed to have been given upon the earlier of receipt, one business day following delivery to a recognized courier service or three business days following mailing by registered
or certified mail. 

16. GOVERNING LAW.  

        This Agreement shall be construed and enforced in accordance with the law of the State of Delaware, without giving
effect to the conflict of law principles thereof. For the purpose of litigating any dispute that arises under this Agreement, the parties hereby consent to exclusive jurisdiction in Massachusetts and
agree that such litigation shall be conducted in the state courts of Massachusetts or the federal courts of the United States for the District of Massachusetts. 

17. BENEFIT OF AGREEMENT.  

        Subject to the provisions of the Plan and the other provisions hereof, this Agreement shall be for the benefit of and shall be binding upon the heirs, executors,
administrators, successors and assigns of the parties hereto. 

18. ENTIRE AGREEMENT.  

        This Agreement, together with the Plan, embodies the entire agreement and understanding between the parties hereto with respect to the subject matter hereof and
supersedes all prior oral or written agreements and understandings relating to the subject matter hereof. No statement, representation, warranty, covenant or agreement not expressly set forth in this
Agreement shall affect or be used to interpret, change or restrict, the express terms and provisions of this Agreement, provided, however, in any event, this Agreement shall be subject to and governed
by the Plan. 

7

 

19. MODIFICATIONS AND AMENDMENTS.  

        The terms and provisions of this Agreement may be modified or amended as provided in the Plan. 

20. WAIVERS AND CONSENTS. 

        Except
as provided in the Plan, the terms and provisions of this Agreement may be waived, or consent for the departure therefrom granted, only by written document executed by the party
entitled to the benefits of such terms or provisions. No such waiver or consent shall be deemed to be or shall constitute a waiver or consent with respect to any other terms or provisions of this
Agreement, whether or not similar. Each such waiver or consent shall be effective only in the specific instance and for the purpose for which it was given, and shall not constitute a continuing waiver
or consent. 

21. DATA PRIVACY. 

        By
entering into this Agreement, the Participant: (i) authorizes the Company and each Affiliate, and any agent of the Company or any Affiliate administering the Plan or providing
Plan recordkeeping services, to disclose to the Company or any of its Affiliates such information and data as the Company or any such Affiliate shall request in order to facilitate the grant of
options and the administration of the Plan; (ii) waives any data privacy rights he or she may have with respect to such information; and (iii) authorizes the Company and each Affiliate
to store and transmit such information in electronic form. 

[REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK] 

8

  

 
 

Exhibit A    
    

 
  NOTICE OF EXERCISE OF STOCK OPTION    
    

[Form for US Employees for Shares registered in the United States]

To:
iBasis, Inc.

Ladies
and Gentlemen: 

        I
hereby exercise my Stock Option to purchase                        shares (the "Shares") of the common stock, $0.001 par value, of
iBasis, Inc. (the "Company"), at the exercise price
of $            per share, pursuant to and subject to the terms of that Stock Option Grant Notice
dated                        , 200    . 

        I
understand the nature of the investment I am making and the financial risks thereof. I am aware that it is my responsibility to have consulted with competent tax and legal advisors
about the relevant national, state and local income tax and securities laws affecting the exercise of the Option and the purchase and subsequent sale of the Shares. 

        I
am paying the option exercise price for the Shares as follows: 

   

        Please
issue the Shares (check one): 

o
to me; or 

o to me and
                                         
                   , as joint tenants with right of survivorship,
 

at the following address: 

   

Exhibit A-1

 

        My
mailing address for shareholder communications, if different from the address listed above, is: 

  

	

 	
 	

Very truly yours,
	

  

    	
 	

 Participant (signature)
	

  

    	
 	

 Print Name
	

 

    	
 	

 Date
	

  

    	
 	

 Social Security Number

Exhibit A-2

QuickLinks

Exhibit 10.2

iBASIS, INC. Stock Option Grant Notice Stock Option Grant under the Company's 2007 Stock Plan

iBASIS, INC. STOCK OPTION AGREEMENT—INCORPORATED TERMS AND CONDITIONS

Exhibit A

NOTICE OF EXERCISE OF STOCK OPTION

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