Summary
Equinix Inc. (EQIX) filed an 8-K report on June 14, 2005, to disclose the resignation of director Dennis Raney and the implications for its audit committee compliance. Mr. Raney resigned on June 8, 2005, due to his new partnership at Liberty-Greenfield, a company with which Equinix does business. This resignation created a vacancy that made Equinix non-compliant with Nasdaq's requirement for at least three independent members on its audit committee, one of whom must be a financial expert. The company has until its next annual meeting or June 7, 2006, to rectify this situation. The resignation is also linked to a real estate lease negotiated with Liberty-Greenfield, where Equinix will lease property, and Liberty-Greenfield will receive a commission from the lessor. Mr. Raney will benefit from this transaction through his partnership interest. Investors should monitor Equinix's progress in filling the audit committee vacancy to ensure continued listing compliance.
Key Highlights
- 1Equinix Inc. reported a director resignation (Dennis Raney) on June 8, 2005.
- 2The resignation was due to Mr. Raney joining Liberty-Greenfield as a partner, a company that does business with Equinix.
- 3Equinix notified Nasdaq that it is not in compliance with the audit committee independence rules (NASD Rule 4350(d)(2)(A)) due to this vacancy.
- 4The company has a cure period until its next annual meeting or June 7, 2006, to regain compliance.
- 5The audit committee currently has two independent members, falling short of the required three independent members and a financial expert.
- 6Mr. Raney's resignation is related to a real estate lease transaction involving Liberty-Greenfield, which will provide commission compensation to Liberty-Greenfield and indirectly benefit Mr. Raney.