Summary
Equinix Inc. (EQIX) announced on February 18, 2009, the entry into a new $25 million one-year senior secured revolving credit facility with Bank of America, effective February 12, 2009. This facility is designed primarily to support working capital needs and facilitate the issuance of letters of credit. The credit line provides flexibility for Equinix to borrow at either the prime rate or a margin over LIBOR, with a floor on the borrowing cost. The BofA Facility is secured by Equinix's domestic accounts receivable and includes financial covenants to be monitored quarterly. The availability of this credit line for renewal is subject to mutual agreement between Equinix and Bank of America. This provides a short-term liquidity option for the company amidst the prevailing economic climate.
Key Highlights
- 1Equinix entered into a $25 million one-year senior secured revolving credit facility with Bank of America.
- 2The facility is primarily for working capital and letters of credit.
- 3Borrowing options include prime rate or a margin over LIBOR (2.75%), with a minimum borrowing cost of 3.00%.
- 4The credit facility is secured by Equinix's domestic accounts receivable.
- 5The facility is subject to quarterly financial covenants.
- 6The credit facility has an initial term of one year and is available for renewal upon mutual agreement.