8-KOther Events

EQUINIX INC 8-K Report, Corporate Update (Feb 18, 2009)

Filed February 18, 2009For Securities:EQIX

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.

Frequently Asked Questions

The $25 million revolving credit facility with Bank of America is intended primarily to provide funds for working capital needs and to support the issuance of letters of credit for Equinix's operations.

Equinix can borrow at either the prime rate or at a margin of 2.75% over one, three, or six-month LIBOR. However, there is a minimum borrowing cost of 3.00% applied.

The facility is secured by Equinix's domestic accounts receivable balances.

Yes, the facility is subject to certain financial covenants that Equinix must meet, measured on a quarterly basis. Additionally, renewal of the facility beyond its initial one-year term is subject to mutual agreement between Equinix and Bank of America.