What is the primary purpose of this Form 8-K filing?

This Form 8-K filing reports on Equinix, Inc.'s entry into material definitive agreements related to the issuance of new convertible subordinated notes and the associated capped call transactions.

What are the key terms of the newly issued 4.75% Convertible Subordinated Notes due 2016?

The notes have an aggregate principal amount of $325 million, mature in 2016, bear a 4.75% annual interest rate payable semi-annually, are unsecured and subordinated, and are convertible into Equinix common stock at an initial price of approximately $84.32 per share.

What are the 'capped call transactions' mentioned in the filing?

The capped call transactions were entered into with certain underwriters to hedge the cost of the convertible note offering. These transactions aim to mitigate the dilutive effect and cost associated with the potential conversion of the notes into common stock, particularly if the stock price increases significantly.

What does the 'fundamental change' provision mean for noteholders?

The 'fundamental change' provision gives noteholders the right to require Equinix to repurchase their notes at par value plus accrued interest under certain significant corporate events. It also provides for potential adjustments to the conversion rate if such events occur, which could benefit noteholders.

EQIX 8-K: Material Agreements & Financial Events

Summary

Equinix, Inc. (EQIX) announced on June 12, 2009, the successful issuance of $325 million in aggregate principal amount of 4.75% Convertible Subordinated Notes due 2016. The company also granted an over-allotment option to purchase up to an additional $48.75 million of these notes. This offering was conducted under an effective registration statement and prospectus filed with the SEC, with Citigroup Global Markets Inc., J.P. Morgan Securities Inc., and Goldman, Sachs & Co. acting as the representatives of the underwriters. The notes are unsecured and subordinated obligations of Equinix, bearing a 4.75% annual interest rate, payable semi-annually. A significant feature for investors is the conversion option, allowing holders to convert the notes into Equinix common stock at an initial rate of 11.8599 shares per $1,000 principal amount, implying an initial conversion price of approximately $84.32 per share. This conversion price represented a premium of about 17.5% over the stock's closing price on June 8, 2009. The company retains the flexibility to settle conversions with cash, Equinix stock, or a combination thereof. Additionally, holders have the right to require Equinix to repurchase the notes under specific "fundamental change" scenarios, and the company may be obligated to increase the conversion rate in such events.

Key Highlights

1Equinix Inc. issued $325 million in 4.75% Convertible Subordinated Notes due 2016.
2An over-allotment option for an additional $48.75 million of notes was granted to underwriters.
3The notes are unsecured and subordinated obligations of Equinix.
4The notes carry a semi-annual interest payment of 4.75% per annum.
5Holders can convert notes to Equinix common stock at an initial conversion price of approximately $84.32 per share, representing a 17.5% premium to the June 8, 2009 closing price.
6Equinix has flexibility to settle conversions with cash, stock, or a combination.
7Holders have repurchase rights under specific 'fundamental change' events, and the company may need to adjust the conversion rate in such situations.

EQUINIX INC 8-K Report, Material Agreement (Jun 12, 2009)

Summary

Key Highlights

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