TERMS AGREEMENT

Exhibit 10.2

 

E XECUTION C OPY

 

CREDIT SUISSE FIRST BOSTON (USA), INC.

 

4,300,000 SAILS

 

(Shared Appreciation Income Linked Securities)

 

Due November 15, 2008

 

Subject to Exchange into Shares of

 

Common Stock, par value $0.001 per share, of Equinix, Inc.

 

TERMS AGREEMENT

 

November 9, 2005

 

CREDIT SUISSE FIRST BOSTON LLC

Eleven Madison Avenue

New York, New York 10010-3629

      As representative (the “ Representative ”)

      of the several Underwriters (as defined below)

 

Dear Sirs and Mesdames:

 

Credit Suisse First Boston (USA), Inc., a Delaware corporation (“ CSFB USA ”), proposes to issue and sell to the several underwriters named in Schedule A hereto (the “ Underwriters ”), 4,300,000 SAILS (Shared Appreciation Income Linked Securities) due November 15, 2008 (the “ SAILS ”) with a principal amount of $35.64 per SAILS. The SAILS are subject to exchange into shares of common stock, par value $0.001 per share (the “ Common Stock ”), of Equinix, Inc., a Delaware corporation (“ Equinix ”), or the cash equivalent of those shares.

 

i-STT Investments (Bermuda) Ltd., a Bermuda corporation (the “ Selling Stockholder ”), which is a wholly-owned subsidiary of i–STT Investments Pte. Ltd., a corporation organized under the laws of the Republic of Singapore (“ STT ,” and, together with the Selling Stockholder, the “ Selling Stockholder Entities ”), has entered into (a) a Forward Purchase Agreement dated the date hereof (the “ Forward Purchase Agreement ”) with Credit Suisse First Boston Capital LLC (“ CSFB Capital ”), pursuant to which the Selling Stockholder has agreed to sell, and CSFB Capital has agreed to purchase, the number of shares of Common Stock specified therein (the “ Contract Shares ”) on the dates specified therein and (b) a Collateral Agreement dated the date hereof with CSFB Capital and Credit Suisse First Boston LLC as collateral agent and securities intermediary, pursuant to which the Selling Stockholder has pledged to CSFB Capital the maximum number of Contract Shares that it may be required to deliver at maturity of the Forward Purchase Agreement (the “ Collateral Agreement ” and, together with the Forward Purchase Agreement, the “ Forward Documents ”).

 

The representations, warranties and agreements among Equinix, the Selling Stockholder and the Underwriters with respect to the Contract Shares that will be delivered at maturity of the SAILS and related matters are set forth in Part A of this Terms Agreement (this “ Agreement ”). The representations, warranties and agreements between CSFB USA and the Underwriters with respect to the offer and sale of the SAILS and related matters are set forth in Part B of this Agreement. As used herein, “ Contract Shares Basic Transactions ” means (i) the sale of the Contract Shares by the Selling Stockholder to CSFB Capital pursuant to the Forward Purchase Agreement and (ii) the pledge of the Contract Shares by the Selling Stockholder pursuant to the Collateral Agreement. For the avoidance of doubt, with respect to the Forward Documents, references to the Contract Shares Basic Transactions herein refer solely to the actions specified in (i) and (ii) above and do not contemplate the other terms and conditions of any of the Forward Documents, including without limitation any aspect of the authorization, execution and delivery of the Forward Documents by, or the enforceability of any of the Forward Documents against, any party thereto.

PART A. REGISTRATION AND SALE OF CONTRACT SHARES

 

Equinix has filed with the Securities and Exchange Commission (the “ Commission ”) a registration statement under the Securities Act on Form S-3 (File No. 333-128857), including a prospectus (the “ Equinix Basic Prospectus ”), relating to the Common Stock. Such registration statement as amended as of the date of this Agreement and, in the event any post-effective amendment thereto becomes effective prior to the Closing Date (as defined in Part B of this Agreement), including the information (if any) deemed to be part of such registration statement (including any information incorporated therein by reference) at the time of effectiveness pursuant to Rule 430A under the Securities Act of 1933, as amended, and the rules and regulations of Commission thereunder (collectively, the “ Securities Act ”) is hereinafter referred to as the “ Equinix Registration Statement ;” any preliminary prospectus supplement to the Equinix Basic Prospectus relating to the Contract Shares together with the Equinix Basic Prospectus is hereinafter referred to as an “ Equinix Preliminary Prospectus; ” the final prospectus supplement to the Equinix Basic Prospectus relating to the Contract Shares in the form first used in conjunction with the final prospectus for the SAILS is hereinafter referred to as the “ Equinix Final Prospectus ” (including, in the case of all references to the Equinix Registration Statement or the Equinix Final Prospectus, unless the context requires otherwise, documents incorporated by reference therein pursuant to Item 12 of Form S-3 of the Securities Act (the “ Incorporated Documents ”)). The terms “ supplement ” and “ amendment ” or “ amend ” with respect to the Equinix Registration Statement, any Equinix Preliminary Prospectus and the Equinix Final Prospectus shall include all documents subsequently filed (but not to the extent all or a portion of such documents are furnished) by Equinix with the Commission pursuant to the Securities Exchange Act of 1934, as amended, and the rules and regulations of the Commission thereunder (collectively, the “ Exchange Act ”), that are deemed to be incorporated by reference therein. If Equinix has filed an abbreviated registration statement to register additional shares of Common Stock pursuant to Rule 462(b) under the Securities Act (the “ Rule 462 Equinix Registration Statement ”), then any reference herein to the term “ Equinix Registration Statement ” shall be deemed to include such Rule 462 Equinix Registration Statement.

 

The Investment Company Act of 1940, as amended, and the rules and regulations of the Commission thereunder are collectively referred to in this Part A as the “ Investment Company Act ;” and the Securities Act and the Investment Company Act are collectively referred to in this Part A as the “ Acts .”

 

The Selling Stockholder, Equinix and the Underwriters hereby agree as follows:

 

1. Representations and Warranties of Equinix and the Selling Stockholder .

 

(a) Equinix represents and warrants to, and agrees with, each of the Underwriters and the Selling Stockholder that:

 

(i) Equinix meets the requirements for filing the Equinix Registration Statement on Form S-3, and such Equinix Registration Statement has become effective; no stop order suspending the effectiveness of the Equinix Registration Statement is in effect, and no proceedings for such purpose are pending before or threatened by the Commission;

 

(ii) no order preventing or suspending the use of any Equinix Preliminary Prospectus has been issued by the Commission, and each Equinix Preliminary Prospectus complied, when so filed, in all material respects with the Acts and did not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein not misleading except that the representations and warranties set forth in this paragraph do not apply to any statements or omissions in any Equinix Preliminary Prospectus based upon information relating to (A) any Underwriter furnished to Equinix in writing by such Underwriter through the Representative expressly for use therein and (B) the Selling Stockholder furnished to Equinix by the Selling Stockholder expressly for use therein;

 

(iii) each part of the Equinix Registration Statement, when it became effective, did not contain and each such part, as amended or supplemented, if applicable, will not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to

make the statements therein not misleading; the Equinix Registration Statement and the Equinix Final Prospectus comply and, as amended or supplemented, if applicable, will comply in all material respects with the Securities Act; and the Equinix Final Prospectus does not contain and, as amended or supplemented, if applicable, will not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, except that the representations and warranties set forth in this paragraph do not apply to statements or omissions in the Equinix Registration Statement or the Equinix Final Prospectus based upon information relating to (A) any Underwriter furnished to Equinix in writing by such Underwriter through the Representative expressly for use therein and (B) the Selling Stockholder Entities furnished to Equinix by the Selling Stockholder expressly for use therein; 

 

(iv) Equinix has been duly incorporated and is an existing corporation in good standing under the laws of State of Delaware, with power and authority (corporate and other) to own its properties and conduct its business as described in the Equinix Final Prospectus; and Equinix is duly qualified to do business as a foreign corporation in good standing in all other jurisdictions in which its ownership or lease of property or the conduct of its business requires such qualification, except to the extent that the failure to be so qualified or in good standing would not have a material adverse effect on the condition (financial or other), business, properties or results of operations of Equinix and the Subsidiaries (as defined below) taken as a whole (each, an “ Equinix Material Adverse Effect ”);

 

(v) Equinix Operating Co., Inc., Equinix Pacific, Inc., Equinix RP II LLC and Equinix RP, Inc. (each a “ Subsidiary ” and, together, the “ Subsidiaries ”) are Equinix’s only subsidiaries that are material to the business of the Company and its subsidiaries taken as a whole. Each of the Subsidiaries has been duly incorporated and is an existing corporation in good standing under the laws of the jurisdiction of its incorporation, with power and authority (corporate and other) to own its properties and conduct its business as described in the Equinix Final Prospectus; and each Subsidiary is duly qualified to do business as a foreign corporation in good standing in all other jurisdictions in which its ownership or lease of property or the conduct of its business requires such qualification except to the extent that the failure to be so qualified or in good standing would not have an Equinix Material Adverse Effect; all of the issued and outstanding capital stock of each subsidiary of Equinix has been duly authorized and validly issued and is fully paid and nonassessable. Equinix owns all of the shares of capital stock of each subsidiary of Equinix, directly or through subsidiaries, free from liens, encumbrances and defects;

 

(vi) the authorized capital stock of Equinix conforms as to legal matters to the description thereof contained in or incorporated by reference into, as applicable, the Equinix Final Prospectus. The Contract Shares and all other outstanding shares of capital stock of Equinix have been duly authorized and validly issued, are fully paid and nonassessable and conform as to legal matters to the description thereof contained in or incorporated by reference into, as applicable, the Equinix Final Prospectus; and the stockholders of Equinix have no preemptive rights with respect to the Contract Shares. Except as set forth in the Equinix Final Prospectus, neither Equinix nor any of the Subsidiaries has outstanding any options to purchase, or any preemptive rights or other rights to subscribe for or to purchase, any securities or obligations convertible into, or any contracts or commitments to issue or sell, shares of its capital stock or any such options, rights, convertible securities or obligations. All outstanding shares of capital stock and options and other rights to acquire capital stock have been issued in compliance with the registration and qualification provisions of all applicable securities laws and were not issued in violation of any preemptive rights, rights of first refusal or other similar rights;

 

(vii) except as disclosed in the Equinix Final Prospectus, there are no contracts, agreements or understandings between Equinix and any person that would give rise to a valid claim against Equinix or any Underwriter for a brokerage commission, finder’s fee or other like payment as a result of the Contract Shares Basic Transactions;

 

(viii) except as disclosed in the Equinix Final Prospectus, there are no contracts, agreements or understandings involving Equinix granting to any person the right to require Equinix to file a registration statement under the Securities Act with respect to any securities of Equinix owned or to be owned by such person or to require Equinix to include such securities in the securities registered pursuant to a Registration Statement or in any securities being registered pursuant to any other registration statement filed by Equinix under the Securities Act;

(ix) the Contract Shares have been approved for listing on the NASDAQ;

 

(x) no consent, approval, authorization, or order of, or filing with, any governmental agency or body or any court is required to be obtained or made by Equinix for the consummation of the Contract Shares Basic Transactions, except such as have been obtained and made under the Acts, the Exchange Act or state securities or blue sky laws in connection with the offer and sale of the SAILS and the delivery of the Contract Shares to holders of the SAILS;

 

(xi) the execution and delivery by Equinix of, and performance by Equinix of its obligations under, this Agreement and the consummation of the Contract Shares Basic Transactions will not result in a material breach or violation of any of the terms and provisions of, or constitute a material default under, any statute, any rule, regulation or order of any governmental agency or body or any court, domestic or foreign, having jurisdiction over Equinix or any of the Subsidiaries or any of their properties, or any agreement or instrument to which Equinix or any such Subsidiary is a party or by which Equinix or any such Subsidiary is bound or to which any of the properties of Equinix or any such Subsidiary is subject, or the charter or by-laws of Equinix or any such Subsidiary;

 

(xii) this Agreement has been duly authorized, executed and delivered by Equinix;

 

(xiii) except as disclosed in the Equinix Final Prospectus, Equinix and the Subsidiaries have good and marketable title to all real properties and all other properties and assets owned by them, in each case free from liens, encumbrances and defects that would materially affect the value thereof or materially interfere with the use made or to be made thereof by them; and Equinix and its Subsidiaries hold any leased real or personal property under valid and enforceable leases with no exceptions that would materially interfere with the use made or to be made thereof by them;

 

(xiv) Equinix and the Subsidiaries possess adequate certificates, authorities or permits issued by appropriate governmental agencies or bodies necessary to conduct the business now operated by them and have not received any notice of proceedings relating to the revocation or modification of any such certificate, authority or permit that, if determined adversely to Equinix or any of its subsidiaries, would individually or in the aggregate have an Equinix Material Adverse Effect;

 

(xv) no labor dispute with the employees of Equinix or any of the Subsidiaries exists or, to the knowledge of Equinix, is imminent that might have an Equinix Material Adverse Effect;

 

(xvi) Equinix and the Subsidiaries own, possess or can acquire on reasonable terms, adequate trademarks, trade names and other rights to inventions, know-how, patents, copyrights, confidential information and other intellectual property (collectively, the “ Intellectual Property Rights ”) necessary to conduct the business now operated by them, or presently employed by them, and have not received any notice of infringement of or conflict with asserted rights of others with respect to any Intellectual Property Rights that, if determined adversely to Equinix or any of the Subsidiaries, would individually or in the aggregate have an Equinix Material Adverse Effect;

 

(xvii) except as disclosed in the Equinix Final Prospectus, neither Equinix nor any of the Subsidiaries (A) is in violation of any statute, any rule, regulation, decision or order of any governmental agency or body or any court, domestic or foreign, relating to the use, disposal or release of hazardous or toxic substances or relating to the protection or restoration of the environment or human exposure to hazardous or toxic substances (collectively, the “ Environmental Laws ”), (B) owns, leases or operates any real property contaminated with any substance that is subject to any Environmental Laws, (C) is liable for any off-site disposal or contamination pursuant to any Environmental Laws, or (D) is subject to any claim relating to any Environmental Laws, in each case which violation, contamination, liability or claim would individually or in the aggregate have an Equinix Material Adverse Effect; and

Equinix is not aware of any pending or threatened investigation which is reasonably expected to lead to such a claim. Except as disclosed in the Equinix Final Prospectus, there are no costs or liabilities associated with Environmental Laws (including, without limitation, any capital or operating expenditures required for clean-up, closure of properties or compliance with Environmental Laws or any permit, license or approval, any related constraints on operating activities and any potential liabilities to third parties) that might have an Equinix Material Adverse Effect;

 

(xviii) except as disclosed in the Equinix Final Prospectus, there are no pending actions, suits or proceedings against or affecting Equinix, any of the Subsidiaries or any of their respective properties that, if determined adversely to Equinix or any of its Subsidiaries, would individually or in the aggregate have an Equinix Material Adverse Effect, or would materially and adversely affect the ability of Equinix to perform its obligations under this Agreement, or which are otherwise material in the context of the transactions contemplated by this Agreement; and no such actions, suits or proceedings are threatened or, to Equinix’s knowledge, contemplated;

 

(xix) the financial statements included in each Equinix Registration Statement and the Equinix Final Prospectus present fairly the financial position of Equinix and its consolidated subsidiaries as of the dates shown and their results of operations and cash flows for the periods shown, and such financial statements have been prepared in conformity with the generally accepted accounting principles in the United States applied on a consistent basis and the schedules included in the Equinix Registration Statement present fairly the information required to be stated therein; and the assumptions used in preparing the pro forma financial statements included in the Equinix Registration Statement and the Equinix Final Prospectus provide a reasonable basis for presenting the significant effects directly attributable to the transactions or events described therein, the related pro forma adjustments give appropriate effect to those assumptions, and the pro forma columns therein reflect the proper application of those adjustments to the corresponding historical financial statement amounts;

 

(xx) except as disclosed in the Equinix Final Prospectus, since the date of the latest audited financial statements included in the Equinix Final Prospectus there has not occurred any Equinix Material Adverse Effect, or any development or event involving a prospective material adverse change in the condition (financial or other), business, properties or results of operations of Equinix and its subsidiaries taken as a whole, and, except as disclosed in or contemplated by the Equinix Final Prospectus, there has been no dividend or distribution of any kind declared, paid or made by Equinix on any class of its capital stock;

 

(xxi) neither Equinix nor any of the Subsidiaries is currently in breach of, or in default under, any other written agreement or instrument to which it or its property is bound or affected except to the extent that such breach or default would not have an Equinix Material Adverse Effect;

 

(xxii) the Incorporated Documents heretofore filed, when they were filed (or, if any amendment with respect to any such document was filed, when such amendment was filed), conformed in all material respects with the requirements of the Exchange Act; any further Incorporated Documents so filed will, when they are filed, conform in all material respects with the requirements of the Exchange Act;

 

(xxiii) Equinix and each of the Subsidiaries is insured by insurers of recognized financial responsibility against such losses and risks and in such amounts as are prudent and customary in the businesses in which they are engaged; neither Equinix nor any such Subsidiary has been refused any insurance coverage sought or applied for; and neither Equinix nor any such Subsidiary has any reason to believe that it will not be able to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be necessary to continue its business at a cost that would not have an Equinix Material Adverse Effect;

 

(xxiv) the accountants who certified the financial statements and supporting schedules included in the Equinix Registration Statement are independent public accountants as required by the Securities Act;

(xxv) Equinix and each of the Subsidiaries maintains a system of internal accounting controls sufficient to provide reasonable assurance that: (A) transactions are executed in accordance with management’s general or specific authorizations; (B) transactions are recorded as necessary to permit preparation of financial statements in conformity with generally accepted accounting principles and to maintain asset accountability; (C) access to assets is permitted only in accordance with management’s general or specific authorization; and (D) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences;

 

(xxvi) neither Equinix nor any of the Subsidiaries has and Equinix is not aware that its or any of its subsidiaries’ officers, directors, partners, employees, agents or affiliates or any other person acting on behalf of Equinix or any Subsidiary has, directly or indirectly, given or agreed to give any money, gift or similar benefit (other than legal price concessions to customers in the ordinary course of business) to any customer, supplier, employee or agent of a customer or supplier, official or employee of any governmental agency (domestic or foreign), instrumentality of any government (domestic or foreign) or any political party or candidate for office (domestic or foreign) or other person who was, is or may be in a position to help or hinder the business of Equinix or any of the Subsidiaries (or assist Equinix or any of the Subsidiaries in connection with any actual or proposed transaction) which might subject Equinix or any of the Subsidiaries, or any other individual or entity to any damage or penalty in any civil, criminal or governmental litigation or proceeding (domestic or foreign), which could reasonably be expected to have an Equinix Material Adverse Effect, if not given in the past, might have had an Equinix Material Adverse Effect, or if not continued in the future, might have an Equinix Material Adverse Effect;

 

(xxvii) none of Equinix nor any of the Subsidiaries has taken, directly or indirectly, any action designed to, or that might reasonably be expected to, cause or result in stabilization or manipulation of the price of any security to facilitate the sale or resale of the Contract Shares or the SAILS. Except as permitted by the Acts, Equinix has not distributed any registration statement, preliminary prospectus, prospectus or other offering material in connection with the offering and sale of the Contract Shares or the SAILS;

 

(xxviii) Equinix is subject to the reporting requirements of either Section 13 or Section 15(d) of the Exchange Act and files reports with the Commission on the Electronic Data Gathering, Analysis and Retrieval (“ EDGAR ”) system; and

 

(xxix) Equinix is not and, after giving effect to the Contract Shares Basic Transactions will not be, an “investment company” as defined in the Investment Company Act.

 

(b) The Selling Stockholder represents and warrants to, and agrees with, each of the Underwriters and Equinix that:

 

(i) the Selling Stockholder has been duly incorporated and is validly existing under the laws of Bermuda, with corporate power and authority to own its properties and conduct its business; and is duly qualified to do business and is in good standing in each jurisdiction in which the ownership or lease of property or the conduct of its business requires such qualification, except as would not, individually or in the aggregate, have a material adverse effect on the financial condition, business, properties or results of operations of the Selling Stockholder (each, a “ Selling Stockholder Material Adverse Effect ”);

 

(ii) this Agreement has been duly authorized, executed and delivered by the Selling Stockholder and the Forward Documents have been duly authorized, executed and delivered by the Selling Stockholder; and each of the Forward Purchase Agreement and the Collateral Agreement constitutes a valid and legally binding agreement of the Selling Stockholder enforceable against the Selling Stockholder in accordance with its terms except, with respect to each, as such enforceability may be limited by: (A) applicable bankruptcy, insolvency or other similar laws affecting creditors’ rights generally; and (B) the availability of equitable remedies may be limited by equitable principles of general applicability including applicable law relating to fiduciary duties (regardless of whether considered and applied in a proceeding in equity or at law).

(iii) the execution and delivery by the Selling Stockholder of, and the performance by the Selling Stockholder of its obligations under, this Agreement and the Forward Documents will not contravene any provision of applicable law or the bye-laws of the Selling Stockholder, or any material agreement or other instrument binding upon the Selling Stockholder or any judgment, order or decree of any governmental body, agency or court having jurisdiction over the Selling Stockholder, except for any such contravention as would not have a Selling Stockholder Material Adverse Effect, and no consent, approval, authorization or order of, or qualification with, any governmental body or agency, self-regulatory organization or court or other tribunal is required for the performance by the Selling Stockholder of its obligations under this Agreement and the Forward Documents, except such as have been obtained and except to the extent that the failure to so obtain such consent, approval, authorization, order or qualification would not have a Selling Stockholder Material Adverse Effect or materially affect the Selling Stockholder’s ability to perform its obligations under this Agreement or the Forward Documents;

 

(iv) the Selling Stockholder is not and, after giving effect to the transactions contemplated by this Agreement and the Forward Documents, will not be, an “investment company” as such term is defined in the Investment Company Act;

 

(v) the Selling Stockholder has the legal right and power, and all authorization and approval required by law, to enter into this Agreement and the Forward Documents and to perform its obligations thereunder;

 

(vi) on the Closing Date the Selling Stockholder will be the beneficial owner of the Contract Shares to be delivered under the Forward Purchase Agreement free and clear of all liens, encumbrances, equities and claims, except for those created pursuant to the Collateral Agreement or otherwise created by CSFB Capital, and, assuming that CSFB Capital acquires its interest in such Contract Shares on the Exchange Date in accordance with the terms of the Forward Purchase Agreement without notice of any adverse claim (within the meaning of Section 8-105 of the New York Uniform Commercial Code (“ UCC ”), CSFB Capital will have acquired the Contract Shares free of any adverse claim (within the meaning of Section 8-102(a)(1) of the UCC);

 

(vii) none of the information relating to the Selling Stockholder Entities that was furnished to Equinix in writing by either of the Selling Stockholder Entities expressly for use in any Equinix Registration Statement, any Equinix Preliminary Prospectus, the Equinix Final Prospectus or any amendment or supplement thereto includes, or will include, any untrue statement of a material fact or omits, or will omit, to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading. In addition, the Selling Stockholder has reviewed the Equinix Registration Statement, any Equinix Preliminary Prospectus and the Equinix Final Prospectus and represents and warrants that it has no reason to believe that any such document includes any untrue statements of a material fact or omits to state any material fact required to be stated therein or necessary to make the statement therein, in light of the circumstances under which they were made, not misleading;

 

(viii) the transfer of the Contract Shares from STT to the Selling Stockholder and the sale of the Contract Shares by the Selling Stockholder are not prompted by any material non-public information concerning Equinix which is not set forth in the Equinix Final Prospectus; and

 

(ix) all of the equity interests in the Selling Stockholder are owned of record and beneficially by STT, and the Selling Stockholder has no subsidiaries.

 

2. Lock-Up Agreement . Equinix agrees with each of the Underwriters and the Selling Stockholder that:

 

(a) for the Lock-Up Period (as defined below) Equinix will not offer, sell, contract to sell, pledge or otherwise dispose of, directly or indirectly, or file with the Commission a registration statement under the Securities Act relating to any additional Common Stock or securities convertible into or exchangeable or exercisable for any Common Stock, or publicly disclose the intention to make any such offer, sale, pledge,

disposition or filing, without the prior written consent of the Representative, except that Equinix shall not be prohibited from causing the issuance of: (i) Common Stock pursuant to the conversion or exchange of convertible or exchangeable securities issuable or exchangeable for Common Stock or upon the exercise of warrants or options exercisable for Common Stock, in each case outstanding on the date hereof; (ii) employee stock options of Equinix exercisable for Common Stock pursuant to the terms of a plan of Equinix in effect on the date hereof; or (iii) any Common Stock or any securities convertible into or exchangeable or exercisable for any Common Stock, up to a maximum aggregate market value at the time of issuance of $30 million, in connection with a business acquisition by Equinix, whether by merger, consolidation, sale of assets, sale or exchange of stock or otherwise, subject to the condition that any recipient of such Common Stock agrees to sign and does sign a lock-up agreement substantially in the form of EXHIBIT A hereto, the obligations under which shall, likewise, terminate or expire no later than the expiration of the Lock-Up Period; and, to the extent required by applicable law or stock market listing requirements, Equinix may publicly disclose the intention to cause such an issuance of securities.

 

(b) the Lock-Up Period will commence on the date hereof and will continue and include the date 45 days after the date of the Equinix Final Prospectus or such earlier date that the Representative consents to in writing; provided , however , that if (i) during the last 17 days of the Lock-Up Period, Equinix releases earnings results or material news or a material event relating to Equinix occurs, or (ii) prior to the expiration of the Lock-Up Period, Equinix announces that it will release earnings results during the 16-day period beginning on the last day of the Lock-Up Period, then in each case the Lock-Up Period will be extended until the expiration of the 18-day period beginning on the date of release of the earnings results or the occurrence of the material news or material event, as applicable, unless the Representative waives, in writing, such extension (such initial period, and such initial period as extended as set forth above, as the case may be, the “ Lock-Up Period ”). Equinix will provide the Representative with notice of any announcement described in clause (ii) of the preceding sentence that gives rise to an extension of the Lock-Up Period.

 

3. Additional Conditions to the Obligations of the Underwriters . In addition to the conditions to the obligations of the Underwriters to purchase the SAILS that are set forth in Part B of this Agreement, the obligations of the several Underwriters to purchase and pay for the SAILS on the Closing Date will be subject to (1) the condition that the Equinix Registration Statement shall have been effective not later than 4:00 P.M. (New York City time), on the date hereof, (2) the accuracy of the representations and warranties on the part of Equinix and the Selling Stockholder herein, in each case as of and on the date hereof and such Closing Date, (3) the accuracy of the statements of Equinix officers made pursuant to the provisions hereof, (4) the performance by Equinix and the Selling Stockholder of their obligations hereunder and (5) the following additional conditions precedent (such conditions precedent being set out in this Part A for convenience only):

 

(a) subsequent to the execution and delivery of this Agreement, there shall not have occurred any: (i) downgrading in the rating of the securities of Equinix by any “nationally recognized statistical rating organization” (as defined for purposes of Rule 436(g) under the Securities Act), or any public announcement that any such organization has under surveillance or review its rating of Equinix (other than an announcement with positive implications of a possible upgrading, and no implication of a possible downgrading, of such rating); (ii) change in U.S. or international financial, political or economic conditions or currency exchange rates or exchange controls as would, in the judgment of the Representative, be likely to prejudice materially the success of the proposed issue, sale or distribution of the SAILS, whether in the primary market or in respect of dealings in the secondary market; (iii) change, or any development involving a prospective change, in the condition (financial or other), business, properties or results of operations of Equinix and its subsidiaries, taken as a whole, from that set forth in the Equinix Final Prospectus (exclusive of any amendments or supplements thereto subsequent to the date of this Agreement) which, in the judgment of the Representative, is material and adverse and makes it impractical or inadvisable to market the SAILS on the terms and in the manner contemplated in the SAILS Prospectus (as defined in Part B); (iv) material suspension or material limitation of trading in securities generally on the NASDAQ, or any setting of minimum prices for trading on such exchange; (v) suspension of trading of any securities of Equinix on any exchange or in the over-the-counter market; (vi) banking moratorium declared by U.S. Federal authorities; (vii) major disruption of settlements of securities or clearance services in the United States; or (viii) attack on, outbreak or escalation of hostilities or act of terrorism involving the United States, any declaration of war by the U.S. Congress or any other national or international calamity or emergency if, in the judgment of the Representative, the effect of any such attack, outbreak, escalation, act, declaration, calamity or emergency makes it impractical or inadvisable to proceed with completion of the public offering or the sale of and payment for the SAILS.

(b) The Representative shall have received, on the Closing Date, certificates, dated the Closing Date and signed by an executive officer or other authorized person, as applicable, of each of Equinix and the Selling Stockholder, respectively, in each case to the relevant effect that the representations and warranties of each of Equinix or the Selling Stockholder contained in this Agreement are true and correct as of and on the date hereof and the Closing Date and that each of Equinix or the Selling Stockholder, as applicable, has complied with all of the agreements and satisfied all of the conditions on its part to be performed or satisfied hereunder on or before the Closing Date.

 

(c) The Representative shall have received on the Closing Date an opinion of Gunderson Dettmer Stough Villeneuve Franklin & Hachigian, LLP, counsel for Equinix, dated the Closing Date, to the effect that:

 

(i) Equinix has been duly incorporated and is validly existing as a corporation in good standing under the laws of the State of Delaware, with corporate power and authority to own its properties and conduct its business as described in the Equinix Final Prospectus;

 

(ii) Equinix has been duly qualified as a foreign corporation for the transaction of business and is in good standing under the laws of California, New Jersey, Ohio, Texas and Virginia;

 

(iii) the compliance by Equinix with the provisions of this Agreement and the consummation of the Contract Shares Basic Transactions will not result in any material violation of the provisions of the Certificate of Incorporation or Bylaws of Equinix or any United States federal, Delaware corporate or California statute or any order, rule or regulation known to such counsel of any court or governmental agency or body in such jurisdictions having jurisdiction over Equinix or any of its properties. No consent, approval, authorization, order, registration or qualification of or with any such court or governmental agency or body is required for the performance by Equinix of its obligations under this Agreement, except such as have been obtained and made under the Securities Act and such as may be required under state securities laws;

 

(iv) Equinix owns all of the shares of capital stock of each Subsidiary of Equinix. Each of the Subsidiaries has been duly incorporated and is an existing corporation in good standing under the laws of the jurisdiction of its incorporation, with corporate power and authority to own its properties and conduct its business as described in the Equinix Final Prospectus; and each Subsidiary is duly qualified to do business as a foreign corporation in good standing under the laws of the jurisdictions listed beside its name on SCHEDULE B hereto; all of the issued and outstanding capital stock of each of the Subsidiaries has been duly authorized and validly issued and is fully paid and nonassessable;

 

(v) Equinix has an authorized capitalization as set forth in the Equinix Final Prospectus, and all of the issued and outstanding shares of capital stock of Equinix (including the Contract Shares) have been duly and validly authorized and issued. The Contract Shares, and, to such counsel’s knowledge, all of the other issued and outstanding shares of capital stock of Equinix, are fully paid and non-assessable; and the Contract Shares conform in all material respects to the “Description of Common Stock” contained in the Equinix Final Prospectus;

 

(vi) this Agreement has been duly authorized, executed and delivered by Equinix;

 

(vii) the statements set forth in the Equinix Final Prospectus under the caption “Description of Common Stock,” insofar as they purport to constitute a summary of the terms of the Contract Shares, and under the caption “Underwriting” insofar as they purport to describe the provisions of the laws and documents referred to therein, provide a fair summary in all material respects of such provisions;

(viii) to such counsel’s knowledge, there are no legal or governmental proceedings required to be described in the Equinix Registration Statement or the Equinix Final Prospectus, which are not described as required;

 

(ix) Equinix is not and, after giving effect to the Contract Shares Basic Transactions will not be, an “investment company” as defined in the Investment Company Act;

 

(x) the compliance by Equinix with all of the provisions of this Agreement and the consummation of the Contract Shares Basic Transactions will not conflict with or result in a breach or violation of any terms or provisions of, or constitute a default under any agreement set forth on an exhibit to such counsel’s opinion; and

 

(xi) such counsel shall also state that (A) such counsel believes that the Equinix Registration Statement and the Equinix Final Prospectus (except for financial statements and schedules thereto and financial and statistical data derived from such financial statements and schedules included therein, as to which they need express no belief) comply as to form in all material respects with the Securities Act and the applicable rules and regulations of the Commission thereunder, (B) such counsel confirms that it has no reason to believe (except for financial statements and schedules thereto and financial and statistical data derived from such financial statements and schedules included therein, as to which such counsel need express no belief) that, as of its effective date, the Equinix Registration Statement and the Equinix Final Prospectus included therein at the time the Equinix Registration Statement became effective contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading, (C) such counsel confirms that it has no reason to believe (except for financial statements and schedules thereto and financial and statistical data derived from such financial statements and schedules included therein, as to which such counsel need express no belief) that, as of its date or the date hereof, the Equinix Final Prospectus contained or contains any untrue statement of a material fact or omitted or omits to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading, and (D) such counsel confirms that it does not know of any contracts or other documents of a character required to be filed as an exhibit to the Equinix Registration Statement or required to be described in the Equinix Registration Statement or the Equinix Final Prospectus which are not so filed or so described as required.

 

With respect to subparagraph (xi) of this paragraph (c), Gunderson Dettmer Stough Villeneuve Franklin & Hachigian LLP may state that their opinion and belief are based upon their participation in the preparation of the Equinix Registration Statement and the Equinix Final Prospectus (excluding the documents incorporated by reference therein) and any amendments or supplements thereto and review and discussion of the contents thereof, but are without independent check or verification, except as specified.

 

(d) The Representative shall have received on the Closing Date an opinion of Brandi Galvin Morandi, General Counsel for Equinix, dated the Closing Date, to the effect that:

 

(i) to her knowledge, Equinix is not in default in the performance or observance of any material obligation, agreement, covenant or condition contained in any agreement filed as an exhibit to the Equinix Registration Statement or appearing on the list of exhibits to Equinix’s quarterly report on Form 10-Q for the quarter ended September 30, 2005 filed with the Commission or any current report on Form 8-K filed by Equinix with the Commission on or after October 19, 2005 and before the date of such opinion (each an “ Equinix Material Agreement ”); and

 

(ii) the compliance by Equinix with all of the provisions of this Agreement and the consummation of the Contract Shares Basic Transactions will not conflict with or result in a breach or violation of any terms or provisions of, or constitute a default under any Equinix Material Agreement (other than those agreements listed on the exhibit to the opinion required by Section 3(c) hereof that is referred to in Section 3(c)(x) hereof).

(e) The Representative shall have received on the Closing Date an opinion of Latham & Watkins LLP, U.S. special counsel for the Selling Stockholder, dated the Closing Date in the form set forth on EXHIBIT B hereto.

 

(f) The Representative shall have received on the Closing Date an opinion of Appleby Spurling Hunter, Bermuda counsel for the Selling Stockholder, dated the Closing Date in the form set forth on EXHIBIT D hereto.

 

The opinions of Gunderson Dettmer Stough Villeneuve Franklin & Hachigian LLP and Brandi Galvin Morandi, described in paragraph (c) and the (d) above shall be rendered to the Underwriters at the request of Equinix, and shall so state therein. The opinions of Appleby Spurling Hunter and Latham & Watkins LLP, described in paragraphs (f) and (g), respectively, above shall be rendered to the Underwriters at the request of the Selling Stockholder and shall so state therein.

 

(g) The Representative shall have received on the Closing Date opinions of Cleary Gottlieb Steen & Hamilton LLP, counsel for the Underwriters, and of Davis Polk & Wardwell, special disclosure counsel for the Underwriters, dated the Closing Date and addressed to the Representative on such matters as the Representative may reasonably require.

 

(h) The Representative shall have received, on each of the date hereof and the Closing Date, a letter dated the date hereof or the Closing Date, as the case may be, in form and substance satisfactory to the Representative, from PricewaterhouseCoopers LLP, Independent Registered Public Accounting Firm for Equinix, containing statements and information of the type ordinarily included in accountants’ “comfort letters” to Underwriters with respect to the financial statements and certain financial information contained in the Equinix Registration Statement and the Equinix Final Prospectus; provided that the letter delivered on the Closing Date shall use a “cut-off date” of November 7, 2005.

 

(i) A “lock-up” agreement substantially in the form of EXHIBIT A hereto, pursuant to both this Agreement and the Underwriting Agreement, expected to be entered into on the date hereof, and to be made by and among Citigroup Global Markets Inc., Credit Suisse First Boston LLC and Goldman Sachs & Co., as representatives of the several underwriters named in SCHEDULE A thereto, STT and Equinix (the “ Secondary Underwriting Agreement ”) relating to sales and certain other dispositions of shares of Common Stock or certain other instruments by the officers and directors of Equinix, delivered to either the Underwriters or the underwriters under the Secondary Underwriting Agreement on or before the date hereof, shall be in full force and effect on the Closing Date.

 

(j) A “lock-up” agreement substantially in the form of EXHIBIT C hereto, pursuant to both this Agreement and the Secondary Underwriting Agreement relating to sales and dispositions of Common Stock or certain other instruments by STT, delivered to either the Underwriters or the underwriters under the Secondary Underwriting Agreement on or before the date hereof, shall be in full force and effect on the Closing Date.

 

(k) Each Forward Document shall have been executed and delivered by all parties thereto, and the Selling Stockholder shall have delivered to the Collateral Agent the number of Contract Shares required by the Collateral Agreement to be initially pledged and assigned by the Selling Stockholder in accordance with the requirements of the Collateral Agreement.

 

(l) The Representative shall have received on the Closing Date an opinion of Wong Partnership, Singapore local counsel for STT, dated the Closing Date, substantially to the effect set forth in EXHIBIT F hereto.

4. Covenants of the Selling Stockholder, the Underwriters and Equinix.

 

(a) In further consideration of the agreements of the Underwriters herein contained, Equinix covenants to the Underwriters:

 

(i) to furnish to the Representative, without charge, five signed copies of the Equinix Registration Statement (including exhibits thereto) and to furnish to the Representative in New York City, without charge, on a timely basis to permit proper delivery on or prior to any Closing Date, and during the period mentioned in paragraph (a)(iii) below, as many copies of the Equinix Final Prospectus and any supplements and amendments thereto or to the Equinix Registration Statement as the Representative may reasonably request;

 

(ii) before amending or supplementing the Equinix Registration Statement or the Equinix Final Prospectus, to furnish to the Representative a copy of each such proposed amendment or supplement and not to file any such proposed amendment or supplement to which the Representative reasonably objects, and to file with the Commission within the applicable period specified in Rule 424(b) under the Securities Act any prospectus required to be filed pursuant to such Rule;

 

(iii) if, during such period after the first date of the public offering of the SAILS as in the opinion of counsel for the Underwriters the Equinix Final Prospectus is required by law to be delivered in connection with sales by the Underwriters or any dealer, any event shall occur or condition exist as a result of which it is necessary to amend or supplement the Equinix Final Prospectus in order to make the statements therein, in the light of the circumstances when the Equinix Final Prospectus is delivered to a purchaser of SAILS, not misleading, or if, in the opinion of counsel for the Underwriters, it is necessary to amend or supplement the Equinix Final Prospectus to comply with applicable law, forthwith to prepare, file with the Commission and furnish, at its own expense, to the Underwriters and to the dealers (whose names and addresses the Representative will furnish to Equinix) to which SAILS may have been sold by the Underwriters and to any other dealers upon request, either amendments or supplements to Equinix Final Prospectus so that the statements in the Equinix Final Prospectus as so amended or supplemented will not, in the light of the circumstances when the Equinix Final Prospectus is delivered to a purchaser of SAILS, be misleading or so that the Equinix Final Prospectus, as amended or supplemented, will comply with law;

 

(iv) if the Common Stock ceases to be listed on the NASDAQ, to endeavor to qualify the Contract Shares for offer and sale under the securities or blue sky laws of such jurisdictions as the Representative shall reasonably request and to comply with such laws so as to permit the continuance of sales and dealings therein in such jurisdictions for as long as may be necessary to complete the distribution of the SAILS;

 

(v) to make generally available to holders of the SAILS and to the Representative as soon as practicable an earning statement of Equinix covering the twelve-month period ending December 31, 2006 that satisfies the provisions of Section 11(a) of the Securities Act and the rules and regulations of the Commission thereunder;

 

(b) In further consideration of the agreements of Equinix, the Selling Stockholder and the Underwriters herein contained, the Selling Stockholder, the Underwriters and Equinix further covenant as follows:

 

(i) Whether or not the transactions contemplated in this Agreement are consummated or this Agreement is terminated and subject to any agreements it has entered into with the Selling Stockholder with respect to the reimbursement by the Selling Stockholder of certain fees and expenses, Equinix agrees to pay or cause to be paid all expenses incident to the performance of its obligations under this Agreement, including: (A) the fees, disbursements and expenses of Equinix’s counsel and Equinix’s accountants in connection with the registration of the shares of Common Stock under the Securities Act and all other fees or expenses in connection with the preparation and filing of the Equinix Registration Statement, any Equinix Preliminary Prospectus, the Equinix Final Prospectus and amendments

and supplements to any of the foregoing, including all printing costs associated therewith, and the mailing and delivering of copies thereof to the Underwriters and dealers, in the quantities hereinabove specified, (B) the cost of printing or producing any Blue Sky or Legal Investment memorandum in connection with the offer and sale of the shares of Common Stock under state securities laws and all expenses in connection with the qualification of such shares for offer and sale under state securities laws as provided in paragraph (iv) of Section 4(a), including filing fees and the reasonable fees and disbursements of counsel for the Underwriters in connection with such qualification and in connection with the Blue Sky or Legal Investment memorandum, (C) the cost of printing certificates representing the shares of Common Stock, (D) the costs and charges of any transfer agent, registrar or depositary for the shares of Common Stock, (E) all costs and expenses incident to listing, on the NASDAQ, the shares of Common Stock to be delivered by the Selling Stockholder in pledge pursuant to the Collateral Agreement, (F) the costs and expenses of Equinix relating to investor presentations on any “road show” undertaken in connection with the marketing of the offering of the SAILS, including, without limitation, expenses associated with the production of road show slides and graphics, fees and expenses of any consultants engaged in connection with the road show presentations with the prior approval of Equinix, travel and lodging expenses of the representatives and officers of Equinix and any such consultants, and the cost of any aircraft chartered in connection with the road show with the prior approval of Equinix, and (G) all other costs and expenses incident to the performance of the obligations of Equinix hereunder for which provision is not otherwise made in this Section 4. It is understood, however, that except as provided in this Section 4, and except as provided in Section 5 below, the Underwriters will pay all of their own costs and expenses, including fees and disbursements of their counsel, stock transfer taxes payable on delivery of any of the shares of Common Stock by it and any advertising expenses connected with any offers it may make and subject to Section 4(b)(ii), below, the Selling Stockholder shall pay its own expenses.

 

(ii) In the event that the transactions contemplated in this Agreement are consummated, the Underwriters agree to reimburse the Selling Stockholder for its out of pocket expenses directly related to the offering, pledge and sale by it of the Common Stock under the Forward Documents in conjunction with CSFB USA’s offering and sale of the SAILS pursuant to Part B of this Agreement (including expenses incurred pursuant to the Selling Stockholder’s obligation, pursuant to and in accordance with that certain Letter Agreement, dated as of October 6, 2005, by and among Equinix, STT and STT Communications Ltd, a corporation organized under the laws of the Republic of Singapore (“ STT Communications ”) (the “ Letter Agreement ”) to reimburse Equinix for certain of its expenses in an amount not to exceed $1,000,000 (of which amount not more than an aggregate of $500,000 may be in reimbursement of fees and disbursements of Equinix’s external counsel, auditors and filing fees to be paid to the Commission)). It is further agreed that the Underwriters will negotiate the terms of all arrangements on behalf of Equinix and the Selling Stockholder with respect to (A) the printing of the Equinix Registration Statement, any Equinix Preliminary Prospectus, Equinix Final Prospectus and amendments and supplements to any of the foregoing and (B) investor presentations related to any “roadshows” undertaken in connection with the marketing of the offering of the SAILS.

 

(c) In further consideration of the agreements of the Selling Stockholder herein contained, Equinix covenants to STT and the Selling Stockholder:

 

(i) before amending or supplementing the Equinix Registration Statement or the Equinix Final Prospectus, to furnish to the Selling Stockholder a copy of each such proposed amendment or supplement and not to file any such proposed amendment or supplement to which the Selling Stockholder reasonably objects within two business days of receipt of such copy, and to file with the Commission within the applicable period specified in Rule 424(b) under the Securities Act any prospectus required to be filed pursuant to such Rule;

 

(ii) if, during such period after the first date of the public offering of the SAILS as in the opinion of counsel for the Underwriters the Equinix Final Prospectus is required by law to be delivered in connection with sales of SAILS by the Underwriters or any dealer, any event shall occur or condition exist as a result of which it is necessary to amend or supplement the Equinix Final Prospectus in order to make the statements therein, in the light of the circumstances when the Equinix Final Prospectus is delivered to a purchaser of SAILS, not misleading, or if, in the opinion of counsel for the Underwriters, it is

necessary to amend or supplement the Equinix Final Prospectus to comply with applicable law, forthwith to prepare, file with the Commission and furnish, at its own expense, to the Underwriters and to the dealers (whose names and addresses the Representative will furnish to Equinix) to which SAILS may have been sold by the Underwriters and to any other dealers upon request, either amendments or supplements to the Equinix Final Prospectus so that the statements in the Equinix Final Prospectus as so amended or supplemented will not, in the light of the circumstances when the Equinix Final Prospectus is delivered to a purchaser of SAILS, be misleading or so that the Equinix Final Prospectus, as amended or supplemented, will comply with law;

 

(iii) if the Common Stock ceases to be listed on the NASDAQ, to endeavour to qualify the Common Stock for offer and sale under the securities or blue sky laws of such jurisdictions as the Representative shall reasonably request and to comply with such laws so as to permit the continuance of sales and dealings therein in such jurisdiction for as long as may be necessary to complete the distribution of the SAILS; and

 

(iv) in accordance with the provisions of the Governance Agreement, dated as of December 30, 2002, by and among Equinix, STT Communications, STT and the stockholders of Pihana Pacific, Inc., a corporation organized under the laws of the State of Delaware, named therein and party thereto (the ” Governance Agreement ”), and the provisions of the Registration Rights Agreement, dated as of December 30, 2002, by and among Equinix and the Initial Purchasers named therein and party thereto (the ” Registration Rights Agreement ,” and, together with the Governance Agreement, the ” Transaction Agreements ”), Equinix shall use commercially reasonable efforts to furnish to the Selling Stockholder: (A) an opinion dated the Closing Date, from Gunderson Dettmer Stough Villeneuve Franklin & Hachigan, LLP, counsel for the Company, to the same effect as set forth in Section 3(c) above, provided that Gunderson, Dettmer Stough Villeneuve Franklin & Hachigan, LLP shall have received a letter dated the Closing Date and from the Selling Stockholder, substantially in the form as previously agreed; and (B) a letter dated the date hereof and the Closing Date, from PricewaterhouseCoopers LLP, Independent Registered Public Accounting Firm for the Company, to the same effect as set forth in Section 3(h) above, provided that PricewaterhouseCoopers LLP shall have received a letter dated the date hereof and from the Selling Stockholder, substantially in the form as previously agreed.

 

(d) Without limiting the rights of the Underwriters under this Agreement in any respect:

 

(i) Notwithstanding any provision in this Agreement, the Transaction Agreements or the Secondary Underwriting Agreement, or any statement in the Equinix Registration Statement to the contrary or otherwise, Equinix hereby affirms, acknowledges and agrees that the Selling Stockholder shall have the rights and obligations pursuant to the Transaction Agreements as to indemnification and contribution, respectively, as between Equinix and the Selling Stockholder, in connection with any Registration Statement (as defined in the Transaction Agreements) or any Prospectus (as defined in the Transaction Agreements), as amended or supplemented, respectively (in each case, the ” Existing Allocation Provisions ”), as if the Selling Stockholder were a “Holder” (as defined in the Transaction Agreements, respectively), and the Existing Allocation Provisions shall otherwise apply in all respects to their respective rights and obligations as to indemnification and contribution, respectively, as between Equinix and the Selling Stockholders, respectively, in connection with any transaction contemplated by this Agreement, the Secondary Underwriting Agreement or the Company Registration Statement, as provided , however , Equinix hereby affirms, acknowledges and agrees that STT shall retain and otherwise preserve all rights set forth in the Transaction Agreements, and all such rights of STT shall in no way be affected or otherwise prejudiced by operation or inclusion of this provision herein or the inclusion of any equivalent provision in the Secondary Underwriting Agreement; and that, for purposes of this Section 4(d)(i), the Contract Shares sold by the Selling Stockholder pursuant to the Forward Purchase Agreement shall be deemed to be Registrable Securities (as defined in the Transaction Agreements), whether or not the provisions of the Transaction Agreements are applicable to the registration with the Commission of less than an aggregate of 10,189,549 shares of Common Stock; and

 

(ii) Equinix and the Selling Stockholder hereby affirm and acknowledge their and/or their affiliates’ respective rights and obligations pursuant to the Letter Agreement which, among other

things, sets forth the terms and conditions of STT Communications’ obligation to reimburse Equinix for certain customary costs and expenses incurred in connection with the offering of Common Stock pursuant to the Equinix Registration Statement.

 

(e) As compensation to the Underwriters for their commitment hereunder, and in view of the fact that the issuance of the SAILS is integrally related to the Selling Stockholder’s sale of the Contract Shares, the Selling Stockholder agrees to pay to the Underwriters, at the time of delivery of the SAILS pursuant to Part B hereof, an amount equal to 3.00% of the aggregate principal amount of the SAILS ($1.0692 per SAILS) delivered. Such payment shall be made by irrevocable direction of the Selling Stockholder to CSFB Capital to pay such amount, to such account as may be directed by the Representative, from the amount payable by CSFB Capital to the Selling Stockholder on such date pursuant to the Forward Purchase Agreement.

 

5. Indemnification and Contribution .

 

(a) Equinix will indemnify and hold harmless each Underwriter, its partners, members, directors, officers and its affiliates and each person, if any, who controls such Underwriter within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act, against any losses, claims, damages or liabilities, joint or several, to which such Underwriter may become subject, under the Securities Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon any untrue statement or alleged untrue statement of any material fact contained in Equinix Registration Statement, any Equinix Preliminary Prospectus and Equinix Final Prospectus, or any amendment or supplement thereto, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, and will reimburse each Underwriter for any legal or other expenses reasonably incurred by such Underwriter in connection with investigating or defending any such loss, claim, damage, liability or action as such expenses are incurred; provided, however, that Equinix will not be liable in any such case to the extent that any such loss, claim, damage or liability arises out of or is based upon an untrue statement or alleged untrue statement in or omission or alleged omission from any of such documents in reliance upon and in conformity with written information furnished to Equinix either (i) by the Selling Stockholder specifically for use therein, or (ii) by any Underwriter through the Representative specifically for use therein, provided , that the foregoing indemnity agreement with respect to any Equinix Preliminary Prospectus shall not inure to the benefit of either the Underwriter from whom the person asserting any such losses, claims, damages and liabilities purchased SAILS, or any person controlling such Underwriter, if a copy of Equinix Final Prospectus (as then amended or supplemented) was not, to the extent required by law, sent or given by or on behalf of such Underwriter to such person, and if (and only to the extent that) Equinix Final Prospectus (as so amended or supplemented) would have cured the defect giving rise to such losses, claims, damages or liabilities provided that Equinix delivered on a timely basis to permit proper delivery on or prior to any Closing Date as many copies of any such Equinix Preliminary Prospectus, Equinix Final Prospectus and Equinix Registration Statement as the Underwriter may have requested.

 

(b) The Selling Stockholder agrees to indemnify and hold harmless each Underwriter, its partners, members, directors, officers and its affiliates and each person, if any, who controls such Underwriter within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act, against any losses, claims, damages or liabilities, joint or several, to which such Underwriter may become subject, under the Securities Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon any untrue statement or alleged untrue statement of any material fact contained in the Equinix Registration Statement, any Equinix Preliminary Prospectus and the Equinix Final Prospectus, or any amendment or supplement thereto, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, in each case to the extent, but only to the extent that such untrue statement or alleged untrue statement or omission or alleged omission was made in reliance upon and in conformity with written information relating to the Selling Stockholder or STT and furnished to Equinix by the Selling Stockholder specifically for use therein, and will reimburse any legal or other expenses reasonably incurred by such Underwriter in connection with investigating or defending any such loss, claim, damage, liability or action as such expenses are incurred. Notwithstanding anything to the contrary contained herein, the maximum aggregate liability of the Selling Stockholder under this Section 5(b) shall not exceed (i) the “Purchase Price” (as defined in Section 1.2 of the Forward Purchase Agreement) for the Contract Shares, minus (ii) any amounts payable to the Underwriters pursuant to Section 4(e) of this Agreement.

(c) Each Underwriter will severally and not jointly indemnify and hold harmless Equinix, its directors and officers and each person, if any, who controls Equinix within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act, and the Selling Stockholder, its affiliates, its directors and officers and each person, if any, who controls the Selling Stockholder within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act against any losses, claims, damages or liabilities to which Equinix or the Selling Stockholder may become subject, under the Securities Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon any untrue statement or alleged untrue statement of any material fact contained in Equinix Registration Statement, any Equinix Preliminary Prospectus and the Equinix Final Prospectus, or any amendment or supplement thereto, or arise out of or are based upon the omission or the alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, in each case to the extent, but only to the extent that such untrue statement or alleged untrue statement or omission or alleged omission was made in reliance upon and in conformity with written information furnished to Equinix by such Underwriter through the Representative specifically for use therein, and will reimburse any legal or other expenses reasonably incurred by Equinix and the Selling Stockholder in connection with investigating or defending any such loss, claim, damage, liability or action as such expenses are incurred.

 

(d) Promptly after receipt by an indemnified party (the “ Indemnified Party ”) under this Section 5 of notice of the commencement of any action, such Indemnified Party will, if a claim in respect thereof is to be made against an indemnifying party (the “ Indemnifying Party ”) under subsection (a), (b) or (c) above, notify the Indemnifying Party of the commencement thereof; but the failure to notify the Indemnifying Party shall not relieve it from any liability that it may have under subsection (a), (b) or (c) above except to the extent that it has been materially prejudiced (through the forfeiture of substantive rights or defenses) by such failure; and provided further that the failure to notify the Indemnifying Party shall not relieve it from any liability that it may have to an Indemnified Party otherwise than under subsection (a), (b) or (c) above. In case any such action is brought against any Indemnified Party and it notifies an Indemnifying Party of the commencement thereof, the Indemnifying Party will be entitled to participate therein and, to the extent that it may wish, jointly with any other Indemnifying Party similarly notified, to assume the defense thereof, with counsel satisfactory to such Indemnified Party (who shall not, except with the consent of the Indemnified Party, be counsel to the Indemnifying Party), and after notice from the Indemnifying Party to such Indemnified Party of its election so to assume the defense thereof, the Indemnifying Party will not be liable to such Indemnified Party under this Section 5 for any legal or other expenses subsequently incurred by such Indemnified Party in connection with the defense thereof other than reasonable costs of investigation. No Indemnifying Party shall, without the prior written consent of the Indemnified Party, effect any settlement of any pending or threatened action in respect of which any Indemnified Party is or could have been a party and indemnity could have been sought hereunder by such Indemnified Party unless such settlement (i) includes an unconditional release of such Indemnified Party from all liability on any claims that are the subject matter of such action and (ii) does not include a statement as to, or an admission of, fault, culpability or a failure to act by or on behalf of an Indemnified Party.

 

(e) If the indemnification provided for in this Section 5 is unavailable or insufficient to hold harmless an Indemnified Party under subsection (a), (b) or (c) above, then each Indemnifying Party shall contribute to the amount paid or payable by such Indemnified Party as a result of the losses, claims, damages or liabilities referred to in subsection (a), (b) or (c) above (i) in such proportion as is appropriate to reflect the relative benefits received by Equinix and the Selling Stockholder on the one hand and the Underwriters on the other from the offering of the SAILS or (ii) if the allocation provided by clause (i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative fault of Equinix and the Selling Stockholder on the one hand and the Underwriters on the other in connection with the statements or omissions which resulted in such losses, claims, damages or liabilities as well as any other relevant equitable considerations. The relative benefits received by Equinix and the Selling Stockholder on the one hand and the Underwriters on the other shall be deemed to be in the same proportion as the total net proceeds from the sale of the Contract Shares (before deducting expenses) received by the Selling Stockholder bear to the total underwriting discounts and commissions received by the Underwriters from the sale of the SAILS. The relative fault shall be determined by reference to, among other things, whether the untrue or alleged untrue

statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by Equinix, the Selling Stockholder or the Underwriters and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such untrue statement or omission. The amount paid by an Indemnified Party as a result of the losses, claims, damages or liabilities referred to in the first sentence of this subsection (e) shall be deemed to include any legal or other expenses reasonably incurred by such Indemnified Party in connection with investigating or defending any action or claim which is the subject of this subsection (e). Notwithstanding the provisions of this subsection (e), no Underwriter shall be required to contribute any amount in excess of the amount by which the total price at which the SAILS underwritten by it and distributed to the public were offered to the public exceeds the amount of any damages which such Underwriter has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The Underwriters’ obligations in this subsection (e) to contribute are several in proportion to their respective underwriting obligations and not joint.

 

(f) The obligations of Equinix and the Selling Stockholder under this Section 5 shall be in addition to any liability which Equinix and the Selling Stockholder may otherwise have and shall extend, upon the same terms and conditions, to each Underwriter, its partners, members, directors, officers and its affiliates and each person, if any, who controls any Underwriter within the meaning of the Securities Act or the Exchange Act; and the obligations of the Underwriters under this Section 5 shall be in addition to any liability which the respective Underwriters may otherwise have and shall extend, upon the same terms and conditions, to the Company, its directors and officers and each person, if any, who controls the Company within the meaning of the Securities Act or the Exchange Act and the Selling Stockholder, its affiliates, directors and officers and each person, if any, who controls the Selling Stockholder within the meaning of the Securities Act or the Exchange Act.

 

6. Survival of Certain Representations and Obligations . The respective indemnities, agreements, representations, warranties and other statements of the Selling Stockholder, of Equinix or its officers and of the several Underwriters set forth in or made pursuant to this Agreement will remain in full force and effect, regardless of any investigation, or statement as to the results thereof, made by or on behalf of any Underwriter, the Selling Stockholder, Equinix or any of their respective representatives, officers or directors or any controlling person, and will survive delivery of and payment for the Contract Shares under the Forward Purchase Agreement and of the SAILS under this Agreement. If this Agreement is terminated or if for any reason the purchase of the Contract Shares by CSFB Capital and the purchase of the SAILS by the Underwriters are not consummated, the respective obligations of Equinix, the Selling Stockholder, and the Underwriters pursuant to Section 4(b) and Section 9 shall remain in effect.

 

7. Notices . All communications hereunder will be in writing and:

 

(a) if sent to the Underwriters, shall be mailed, delivered or faxed and confirmed to the Representative at Credit Suisse First Boston LLC, Eleven Madison Avenue, New York, New York 10010-3629, fax: (212) 325-8227 Attention: Transactions Advisory Group, with a copy thereof mailed, delivered or faxed to Cleary Gottlieb Steen & Hamilton LLP, One Liberty Plaza, New York, New York 10006, fax: 212-225-2122, Attention: Raymond B. Check, Esq.;

 

(b) if sent to Equinix, shall be mailed, delivered or faxed and confirmed to it at Equinix, Inc., 301 Velocity Way, Foster City, California 94404-4803, fax: (650) 513-7909 Attention: General Counsel, with a copy thereof mailed, delivered or faxed to Gunderson Dettmer Stough Villeneuve Franklin & Hachigian LLP, 155 Constitution Drive, Menlo Park, California 94025, fax: (650) 321-2800 Attention: Christopher D. Dillon, Esq.; and

 

(c) if sent to the Selling Stockholder, shall be mailed, delivered or faxed and confirmed to it at Canon’s Court, 22 Victoria Street, Hamilton, HM12, Bermuda, fax: (441) 292-8666, Attention: Directors, with a copy to STT at 51 Cuppage Road, #10-11/17 StarHub Centre, Singapore 229469, fax: (65) 6720-7277 Attention: General Counsel, with a copy thereof mailed, delivered or faxed to Latham & Watkins LLP, 505 Montgomery Street, Suite 2000, San Francisco, California 94111, fax: (415) 395-8095, Attention: Tracy K. Edmonson, Esq., and also to Latham & Watkins LLP, 80 Raffles Place, No. 14-20 UOB Plaza 2, Singapore 048624, fax: (65) 6536-1171, Attention: Michael Sturrock, Esq.

8. Effectiveness. This Agreement shall become effective upon the execution and delivery hereof by the parties hereto.

 

9. Expenses. If this Agreement shall be terminated before the Closing Date (a) because of any failure or refusal on the part of Equinix to comply with the terms or to fulfill any of the conditions of this Agreement, or if for any reason Equinix shall be unable to perform its respective obligations under this Agreement, Equinix will reimburse the Underwriters for all out-of-pocket expenses (including the fees and disbursements of their counsel) reasonably incurred by the Underwriters in connection with this Agreement and the offering contemplated hereunder or (b) because of any failure or refusal on the part of the Selling Stockholder to comply with the terms or to fulfill any of the conditions of this Agreement, the Forward Purchase Agreement or the Collateral Agreement, or if for any reason the Selling Stockholder shall be unable to perform its obligations under this Agreement, the Forward Purchase Agreement or the Collateral Agreement, the Selling Stockholder will reimburse the Underwriters for all out-of-pocket expenses (including the fees and disbursements of their counsel) reasonably incurred by the Underwriters in connection with this Agreement and the offering contemplated hereunder and in connection with the Forward Purchase Agreement and the Collateral Agreement.

 

10. Successors . This Agreement will inure to the benefit of and be binding upon the parties hereto and their respective successors and the officers and directors and controlling persons referred to in Section 5, and no other person will have any right or obligation hereunder.

 

11. Representation . The Representative will act for the several Underwriters in connection with the transactions contemplated by this Agreement, and any action under this Agreement taken by the Representative will be binding upon all the Underwriters.

 

12. Counterparts . This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original, but all such counterparts shall together constitute one and the same agreement.

 

13. Absence of Fiduciary Relationship. Equinix and the Selling Stockholder acknowledge and agree that:

 

(a) the purchase and sale of the Contract Shares pursuant to the Forward Purchase Agreement is an arm’s-length commercial transaction between CSFB Capital and the Selling Stockholder, and the related purchase and sale of the SAILS pursuant to this Agreement is an arm’s-length commercial transaction by and among CSFB USA and the Underwriters;

 

(b) in connection therewith, and with the process leading to such transaction, CSFB Capital and each Underwriter is acting solely as a principal and not the agent or fiduciary of either Equinix or the Selling Stockholder;

 

(c) no Underwriter has assumed an advisory or fiduciary responsibility in favour of either Equinix or the Selling Stockholder with respect to the offering contemplated hereby or the process leading thereto (irrespective of whether such Underwriter has advised or is currently advising Equinix, the Selling Stockholder or STT on other matters) or any other obligation to either Equinix or the Selling Stockholder (except the obligations expressly set forth in this Agreement or the Secondary Underwriting Agreement); and

 

(d) Equinix and the Seller Stockholder have each consulted their own legal and financial advisors to the extent they deemed appropriate. Equinix and the Selling Stockholder agree they will not claim that CSFB Capital or the Underwriters, or any of them, have rendered advisory services of any nature or respect, or owe a fiduciary or similar duty to Equinix or the Selling Stockholder Entities, in connection with such transaction or the process leading thereto.

14. Applicable Law; Jurisdiction . This Agreement shall be governed by, and construed in accordance with, the laws of the State of New York, without regard to principles of conflicts of laws. The parties hereto submit to the non-exclusive jurisdiction of the federal and state courts in the Borough of Manhattan in The City of New York in any suit or proceeding arising out of or relating to this Agreement or the transactions contemplated hereby.

 

[PART B FOLLOWS]

PART B. REGISTRATION AND SALE OF THE SAILS

 

CSFB USA agrees to sell to the several Underwriters for their respective accounts, on and subject to the terms and conditions of the Underwriting Agreement – Debt Securities attached hereto as EXHIBIT E (“ Underwriting Agreement ”), the SAILS on the following terms:

 

Representative: CSFB LLC.

 

Title: 5.50% Shared Appreciation Income Linked Securities due 2008.

 

Principal Amount: $ 153,252,000 (4,300,000 SAILS).

 

Interest: 5.50% per annum. From November 16, 2005, payable quarterly on each February 15, May 15, August 15 and November 15, commencing February 15, 2006, to the persons who are registered as the owners of such SAILS at the close of business on the preceding February 1, May 1, August 1 and November 1, as the case may be, except that interest payable at maturity will be paid to the same persons to whom principal of such SAILS is payable.

 

Maturity: November 15, 2008.

 

Optional Redemption : None.

 

Sinking Fund: None.

 

Listing: None.

 

Delayed Delivery Contracts: None.

 

Purchase Price: 97% of the principal amount, plus accrued interest, if any, from November 16, 2005.

 

Expected Reoffering Price: 100% of the principal amount, subject to change by the Representative.

 

Closing: 10:30 A.M. on November 16, 2005 (the “ Closing Date