Equinix
Annual Report 2017

Plain-text annual report

UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWASHINGTON, D.C. 20549__________________________FORM 10-KxANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended December 31, 2017OR¨TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934For the transition period from _____________ to _____________Commission file number 000-31293______________________EQUINIX, INC.(Exact name of registrant as specified in its charter)Delaware 77-0487526(State of incorporation) (IRS Employer Identification No.)One Lagoon Drive, Redwood City, California 94065(Address of principal executive offices, including ZIP code)(650) 598-6000(Registrant’s telephone number, including area code)Securities registered pursuant to Section 12(b) of the Act:Title of each class Name of each exchange on which registeredCommon Stock, $0.001 The NASDAQ Stock Market LLCSecurities registered pursuant to Section 12(g) of the Act: NoneIndicate by check mark if the registrant is a well-known seasoned issuer as defined in Rule 405 of the Act. Yes x No ¨Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ¨ No xIndicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filingrequirements for the past 90 days. Yes x No ¨Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data Filerequired to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant wasrequired to submit and post such files). Yes x No ¨Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to thebest of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to thisForm 10-K. xIndicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. Seedefinitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one):Large accelerated filer xAccelerated filer oNon-accelerated filer oSmaller reporting company o Emerging growth company ¨If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any newor revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No xThe aggregate market value of the voting and non-voting common stock held by non-affiliates computed by reference to the price at which the commonstock was last sold as of the last business day of the registrant’s most recently completed second fiscal quarter was approximately $33.5 billion. As ofFebruary 23, 2018, a total of 79,228,072 shares of the registrant’s common stock were outstanding.DOCUMENTS INCORPORATED BY REFERENCEPart III – Portions of the registrant’s definitive proxy statement to be issued in conjunction with the registrant’s 2018 Annual Meeting of Stockholders, whichis expected to be filed not later than 120 days after the registrant’s fiscal year ended December 31, 2017. Except as expressly incorporated by reference, theregistrant’s proxy statement shall not be deemed to be a part of this report on Form 10-K. EQUINIX, INC.FORM 10-KDECEMBER 31, 2017TABLE OF CONTENTSItemPART IPage No.1.Business31A.Risk Factors151B.Unresolved Staff Comments342.Properties343.Legal Proceedings354.Mine Safety Disclosure35 PART II 5.Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities366.Selected Financial Data397.Management’s Discussion and Analysis of Financial Condition and Results of Operations417A.Quantitative and Qualitative Disclosures About Market Risk698.Financial Statements and Supplementary Data719.Changes in and Disagreements with Accountants on Accounting and Financial Disclosure719A.Controls and Procedures719B.Other Information72 PART III 10.Directors, Executive Officers and Corporate Governance7211.Executive Compensation7212.Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters7213.Certain Relationships and Related Transactions, and Director Independence7214.Principal Accounting Fees and Services72 PART IV 15.Exhibits and Financial Statement Schedules7316.Form 10-K Summary78 Signatures79 Index to Exhibits802Table of ContentsPART ITable of ContentsITEM 1.BUSINESSThe words "Equinix", "we", "our", "ours", "us" and the "Company" refer to Equinix, Inc. All statements in this discussion that are not historical areforward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, including statements regardingEquinix’s "expectations", "beliefs", "intentions", "strategies", "forecasts", "predictions", "plans" or the like. Such statements are based on management’scurrent expectations and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in theforward-looking statements. Equinix cautions investors that there can be no assurance that actual results or business conditions will not differ materiallyfrom those projected or suggested in such forward-looking statements as a result of various factors, including, but not limited to, the risk factors discussedin this Annual Report on Form 10-K. Equinix expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forwardlooking statements contained herein to reflect any change in Equinix’s expectations with regard thereto or any change in events, conditions, orcircumstances on which any such statements are based.OverviewEquinix, Inc. connects more than 9,800 companies directly to their customers and partners across the world’s most interconnected data center andinterconnection platform. Platform Equinix® combines a global footprint of state-of-the-art International Business Exchange™ (IBX®) data centers, a varietyof interconnection solutions, unique business and digital ecosystems and expert support. Today, businesses leverage the Equinix interconnection platform in48 strategic markets across the Americas, Asia-Pacific, and Europe, the Middle East and Africa ("EMEA"). Equinix operates as a real estate investment trustfor federal income tax purposes ("REIT").We elected to be taxed as a REIT for federal income tax purposes effective January 1, 2015. As of December 31, 2017, our REIT structure included all ofour data center operations in the United States ("U.S."), Canada and Japan, and the data center operations in Europe with the exception of Bulgaria, Portugal,Spain and Turkey. Our data center operations in other jurisdictions are operated as taxable REIT subsidiaries ("TRSs").In May 2017, we completed the acquisition of 29 data centers and their operations across 15 metro areas from Verizon Communications Inc. ("Verizon")for $3.6 billion (the "Verizon Data Center Acquisition"). Additional acquisitions that closed in 2017 include the purchase of IO UK’s facility in Slough,United Kingdom (the "IO Acquisition"); the purchase of data center provider Itconic, which operated four data centers in Spain and one in Portugal; and thepurchase of the Zenium data center in Istanbul. In December 2017, we announced the entry into a transaction agreement to acquire Metronode, whichoperates 10 data centers throughout Australia. In February 2018, we also announced the entry into a transaction agreement to acquire Infomart Dallas,including its operations and tenants. The acquisitions of Metronode and the Infomart Dallas are expected to close in the first half of 2018, subject to closingconditions. Careful, steady expansion has been key to Equinix’s growth strategy since our founding, as we seek to offer our customers interconnectionopportunities ahead of demand. Equinix also saw organic growth in 2017, opening new data centers in several important markets, including Amsterdam,Frankfurt, Hong Kong, São Paulo, Silicon Valley and Washington, D.C.In July 2017, Equinix created a new Strategy, Services and Innovation (SSI) group to ensure Equinix keeps pace with the dynamic customer requirementsof an increasingly "cloud-first" world. The group is led by Equinix company veteran Charles Meyers. Included in the SSI unit are the office of the ChiefTechnology Officer, Business Development, Product Management and Product Engineering. SSI is chartered to position Equinix for future success by:optimizing Equinix's position as a strategic enabler of cloud services; identifying key growth areas that align to Equinix's long-term strategy; and evaluatingand translating key market, competitive and technology trends into actionable business requirements.In December 2017, we announced the next phase in the evolution of Platform Equinix as we work to achieve the direct physical and virtual connectionof our IBX data centers around the world. This advance will enable customers to connect on demand to any other customer from any Equinix location,equipping digital businesses to scale their operations rapidly across the largest markets globally. By connecting to more business partners and destinations,Platform Equinix also enables service providers to directly access a global base of enterprise customers and cloud providers. This provides a more consistentend-user experience and expands our customers’ addressable market.3Table of ContentsIndustry BackgroundThe internet is a collection of numerous independent networks interconnected to form a network of networks. Users on different networks communicatewith each other through interconnection between these networks. For example, when a person sends an email to someone who uses a different provider for hisor her connectivity (e.g. Comcast versus AT&T), the email must pass from one network to the other to get to its final destination. A data center provides aphysical point at which that interconnection can occur.To accommodate the rapid growth of internet traffic that was occurring in the early years of the internet, an organized approach for networkinterconnection was needed. This was the start of the network era, when networks gained mutual advantage by exchanging data traffic on interoperableplatforms. The exchange of traffic between these networks became known as peering, which is when networks agree to trade traffic at relatively equalamounts, often at no charge to the other party. At first, government and nonprofit organizations established places where these networks could peer with eachother. These points were known as network access points, or NAPs. Over time, many NAPs became a natural extension of carrier services and were run bycompanies such as MFS (now a part of Verizon Business), Sprint, Ameritech and Pacific Bell (the latter two now part of AT&T).Ultimately, these NAPs were unable to scale with the growth of the internet, and the lack of "neutrality" by the carrier owners of these NAPs created aconflict of interest with the participants. This created a market need for network-neutral interconnection points that could accommodate the rapidly growingdemand to increase performance for enterprise and consumer users of the internet, especially with the rise of important content providers such as AOL,Microsoft, Yahoo! and others. In addition, the providers, as well as a growing number of enterprises, required a more secure and reliable solution for directconnection to a variety of telecommunications networks, as the importance of their internet operations continued to grow. These were the seeds of theconnected era, when peering expanded exponentially among new players, and access to information anytime and anywhere became the norm.To accommodate internet traffic growth, the largest networks left the NAPs and began connecting and trading traffic by placing private circuits betweeneach other. Peering, which once occurred at the NAP locations, was moved to these private circuits. Over the years, these circuits became expensive to expandand could not be built quickly enough to accommodate traffic growth. This led to a need by the large carriers to find a more efficient way to peer. The multi-tenant or colocation data center was introduced to meet this need. Today, many customers satisfy their requirements for peering through data center providerslike Equinix because this strategy permits them to peer with the networks as they require within one location, using simple, direct and secure connections.Their ability to peer within a data center or across a data center campus, instead of across a metro area, has increased the scalability of their operations whiledecreasing network costs.The interconnection model has further evolved over the years to include new offerings, as the collaborative landscape of the interconnected era imposesnew demands for connectivity that facilitates more scalable interactive and real-time digital interconnections. Enterprises are becoming increasinglyinterdependent and cloud- and digital-enabled, and to compete they need real-time data exchange and reliable, instant connections between and across anygiven digital ecosystem. Starting with the peering and network communities, interconnection has been used for new network solutions, including carrierEthernet, multiprotocol label switching (MPLS), virtual private networks (VPNs), and mobile services, in addition to traditional international private line andvoice services. The data center industry is working to keep up with the rapid digital transformation of today's businesses, and it continues to evolve with a setof new network offerings (such as SDN, blockchain and 5G) where interconnection is often used to solve any challenge using both physical and virtualnetworks, across geographic boundaries.In addition, the enterprise customer segment is also evolving. In the past, most enterprises opted to keep their data center requirements in-house.However, current trends are leading more enterprise chief information officers (CIOs) to either outsource their data center requirements, and/or extend theircorporate wide area networks (WANs) into carrier-neutral colocation facilities. These trends include the following:•Private interconnection is a rapidly growing business practice for leading companies, as their businesses become increasingly digital. According tothe Global Interconnection Index, a market study published in 2017 by Equinix, the capacity for private data exchange between businesses isgrowing at nearly twice the rate of the public internet and is on pace to reach nearly six times the volume of global IP traffic by 2020.•Digital transformation is accelerating in all global businesses and industries. Key trends are creating the need for real-time interaction and forcingdigital services to the edge, where the users need them the most, increasing the requirement for a single digitally interconnected business platform.•The need for businesses and organizations to create a "digital edge" - where commerce, population centers and digital ecosystems meet. A moregeographically distributed IT infrastructure is needed to support the digital operations that now cover every global region and every aspect oftoday’s global businesses.4Table of Contents•The growth of "proximity communities" that rely on immediate physical colocation and interconnection with strategic partners and customers.Examples include financial exchange ecosystems for electronic trading and settlement, media and content provider ecosystems, and ecosystems forreal-time bidding and fulfillment of internet advertising.•The Internet of Things (IoT) and big data infrastructures, which are creating unprecedented quantities of data that fuel digital business.•The need to manage data and security and enforce regulatory control locally in support of the global digital trade of goods and services.•The accelerating adoption and ubiquitous nature of cloud computing technology services, in particular hybrid/multiclouds, along with enterprisecloud service offerings such as Software-as-a-Service (SaaS), Infrastructure-as-a-Service (IaaS) and Platform-as-a-Service (PaaS) and security anddisaster recovery services.•The continuing growth of consumer internet traffic from new bandwidth-intensive services (e.g., video, voice over IP, social media, mobile data,gaming, data-rich media), Ethernet and wireless services, as well as new devices (e.g., wearables, home assistances, AR/VR headsets). These devicesand services also increase the requirements for anytime, anywhere and any device interconnection out at the edge to improve the performance,security, scalability and reliability of interconnecting people, locations, clouds, data and things.•Significant increases in power and cooling requirements for today’s data center equipment. New generations of servers and storage devices continueto concentrate processing capability and the associated power consumption and cooling load into smaller footprints; and many legacy-built datacenters are unable to accommodate these new power and cooling demands. The high capital costs associated with building and maintaining "in-sourced" data centers creates an opportunity for capital savings by leveraging an outsourced colocation model.Industry analysts project the compound annual growth rate of the global carrier neutral colocation market to be approximately 8% between 2016 and2020.Equinix Value PropositionEquinix’s global platform for digital business offers these unique value propositions to customers:•Reach EverywhereWith Platform Equinix, enterprises and service providers can deploy digital infrastructure anywhere they need to be. Customers are quickly andeasily able to place applications, data, security and networking controls next to users, clouds and networks in major metros globally. With oneglobal partner, our customers are able to reduce complexity and accelerate time to market while relying on the consistency of a proven worldwideinterconnection and data center leader.•Interconnect EveryoneBusinesses operating on Platform Equinix will be able to discover and reach anyone on demand, through one connection to the world, by directlyconnecting physically or virtually to customers, partners, providers and between their points of presence. This gives our customers the capabilities toreach everyone they need to from one place and to simplify, scale and dynamically adapt their digital infrastructures to keep pace with rapidlychanging business demands.•Integrate EverythingOn Platform Equinix, our customers are able to activate their digital edge through leading technology tools, partners and services. By leveragingsoftware controls and expert advisors, service providers and enterprises can dynamically design, implement and manage their digital edge. They canalso secure, view, control and manage hybrid IT environments to seamlessly scale digital integration across their business.More than 9,800 companies, including a diversified mix of cloud and IT service providers, content providers, enterprises, financial companies, andnetwork and mobile service providers, currently operate within Equinix IBX data centers. These companies derive specific value from the following elementsof the Equinix platform offering:•Interconnection leadership: The global digital economy’s demands for fast, secure business collaboration creates a need for interconnection acrossEquinix’s global platform. As this digital journey intensifies, businesses are creating new commerce and collaboration models to compete. Successin this fast-moving world can be facilitated by a single5Table of Contentsinterconnection platform for digital business that is connected physically and virtually around the world. Companies that can deploy aninterconnected digital infrastructure can connect broadly and securely scale the integration of their business at the digital edge.•Cloud access and expertise: Equinix is home to more than 2,900 cloud and IT service providers and a variety of secure routes to the efficiencies,performance and cost-savings of the cloud. The Equinix Cloud Exchange Fabric™ ("ECX Fabric") offers on-demand access to multiple cloudproviders from multiple networks, enabling customers to design scalable cloud services tailored to their needs at a given moment. On the ECXFabric, customers do not have to be in the same IBX data center as their cloud provider(s); they can remotely access cloud services as if they werephysically close to the provider. Equinix Professional Services for Cloud experts enable our customers to successfully deploy a mix of private,public, hybrid and multicloud environments over a global interconnected cloud fabric to best fit their business and customer requirements.•Comprehensive global solution: With 190 IBX data centers in 48 markets in the Americas, EMEA and Asia-Pacific, Equinix offers a consistent,interconnected global solution.•Premium data centers and expertise: Equinix IBX data centers feature advanced design, security, power and cooling, and data center infrastructuremanagement (DCIM) elements to provide customers with industry-leading visibility and reliability, including average uptime of 99.9999% globallyin 2017. While others in the market have business models that include additional offerings, Equinix is focused on colocation and interconnection asour core competencies. Equinix Professional Services offers practical guidance and proven solutions to help customers optimize their data centerarchitecture.•Dynamic interconnected business ecosystems: Equinix’s network- and cloud-neutral model has enabled us to attract a critical mass of networks andcloud and IT services providers, and that, in turn, attracts other businesses seeking to interconnect within a single location or across metros. Thislocal ecosystem model leverages lower networking costs and optimizes the performance of data exchange. At the same time, the ECX Fabric enablesprivate access to remote business ecosystems in regionally distributed IBX data centers to further reduce long-distance networking costs and deliveroutstanding performance. As Equinix grows and attracts an ever-more diversified base of customers, the value of Equinix’s IBX interconnected datacenter offering increases.•Improved economics: Customers seeking to outsource their data center operations rather than build their own capital-intensive data centers enjoysignificant capital cost savings. Customers also benefit from improved economics because of the broad access to networks and clouds that Equinixprovides. Rather than purchasing costly local loops from multiple transit providers, customers can connect directly to more than 1,700 networks and2,900 cloud and IT service providers inside Equinix’s IBX data centers.•Leading interconnection insight: After more than 19 years in the industry, Equinix has a specialized staff of industry experts, professional servicesspecialists and solutions architects who helped build and shape the interconnection infrastructure of the internet, and who are now positioned to dothe same for digital businesses. This specialization and industry knowledge base offers customers unique expertise and the competitive advantageneeded to compete in the global digital economy.•Lasting sustainability: Energy efficiency and environmental sustainability are a part of everything we do, whether we're building new data centersor upgrading existing facilities. We have committed to design, build and operate our data centers with high energy efficiency standards, and we havea long-term goal of using 100% clean and renewable energy across our global platform.Our StrategyOur objective is to expand our global leadership position as the premier network and cloud-neutral data center and interconnection platform forenterprises, cloud and IT services providers, media and content companies, financial services firms, IoT and big data providers, and network and mobileservices providers. These are the key components of our strategy:Improve customer performance through global interconnection. To succeed in today’s digital economy, enterprises around the world must adoptglobally interconnected, on-demand digital IT architectures. The business connections forged in Equinix data centers through the power of interconnectionare vital to accelerating our customers' businesses. To help companies understand, deploy and benefit from global interconnection, Equinix has created ablueprint for becoming an interconnected enterprise - the Interconnection Oriented Architecture® (IOA®) strategy. Based on work with more than 230 Fortune500 customers, our IOA framework is a proven and repeatable engagement model that both enterprises and solution providers can leverage to directly andsecurely connect people, locations, clouds and data. An IOA strategy shifts the fundamental IT delivery architecture from siloed6Table of Contentsand centralized to interconnected and distributed. Since the introduction of its IOA strategy, Equinix has created an "IOA Playbook" and "IOA KnowledgeBase™," which were developed from our aggregated learnings across more than 600 Equinix customer (enterprise and service provider) deployments. Thesetools are offered online at no charge to any organization and provide fundamental, repeatable steps that organizations can take to deploy an IOA strategyacross common digital workloads. They offer application blueprints for networks, security, data and applications, as well as for various use cases includingecosystems, analytics, content delivery, collaboration, hybrid multicloud and the IoT.When combined with Equinix's critical mass of premier network and cloud providers and content companies, the increasing rate of adoption of an IOAstrategy by the world's enterprise companies enables Equinix to extend its leadership as one of the core interconnection hubs of the information-driven,digital world. The density of providers inside Equinix is a key selling point for companies looking to connect with a diverse set of networks and deliver thebest connectivity to their end customers at the digital edge, as well as to network companies that want to sell bandwidth to companies and efficientlyinterconnect with other networks. Equinix currently houses more than 1,700 unique networks, including the top-tier networks, which allow customers todirectly interconnect with providers that best meet their unique price and performance needs. We have a growing mass of key players in cloud and IT services(Accenture, Amazon Web Services, AT&T, Google Cloud Platform, Microsoft Azure and Office 365, Oracle Cloud, SAP HANA Enterprise Cloud and SAPCloud Platform, Salesforce.com, IBM Bluemix and VMware vCloud Air), and in the enterprise and financial sectors (Bechtel, Bloomberg, Chicago Board ofTrade, The GAP, McGraw-Hill, etc.). We expect these segments will continue to grow as customers seek to leverage our density of network providers andinterconnect directly with each other to improve performance.Streamline ease of doing business globally. Customers say data center reliability, power availability and network choice are the most importantattributes they consider when choosing a data center provider in a particular location. We have long been recognized as a leader in these areas, and ourperformance continues to improve.In 2017, more than half of our revenue came from customers with deployments in all three of our global regions, and we expect seamless global solutionsto become an increasingly important data center selection criteria as the need for globally interconnected, on-demand digital IT architectures continues togrow. We continue to focus on strategic acquisitions to expand our market coverage and on global product standardization, pricing and contractsharmonization initiatives to meet these global demands. Deepen existing ecosystems and develop new ones. As various enterprises and service and content providers locate in our IBX data centers, theirsuppliers and business partners benefit by doing the same, and they gain the full economic and performance benefits of direct, global interconnection fortheir business ecosystems. These partners, in turn, pull in their business partners, creating a "network effect" of customer adoption. Our interconnectionofferings enable scalable, secure, reliable and cost-effective interconnectivity and optimized traffic exchange, which lowers overall costs and increasesflexibility. The ability to directly and globally interconnect with a wide variety of companies is a key differentiator for us and enables companies to createnew opportunities within unique ecosystems by working together. We also have efficient and innovative internet and cloud exchange platforms in our IBXsites to accelerate commercial growth within the ecosystems via the network effect. Expand vertical go-to-market plan. We plan to continue to focus our go-to-market efforts on customer segments and business applications thatappreciate the Equinix value proposition of interconnection, reliability, global reach and prime collaboration opportunities within and across ecosystems.We have identified these segments today as cloud and IT services, content and digital media, financial services, enterprises, and network and mobile serviceproviders. As digital business evolves, we will continue to identify and focus our go-to-market efforts on industry segments that need our value proposition.Accelerate global reach and scale. We continue to evaluate expansion opportunities in select markets based on customer demand. In May 2017, weclosed a deal with Verizon to acquire 29 data centers across 15 metro areas. This strategic acquisition strengthened our global platform by increasinginterconnection in the U.S. and Latin America and accelerated Equinix's penetration of the enterprise and strategic market sectors, including government andenergy. We made several other important, smaller acquisitions in 2017, including the purchase of IO UK’s facility in Slough, United Kingdom, the purchaseof data center provider Itconic and its five data centers (four in Spain and one in Portugal), and the purchase of a Zenium data center in Istanbul. At the end ofthe year, we announced the entry into a transaction agreement to acquire Metronode, which operates 10 data centers spanning Australia. In February 2018, weannounced the entry into a transaction agreement to acquire Infomart Dallas, including its operations and tenants. We also saw significant organic growth in2017, opening new data centers on four continents, including AM4 in Amsterdam, FR6 in Frankfurt, HK5 in Hong Kong, SP3 in São Paulo, SV10 in SiliconValley and DC12 in Washington, D.C. Once we close the Metronode acquisition, expected in the first half of 2018, Equinix's total global footprint willexpand to 200 data centers in 52 markets in the Americas, Europe and Asia-Pacific.7Table of ContentsWe expect to continue to execute our expansion strategy in a cost-effective and disciplined manner through a combination of acquiring existing datacenters through lease or purchase, acquiring or investing in local data center operators, and building new IBX data centers based on key criteria, such asdemand and potential financial return in each market.Our CustomersOur customers include carriers, mobile and other bandwidth providers, cloud and IT services providers, content providers, financial companies andglobal enterprises. We provide each customer access to a choice of business partners and solutions based on their colocation, interconnection and managedIT service needs. As of December 31, 2017, we had more than 9,800 customers worldwide.Customers in our five key customer categories include the following:Cloud and IT ServicesContent ProvidersEnterpriseFinancial CompaniesNetwork and Mobile ServicesAmazon Web ServicesBox Inc.Cisco Systems Inc. GoogleCloud PlatformDatapipeIBM BluemixMicrosoft AzureNetAppOracle CloudSalesforce.comSAP VMware Workday, Inc.BrightrollCasale MediaDirectTVDiscoveryCommunicationsIndex ExchangeThomson ReutersNetflixPriceline.comAnheuser-BuschBMC Software Burger KingCorporationFord MotorsCDM SmithChevronGeneral ElectricShireIngram MicroDelloiteSmithfield FoodsWeyerhaueserEricssonAonBloombergChicago Board OptionsExchange LincolnFinancialLondon Stock ExchangeNASDAQOMX Group Inc. NYSETechnologies PayPalMorgan StanleyAT&TBritish TelecomChina MobileLycamobileNTT Communications SiemensMobility ServicesVodafoneT-SystemsTATA Communications VerizonCustomers typically sign renewable contracts of one or more years in length. Our largest customer accounted for approximately 3% of our recurringrevenues for the years ended December 31, 2017, 2016 and 2015. Our 50 largest customers accounted for approximately 37%, 36% and 34% of our recurringrevenues for the years ended December 31, 2017, 2016 and 2015, respectively.Our OfferingsEquinix provides a choice of data center offerings primarily comprised of colocation, interconnection solutions, bundled offers and professional services.Colocation and Related OfferingsOur IBX data centers provide our customers with secure, reliable and robust environments that are necessary for optimum internet commerceinterconnection. Our IBX data centers include multiple layers of physical security, scalable cabinet space availability, on-site trained staff (24x7x365),dedicated areas for customer care and equipment staging, redundant AC/DC power systems and other redundant and fault-tolerant infrastructure systems.Some specifications of offerings provided by individual IBX data centers may differ based on original facility design or market.Within our IBX data centers, customers can deploy their equipment and interconnect with a choice of networks, cloud providers or other businesspartners. We also provide customized solutions for customers looking to package our IBX offerings as part of their complex solutions. Our colocationofferings include:Cabinets. Our customers have several choices for colocating their networking, server and storage equipment. They can place the equipment in one of ourshared or private cages or customize their space. In certain select markets, customers can purchase their own private "suite" which is walled off from the rest ofthe data center. As customers’ colocation requirements increase, they can expand within their original cage (or suite) or upgrade into a cage that meets theirexpanded requirements. Customers buy the hardware they place in our IBX data centers directly from their chosen vendors. Cabinets (or suites) are pricedwith an initial installation fee and an ongoing recurring monthly charge.8Table of ContentsPower. Power is an element of increasing importance in customers’ colocation decisions. We offer both AC and DC power circuits at various amperagesand phases customized to a customer’s individual power requirements. Power is priced with an initial installation fee and an ongoing recurring monthlycharge. We also offer metered power in certain markets.IBXflex®. IBXflex allows customers to deploy mission-critical operations personnel and equipment on-site at our IBX data centers. Because of theproximity to their infrastructure within our IBX data centers, IBXflex customers can offer a faster response and quicker troubleshooting solution than thoseavailable in traditional colocation facilities. This space can also be used as a secure disaster recovery point for customers’ business and operations personnel.IBXflex is priced with an initial installation fee and an ongoing recurring monthly charge.IBX SmartView™. Equinix IBX SmartView™ offers application programming interface (API) -based DCIM that provides real-time access toenvironmental and operating information within an Equinix IBX footprint, as if those cages were all on site with the customer. IBX SmartView helps itscustomers consistently maintain their IBX operations and deployments with alerts and notifications, while enhancing long-term planning with customizablereports.Hyperscale Infrastructure. Our integration efforts with the major cloud players have provided us with deep insight into the evolving architecture of thecloud. Today, the majority of private interconnection nodes for the major cloud players are located in Equinix facilities. In addition, we are in discussionswith a targeted set of hyperscale customers to develop capacity to serve their larger footprint needs. We are leveraging the combination of existing capacityand dedicated hyperscale builds to meet these needs in a handful of key markets in 2018.Interconnection SolutionsOur interconnection solutions are evolving to enable high-performance, secure, scalable, reliable and cost-effective interconnection and traffic exchangebetween Equinix customers across our global platform. These interconnection solutions are either on a one-to-one basis with direct cross connects or on aone-to-many basis through our ECX Fabric or other exchange solutions. In the peering community, we play an important industry leadership role by acting asthe relationship broker between parties who would like to interconnect within our IBX data centers and, now, between regionally distributed IBX datacenters. Our staff holds or has held significant positions in many leading industry groups, such as the North American Network Operators’ Group (NANOG)and the Internet Engineering Task Force (IETF). Members of our staff have published industry-recognized white papers and strategy documents in the areas ofpeering and interconnection, many of which are used by other institutions worldwide in furthering the education and promotion of this important set ofsolutions.Our current interconnection solutions are comprised of the following:Physical Cross Connect/Direct Interconnections. Customers needing to directly and privately connect to another IBX data center customer can do sothrough single or multi-mode fiber. These cross connections are the physical link between customers and can be implemented within 24 hours of request.Cross-connect offerings are priced with an initial installation fee and an ongoing monthly recurring charge.Equinix Internet Exchange™. Customers may choose to connect to and peer through the central switching fabric of our Equinix Internet Exchange,rather than purchase a direct physical cross connection. With a connection to this switch, a customer can aggregate multiple interconnects over one physicalconnection with multiple, linked 100-gigabit ports of capacity, instead of purchasing individual physical cross connects. The offering is priced per IBX datacenter with an initial installation fee and an ongoing monthly recurring charge.Equinix Metro Connect. Customers who are located in one IBX data center may need to interconnect with networks or other customers located in anadjacent or nearby IBX data center in the same metro area. Metro Connect allows customers to seamlessly interconnect between IBX data centers at capacitiesup to 100 Gigabits per second. Metro Connect offerings are priced with an initial installation fee and an ongoing monthly recurring charge dependent on thecapacity purchased by the customer.Internet Connectivity. Customers who are installing equipment in our IBX data centers generally require IP connectivity or bandwidth access. Althoughmany large customers prefer to contract directly with carriers, we offer customers the ability to contract for IP connectivity and bandwidth access through usfrom any of the major bandwidth providers in that data center. This bandwidth access is targeted to customers who require a single bill and a single point ofsupport through Equinix for the entire contract for their bandwidth needs. Internet connectivity is priced with an initial installation fee and an ongoingmonthly recurring charge based on the amount of bandwidth committed.Equinix Cloud Exchange™ (ECX) Fabric. The ECX Fabric directly, securely and dynamically connects distributed infrastructure and digitalecosystems on Platform Equinix via global, software-defined interconnection. It enables businesses to customize their connectivity to partners, customers andsuppliers through an interface that provides all the benefits companies9Table of Contentshave come to expect from "as-a-service" models. This includes real-time provisioning via a portal or API, pay-as-you-go billing increments and the removalof friction in establishing elastic connectivity between metros. The ECX Fabric is designed for scalability, agility and virtualized connectivity. Through asingle port, Equinix customers can discover and reach anyone on demand, locally or across metros. Customers pay a monthly port fee to access the ECXFabric, plus a transport access fee to connect to customers in other metros based on data and inter-city bandwidth expense.The new ECX Fabric capabilities are now available in the Americas and EMEA regions, including Amsterdam, Atlanta, Chicago, Dallas, Dublin,Frankfurt, London, Los Angeles, Manchester, New York, Paris, Seattle, Silicon Valley, Stockholm, Toronto, Washington, D.C. and Zurich. In the fourthquarter of 2017 and into early 2018, Equinix is rolling out ECX Fabric to new metros in the Americas and EMEA regions of Denver, Düsseldorf, Geneva,Helsinki, Miami, Milan, and Munich. In 2018, Equinix will also extend connectivity to São Paulo within the Americas region, and between the APAC regionECX Fabric metro locations of Hong Kong, Melbourne, Osaka, Singapore, Sydney and Tokyo.Equinix Performance Hub® The Equinix Performance Hub places corporate IT resources in IBX data centers connected to many networks and clouds near large user populations.Performance Hub solutions can be implemented gradually, without closing or moving out of existing data centers. Performance Hub allows companies toefficiently deploy resources at the edge, closest to their end-users, enabling an affordable, low-risk approach to improving network performance and reducingcosts. This distributed, connectivity-driven approach to data center computing has been proven by Gartner, 451 Group, and many enterprise customers toprovide dramatic benefits in application and network performance, as well as in business and IT agility. The Performance Hub offering is priced per IBX datacenter with an initial installation fee and an ongoing recurring monthly charge.Equinix Data Hub® Equinix Data Hub is an extension of the Equinix Performance Hub framework and is a data center solution that addresses enterprise demands for real-time analytics, IoT, data collection and data protection. Data Hub empowers organizations to build a globally optimized data platform located in strategicdata centers around the world and maintain full control over business-critical data for any and all security and compliance demands. Data Hub use casesinclude: cloud integrated tiered storage, big data analytics infrastructures and data protection and replication. The Data Hub offering is priced per IBX datacenter with an initial installation fee and an ongoing recurring monthly charge.Equinix Professional ServicesExponential increases in data traffic and growing demand for interconnection mean pressure on companies to stay competitive. Customers need a partnerwith knowledge of the global terrain and trends, so they can maximize new technology and information and meet the needs of dispersed end users. EquinixProfessional Services is uniquely positioned to be that partner. Equinix experts help companies tap the resources and opportunities for innovation availableon a global platform of more than 9,800 companies in 48 markets, including more than 1,700 network service providers and 2,900 cloud and IT servicesproviders. Our consultants have the know-how and experience to help customers introduce new service offerings, optimize IT architectures, simplify hybridand multicloud migrations and stay up-and-running. Equinix professional services are priced at the project level and include:Cloud Consulting Services. Many companies are migrating to a hybrid or multicloud environment as the cloud’s cost advantages and flexibility arecritical in an era of rising electronic collaboration and user expectations. Equinix's Professional Services for Cloud are designed to facilitate cloud migrationwith a detailed assessment, design and implementation process that gives customers a faster, smoother path to the cloud. The 2,900 cloud and IT serviceproviders and 1,700 network service providers within Equinix's network help our experts tailor cloud deployments to individual business needs andmaximize their cloud performance, savings and security while ensuring future resilience and agility.Network and IOA Transformation Services. Digital transformation creates new revenue streams from information about an organizations’ physicaloperations, it also creates congestion and performance issues for an organization’s legacy network. The growth in data, applications and locations that mustbe served by a digital enterprise, plus the reduction in latency required by real-time applications, all put enormous stress on legacy IT infrastructure.Equinix’s Professional Services for network and IOA transformation helps companies plan and build their future network and infrastructure architecture,ready for the challenges of digital business today and tomorrow.10Table of ContentsGlobal Solutions Architects® Equinix Global Solutions Architects (GSAs) are industry experts, innovators and thought leaders, committed to helping companies deploy their ITinfrastructures in ways that best serve their business needs and fully exploit the advantages offered by Equinix’s global interconnection platform. Equinix’sGSAs have decades of combined experience in cloud deployments, facility operations, business analytics and network design and operations. They work asextensions of our customers’ IT and technology teams, helping efficiently deploy high-performance solutions, advising them on service provider choices,and designing IT architectures that help them reach today’s goals and anticipate tomorrow’s requirements. GSA services are provided at no additional cost.Solution Validation Centers® Equinix Solution Validation Centers (SVCs) are state-of-the-art facilities that allow customers to test and fine-tune their IT infrastructure, network, cloudand data center rollouts in a real-world environment before full build-out and deployment. Customers can measure how their applications perform when theymove off legacy systems, spot and address unforeseen technical barriers, and optimize various infrastructure components, network connections andapplications. Our SVCs operate in 18 strategic markets globally, helping companies reduce risk and maximize their IT investments.Smart Hands Services® The Equinix Smart Hands service enables customers to use our highly trained IBX data center personnel to act as their hands (or eyes and ears) when theirown staff cannot be on-site. Smart Hands technicians offer a range of services, from routine equipment inventory and labeling to more complex installationsand configuring. Smart Hands technicians also provide technical assistance and troubleshooting services. Smart Hands services are sold by the hour.Equinix Customer PortalThe Equinix Customer Portal offers 24/7 access to our customer care personnel, so customers can report problems, schedule shipments or order SmartHands services at any time of the day or night. Equinix conducts a significant portion of its transactions with its customers via this portal.Business Continuity Trading RoomsTrading infrastructure is mission-critical for financial firms worldwide, and our Business Continuity Trading Rooms (BCTRs) ensure that trading doesnot stop, even if primary operations are knocked off-line or are disabled. A BCTR backs up our customers’ trading operations in one of our secure data centerfacilities, right down to telephone services and multiple desktop monitors. BCTR offerings are protected with backup generators and uninterruptible powersupply to guarantee reliability and deliver peace of mind. BCTR services are priced by size of capacity.Sales and MarketingSales. We use a direct sales force and channel marketing program to market our offerings to global enterprises, content providers, financial companies,and mobile and network service providers. We organize our sales force by customer type, as well as by establishing a sales presence in diverse geographicregions, which enables efficient servicing of the customer base from a network of regional offices. In addition to our worldwide headquarters located inSilicon Valley, we have established an Asia-Pacific regional headquarters in Hong Kong and a European regional headquarters in Amsterdam. Our Americassales offices are located in Ashburn, Bogota, Boston, Chicago, Los Angeles, Miami, New York, Rio de Janeiro, São Paulo, Silicon Valley, Tampa andToronto. Our EMEA sales offices are located in Amsterdam, Barcelona, Dubai, Dublin, Dusseldorf, Enschede, Frankfurt, Geneva, Helsinki, Istanbul, Lisbon,London, Madrid, Manchester, Milan, Munich, Paris, Sofia, Stockholm, Warsaw and Zurich. Our Asia-Pacific sales offices are located in Beijing, Hong Kong,Jakarta, Osaka, Seoul, Shanghai, Singapore, Sydney, Melbourne and Tokyo.11Table of ContentsOur sales team works closely with each customer to foster the natural network effect of our IBX model, resulting in access to a wider potential customerbase via our existing customers. As a result of the IBX interconnection model, IBX data center participants often encourage their customers, suppliers andbusiness partners to also locate in our IBX data centers. These customers, suppliers and business partners, in turn, encourage their business partners to locatein our IBX data centers, resulting in additional customer growth. This network effect significantly reduces our new customer acquisition costs. In addition,large network providers, cloud providers or managed service providers may refer customers to Equinix as a part of their total customer solution. Equinix alsofocuses the selling by our vertical sales specialists on supporting specific industry requirements for network, mobile, and media and content providers,financial services, cloud computing, systems integrators and enterprise customer segments.The Equinix channel program adds an ecosystem of leading system integrators and service providers, from managed network to cloud services. Theyhelp our customers design and deploy the right cloud and IT solutions enterprises need to reach their customers, employees and supply chains. Our channelpartners understand how to leverage and integrate the advantages of the Platform Equinix global footprint, high performance connectivity options and globalsupply-chain ecosystems to deliver solutions that precisely meet our customers’ performance, reliability and cost requirements.Marketing. To support our sales efforts and to actively promote our brand in the Americas, Asia-Pacific and EMEA, we conduct comprehensivemarketing programs. Our marketing strategies include active public relations and ongoing customer communications programs. Our marketing efforts arefocused on major business and trade publications, online media outlets, industry events and sponsored activities. Our staff holds leadership positions in keynetworking organizations, and we participate in a variety of internet, enterprise IT, computer and financial industry conferences, placing our officers andemployees in keynote speaking engagements at these conferences. We also regularly measure customer satisfaction levels and host key customer forums toensure customer needs are understood and incorporated in product and service planning efforts. From a brand perspective, we build recognition through ourwebsite, external blog and social media channels by sponsoring or leading industry technical forums, by participating in internet industry standard-settingbodies and through advertising, paid social media and online campaigns. We continue to develop and host industry educational forums focused on peeringtechnologies and practices for ISPs and content providers.Our CompetitionWhile a large number of enterprises own their own data centers, many others outsource some or all of their requirements to multi-tenant data center(MTDC) facilities, such as those operated by Equinix. We believe that the outsourcing trend is likely to accelerate in the coming years. The global MTDCmarket is highly fragmented. It is estimated that Equinix is one of more than 1,300 companies that provide MTDC offerings around the world, ranging in sizefrom firms with a single data center in a single market to firms in over 20 markets. Equinix competes with these firms which vary in terms of their data centerofferings, including:Colocation ProvidersColocation data centers are a type of MTDC that can also be referred to as "retail" data center space. Typically, colocation data center space is offered onthe basis of individual racks/cabinets or cages ranging from 500 to 10,000 square feet in size. Typical customers of colocation providers include:•Large enterprises with significant IT expertise and requirements•Small and medium businesses looking to outsource data center requirements•Internet application providers•Major internet content, entertainment and social networking providers•Shared, dedicated and managed hosting providers•Mobile and network service providers•Content delivery networksFull facility maintenance and systems, including fire suppression, security, power backup and HVAC, are routinely included in managed colocationofferings. A variety of additional services are typically available, including remote hands technician services and network monitoring services.Providers in addition to Equinix that offer colocation both globally and locally include firms such as AT&T, COLT and NTT.12Table of ContentsCarrier-Neutral Colocation ProvidersIn addition to data center space and power, colocation providers also offer interconnection. Some of these providers, known as network or carrier-neutralcolocation providers, can offer customers the choice of hundreds of network service providers or ISPs to choose from. Typically, customers useinterconnection to buy internet connectivity, connect to VoIP telephone networks, perform financial exchange and settlement functions or perform business-to-business e-commerce. Carrier-neutral data centers are often located in key network hubs around the world, such as New York, Ashburn, Va., London,Amsterdam, Singapore and Hong Kong. Two types of data center facilities offering carrier-neutral colocation are used for many network-to-networkinterconnections:•A Meet Me Room (MMR) is typically a smaller space, generally 5,000 square feet or less, located in a major carrier hotel and often found in awholesale data center facility.•A carrier-neutral data center is generally larger than an MMR and may be a stand-alone building separate from existing carrier hotels.Providers in addition to Equinix that we believe could be defined as offering carrier-neutral colocation include CoreSite, Digital Realty Trust, GlobalSwitch, Interxion and Telehouse.Wholesale Data Center ProvidersWholesale data center providers lease data center space that is typically offered in cells or pods (i.e., individual white-space rooms) ranging in size from10,000 to 20,000 square feet or larger. Wholesale data center offerings are targeted to both enterprises and colocation providers. These data centers primarilyprovide space and power without additional services like technicians, remote hands services or network monitoring (although other tenants might offer suchservices).Sample wholesale data center providers include Digital Realty Trust, e-Shelter and Global Switch.Managed Hosting ProvidersManaged hosting services are provided by several firms that also provide data center colocation solutions. Typically, managed hosting providers canmanage server hardware that is owned by either the hosting provider or the customer. They can also provide a combination of comprehensive systemsadministration, database administration and sometimes application management services. Frequently, this results in managed hosting providers "running" thecustomer’s servers, although such administration is frequently shared. The provider may manage such functions as operating systems, databases, security andpatch management, while the customer will maintain management of the applications riding on top of those systems.The full list of potential services that can be offered as part of managed hosting is substantial and includes services such as remote management, customapplications, helpdesk, messaging, databases, disaster recovery, managed storage, managed virtualization, managed security, managed networks and systemsmonitoring. Managed hosting services are typically used for:•Application hosting by organizations of any size, including large enterprises•Hosted or managed messaging, including Microsoft Exchange and other complex messaging applications•Complex or highly scalable web hosting or e-commerce websites•Managed storage solutions (including large drive arrays or backup robots)•Server disaster recovery and business continuity, including clustering and global server load balancing•Database servers, applications and servicesExamples of managed hosting providers include: AT&T, CenturyLink, NaviSite, Rackspace, SunGard and Verizon Business.Unlike other providers whose core businesses are bandwidth or managed services, we focus on neutral interconnection hubs for cloud and IT serviceproviders, content providers, financial companies, enterprises and network service providers. As a result, we do not have the limited choices found commonlyat other hosting/colocation companies. We compete based on the quality of our IBX data centers, our ability to provide a one-stop global solution in ourAmericas, EMEA and Asia-Pacific locations, the performance and diversity of our network- and cloud-neutral strategy, and the economic benefits of theaggregation of top network, cloud and business ecosystems under one roof. We expect to continue to benefit from several industry trends, including the needfor contracting with multiple networks due to the uncertainty in the telecommunications market; customers’ increasing power requirements; enterprisecustomers’ increased use of virtualization and outsourcing; the continued growth of broadband and significant growth in Ethernet as a network alternative;and the growth in mobile applications.13Table of ContentsOur Business Segment Financial InformationWe currently operate in three reportable segments comprised of our Americas, EMEA and Asia-Pacific geographic regions. Information attributable toeach of our reportable segments is set forth in Note 16 of Notes to Consolidated Financial Statements in Item 8 of this Annual Report on Form 10-K.EmployeesWe had 7,273 employees as of December 31, 2017. We had 3,154 employees based in the Americas, 2,560 employees based in EMEA and 1,559employees based in Asia-Pacific. Of those employees, 3,341 employees were in engineering and operations, 1,264 employees were in sales and marketing and2,668 employees were in management, finance and administration.Available InformationWe were incorporated in Delaware in June 1998. We are required to file reports under the Securities Exchange Act of 1934, as amended, with theSecurities and Exchange Commission ("SEC".) You may read and copy our materials on file with the SEC at the SEC’s Public Reference Room at 100 FStreet, NE, Washington, DC 20549. You may obtain information regarding the SEC’s Public Reference Room by calling the SEC at 1-800-SEC-0330. TheSEC also maintains an internet website at http://www.sec.gov that contains reports, proxy and information statements and other information.You may also obtain copies of our annual reports on Form 10-K, our quarterly reports on Form 10-Q and our current reports on Form 8-K, and anyamendments to such reports, free of charge by visiting the Investor Relations page on our website, www.equinix.com. These reports are available as soon asreasonably practical after we file them with the SEC. Information contained on our website is not part of this Annual Report on Form 10-K.14Table of ContentsITEM 1A. RISK FACTORSIn addition to the other information contained in this report, the following risk factors should be considered carefully in evaluating our business and us:Acquisitions present many risks, and we may not realize the financial or strategic goals that were contemplated at the time of any transaction.We have completed numerous acquisitions. We currently have acquisitions pending and expect to make additional acquisitions in the future. These mayinclude (i) acquisitions of businesses, products, solutions or technologies that we believe to be complementary, (ii) acquisitions of new IBX data centers orreal estate for development of new IBX data centers or (iii) acquisitions through investments in local data center operators. We may pay for futureacquisitions by using our existing cash resources (which may limit other potential uses of our cash), incurring additional debt (which may increase ourinterest expense, leverage and debt service requirements) and/or issuing shares (which may dilute our existing stockholders and have a negative effect on ourearnings per share). Acquisitions expose us to potential risks, including:•the possible disruption of our ongoing business and diversion of management’s attention by acquisition, transition and integration activities,particularly when multiple acquisitions and integrations are occurring at the same time;•our potential inability to successfully pursue or realize some or all of the anticipated revenue opportunities associated with an acquisition orinvestment;•the possibility that we may not be able to successfully integrate acquired businesses, or businesses in which we invest, or achieve anticipatedoperating efficiencies or cost savings;•the possibility that announced acquisitions may not be completed, due to failure to satisfy the conditions to closing as a result of:◦an injunction, law or order that makes unlawful the consummation of the acquisition;◦inaccuracy or breach of the representations and warranties of, or the non-compliance with covenants by, either party;◦the nonreceipt of closing documents; or◦for other reasons;•the possibility that there could be a delay in the completion of an acquisition, which could, among other things, result in additional transactioncosts, loss of revenue or other negative effects resulting from uncertainty about completion of the respective acquisition;•the dilution of our existing stockholders as a result of our issuing stock as consideration in a transaction or selling stock in order to fund thetransaction;•the possibility of customer dissatisfaction if we are unable to achieve levels of quality and stability on par with past practices;•the possibility that we will be unable to retain relationships with key customers, landlords and/or suppliers of the acquired businesses, some ofwhich may terminate their contracts with the acquired business as a result of the acquisition or which may attempt to negotiate changes in theircurrent or future business relationships with us;•the possibility that we could lose key employees from the acquired businesses before integrating them;•the possibility that we may be unable to integrate or migrate IT systems, which could create a risk of errors or performance problems and could affectour ability to meet customer service level obligations;•the potential deterioration in our ability to access credit markets due to increased leverage;•the possibility that our customers may not accept either the existing equipment infrastructure or the "look-and-feel" of a new or different IBX datacenter;•the possibility that additional capital expenditures may be required or that transaction expenses associated with acquisitions may be higher thananticipated;•the possibility that required financing to fund an acquisition may not be available on acceptable terms or at all;•the possibility that we may be unable to obtain required approvals from governmental authorities under antitrust and competition laws on a timelybasis or at all, which could, among other things, delay or prevent us from completing an acquisition, limit our ability to realize the expectedfinancial or strategic benefits of an acquisition or have other adverse effects on our current business and operations;•the possible loss or reduction in value of acquired businesses;•the possibility that future acquisitions may present new complexities in deal structure, related complex accounting and coordination with newpartners, particularly in light of our desire to maintain our qualification for taxation as a REIT;15Table of Contents•the possibility that we may not be able to prepare and issue our financial statements and other public filings in a timely and accurate manner, and/ormaintain an effective control environment, due to the strain on the finance organization when multiple acquisitions and integrations are occurring atthe same time;•the possibility that future acquisitions may be in geographies and regulatory environments to which we are unaccustomed;•the possibility that carriers may find it cost-prohibitive or impractical to bring fiber and networks into a new IBX data center;•the possibility of litigation or other claims in connection with, or as a result of, an acquisition, including claims from terminated employees,customers, former stockholders or other third parties;•the possibility that asset divestments may be required in order to obtain regulatory clearance for a transaction; and•the possibility of pre-existing undisclosed liabilities, including, but not limited to, lease or landlord related liability, environmental liability orasbestos liability, for which insurance coverage may be insufficient or unavailable, or other issues not discovered in the diligence process.The occurrence of any of these risks could have a material adverse effect on our business, results of operations, financial condition or cash flows. If anacquisition does not proceed or is materially delayed for any reason, the price of our common stock may be adversely impacted and we will not recognize theanticipated benefits of the acquisition.We cannot assure that the price of any future acquisitions of IBX data centers will be similar to prior IBX data center acquisitions. In fact, we expect costsrequired to build or render new IBX data centers operational to increase in the future. If our revenue does not keep pace with these potential acquisition andexpansion costs, we may not be able to maintain our current or expected margins as we absorb these additional expenses. There is no assurance we wouldsuccessfully overcome these risks or any other problems encountered with these acquisitions.There will be numerous challenges associated with the Verizon Data Center integrationOn May 1, 2017, we acquired Verizon's colocation business (the "Business"), for a cash purchase price of approximately $3.6 billion. The success of theVerizon Data Center Acquisition will depend, in part, on our ability to successfully integrate the Verizon assets into our business, and realize the anticipatedbenefits, including synergies and cost savings, from the Verizon Data Center Acquisition. If we are unable to achieve these objectives within the anticipatedtime frame, or at all, the anticipated benefits may not be realized fully or at all, or may take longer to realize than expected and the value of our commonstock may be adversely affected.We may encounter material challenges in connection with this ongoing integration process, including from, without limitation:•expanding our relationships with U.S. government customers, which will subject us to complex regulatory and compliance requirements and riskswith which we have limited experience;•our reliance on transition services from Verizon to operate the Business, and our need to develop sustainable alternative arrangements uponexpiration or interruption of those transition services;•retaining key employees, who may experience uncertainty associated with the Verizon Data Center Acquisition and who may depart after theVerizon Data Center Acquisition because of issues relating to the uncertainty and difficulty of the integration or a desire not to remain with usfollowing the Verizon Data Center Acquisition; and•unforeseen expenses or delays associated with the Verizon Data Center Acquisition.Many of these factors will be outside of our control and any one of them could result in increased costs, decreases in the amount of expected revenuesand diversion of management's time and energy, which could materially impact our business, financial condition and results of operations.Our substantial debt could adversely affect our cash flows and limit our flexibility to raise additional capital.We have a significant amount of debt and may need to incur additional debt to support our growth. Additional debt may also be incurred to fund futureacquisitions, any future special distributions, regular distributions or the other cash outlays associated with maintaining our qualification for taxation as aREIT. As of December 31, 2017, our total indebtedness (gross of debt issuance cost, debt discount, and debt premium) was approximately $10.2 billion, ourstockholders’ equity was $6.8 billion and our cash, cash equivalents, and investments totaled $1.5 billion. In addition, as of December 31, 2017, we hadapproximately $1.9 billion of additional liquidity available to us from our $2.0 billion revolving credit facility. Some of our debt contains covenants whichmay limit our operating flexibility. In addition to our substantial debt, we lease a majority of our IBX data centers and certain equipment under non-cancellable lease agreements, some of which are accounted for as operating leases. As of December 31, 2017, our total minimum operating lease commitmentsunder those lease agreements, excluding potential lease renewals, was approximately $1.9 billion, which represents off-balance sheet commitments.16Table of ContentsOur substantial amount of debt and related covenants, and our off-balance sheet commitments, could have important consequences. For example, theycould:•require us to dedicate a substantial portion of our cash flow from operations to make interest and principal payments on our debt and in respect ofother off-balance sheet arrangements, reducing the availability of our cash flow to fund future capital expenditures, working capital, execution ofour expansion strategy and other general corporate requirements;•increase the likelihood of negative outlook from our rating agencies;•make it more difficult for us to satisfy our obligations under our various debt instruments;•increase our cost of borrowing and even limit our ability to access additional debt to fund future growth;•increase our vulnerability to general adverse economic and industry conditions and adverse changes in governmental regulations;•limit our flexibility in planning for, or reacting to, changes in our business and industry, which may place us at a competitive disadvantagecompared with our competitors;•limit our operating flexibility through covenants with which we must comply, such as limiting our ability to repurchase shares of our common stock;•limit our ability to borrow additional funds, even when necessary to maintain adequate liquidity, which would also limit our ability to furtherexpand our business; and•make us more vulnerable to increases in interest rates because of the variable interest rates on some of our borrowings to the extent we have notentirely hedged such variable rate debt.The occurrence of any of the foregoing factors could have a material adverse effect on our business, results of operations and financial condition.We may also need to refinance a portion of our outstanding debt as it matures. There is a risk that we may not be able to refinance existing debt or thatthe terms of any refinancing may not be as favorable as the terms of our existing debt. Furthermore, if prevailing interest rates or other factors at the time ofrefinancing result in higher interest rates upon refinancing, then the interest expense relating to that refinanced indebtedness would increase. These riskscould materially adversely affect our financial condition, cash flows and results of operations.Adverse global economic conditions and credit market uncertainty could adversely impact our business and financial condition.Adverse global economic conditions and uncertain conditions in the credit markets have created, and in the future may create, uncertainty andunpredictability and add risk to our future outlook. An uncertain global economy could also result in churn in our customer base, reductions in revenues fromour offerings, longer sales cycles, slower adoption of new technologies and increased price competition, adversely affecting our liquidity. The uncertaineconomic environment could also have an impact on our foreign exchange forward contracts if our counterparties’ credit deteriorates or they are otherwiseunable to perform their obligations. Finally, our ability to access the capital markets may be severely restricted at a time when we would like, or need, to doso which could have an impact on our flexibility to pursue additional expansion opportunities and maintain our desired level of revenue growth in the future.Recent political developments related to the U.K.’s referendum on membership in the European Union (the "EU") could have a material adverse effecton our business.We currently have IBX data centers and employees located in the UK and other European jurisdictions. A referendum was held on June 23, 2016 in theUK to determine whether it should remain in or leave the EU, the outcome of which was a vote in favor of leaving the EU (the "Brexit"). The Brexit hasresulted in political and economic instability throughout Europe. There is considerable uncertainty surrounding the exit process, the extent of the UK’sfuture relationship with the EU, and the longer-term impact of the Brexit on economic conditions in the UK and in the EU. The ongoing instability anduncertainty surrounding the Brexit in the near term, and the final terms reached regarding the Brexit, could have an adverse impact on our business andemployees in EMEA and could adversely affect our financial condition and results of operations.If we cannot effectively manage our international operations, and successfully implement our international expansion plans, our revenues may notincrease and our business and results of operations would be harmed.For the years ended December 31, 2017, 2016 and 2015, we recognized approximately 55%, 57% and 49%, respectively, of our revenues outside the U.S.We currently operate outside of the U.S. in Asia-Pacific, Canada, EMEA and South America.17Table of ContentsTo date, the network neutrality of our IBX data centers and the variety of networks available to our customers has often been a competitive advantage forus. In certain of our acquired IBX data centers in the Asia-Pacific region the limited number of carriers available reduces that advantage. As a result, we mayneed to adapt our key revenue-generating offerings and pricing to be competitive in those markets. In addition, we are currently undergoing expansions orevaluating expansion opportunities outside of the U.S. Undertaking and managing expansions in foreign jurisdictions may present unanticipated challengesto us.Our international operations are generally subject to a number of additional risks, including:•the costs of customizing IBX data centers for foreign countries;•protectionist laws and business practices favoring local competition;•greater difficulty or delay in accounts receivable collection;•difficulties in staffing and managing foreign operations, including negotiating with foreign labor unions or workers’ councils;•difficulties in managing across cultures and in foreign languages;•political and economic instability;•fluctuations in currency exchange rates;•difficulties in repatriating funds from certain countries;•our ability to obtain, transfer, or maintain licenses required by governmental entities with respect to our business;•unexpected changes in regulatory, tax and political environments;•our ability to secure and maintain the necessary physical and telecommunications infrastructure;•compliance with anti-bribery and corruption laws;•compliance with economic and trade sanctions enforced by the Office of Foreign Assets Control of the U.S. Department of Treasury; and•compliance with evolving governmental regulation with which we have little experience.In addition, compliance with international and U.S. laws and regulations that apply to our international operations increases our cost of doing businessin foreign jurisdictions. These laws and regulations include the General Data Protection Regulation (GDPR) and other data privacy requirements, laborrelations laws, tax laws, anti-competition regulations, import and trade restrictions, export requirements, economic and trade sanctions, U.S. laws such as theForeign Corrupt Practices Act and local laws which also prohibit corrupt payments to governmental officials. Violations of these laws and regulations couldresult in fines, criminal sanctions against us, our officers or our employees, and prohibitions on the conduct of our business. Any such violations couldinclude prohibitions on our ability to offer our offerings in one or more countries, could delay or prevent potential acquisitions, and could also materiallydamage our reputation, our brand, our international expansion efforts, our ability to attract and retain employees, our business and our operating results. Oursuccess depends, in part, on our ability to anticipate and address these risks and manage these difficulties.Economic and political uncertainty in developing markets could adversely affect our revenue and earnings.We conduct business and are contemplating expansion in developing markets with economies and governments that tend to be more volatile than thosein the U.S. and Western Europe. The risk of doing business in developing markets such as Brazil, China, Colombia, India, Indonesia, Russia, Turkey, theUnited Arab Emirates and other economically volatile areas could adversely affect our operations and earnings. Such risks include the financial instabilityamong customers in these regions, political instability, fraud or corruption and other non-economic factors such as irregular trade flows that need to bemanaged successfully with the help of the local governments. In addition, commercial laws in some developing countries can be vague, inconsistentlyadministered and retroactively applied. If we are deemed not to be in compliance with applicable laws in developing countries where we conduct business,our prospects and business in those countries could be harmed, which could then have a material adverse impact on our results of operations and financialposition. Our failure to successfully manage economic, political and other risks relating to doing business in developing countries and economically andpolitically volatile areas could adversely affect our business.Terrorist activity throughout the world and military action to counter terrorism could adversely impact our business.The continued threat of terrorist activity and other acts of war or hostility contribute to a climate of political and economic uncertainty. Due to existingor developing circumstances, we may need to incur additional costs in the future to provide enhanced security, including cyber security, which could have amaterial adverse effect on our business and results of operations. These circumstances may also adversely affect our ability to attract and retain customers, ourability to raise capital and the operation and maintenance of our IBX data centers.18Table of ContentsSales or issuances of shares of our common stock may adversely affect the market price of our common stock.Future sales or issuances of common stock or other equity related securities may adversely affect the market price of our common stock, including anyshares of our common stock issued to finance capital expenditures, finance acquisitions or repay debt. In August 2017, we established an "at-the-market"stock offering program (the "ATM Program") through which we may, from time to time, issue and sell shares of our common stock having an aggregate grosssales price of up to $750.0 million to or through sales agents. We may also seek authorization to sell additional shares of common stock under the ATMProgram once we have reached the $750.0 million limit which would lead to additional dilution for our stockholders. Please see Note 11 of Notes toConsolidated Financial Statements in Item 8 of this Annual Report on Form 10-K for sales of our common stock under the ATM Program to date.The market price of our stock may continue to be highly volatile, and the value of an investment in our common stock may decline.The market price of the shares of our common stock has been and may continue to be highly volatile. General economic and market conditions, andmarket conditions for telecommunications stocks in general, may affect the market price of our common stock.Announcements by us or others, or speculations about our future plans, may also have a significant impact on the market price of our common stock.These may relate to:•our operating results or forecasts;•new issuances of equity, debt or convertible debt by us, including through our ATM Program;•increases in market interest rates and changes in other general market and economic conditions, including inflationary concerns;•changes to our capital allocation, tax planning or business strategy;•our qualification for taxation as a REIT and our declaration of distributions to our stockholders;•changes in U.S. or foreign tax laws;•changes in management or key personnel;•developments in our relationships with customers;•announcements by our customers or competitors;•changes in regulatory policy or interpretation;•governmental investigations;•changes in the ratings of our debt or stock by rating agencies or securities analysts;•our purchase or development of real estate and/or additional IBX data centers;•our acquisitions of complementary businesses; or•the operational performance of our IBX data centers.The stock market has from time to time experienced extreme price and volume fluctuations, which have particularly affected the market prices fortelecommunications companies, and which have often been unrelated to their operating performance. These broad market fluctuations may adversely affectthe market price of our common stock. One of the factors that investors may consider in deciding whether to buy or sell our common stock is our distributionrate as a percentage of our stock price relative to market interest rates. If market interest rates increase, prospective investors may demand a higher distributionrate or seek alternative investments paying higher dividends or interest. As a result, interest rate fluctuations and conditions in the capital markets may affectthe market value of our common stock. Furthermore, companies that have experienced volatility in the market price of their stock have been subject tosecurities class action litigation. We may be the target of this type of litigation in the future. Securities litigation against us could result in substantial costsand/or damages, and divert management’s attention from other business concerns, which could seriously harm our business.If we are not able to generate sufficient operating cash flows or obtain external financing, our ability to fund incremental expansion plans may belimited.Our capital expenditures, together with ongoing operating expenses, obligations to service our debt and the cash outlays associated with our REITdistribution requirements, are, and will continue to be, a substantial burden on our cash flow and may decrease our cash balances. Additional debt or equityfinancing may not be available when needed or, if available, may not be available on satisfactory terms. Our inability to obtain additional debt and/or equityfinancing or to generate sufficient cash from operations may require us to prioritize projects or curtail capital expenditures which could adversely affect ourresults of operations.19Table of ContentsFluctuations in foreign currency exchange rates in the markets in which we operate internationally could harm our results of operations.We may experience gains and losses resulting from fluctuations in foreign currency exchange rates. To date, the majority of revenues and costs in ourinternational operations are denominated in foreign currencies. Where our prices are denominated in U.S. dollars, our sales and revenues could be adverselyaffected by declines in foreign currencies relative to the U.S. dollar, thereby making our offerings more expensive in local currencies. We are also exposed torisks resulting from fluctuations in foreign currency exchange rates in connection with our international operations. To the extent we are paying contractorsin foreign currencies, our operations could cost more than anticipated as a result of declines in the U.S. dollar relative to foreign currencies. In addition,fluctuating foreign currency exchange rates have a direct impact on how our international results of operations translate into U.S. dollars.Although we currently undertake, and may decide in the future to further undertake, foreign exchange hedging transactions to reduce foreign currencytransaction exposure, we do not currently intend to eliminate all foreign currency transaction exposure. In addition, REIT compliance rules may restrict ourability to enter into hedging transactions. Therefore, any weakness of the U.S. dollar may have a positive impact on our consolidated results of operationsbecause the currencies in the foreign countries in which we operate may translate into more U.S. dollars. However, if the U.S. dollar strengthens relative to thecurrencies of the foreign countries in which we operate, our consolidated financial position and results of operations may be negatively impacted as amountsin foreign currencies will generally translate into fewer U.S. dollars. For additional information on foreign currency risk, refer to our discussion of foreigncurrency risk in "Quantitative and Qualitative Disclosures About Market Risk" included in Item 7A of this Annual Report on Form 10-K.Changes in U.S. or foreign tax laws, regulations, or interpretations thereof, including changes to tax rates, may adversely affect our financial statementsand cash taxes.We are a U.S. company with global subsidiaries and are subject to income taxes in the U.S. (although currently limited due to our taxation as a REIT) andmany foreign jurisdictions. Significant judgment is required in determining our worldwide provision for income taxes. The U.S. government has also recentlychanged tax laws in the U.S. and the governments of many of the countries in which we operate are actively discussing changes to foreign tax laws. Althoughwe believe that we have adequately assessed and accounted for our potential tax liabilities, and that our tax estimates are reasonable, there can be nocertainty that additional taxes will not be due upon audit of our tax returns or as a result of further changes to the tax laws and interpretations thereof. Thenature and timing of any future changes to each jurisdiction’s tax laws and the impact on our future tax liabilities cannot be predicted with any accuracy butcould materially and adversely impact our results of operations and financial position or cash flows.We are continuing to invest in our expansion efforts but may not have sufficient customer demand in the future to realize expected returns on theseinvestments.We are considering the acquisition or lease of additional properties and the construction of new IBX data centers beyond those expansion projectsalready announced. We will be required to commit substantial operational and financial resources to these IBX data centers, generally 12 to 18 months inadvance of securing customer contracts, and we may not have sufficient customer demand in those markets to support these centers once they are built. Inaddition, unanticipated technological changes could affect customer requirements for data centers, and we may not have built such requirements into our newIBX data centers. Either of these contingencies, if they were to occur, could make it difficult for us to realize expected or reasonable returns on theseinvestments.Our offerings have a long sales cycle that may harm our revenue and operating results.A customer’s decision to purchase our offerings typically involves a significant commitment of resources. In addition, some customers will be reluctantto commit to locating in our IBX data centers until they are confident that the IBX data center has adequate carrier connections. As a result, we have a longsales cycle. Furthermore, we may devote significant time and resources to pursuing a particular sale or customer that does not result in revenues. We have alsosignificantly expanded our sales force in recent years, and it will take time for these new hires to become fully productive.Delays due to the length of our sales cycle may materially and adversely affect our revenues and operating results, which could harm our ability to meetour forecasts and cause volatility in our stock price.Any failure of our physical infrastructure or offerings, or damage to customer infrastructure within our IBX data centers, could lead to significant costsand disruptions that could reduce our revenue and harm our business reputation and financial results.Our business depends on providing customers with highly reliable solutions. We must safehouse our customers’ infrastructure and equipment located inour IBX data centers and ensure our IBX data centers and non-IBX offices remain operational. We own20Table of Contentscertain of our IBX data centers, but others are leased by us, and we rely on the landlord for basic maintenance of our leased IBX data centers and officebuildings. If such landlord has not maintained a leased property sufficiently, we may be forced into an early exit from the center which could be disruptive toour business. Furthermore, we continue to acquire IBX data centers not built by us. If we discover that these buildings and their infrastructure assets are not inthe condition we expected when they were acquired, we may be required to incur substantial additional costs to repair or upgrade the centers.Our office buildings and IBX data centers are subject to failure resulting from, and infrastructure within such IBX data centers is at risk from, numerousfactors, including:•human error;•equipment failure;•physical, electronic and cyber security breaches;•fire, earthquake, hurricane, flood, tornado and other natural disasters;•extreme temperatures;•water damage;•fiber cuts;•power loss;•terrorist acts;•sabotage and vandalism; and•failure of business partners who provide our resale products.Problems at one or more of our IBX data centers, whether or not within our control, could result in service interruptions or significant equipment damage.We have service level commitment obligations to certain of our customers. As a result, service interruptions or significant equipment damage in our IBX datacenters could result in difficulty maintaining service level commitments to these customers and potential claims related to such failures. Because our IBXdata centers are critical to many of our customers’ businesses, service interruptions or significant equipment damage in our IBX data centers could also resultin lost profits or other indirect or consequential damages to our customers. We cannot guarantee that a court would enforce any contractual limitations on ourliability in the event that one of our customers brings a lawsuit against us as a result of a problem at one of our IBX data centers and we may decide to reachsettlements with affected customers irrespective of any such contractual limitations. Any such settlement may result in a reduction of revenue under U.S.generally accepted accounting principles ("GAAP"). In addition, any loss of service, equipment damage or inability to meet our service level commitmentobligations could reduce the confidence of our customers and could consequently impair our ability to obtain and retain customers, which would adverselyaffect both our ability to generate revenues and our operating results.Furthermore, we are dependent upon internet service providers, telecommunications carriers and other website operators in the Americas, Asia-Pacificand EMEA regions and elsewhere, some of which have experienced significant system failures and electrical outages in the past. Our customers may in thefuture experience difficulties due to system failures unrelated to our systems and offerings. If, for any reason, these providers fail to provide the requiredservices, our business, financial condition and results of operations could be materially and adversely impacted.We are currently making significant investments in our back office information technology systems and processes. Difficulties from or disruptions tothese efforts may interrupt our normal operations and adversely affect our business and operating results.We have been investing heavily in our back office information technology systems and processes for a number of years and expect such investment tocontinue for the foreseeable future in support of our pursuit of global, scalable solutions across all geographies and functions that we operate in. Thesecontinuing investments include: 1) ongoing improvements to the customer experience from initial quote to customer billing and our revenue recognitionprocess; 2) integration of recently-acquired operations such as Bit-isle, Inc. ("Bit-isle"), Itconic and the Zenium data center onto our various informationtechnology systems; and 3) implementation of new tools and technologies to either further streamline and automate processes, such as our fixed asset procureto disposal process, or to support our compliance with evolving U.S. GAAP, such as the new revenue accounting and leasing standards. As a result of ourcontinued work on these projects, we may experience difficulties with our systems, management distraction and significant business disruptions. Forexample, difficulties with our systems may interrupt our ability to accept and deliver customer orders and may adversely impact our overall financialoperations, including our accounts payable, accounts receivables, general ledger, fixed assets, revenue recognition, close processes, internal financialcontrols and our ability to otherwise run and track our business. We may need to expend significant attention, time and resources to correct problems or findalternative sources for performing these functions. All of these changes to our financial systems also create an increased risk of deficiencies in our internalcontrols over financial reporting until such systems are stabilized. Such significant investments in our back office21Table of Contentssystems may take longer to complete and cost more than originally planned. In addition, we may not realize the full benefits we hoped to achieve and there isa risk of an impairment charge if we decide that portions of these projects will not ultimately benefit the company or are de-scoped. Finally, the collectiveimpact of these changes to our business has placed significant demands on impacted employees across multiple functions, increasing the risk of errors andcontrol deficiencies in our financial statements, distraction from the effective operation of our business and difficulty in attracting and retaining employees.Any such difficulties or disruptions may adversely affect our business and operating results.Inadequate external and internal information, including budget and planning data, could prove to be inaccurate and lead to inaccurate financialforecasts and inappropriate financial decisions.Our financial forecasts are dependent on estimates and assumptions including budget and planning data, market growth, foreign exchange rates, ourability to remain qualified for taxation as a REIT, and our ability to generate sufficient cash flow to reinvest in the business, fund internal growth, makeacquisitions, pay dividends and meet our debt obligations. Our financial projections are based on historical experience and on various other assumptions thatour management believes to be reasonable under the circumstances and at the time they are made. However, if our external and internal information isinadequate, our actual results may differ materially from our forecasts and cause us to make inappropriate financial decisions. Any material variation betweenour financial forecasts and our actual results may also adversely affect our future profitability, stock price and stockholder confidence.The level of insurance coverage that we purchase may prove to be inadequate.We carry liability, property, business interruption and other insurance policies to cover insurable risks to our company. We select the types of insurance,the limits and the deductibles based on our specific risk profile, the cost of the insurance coverage versus its perceived benefit and general industry standards.Our insurance policies contain industry standard exclusions for events such as war and nuclear reaction. We purchase minimal levels of earthquake insurancefor certain of our IBX data centers, but for most of our data centers, including many in California, we have elected to self-insure. The earthquake and floodinsurance that we do purchase would be subject to high deductibles. Any of the limits of insurance that we purchase, including those for cyber risks, couldprove to be inadequate, which could materially and adversely impact our business, financial condition and results of operations.Our construction of additional new IBX data centers or IBX data center expansions could involve significant risks to our business.In order to sustain our growth in certain of our existing and new markets, we must expand an existing data center, lease a new facility or acquire suitableland, with or without structures, to build new IBX data centers from the ground up. Expansions or new builds are currently underway, or being contemplated,in many of our markets. Any related construction requires us to carefully select and rely on the experience of one or more designers, general contractors, andassociated subcontractors during the design and construction process. Should a designer, general contractor or significant subcontractor experience financialor other problems during the design or construction process, we could experience significant delays, increased costs to complete the project and/or othernegative impacts to our expected returns.Site selection is also a critical factor in our expansion plans. There may not be suitable properties available in our markets with the necessarycombination of high power capacity and fiber connectivity, or selection may be limited. Thus, while we may prefer to locate new IBX data centers adjacent toour existing locations it may not always be possible. In the event we decide to build new IBX data centers separate from our existing IBX data centers, wemay provide interconnection solutions to connect these two centers. Should these solutions not provide the necessary reliability to sustain connection, thiscould result in lower interconnection revenue and lower margins and could have a negative impact on customer retention over time.Environmental regulations may impose upon us new or unexpected costs.Environmental regulations may impose upon us new or unexpected costs. We are subject to various federal, state, local and international environmentaland health and safety laws and regulations, including those relating to the generation, storage, handling and disposal of hazardous substances and wastes.Certain of these laws and regulations also impose joint and several liability, without regard to fault, for investigation and cleanup costs on current and formerowners and operators of real property and persons who have disposed of or released hazardous substances into the environment. Our operations involve theuse of hazardous substances and materials such as petroleum fuel for emergency generators, as well as batteries, cleaning solutions and other materials. Inaddition, we lease, own or operate real property at which hazardous substances and regulated materials have been used in the past. At some of our locations,hazardous substances or regulated materials are known to be present in soil or groundwater, and there may be additional unknown hazardous substances orregulated materials present at sites we own, operate or lease. At some of our locations, there are land use restrictions in place relating to earlier environmentalcleanups that do not materially limit our use of the sites. To the extent any hazardous substances or any other substance or material must be cleaned up orremoved from our22Table of Contentsproperty, we may be responsible under applicable laws, regulations or leases for the removal or cleanup of such substances or materials, the cost of whichcould be substantial.Electricity is a material cost in connection with our business, and an increase in the cost of electricity could adversely affect us. The generators thatprovide electricity to our facilities are subject to environmental laws, regulations and permit requirements that are subject to material change, which couldresult in increases in generators’ compliance costs that may be passed through to us. Regulations recently promulgated by the U.S. EPA could limit airemissions from power plants, restrict discharges of cooling water, and otherwise impose new operational restraints on conventional power plants that couldincrease costs of electricity. In addition, we are directly subject to environmental, health and safety laws regulating air emissions, storm water managementand other issues arising in our business. For example, our emergency generators are subject to state and federal regulations governing air pollutants, whichcould limit the operation of those generators or require the installation of new pollution control technologies. While environmental regulations do notnormally impose material costs upon our operations, unexpected events, equipment malfunctions, human error and changes in law or regulations, amongother factors, can lead to violations of environmental laws, regulations or permits, and to additional unexpected operational limitations or costs.Regulation of greenhouse gas ("GHG") emissions could increase the cost of electricity by reducing amounts of electricity generated from fossil fuels, byrequiring the use of more expensive generating methods or by imposing taxes or fees upon electricity generation or use. The U.S. EPA initially published aregulation in October 2015, called the "Clean Power Plan," that was intended to reduce GHG emissions from existing fossil fuel-fired power plants by 32percent from 2005 levels by 2030. In October 2017, the EPA proposed to repeal that Clean Power Plan and replace it with another regulation that wouldaddress GHG emissions from fossil fuel-fired plant. The EPA has not yet issued a replacement regulation. While we do not expect these regulatorydevelopments to materially increase our costs of electricity, the costs remain difficult to predict or estimate.State regulations also have the potential to increase our costs of obtaining electricity. While GHG regulation at the federal level is unlikely in the nearfuture, certain states, like California, also have issued or may enact environmental regulations that could materially affect our facilities and electricity costs.California has limited GHG emissions from new and existing conventional power plants by imposing regulatory caps and by selling or auctioning the rightsto emission allowances. Washington, Oregon and Massachusetts have issued regulations to implement similar carbon cap and trade programs. Some otherstates limit carbon emissions through the Regional Greenhouse Gas Initiative ("RGGI") cap and trade program. State programs have not had a materialadverse effect on our electricity costs to date, but due to the market-driven nature of some of the programs, could do so in the future. Such laws andregulations are also subject to change at any time.Aside from regulatory requirements, we have separately undertaken to procure energy from renewable energy projects in order to support new renewablesdevelopment. The costs of procuring such energy may exceed the costs of procuring electricity from existing sources, such as existing utilities or electricservice provided through conventional grids. These efforts to support and enhance renewable electricity generation may increase our costs of electricityabove those that would be incurred through procurement of conventional electricity from existing sources.If we are unable to recruit or retain qualified personnel, including a new CEO, our business could be harmed.On January 19, 2018, our then President and Chief Executive Officer ("CEO"), Steve Smith, resigned from his positions at Equinix. Our ExecutiveChairman, Peter Van Camp, is serving as interim CEO. While we intend to find a permanent replacement for the CEO role, we cannot assure you that we willbe able to secure such replacement in a timely manner. Even though we are confident in the interim leadership of Mr. Van Camp, any disruption resultingfrom Mr. Smith’s departure may adversely impact our customer relationships, employee morale and our business.Additionally, we must continue to identify, hire, train and retain IT professionals, technical engineers, operations employees, and sales, marketing,finance and senior management personnel who maintain relationships with our customers and who can provide the technical, strategic and marketing skillsrequired for our company to grow. There is a shortage of qualified personnel in these fields, and we compete with other companies for the limited pool oftalent.The failure to recruit and retain necessary personnel, including, but not limited to, a new CEO, could harm our business and our ability to grow ourcompany.We may not be able to compete successfully against current and future competitors.We must continue to evolve our product strategy and be able to differentiate our IBX data centers and product offerings from those of our competitors. Inaddition to competing with other neutral colocation providers, we compete with traditional colocation providers, including telecommunications companies,carriers, internet service providers, managed services providers and large REITs who also operate in our market and may enjoy a cost advantage in providingofferings similar to those provided by our IBX data centers. We may experience competition from our landlords which could also reduce the amount of spaceavailable to us for23Table of Contentsexpansion in the future. Rather than leasing available space in our buildings to large single tenants, they may decide to convert the space instead to smallersquare foot units designed for multi-tenant colocation use, blurring the line between retail and wholesale space. We may also face competition from existingcompetitors or new entrants to the market seeking to replicate our global IBX data center concept by building or acquiring data centers, offering colocationon neutral terms or by replicating our strategy and messaging. Finally, customers may also decide it is cost-effective for them to build out their own datacenters. Once customers have an established data center footprint, either through a relationship with one of our competitors or through in-sourcing, it may beextremely difficult to convince them to relocate to our IBX data centers.Some of our competitors may adopt aggressive pricing policies, especially if they are not highly leveraged or have lower return thresholds than we do. Asa result, we may suffer from pricing pressure that would adversely affect our ability to generate revenues. Some of these competitors may also provide ourtarget customers with additional benefits, including bundled communication services or cloud services, and may do so in a manner that is more attractive toour potential customers than obtaining space in our IBX data centers. Similarly, with growing acceptance of cloud-based technologies, we are at risk of losingcustomers that may decide to fully leverage cloud infrastructure offerings instead of managing their own. Competitors could also operate more successfully orform alliances to acquire significant market share.Finally, as our customers evolve their IT strategies, we must remain flexible and evolve along with industry and market shifts. Ineffective planning andexecution in our cloud strategy and product development lifecycle may cause difficulty in sustaining competitive advantage in our products and services.Failure to compete successfully may materially adversely affect our financial condition, cash flows and results of operations.Our business could be harmed by prolonged power outages or shortages, increased costs of energy or general lack of availability of electricalresources.Our IBX data centers are susceptible to regional costs of power, power shortages, planned or unplanned power outages and limitations, especiallyinternationally, on the availability of adequate power resources.Power outages, such as those relating to large storms, earthquakes, fires and tsunamis, could harm our customers and our business. We attempt to limit ourexposure to system downtime by using backup generators and power supplies; however, we may not be able to limit our exposure entirely even with theseprotections in place. Some of our IBX data centers are located in leased buildings where, depending upon the lease requirements and number of tenantsinvolved, we may or may not control some or all of the infrastructure including generators and fuel tanks. As a result, in the event of a power outage, we maybe dependent upon the landlord, as well as the utility company, to restore the power.In addition, global fluctuations in the price of power can increase the cost of energy, and although contractual price increase clauses exist in the majorityof our customer agreements, we may not always choose to pass these increased costs on to our customers.In each of our markets, we rely on third parties to provide a sufficient amount of power for current and future customers. At the same time, power andcooling requirements are growing on a per unit basis. As a result, some customers are consuming an increasing amount of power per cabinet. We generally donot control the amount of power our customers draw from their installed circuits. This means that we could face power limitations in our IBX data centers.This could have a negative impact on the effective available capacity of a given center and limit our ability to grow our business, which could have anegative impact on our financial performance, operating results and cash flows.We may also have difficulty obtaining sufficient power capacity for potential expansion sites in new or existing markets. We may experience significantdelays and substantial increased costs demanded by the utilities to provide the level of electrical service required by our current IBX data center designs.If our internal controls are found to be ineffective, our financial results or our stock price may be adversely affected.Our most recent evaluation of our controls resulted in our conclusion that, as of December 31, 2017, in compliance with Section 404 of the Sarbanes-Oxley Act of 2002, our internal controls over financial reporting were effective. Our ability to manage our operations and growth, through, for example, theintegration of Bit-isle, Telecity Group plc ("TelecityGroup") and the Verizon Data Center Acquisition, the adoption of new accounting principles and taxlaws, and our overhaul of our back office systems that, for example, support the customer experience from initial quote to customer billing and our revenuerecognition process, will require us to further develop our controls and reporting systems and implement or amend new or existing controls and reportingsystems in those areas where the implementation and integration is still ongoing. All of these changes to our financial systems and the implementation andintegration of acquisitions create an increased risk of deficiencies in our internal controls over financial reporting. If, in the future, our internal control overfinancial reporting is found to be ineffective, or if a material weakness is24Table of Contentsidentified in our controls over financial reporting, our financial results may be adversely affected. Investors may also lose confidence in the reliability of ourfinancial statements which could adversely affect our stock price.The use of high power density equipment may limit our ability to fully utilize our older IBX data centers.Some customers have increased their use of high power density equipment, such as blade servers, in our IBX data centers which has increased the demandfor power on a per cabinet basis. Because many of our IBX data centers were built a number of years ago, the current demand for power may exceed thedesigned electrical capacity in these centers. As power, not space, is a limiting factor in many of our IBX data centers, our ability to fully utilize those IBXdata centers may be limited. The ability to increase the power capacity of an IBX data center, should we decide to, is dependent on several factors including,but not limited to, the local utility’s ability to provide additional power; the length of time required to provide such power; and/or whether it is feasible toupgrade the electrical infrastructure of an IBX data center to deliver additional power to customers. Although we are currently designing and building to ahigher power specification than that of many of our older IBX data centers, there is a risk that demand will continue to increase and our IBX data centerscould become underutilized sooner than expected.Our operating results may fluctuate.We have experienced fluctuations in our results of operations on a quarterly and annual basis. The fluctuations in our operating results may cause themarket price of our common stock to be volatile. We may experience significant fluctuations in our operating results in the foreseeable future due to a varietyof factors, including, but not limited to:•fluctuations of foreign currencies in the markets in which we operate;•the timing and magnitude of depreciation and interest expense or other expenses related to the acquisition, purchase or construction of additionalIBX data centers or the upgrade of existing IBX data centers;•demand for space, power and services at our IBX data centers;•changes in general economic conditions, such as an economic downturn, or specific market conditions in the telecommunications and internetindustries, both of which may have an impact on our customer base;•charges to earnings resulting from past acquisitions due to, among other things, impairment of goodwill or intangible assets, reduction in the usefullives of intangible assets acquired, identification of additional assumed contingent liabilities or revised estimates to restructure an acquiredcompany’s operations;•the duration of the sales cycle for our offerings and our ability to ramp our newly-hired sales persons to full productivity within the time period wehave forecasted;•restructuring charges or reversals of restructuring charges, which may be necessary due to revised sublease assumptions, changes in strategy orotherwise;•acquisitions or dispositions we may make;•the financial condition and credit risk of our customers;•the provision of customer discounts and credits;•the mix of current and proposed products and offerings and the gross margins associated with our products and offerings;•the timing required for new and future IBX data centers to open or become fully utilized;•competition in the markets in which we operate;•conditions related to international operations;•increasing repair and maintenance expenses in connection with aging IBX data centers;•lack of available capacity in our existing IBX data centers to generate new revenue or delays in opening new or acquired IBX data centers that delayour ability to generate new revenue in markets which have otherwise reached capacity;•changes in rent expense as we amend our IBX data center leases in connection with extending their lease terms when their initial lease termexpiration dates approach or changes in shared operating costs in connection with our leases, which are commonly referred to as common areamaintenance expenses;•the timing and magnitude of other operating expenses, including taxes, expenses related to the expansion of sales, marketing, operations andacquisitions, if any, of complementary businesses and assets;•the cost and availability of adequate public utilities, including power;•changes in employee stock-based compensation;•overall inflation;•increasing interest expense due to any increases in interest rates and/or potential additional debt financings;•changes in our tax planning strategies or failure to realize anticipated benefits from such strategies;25Table of Contents•changes in income tax benefit or expense; and•changes in or new GAAP as periodically released by the Financial Accounting Standards Board ("FASB").Any of the foregoing factors, or other factors discussed elsewhere in this report, could have a material adverse effect on our business, results of operationsand financial condition. Although we have experienced growth in revenues in recent quarters, this growth rate is not necessarily indicative of futureoperating results. Prior to 2008, we had generated net losses every fiscal year since inception. It is possible that we may not be able to generate net income ona quarterly or annual basis in the future. In addition, a relatively large portion of our expenses are fixed in the short-term, particularly with respect to lease andpersonnel expenses, depreciation and amortization and interest expenses. Therefore, our results of operations are particularly sensitive to fluctuations inrevenues. As such, comparisons to prior reporting periods should not be relied upon as indications of our future performance. In addition, our operatingresults in one or more future quarters may fail to meet the expectations of securities analysts or investors.Our days sales outstanding ("DSO") may be negatively impacted by process and system upgrades and acquisitions.Our DSO may be negatively impacted by ongoing process and system upgrades which can impact our customer's experience in the short term, togetherwith integrating recent acquisitions into our processes and systems, which may have a negative impact on our operating cash flows, liquidity and financialperformance.Our reported financial results may be adversely affected by changes in U.S. GAAP.We prepare our consolidated financial statements in conformity with U.S. GAAP. A change in these principles can have a significant effect on ourreported financial position and financial results. In addition, the adoption of new or revised accounting principles may require that we make changes to oursystems, processes and controls. For example, we are currently in the process of evaluating the newly issued accounting standards for revenue recognition andleasing, which could have a significant effect on our reported financial results, cause unexpected financial reporting fluctuations or require us to make costlychanges to our operational processes and accounting systems upon or following the adoption of these standards. For additional information regarding theaccounting standard updates, see "Accounting Standards Not Yet Adopted" and "Accounting Standards Adopted" sections of Note 1 of Notes in ConsolidatedFinancial Statements in Item 8 of this Annual Report on Form 10-K.We may incur goodwill and other intangible asset impairment charges, or impairment charges to our property, plant and equipment, which couldresult in a significant reduction to our earnings.In accordance with U.S. GAAP, we are required to assess our goodwill and other intangible assets annually, or more frequently whenever events orchanges in circumstances indicate potential impairment, such as changing market conditions or any changes in key assumptions. If the testing performedindicates that an asset may not be recoverable, we are required to record a non-cash impairment charge for the difference between the carrying value of thegoodwill or other intangible assets and the implied fair value of the goodwill or other intangible assets in the period the determination is made.We also monitor the remaining net book values of our property, plant and equipment periodically, including at the individual IBX data center level.Although each individual IBX data center is currently performing in line with our expectations, the possibility that one or more IBX data centers could beginto under-perform relative to our expectations is possible and may also result in non-cash impairment charges.These charges could be significant, which could have a material adverse effect on our business, results of operations or financial condition.We have incurred substantial losses in the past and may incur additional losses in the future.As of December 31, 2017, our retained earnings were $252.7 million. Although we have generated net income for each fiscal year since 2008, except forthe year ended December 31, 2014, we are currently investing heavily in our future growth through the build out of multiple additional IBX data centers andIBX data center expansions as well as acquisitions of complementary businesses. As a result, we will incur higher depreciation and other operating expenses,as well as acquisition costs and interest expense, that may negatively impact our ability to sustain profitability in future periods unless and until these newIBX data centers generate enough revenue to exceed their operating costs and cover our additional overhead needed to scale our business for this anticipatedgrowth. The current global financial uncertainty may also impact our ability to sustain profitability if we cannot generate sufficient revenue to offset theincreased costs of our recently-opened IBX data centers or IBX data centers currently under construction. In addition, costs associated with the acquisitionand integration of any acquired companies, as well as the additional interest expense associated with debt financing we have undertaken to fund our growthinitiatives, may also negatively impact our ability to sustain profitability. Finally, given the competitive and evolving nature of the industry in which weoperate, we may not be able to sustain or increase profitability on a quarterly or annual basis.26Table of ContentsThe failure to obtain favorable terms when we renew our IBX data center leases, or the failure to renew such leases, could harm our business and resultsof operations.While we own certain of our IBX data centers, others are leased under long-term arrangements with lease terms expiring at various dates through 2065.These leased centers have all been subject to significant development by us in order to convert them from, in most cases, vacant buildings or warehouses intoIBX data centers. Most of our IBX data center leases have renewal options available to us. However, many of these renewal options provide for the rent to beset at then-prevailing market rates. To the extent that then-prevailing market rates or negotiated rates are higher than present rates, these higher costs mayadversely impact our business and results of operations, or we may decide against renewing the lease. In the event that an IBX data center lease does not havea renewal option, or we fail to exercise a renewal option in a timely fashion and lose our right to renew the lease, we may not be successful in negotiating arenewal of the lease with the landlord. A failure to renew a lease could force us to exit a building prematurely, which could be disruptive to our business,harm our customer relationships, expose us to liability under our customer contracts, cause us to take impairment charges and negatively affect our operatingresults.We depend on a number of third parties to provide internet connectivity to our IBX data centers; if connectivity is interrupted or terminated, ouroperating results and cash flow could be materially and adversely affected.The presence of diverse telecommunications carriers’ fiber networks in our IBX data centers is critical to our ability to retain and attract new customers.We are not a telecommunications carrier, and as such, we rely on third parties to provide our customers with carrier services. We believe that the availabilityof carrier capacity will directly affect our ability to achieve our projected results. We rely primarily on revenue opportunities from the telecommunicationscarriers’ customers to encourage them to invest the capital and operating resources required to connect from their centers to our IBX data centers. Carriers willlikely evaluate the revenue opportunity of an IBX data center based on the assumption that the environment will be highly competitive. We cannot provideassurance that each and every carrier will elect to offer its services within our IBX data centers or that once a carrier has decided to provide internetconnectivity to our IBX data centers that it will continue to do so for any period of time.Our new IBX data centers require construction and operation of a sophisticated redundant fiber network. The construction required to connect multiplecarrier facilities to our IBX data centers is complex and involves factors outside of our control, including regulatory processes and the availability ofconstruction resources. Any hardware or fiber failures on this network may result in significant loss of connectivity to our new IBX data center expansions.This could affect our ability to attract new customers to these IBX data centers or retain existing customers.If the establishment of highly diverse internet connectivity to our IBX data centers does not occur, is materially delayed or is discontinued, or is subjectto failure, our operating results and cash flow will be adversely affected.We may be vulnerable to security breaches which could disrupt our operations and have a material adverse effect on our financial performance andoperating results.We face risks associated with unauthorized access to our computer systems, loss or destruction of data, computer viruses, malware, distributed denial-of-service attacks, or other malicious activities. These threats may result from human error, equipment failure, or fraud or malice on the part of employees or thirdparties. A party who is able to compromise the security measures on our networks or the security of our infrastructure could misappropriate either ourproprietary information or the personal information of our customers or our employees, or cause interruptions or malfunctions in our operations or ourcustomers’ operations. As we provide assurances to our customers that we provide a high level of security, such a compromise could be particularly harmfulto our brand and reputation. We may be required to expend significant capital and resources to protect against such threats or to alleviate problems caused bybreaches in security. As techniques used to breach security change frequently, and are generally not recognized until launched against a target, we may notbe able to promptly detect that a cyber breach has occurred, or implement security measures in a timely manner or, if and when implemented, we may not beable to determine the extent to which these measures could be circumvented. Any breaches that may occur could expose us to increased risk of lawsuits,regulatory penalties, loss of existing or potential customers, damage relating to loss of proprietary information, harm to our reputation and increases in oursecurity costs, which could have a material adverse effect on our financial performance and operating results. We maintain insurance coverage for cyber risksbut such coverage may be unavailable or insufficient to cover our losses. We offer professional services to our customers where we consult on data center solutions and assist with implementations. We also offer managedservices in certain of our foreign jurisdictions outside of the U.S. where we manage the data center infrastructure for our customers. The access gained fromthese services to our clients’ networks and data creates some risk that our clients' networks or data will be improperly accessed. We may also design ourclients’ cloud storage systems in such a way that exposes our clients to increased risk of data breach. If Equinix were held to be responsible for any such abreach, it could result in a significant loss to Equinix, including damage to Equinix’s client relationships, harm to our brand and reputation, and legalliability.27Table of ContentsWe have government customers, which subjects us to risks including early termination, audits, investigations, sanctions and penalties.We derive revenues from contracts with the U.S. government, state and local governments and foreign governments. Some of these customers mayterminate all or part of their contracts at any time, without cause. There is increased pressure for governments and their agencies, both domestically andinternationally, to reduce spending. Some of our federal government contracts are subject to the approval of appropriations being made by the U.S. Congressto fund the expenditures under these contracts. Similarly, some of our contracts at the state and local levels are subject to government funding authorizations.Additionally, government contracts often have unique terms and conditions, such as most favored customer obligations, and are generally subject toaudits and investigations which could result in various civil and criminal penalties and administrative sanctions, including termination of contracts, refundof a portion of fees received, forfeiture of profits, suspension of payments, fines and suspensions or debarment from future government business.Because we depend on the development and growth of a balanced customer base, including key magnet customers, failure to attract, grow and retainthis base of customers could harm our business and operating results.Our ability to maximize revenues depends on our ability to develop and grow a balanced customer base, consisting of a variety of companies, includingenterprises, cloud, digital content and financial companies, and network service providers. We consider certain of these customers to be key magnets in thatthey draw in other customers. The more balanced the customer base within each IBX data center, the better we will be able to generate significantinterconnection revenues, which in turn increases our overall revenues. Our ability to attract customers to our IBX data centers will depend on a variety offactors, including the presence of multiple carriers, the mix of our offerings, the overall mix of customers, the presence of key customers attracting businessthrough vertical market ecosystems, the IBX data center’s operating reliability and security and our ability to effectively market our offerings. However, someof our customers may face competitive pressures and may ultimately not be successful or may be consolidated through merger or acquisition. If thesecustomers do not continue to use our IBX data centers it may be disruptive to our business. Finally, the uncertain global economic climate may harm ourability to attract and retain customers if customers slow spending, or delay decision-making on our offerings, or if customers begin to have difficulty payingus and we experience increased churn in our customer base. Any of these factors may hinder the development, growth and retention of a balanced customerbase and adversely affect our business, financial condition and results of operations.We may be subject to securities class action and other litigation, which may harm our business and results of operations.We may be subject to securities class action or other litigation. For example, securities class action litigation has often been brought against a companyfollowing periods of volatility in the market price of its securities. Litigation can be lengthy, expensive, and divert management’s attention and resources.Results cannot be predicted with certainty and an adverse outcome in litigation could result in monetary damages or injunctive relief. Further, any paymentsmade in settlement may directly reduce our revenue under U.S. GAAP and could negatively impact our operating results for the period. For all of thesereasons, litigation could seriously harm our business, results of operations, financial condition or cash flows.We may not be able to protect our intellectual property rights.We cannot make assurances that the steps taken by us to protect our intellectual property rights will be adequate to deter misappropriation of proprietaryinformation or that we will be able to detect unauthorized use and take appropriate steps to enforce our intellectual property rights. We also are subject to therisk of litigation alleging infringement of third-party intellectual property rights. Any such claims could require us to spend significant sums in litigation,pay damages, develop non-infringing intellectual property, or acquire licenses to the intellectual property that is the subject of the alleged infringement.Government regulation may adversely affect our business.Various laws and governmental regulations, both in the U.S. and abroad, governing internet-related services, related communications services andinformation technologies remain largely unsettled, even in areas where there has been some legislative action. For example, the Federal CommunicationsCommission ("FCC") recently overturned network neutrality rules, which may result in material changes in the regulations and contribution regime affectingus and our customers. Furthermore, the U.S. Congress and state legislatures are reviewing and considering changes to the new FCC rules making the future ofnetwork neutrality and its impact on Equinix uncertain. There may also be forthcoming regulation in the U.S. in the areas of cybersecurity, data privacy anddata security, any of which could impact Equinix and our customers. Similarly, data privacy regulations outside of the U.S. continue to evolve and must beaddressed by Equinix as a global company.Likewise, as part of a review of the current equity market structure, the Securities and Exchange Commission and the Commodity Futures TradingCommission ("CFTC") have both sought comments regarding the regulation of independent data28Table of Contentscenters, such as us, which provide colocation for financial markets and exchanges. In the past, the CFTC has also considered regulation of companies that useautomated and high-frequency trading systems. Any such regulation may ultimately affect our provision of offerings.We remain focused on whether and how existing and changing laws, such as those governing intellectual property, privacy, libel, telecommunicationsservices, data flows/data localization and taxation apply to the internet and to related offerings such as ours; and substantial resources may be required tocomply with regulations or bring any non-compliant business practices into compliance with such regulations. In addition, the continuing development ofthe market for online commerce and the displacement of traditional telephony service by the internet and related communications services may prompt anincreased call for more stringent consumer protection laws or other regulation both in the U.S. and abroad that may impose additional burdens on companiesconducting business online and their service providers.The adoption, or modification of laws or regulations relating to the internet and our business, or interpretations of existing laws, could have a materialadverse effect on our business, financial condition and results of operations.Industry consolidation may have a negative impact on our business model.If customers combine businesses, they may require less colocation space, which could lead to churn in our customer base. Regional competitors may alsoconsolidate to become a global competitor. Consolidation of our customers and/or our competitors may present a risk to our business model and have anegative impact on our revenues.We have various mechanisms in place that may discourage takeover attempts.Certain provisions of our certificate of incorporation and bylaws may discourage, delay or prevent a third party from acquiring control of us in a merger,acquisition or similar transaction that a stockholder may consider favorable. Such provisions include:•ownership limitations and transfer restrictions relating to our stock that are intended to facilitate our compliance with certain REIT rules relating toshare ownership;•authorization for the issuance of "blank check" preferred stock;•the prohibition of cumulative voting in the election of directors;•limits on the persons who may call special meetings of stockholders;•limits on stockholder action by written consent; and•advance notice requirements for nominations to the Board of Directors or for proposing matters that can be acted on by stockholders at stockholdermeetings.In addition, Section 203 of the Delaware General Corporation Law, which restricts certain business combinations with interested stockholders in certainsituations, may also discourage, delay or prevent someone from acquiring or merging with us.Risks Related to Our Taxation as a REITWe may not remain qualified for taxation as a REIT.We have elected to be taxed as a REIT for U.S. federal income tax purposes beginning with our 2015 taxable year. We believe that our organization andmethod of operation comply with the rules and regulations promulgated under the Internal Revenue Code of 1986, as amended (the "Code"), such that wewill continue to qualify for taxation as a REIT. However, we cannot assure you that we have qualified for taxation as a REIT or that we will remain soqualified. Qualification for taxation as a REIT involves the application of highly technical and complex provisions of the Code to our operations as well asvarious factual determinations concerning matters and circumstances not entirely within our control. There are limited judicial or administrativeinterpretations of applicable REIT provisions.If, in any taxable year, we fail to remain qualified for taxation as a REIT and are not entitled to relief under the Code:•we will not be allowed a deduction for distributions to stockholders in computing our taxable income;•we will be subject to federal and state income tax on our taxable income at regular corporate income tax rates; and•we would not be eligible to elect REIT status again until the fifth taxable year that begins after the first year for which we failed to qualify fortaxation as a REIT.Any such corporate tax liability could be substantial and would reduce the amount of cash available for other purposes. If we fail to remain qualified fortaxation as a REIT, we may need to borrow additional funds or liquidate some investments to pay any additional tax liability. Accordingly, funds availablefor investment and distributions to stockholders could be reduced.29Table of ContentsAs a REIT, failure to make required distributions would subject us to federal corporate income tax.We paid quarterly distributions in 2017. The amount, timing and form of any future distributions will be determined, and will be subject to adjustment,by our Board of Directors. To remain qualified for taxation as a REIT, we are generally required to distribute at least 90% of our REIT taxable income(determined without regard to the dividends paid deduction and excluding net capital gain) each year, or in limited circumstances, the following year, to ourstockholders. Generally, we expect to distribute all or substantially all of our REIT taxable income. If our cash available for distribution falls short of ourestimates, we may be unable to maintain distributions that approximate our REIT taxable income and may fail to remain qualified for taxation as a REIT. Inaddition, our cash flows from operations may be insufficient to fund required distributions as a result of differences in timing between the actual receipt ofincome and the payment of expenses and the recognition of income and expenses for federal income tax purposes, or the effect of nondeductibleexpenditures, such as capital expenditures, payments of compensation for which Section 162(m) of the Code denies a deduction, interest expense deductionslimited by Section 163(j) of the Code, the creation of reserves or required debt service or amortization payments.To the extent that we satisfy the 90% distribution requirement but distribute less than 100% of our REIT taxable income, we will be subject to federalcorporate income tax on our undistributed taxable income. In addition, we will be subject to a 4% nondeductible excise tax on our undistributed taxableincome if the actual amount that we distribute to our stockholders for a calendar year is less than the minimum amount specified under the Code.We may be required to borrow funds, sell assets or raise equity to satisfy our REIT distribution requirements.Due to the size and timing of future distributions, including any distributions made to satisfy REIT distribution requirements, we may need to borrowfunds, sell assets or raise equity, even if the then-prevailing market conditions are not favorable for these borrowings, sales or offerings.Any insufficiency of our cash flows to cover our REIT distribution requirements could adversely impact our ability to raise short- and long-term debt, tosell assets, or to offer equity securities in order to fund distributions required to maintain our qualification and taxation as a REIT. Furthermore, the REITdistribution requirements may increase the financing we need to fund capital expenditures, future growth and expansion initiatives. This would increase ourindebtedness. A significant increase in our outstanding debt could lead to a downgrade of our credit rating. A downgrade of our credit rating couldnegatively impact our ability to access credit markets. Further, certain of our current debt instruments limit the amount of indebtedness we and oursubsidiaries may incur. Significantly more financing, therefore, may be unavailable, more expensive or restricted by the terms of our outstandingindebtedness. For a discussion of risks related to our substantial level of indebtedness, see other risks described elsewhere in this Form 10-K.Whether we issue equity, at what price and the amount and other terms of any such issuances will depend on many factors, including alternative sourcesof capital, our then-existing leverage, our need for additional capital, market conditions and other factors beyond our control. If we raise additional fundsthrough the issuance of equity securities or debt convertible into equity securities, the percentage of stock ownership by our existing stockholders may bereduced. In addition, new equity securities or convertible debt securities could have rights, preferences and privileges senior to those of our currentstockholders, which could substantially decrease the value of our securities owned by them. Depending on the share price we are able to obtain, we may haveto sell a significant number of shares in order to raise the capital we deem necessary to execute our long-term strategy, and our stockholders may experiencedilution in the value of their shares as a result.Complying with REIT requirements may limit our flexibility or cause us to forgo otherwise attractive opportunities.To remain qualified for taxation as a REIT for U.S. federal income tax purposes, we must satisfy tests concerning, among other things, the sources of ourincome, the nature and diversification of our assets and the amounts we distribute to our stockholders. For example, under the Code, no more than 20% of thevalue of the assets of a REIT may be represented by securities of one or more TRSs. Similar rules apply to other nonqualifying assets. These limitations mayaffect our ability to make large investments in other non-REIT qualifying operations or assets. In addition, in order to maintain our qualification for taxationas a REIT, we must distribute at least 90% of our REIT taxable income, determined without regard to the dividends paid deduction and excluding any netcapital gains. Even if we maintain our qualification for taxation as a REIT, we will be subject to U.S. federal income tax at regular corporate income tax ratesfor our undistributed REIT taxable income, as well as U.S. federal income tax at regular corporate income tax rates for income recognized by our TRSs.Because of these distribution requirements, we will likely not be able to fund future capital needs and investments from operating cash flow. As such,compliance with REIT tests may hinder our ability to make certain attractive investments, including the purchase of significant nonqualifying assets and thematerial expansion of non-real estate activities.30Table of ContentsOur ability to fully deduct our interest expense may be limited, or we may be required to adjust the tax depreciation of our real property in order tomaintain the full deductibility of our interest expense.December 2017 amendments to the Code limit interest deductions for businesses, whether in corporate or passthrough form, to the sum of the taxpayer’sbusiness interest income for the tax year and 30% of the taxpayer’s adjusted taxable income for that tax year. This limitation does not apply to an "electingreal property trade or business". We have not yet determined whether we or any of our subsidiaries will elect out of the new interest expense limitation orwhether each of our subsidiaries is eligible to elect out, although legislative history indicates that a real property trade or business includes a trade orbusiness conducted by a corporation or a REIT. Depreciable real property (including specified improvements) held by electing real property trades orbusinesses must be depreciated for U.S. federal income tax purposes under the alternative depreciation system of the Code, which generally imposes a classlife for depreciable real property as long as forty years.As a REIT, we are limited in our ability to fund distribution payments using cash generated through our TRSs.Our ability to receive distributions from our TRSs is limited by the rules with which we must comply to maintain our qualification for taxation as a REIT.In particular, at least 75% of our gross income for each taxable year as a REIT must be derived from real estate. Consequently, no more than 25% of our grossincome may consist of dividend income from our TRSs and other nonqualifying types of income. Thus, our ability to receive distributions from our TRSsmay be limited, and may impact our ability to fund distributions to our stockholders using cash flows from our TRSs. Specifically, if our TRSs become highlyprofitable, we might become limited in our ability to receive net income from our TRSs in an amount required to fund distributions to our stockholderscommensurate with that profitability.In addition, a significant amount of our income and cash flows from our TRSs is generated from our international operations. In many cases, there arelocal withholding taxes and currency controls that may impact our ability or willingness to repatriate funds to the United States to help satisfy REITdistribution requirements.Our extensive use of TRSs, including for certain of our international operations, may cause us to fail to remain qualified for taxation as a REIT.Our operations include an extensive use of TRSs. The net income of our TRSs is not required to be distributed to us, and income that is not distributed tous generally is not subject to the REIT income distribution requirement. However, there may be limitations on our ability to accumulate earnings in our TRSsand the accumulation or reinvestment of significant earnings in our TRSs could result in adverse tax treatment. In particular, if the accumulation of cash inour TRSs causes (1) the fair market value of our securities in our TRSs to exceed 20% of the fair market value of our assets or (2) the fair market value of oursecurities in our TRSs and other nonqualifying assets to exceed 25% of the fair market value of our assets, then we will fail to remain qualified for taxation asa REIT. Further, a substantial portion of our TRSs are overseas, and a material change in foreign currency rates could also negatively impact our ability toremain qualified for taxation as a REIT.December 2017 amendments to the Code have imposed limitations on the ability of our TRSs to utilize specified income tax deductions, includinglimits on the use of net operating losses and limits on the deductibility of interest expense. Further, these amendments made substantial changes to thetaxation of international income. Some of these changes did not contemplate unintended consequences of such reforms on REITs with global operations, andwe may be required to recognize income on account of the activities of our foreign TRSs that may not be treated as qualifying income for purposes of theREIT gross income tests that we are required to satisfy.Our cash distributions are not guaranteed and may fluctuate.A REIT generally is required to distribute at least 90% of its REIT taxable income to its stockholders.Our Board of Directors, in its sole discretion, will determine on a quarterly basis the amount of cash to be distributed to our stockholders based on anumber of factors including, but not limited to, our results of operations, cash flow and capital requirements, economic conditions, tax considerations,borrowing capacity and other factors, including debt covenant restrictions that may impose limitations on cash payments, future acquisitions and divestituresand any stock repurchase program. Consequently, our distribution levels may fluctuate.Even if we remain qualified for taxation as a REIT, some of our business activities are subject to corporate level income tax and foreign taxes, whichwill continue to reduce our cash flows, and we will have potential deferred and contingent tax liabilities.Even if we remain qualified for taxation as a REIT, we may be subject to some federal, state, local and foreign taxes on our income and assets, taxes onany undistributed income, and state, local or foreign income, franchise, property and transfer taxes.31Table of ContentsIn addition, we could in certain circumstances be required to pay an excise or penalty tax, which could be significant in amount, in order to utilize one ormore relief provisions under the Code to maintain our qualification for taxation as a REIT.A portion of our business is conducted through wholly-owned TRSs because certain of our business activities could generate nonqualifying REITincome as currently structured and operated. The income of our U.S. TRSs will continue to be subject to federal and state corporate income taxes. In addition,our international assets and operations will continue to be subject to taxation in the foreign jurisdictions where those assets are held or those operations areconducted. Any of these taxes would decrease our earnings and our available cash.We will also be subject to a federal corporate level income tax at the highest regular corporate income tax rate (21%, effective January 1, 2018) on gainrecognized from a sale of a REIT asset where our basis in the asset is determined by reference to the basis of the asset in the hands of a C corporation (such as(i) an asset that we held as of the effective date of our REIT election, that is, January 1, 2015, or (ii) an asset that we or our qualified REIT subsidiaries("QRSs") hold following the liquidation or other conversion of a former TRS). This 21% tax is generally applicable to any disposition of such an asset duringthe five-year period after the date we first owned the asset as a REIT asset (e.g., January 1, 2015 in the case of REIT assets we held at the time of our REITconversion), to the extent of the built-in-gain based on the fair market value of such asset on the date we first held the asset as a REIT asset.In addition, the U.S. Internal Revenue Service ("IRS") and any state or local tax authority may successfully assert liabilities against us for corporateincome taxes for our pre-REIT period, in which case we will owe these taxes plus applicable interest and penalties, if any. Moreover, any increase in taxableincome for these pre-REIT periods will likely result in an increase in pre-REIT accumulated earnings and profits, which could cause us to pay an additionaltaxable distribution to our stockholders and an interest penalty to the IRS after the relevant determination.Restrictive loan covenants could prevent us from satisfying REIT distribution requirements.Restrictions in our credit facility and our indentures may prevent us from satisfying our REIT distribution requirements, and we could fail to remainqualified for taxation as a REIT. If these limits do not jeopardize our qualification for taxation as a REIT but nevertheless prevent us from distributing 100%of our REIT taxable income, we would be subject to federal corporate income tax, and potentially a nondeductible excise tax, on the retained amounts. Seesee other risks described elsewhere in this Form 10-K for further information on our restrictive loan covenants.Complying with REIT requirements may limit our ability to hedge effectively and increase the cost of our hedging, and may cause us to incur taxliabilities.The REIT provisions of the Code limit our ability to hedge assets, liabilities, revenues and expenses. Generally, income from hedging transactions thatwe enter into to manage risk of interest rate changes or fluctuations with respect to borrowings made or to be made by us to acquire or carry real estate assetsand income from certain currency hedging transactions related to our non-U.S. operations, as well as income from qualifying counteracting hedges, do notconstitute "gross income" for purposes of the REIT gross income tests. To the extent that we enter into other types of hedging transactions, the income fromthose transactions is likely to be treated as nonqualifying income for purposes of the REIT gross income tests. As a result of these rules, we may need to limitour use of advantageous hedging techniques or implement those hedges through our TRSs, which we presently do. This increases the cost of our hedgingactivities because our TRSs are subject to tax on income or gains resulting from hedges entered into by them and may expose us to greater risks associatedwith changes in interest rates or exchange rates than we would otherwise want to bear. In addition, hedging losses in any of our TRSs may not provide any taxbenefit, except for being carried forward for possible use against future income or gain in the TRSs.Distributions payable by REITs generally do not qualify for preferential tax rates.Dividends payable by U.S. corporations to noncorporate stockholders, such as individuals, trusts and estates, are generally eligible for reduced U.S.federal income tax rates applicable to "qualified dividends." Distributions paid by REITs generally are not treated as "qualified dividends" under the Code,and the reduced rates applicable to such dividends do not generally apply. However, for tax years beginning after 2017 and before 2026, REIT dividendspaid to noncorporate stockholders are generally taxed at an effective tax rate lower than applicable ordinary income tax rates due to the availability of adeduction under the Code for specified forms of income from passthrough entities. More favorable rates will nevertheless continue to apply to regularcorporate "qualified" dividends, which may cause some investors to perceive that an investment in a REIT is less attractive than an investment in a non-REITentity that pays dividends, thereby reducing the demand and market price of our common stock.32Table of ContentsOur certificate of incorporation contains restrictions on the ownership and transfer of our stock, though they may not be successful in preserving ourqualification for taxation as a REIT.In order for us to remain qualified for taxation as a REIT, no more than 50% of the value of outstanding shares of our stock may be owned, beneficially orconstructively, by five or fewer individuals at any time during the last half of each taxable year other than the first year for which we elected to be taxed as aREIT. In addition, rents from "affiliated tenants" will not qualify as qualifying REIT income if we own 10% or more by vote or value of the customer, whetherdirectly or after application of attribution rules under the Code. Subject to certain exceptions, our certificate of incorporation prohibits any stockholder fromowning, beneficially or constructively, more than (i) 9.8% in value of the outstanding shares of all classes or series of our capital stock or (ii) 9.8% in value ornumber, whichever is more restrictive, of the outstanding shares of any class or series of our capital stock. We refer to these restrictions collectively as the"ownership limits" and we included them in our certificate of incorporation to facilitate our compliance with REIT tax rules. The constructive ownership rulesunder the Code are complex and may cause the outstanding stock owned by a group of related individuals or entities to be deemed to be constructivelyowned by one individual or entity. As a result, the acquisition of less than 9.8% of our outstanding common stock (or the outstanding shares of any class orseries of our stock) by an individual or entity could cause that individual or entity or another individual or entity to own constructively in excess of therelevant ownership limits. Any attempt to own or transfer shares of our common stock or of any of our other capital stock in violation of these restrictions mayresult in the shares being automatically transferred to a charitable trust or may be void. Even though our certificate of incorporation contains the ownershiplimits, there can be no assurance that these provisions will be effective to prevent our qualification for taxation as a REIT from being jeopardized, includingunder the affiliated tenant rule. Furthermore, there can be no assurance that we will be able to monitor and enforce the ownership limits. If the restrictions inour certificate of incorporation are not effective and, as a result, we fail to satisfy the REIT tax rules described above, then absent an applicable reliefprovision, we will fail to remain qualified for taxation as a REIT.In addition, the ownership and transfer restrictions could delay, defer or prevent a transaction or a change in control that might involve a premium pricefor our stock or otherwise be in the best interest of our stockholders. As a result, the overall effect of the ownership and transfer restrictions may be to rendermore difficult or discourage any attempt to acquire us, even if such acquisition may be favorable to the interests of our stockholders.Legislative or other actions affecting REITs could have a negative effect on us or our stockholders.At any time, the federal or state income tax laws governing REITs, or the administrative interpretations of those laws, may be amended. Federal and statetax laws are constantly under review by persons involved in the legislative process, the IRS, the U.S. Department of the Treasury and state taxing authorities.Changes to the tax laws, regulations and administrative interpretations, which may have retroactive application, could adversely affect us. In addition, someof these changes could have a more significant impact on us as compared to other REITs due to the nature of our business and our substantial use of TRSs,particularly non-U.S. TRSs.In addition, December 2017 legislation has made substantial changes to the Code, particularly as it relates to the taxation of both corporate income andinternational income. Among those changes are a significant permanent reduction in the generally applicable corporate income tax rate, changes in thetaxation of individuals and other noncorporate taxpayers that generally reduce their taxes on a temporary basis subject to "sunset" provisions, the eliminationor modification of various deductions (including substantial limitation of the deduction for personal state and local taxes imposed on individuals), andpreferential taxation of income derived by individuals from passthrough entities in comparison to earnings received directly by individuals. This legislationalso imposes additional limitations on the deduction of net operating losses, which may in the future cause us to make additional distributions that will betaxable to our stockholders to the extent of our current or accumulated earnings and profits in order to comply with the REIT distribution requirements. Theeffect of these and other changes made in this legislation is highly uncertain, both in terms of their direct effect on the taxation of an investment in ourcommon stock and their indirect effect on the value of properties owned by us. Furthermore, many of the provisions of the new law will require guidancethrough the issuance of Treasury regulations in order to assess their effect. There may be a substantial delay before such regulations are promulgated,increasing the uncertainty as to the ultimate effect of the statutory amendments on us or our stockholders. It is also possible that there will be technicalcorrections legislation proposed with respect to the new law, the effect of which cannot be predicted and may be adverse to us or our stockholders. Ourstockholders are encouraged to consult with their tax advisors about the potential effects that changes in law may have on them and their ownership of ourcommon stock.We could incur adverse tax consequences if we fail to integrate an acquisition target in compliance with the requirements to qualify for taxation as aREIT.We periodically explore and occasionally consummate merger and acquisition transactions. When we consummate these transactions, we structure theacquisition to successfully manage the REIT income, asset, and distribution tests that we must satisfy. We believe that we have and will in the futuresuccessfully integrate our acquisition targets in a manner that has and will allow us33Table of Contentsto timely satisfy the REIT tests applicable to us, but if we failed or in the future fail to do so, then we could jeopardize or lose our qualification for taxation asa REIT, particularly if we were not eligible to utilize relief provisions set forth in the Code.ITEM 1B.UNRESOLVED STAFF COMMENTSThere is no disclosure to report pursuant to Item 1B.ITEM 2.PROPERTIESOur executive offices are located in Redwood City, California, and we also have sales offices in several cities throughout the U.S. Our Asia-Pacificheadquarters office is located in Hong Kong and we also have office space in Shanghai, China; Singapore; Tokyo, Japan; and Sydney, Australia. Our EMEAheadquarters office is located in Amsterdam, the Netherlands and our regional sales offices in EMEA are based in our IBX data centers in EMEA. We haveentered into leases for certain of our IBX data centers. In the Americas region: Rio de Janeiro and Sao Paulo, Brazil; Toronto, Canada; Atlanta, Georgia;Boston, Massachusetts; Chicago, Illinois; Dallas, Texas; Washington D.C. and Ashburn, Virginia; Denver, Colorado; Miami, Florida; New York, New York;Philadelphia, Pennsylvania; Seattle, Washington; Silicon Valley and Los Angeles, California; and Bogota, Colombia. In the Asia-Pacific region: Hong Kongand Shanghai, China; Singapore; Sydney, Australia; and Tokyo and Osaka, Japan. In the EMEA region: Paris, France; Frankfurt and Munich, Germany;Amsterdam and East Netherlands, the Netherlands; Geneva and Zurich, Switzerland; Dubai and Abu Dhabi, U.A.E.; London and Manchester, UnitedKingdom; Helsinki, Finland; Dublin, Ireland; Milan, Italy; Stockholm, Sweden; Istanbul, Turkey; Warsaw, Poland; and Barcelona, Madrid, and Seville,Spain. We own certain of our IBX data centers. In the Americas region: Chicago, Illinois; Washington D.C., Ashburn and Culpeper, Virginia; Silicon Valleyand Los Angeles, California; Rio de Janeiro and Sao Paulo, Brazil; Atlanta, Georgia; Boston, Massachusetts; Dallas and Houston, Texas; Denver, Colorado;Miami, Florida; New York, New York; Seattle, Washington. In the Asia-Pacific region: Shanghai, China; Tokyo, Japan; and Melbourne and Sydney,Australia. In the EMEA region: Paris, France; Frankfurt and Dusseldorf, Germany; London, United Kingdom; Amsterdam, the Netherlands; Dublin, Ireland;Sofia, Bulgaria; Istanbul, Turkey; Milan, Italy; Helsinki, Finland; Lisbon, PortugalThe following table presents an overview of our portfolio of IBX data centers as of December 31, 2017: # of IBXs Total Cabinet Capacity(1) Cabinets Billed Cabinet Utilization % (2) MRR per Cabinet (3)Americas87 96,300 78,900 82% $2,371EMEA73 101,900 83,200 82% 1,342Asia-Pacific30 44,400 33,000 74% 2,007Total190 242,600 195,100 _________________________(1)Cabinets represent a specific amount of space within an IBX data center. Customers can combine and use multiple adjacent cabinets within an IBXdata center, depending on their space requirements. Includes Verizon but excludes Itconic and IS2.(2)The cabinet utilization rate represents the percentage of cabinet space billing versus total cabinet capacity, taking into consideration powerlimitations. Includes data center assets acquired from Verizon but excludes data center assets acquired from Zenium and Itconic(3)MRR per cabinet represents average monthly recurring revenue recognized during the year divided by the average number of cabinets billing duringthe year. Bit-isle Managed Infrastructure Services, Brazil, Colombia, the data centers acquired from Zenium and Itconic and the impact of embeddedderivatives are excluded from MRR per cabinet calculations.34Table of ContentsThe following table presents a summary of our significant IBX data center expansion projects under construction as of December 31, 2017:Property Property Location Target Open Date Sellable Cabinets Total Capex(in Millions)Americas: CH3 phase IV Chicago Q1 2018 715 $67RJ2 phase III Rio de Janeiro Q1 2018 500 22DE2 phase II Denver Q2 2018 475 28CU4 phase II Culpeper Q3 2018 775 34HO1 phase II Houston Q3 2018 600 31MI1 phase II Miami Q3 2018 1,100 59SP4 phase II São Paulo Q3 2018 450 15DC12 phase II Ashburn Q4 2018 1,500 54SV10 phase II San Jose Q4 2018 1,900 85SP3 phase II São Paulo Q4 2018 950 41 8,965 436EMEA: LD10 phase II London Q1 2018 1,420 63PA4 phase IV Paris Q1 2018 1,045 36AM2 phase III Amsterdam Q2 2018 400 15FR5 phase III Frankfurt Q2 2018 550 13FR6 phase II Frankfurt Q3 2018 1,325 37SK2 phase VI Stockholm Q3 2018 550 35AM7 phase II Amsterdam Q4 2018 925 55FR2 phase VI Frankfurt Q4 2018 1,250 103LD4 phase II London Q4 2018 1,075 39LD9 phase V London Q4 2018 1,550 72PA8 phase I Paris Q4 2018 875 73SO2 phase I Sofia Q4 2018 350 19FR5 phase IV Frankfurt Q1 2019 350 25LD7 phase I London Q2 2019 1,775 120LD10 phase III London Q2 2019 1,375 45 14,815 750Asia-Pacific: OS1 phase IV Osaka Q1 2018 500 10SH6 phase I Shanghai Q3 2018 400 31ME1 phase III Melbourne Q3 2018 375 10SG3 phase III Singapore Q3 2018 2,875 78HK2 phase V Hong Kong Q4 2018 925 41 5,075 170Total 28,855 $1,356ITEM 3. LEGAL PROCEEDINGSNone.ITEM 4. MINE SAFETY DISCLOSURENot applicable.35Table of ContentsPART IIITEM 5.MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OFEQUITY SECURITIESOur common stock is quoted on the NASDAQ Global Select Market under the symbol of "EQIX." Our common stock began trading in August 2000. Thefollowing table sets forth on a per share basis the low and high closing prices of our common stock as reported by the NASDAQ Global Select Market duringthe last two years. Low HighFiscal 2017 Fourth Fiscal Quarter$442.28 $492.98Third Fiscal Quarter418.43 474.42Second Fiscal Quarter399.11 444.97First Fiscal Quarter358.72 400.37 Low HighFiscal 2016 Fourth Fiscal Quarter$325.05 $373.22Third Fiscal Quarter355.01 389.45Second Fiscal Quarter319.89 387.73First Fiscal Quarter265.05 330.71As of January 31, 2018, we had 79,122,300 shares of our common stock outstanding held by approximately 280 registered holders. During the yearsended December 31, 2017 and 2016, we did not issue or sell any securities on an unregistered basis.Dividends and Special DistributionsIn September 2015, our Board of Directors declared a special distribution of $627.0 million, or approximately $10.95 per share (the "2015 SpecialDistribution"), to our common stockholders. The 2015 Special Distribution was paid on November 10, 2015 to our common stockholders of record as of theclose of business on October 8, 2015. Common stockholders had the option to elect to receive payment of the 2015 Special Distribution in the form of stockor cash, with the total cash payment to all stockholders limited to no more than 20% of the total distribution. The number of shares distributed wasdetermined based upon common stockholder elections and the average closing price of our common stock on the three trading days commencing onNovember 3, 2015 or $297.03 per share. As such, we issued 1.7 million shares of our common stock and paid $125.5 million in connection with the 2015Special Distribution.In connection with our conversion to a REIT effective January 1, 2015, we began paying quarterly dividends in 2015. On each of February 19, May 7,July 29, and October 28, 2015, our Board of Directors declared a quarterly cash dividend of $1.69 per share. On each of February 18, May 4, August 3 andNovember 2, 2016, our Board of Directors declared a quarterly cash dividend of $1.75 per share. On each of February 15, April 26, August 2 and November 1,2017, our Board of Directors declared a quarterly cash dividend of $2.00 per share. We expect to continue to pay regular cash dividends in order to satisfy therequired REIT tests to remain qualified for taxation as a REIT for US federal income tax purposes. For additional information, see "Dividends" in Note 11 ofour Notes to Consolidated Financial Statements in this Annual Report on Form 10-K.36Table of ContentsTax Treatment of DistributionsFor Federal income tax purposes, distributions to stockholders are treated as ordinary income, capital gains, return of capital or a combination thereof.For the years ended December 31, 2017 and 2016, the dividends and special distributions we paid were classified as follows:Record Date Payment Date Total Distribution NonqualifiedOrdinary Dividend Qualified OrdinaryDividend Return of Capital (per share)Fiscal 2017 2/27/2017 3/22/2017 $2.000000 $2.000000 $— $—5/24/2017 6/21/2017 2.000000 2.000000 — —8/23/2017 9/20/2017 2.000000 2.000000 — —11/15/2017 12/13/2017 2.000000 2.000000 — —Total $8.000000 $8.000000 $— $— Fiscal 2016 3/9/2016 3/23/2016 $1.750000 $1.231334 $0.518666 $—5/25/2016 6/15/2016 1.750000 1.231334 0.518666 —8/24/2016 9/14/2016 1.750000 1.231334 0.518666 —11/16/2016 12/14/2016 1.750000 1.231334 0.518666 —Total $7.000000 $4.925336 $2.074664 $—Stock Performance GraphThe graph set forth below compares the cumulative total stockholder return on Equinix’s common stock between December 31, 2012 and December 31,2017 with the cumulative total return of (i) the S&P 500 Index, (ii) the NASDAQ Composite Index and (iii) the FTSE NAREIT All REITs Index. The graphassumes the investment of $100.00 on December 31, 2012 in Equinix’s common stock and in each index, and assumes the reinvestment of dividends, if any.Equinix cautions that the stock price performance shown in the graph below is not indicative of, nor intended to forecast, the potential futureperformance of Equinix’s common stock.Notwithstanding anything to the contrary set forth in any of Equinix’s previous or future filings under the Securities Act of 1933, as amended, orSecurities Exchange Act of 1934, as amended, that might incorporate this Annual Report on Form 10-K or future filings made by Equinix under thosestatutes, the stock performance graph shall not be deemed filed with the Securities and Exchange Commission and shall not be deemed incorporated byreference into any of those prior filings or into any future filings made by Equinix under those statutes.37Table of ContentsCOMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN**$100 invested on 12/31/12 in stock or index, including reinvestment of dividends.Fiscal year ending December 31.38Table of ContentsITEM 6. SELECTED FINANCIAL DATAThe following consolidated statement of operations data for the five years ended December 31, 2017 and the consolidated balance sheet data as ofDecember 31, 2017, 2016, 2015, 2014 and 2013 have been derived from our audited consolidated financial statements and the related notes. Our historicalresults are not necessarily indicative of the results to be expected for future periods. The following selected consolidated financial data for the five yearsended December 31, 2017 and as of December 31, 2017, 2016, 2015, 2014 and 2013, should be read in conjunction with our audited consolidated financialstatements and the related notes in Item 8 of this Annual Report on Form 10-K and "Management’s Discussion and Analysis of Financial Condition andResults of Operations" in Item 7 of this Annual Report on Form 10-K. We completed acquisitions of the Zenium data center business in Istanbul and Itconicin October 2017, certain colocation business from Verizon in May 2017, the IO Acquisition in February 2017, certain Paris IBX data centers in August 2016(the "Paris IBX Data Center Acquisition"), Telecity Group plc in January 2016, Bit-isle in November 2015 and Nimbo Technologies Inc. ("Nimbo") inJanuary 2015. We also completed the acquisition of the 100% controlling equity interest in ALOG Data Centers do Brasil S.A. ("ALOG") in July 2014 and weacquired the Frankfurt Kleyer 90 carrier hotel in October 2013. We sold solar power assets of Bit-isle in November 2016 and eight of our IBX data centerslocated in the U.K., the Netherlands and Germany in July 2016. For further information on our acquisitions and divestitures during the three years endedDecember 31, 2017, refer to Note 2, Note 4 and Note 5 of our Notes to Consolidated Financial Statements in Item 8 of this Annual Report on Form 10-K. Years Ended December 31, 2017 2016 2015 2014 2013 (dollars in thousands, except per share data)Revenues$4,368,428 $3,611,989 $2,725,867 $2,443,776 $2,152,766Costs and operating expenses: Cost of revenues2,193,149 1,820,870 1,291,506 1,197,885 1,064,403Sales and marketing581,724 438,742 332,012 296,103 246,623General and administrative745,906 694,561 493,284 438,016 374,790Restructuring reversals— — — — (4,837)Acquisition costs38,635 64,195 41,723 2,506 10,855Impairment charges— 7,698 — — —Gain on asset sales— (32,816) — — —Total costs and operating expenses3,559,414 2,993,250 2,158,525 1,934,510 1,691,834Income from operations809,014 618,739 567,342 509,266 460,932Interest income13,075 3,476 3,581 2,891 3,387Interest expense(478,698) (392,156) (299,055) (270,553) (248,792)Other income (expense)9,213 (57,924) (60,581) 119 5,253Loss on debt extinguishment(65,772) (12,276) (289) (156,990) (108,501)Income from continuing operations before income taxes286,832 159,859 210,998 84,733 112,279Income tax expense (1)(53,850) (45,451) (23,224) (345,459) (16,156)Net income (loss) from continuing operations232,982 114,408 187,774 (260,726) 96,123Net income from discontinued operations, net of tax— 12,392 — — —Net income (loss)232,982 126,800 187,774 (260,726) 96,123Net (income) loss attributable to non-controlling interest— — — 1,179 (1,438)Net income (loss) attributable to Equinix$232,982 $126,800 $187,774 $(259,547) $94,685 Earnings per share ("EPS") attributable to Equinix: Basic EPS from continuing operations$3.03 $1.63 $3.25 $(4.96) $1.92Basic EPS from discontinued operations— 0.18 — — —Basic EPS$3.03 $1.81 $3.25 $(4.96) $1.92Weighted-average shares76,854 70,117 57,790 52,359 49,438Diluted EPS from continuing operations$3.00 $1.62 $3.21 $(4.96) $1.89Diluted EPS from discontinued operations— 0.17 — — —Diluted EPS$3.00 $1.79 $3.21 $(4.96) $1.89Weighted-average shares77,535 70,816 58,483 52,359 50,116Dividends per share (2)$8.00 $7.00 $17.71 $7.57 $—_______________________39Table of Contents(1)The increase in income tax expense from the year ended December 31, 2013 to the year ended December 31, 2014 was primarily attributed to the de-recognition of $324.1million of net deferred tax assets and deferred tax liabilities in December 2014, when our Board of Directors formally approved our conversion to a REIT and wereassessed the deferred tax assets and deferred tax liabilities of our U.S. operations included in the REIT structure.(2)During the year ended December 31, 2015, we paid $10.95 per share of special distribution and $6.76 per share of quarterly cash dividend. During the year endedDecember 31, 2014, we paid $7.57 per share of special distribution. Years Ended December 31, 2017 2016 2015 2014 2013Other Financial Data: (1) (2)(in thousands)Net cash provided by operating activities$1,439,233 $1,019,353 $894,823 $709,002 $604,608Net cash used in investing activities(5,400,826) (2,045,668) (637,797) (437,443) (1,169,313)Net cash provided by (used in) financing activities4,607,860 (897,065) 1,873,152 87,819 574,907_________________________(1)For a discussion of our primary non-GAAP financial metrics, see our non-GAAP financial measures discussion in "Management’s Discussion and Analysis of FinancialCondition and Results of Operations" in Item 7 of this Annual Report on Form 10-K.(2)These cash flow line items for the years ended December 31, 2016, 2015 and 2014 have been modified to reflect the adoption of ASU 2016-18 and ASU 2016-09. SeeNote 1 of Notes to Consolidated Financial Statements in Item 8 of this Annual Report on Form 10-K for further discussion. As of December 31, 2017 2016 2015 2014 2013Consolidated Balance Sheet Data:(in thousands)Cash, cash equivalents and short-term and long-term investments$1,450,031 $761,927 $2,246,297 $1,140,751 $1,030,092Accounts receivable, net576,313 396,245 291,964 262,570 184,840Property, plant and equipment, net9,394,602 7,199,210 5,606,436 4,998,270 4,591,650Total assets (1)18,691,457 12,608,371 10,356,695 7,781,978 7,457,039Capital lease and other financing obligations, excluding current portion1,620,256 1,410,742 1,287,139 1,168,042 914,032Mortgage and loans payable, excluding current portion (1)1,393,118 1,369,087 472,769 532,809 197,172Senior notes (1)6,923,849 3,810,770 3,804,634 2,717,046 2,220,911Convertible debt, excluding current portion (1)— — — 145,229 720,499Redeemable non-controlling interests— — — — 123,902Total stockholders' equity6,849,790 4,365,829 2,745,386 2,270,131 2,459,064_________________________(1)The company adopted ASU 2015-03 during the year ended December 31, 2015. As a result, debt issuance costs of $35.5 million and $35.3 million were reclassified fromother assets to debt as of December 31, 2014 and 2013, respectively.40Table of ContentsITEM 7.MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSThe following commentary should be read in conjunction with the financial statements and related notes contained elsewhere in this Annual Report onForm 10-K. The information in this discussion contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, asamended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such statements are based upon current expectations that involve risks anduncertainties. Any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements. For example, thewords "believes," "anticipates," "plans," "expects," "intends" and similar expressions are intended to identify forward-looking statements. Our actual resultsand the timing of certain events may differ significantly from the results discussed in the forward-looking statements. Factors that might cause such adiscrepancy include, but are not limited to, those discussed in "Liquidity and Capital Resources" and "Risk Factors" elsewhere in this Annual Report onForm 10-K. All forward-looking statements in this document are based on information available to us as of the date hereof and we assume no obligation toupdate any such forward-looking statements.Our management’s discussion and analysis of financial condition and results of operations is intended to assist readers in understanding our financialinformation from our management’s perspective and is presented as follows:•Overview•Results of Operations•Non-GAAP Financial Measures•Liquidity and Capital Resources•Contractual Obligations and Off-Balance-Sheet Arrangements•Critical Accounting Policies and Estimates•Recent Accounting PronouncementsIn February 2018, as more fully described in Note 17 of Notes to Consolidated Financial Statements in Item 8 of this Annual Report on Form 10-K, weentered into an agreement to acquire the Infomart Dallas, including its operations and tenants, from ASB Real Estate Investments. At the closing, we willdeliver $31.0 million in cash, subject to customary adjustments, and will issue $750.0 million aggregate principal amount of 5.000% senior unsecured notes.The transaction is expected to close in mid-2018, subject to satisfaction of closing conditions. We will account for this transaction as a business combinationusing the acquisition method of accounting.In December 2017, as more fully described in Note 2 of Notes to Consolidated Financial Statements in Item 8 of this Annual Report on Form 10-K, weentered into a transaction agreement to acquire the Metronode group of companies, for a cash purchase price of A$1.035 billion, or approximately $791.2million at the exchange rate in effect on December 15, 2017. The transaction is expected to close in the first half of 2018. We will account for this transactionas a business combination using the acquisition method of accounting.In December 2017, as more fully described in Note 10 of Notes to Consolidated Financial Statements in Item 8 of this Annual Report on Form 10-K, weissued €1,000.0 million in aggregate principal amount of 2.875% senior notes due February 1, 2026 (the "2026 Euro Senior Notes"), orapproximately $1,179.0 million in U.S. dollars, at the exchange rate in effect on December 12, 2017, and recorded debt issuance costs of $15.7 million. Wealso entered into a credit agreement in the aggregate principal amount of approximately $3,000.0 million ("Senior Credit Facility"), comprised of a $2,000.0million senior unsecured multi-currency revolving credit facility ("Revolving Facility") and an approximately $1,000.0 million senior unsecured multi-currency term loan facility, with maturity date of December 12, 2022 ("Term Loan Facility"). We borrowed £500.0 million and SEK 2,800.0 million under theterm loan facility on December 12, 2017, or approximately $997.1 million at the exchange rate in effect on that date. With the proceeds from the issuance ofthe 2026 Euro Senior Notes and borrowings under the Term Loan Facility and cash on hand, we terminated and prepaid in full the amounts outstanding underthe senior secured credit facility we entered in 2014 (the "2014 Senior Credit Facility"). As a result, we recognized a loss on debt extinguishment of $22.5million during the fourth quarter of 2017.In October 2017, as more fully described in Note 2 of Notes to Consolidated Financial Statements in Item 8 of this Annual Report on Form 10-K, weacquired Itconic, with 5 data centers in Spain and Portugal, for a cash purchase price of approximately €220.5 million, or $259.1 million at the exchange ratein effect on October 9, 2017 (the "Itconic Acquisition"). The Itconic Acquisition was accounted for using the acquisition method. The valuation and purchaseaccounting of this acquisition have not yet been finalized as of December 31, 2017.41Table of ContentsIn October 2017, as more fully described in Note 2 of Notes to Consolidated Financial Statements in Item 8 of this Annual Report on Form 10-K, weacquired the Zenium data center business in Istanbul for a cash purchase price of approximately $92.0 million. The acquired data center will be renamed asthe Istanbul 2 (or "IS2") data center. The acquisition of the Zenium data center will be accounted for using the acquisition method. The valuation andpurchase accounting of this acquisition have not yet been finalized as of December 31, 2017.In September 2017, as more fully described in Note 10 of Notes to Consolidated Financial Statements in Item 8 of this Annual Report on Form 10-K, weissued €1,000.0 million, or approximately $1,199.7 million in U.S. dollars, at the exchange rate in effect on September 20, 2017, in aggregate principalamount of 2.875% senior notes due October 1, 2025 (the "2025 Euro Senior Notes") and recorded debt issuance costs of $16.3 million. We used a portion ofthe net proceeds from the 2025 Euro Senior Notes to redeem our 4.875% senior notes with an aggregate principal amount of $500.0 million in September2017. As a result, we recognized a loss on debt extinguishment of $14.6 million during the third quarter of 2017.In August 2017, as more fully described in Note 11 of Notes to Consolidated Financial Statements in Item 8 of this Annual Report on Form 10-K, welaunched the ATM program, under which we may offer and sell shares of our common stock having an aggregate offering price of up to $750.0 million fromtime to time through our sales agents. Through December 31, 2017, we have sold 763,201 shares of common stock under the ATM program for net proceedsof approximately $355.1 million.In August 2017, as more fully described in Note 10 of Notes to Consolidated Financial Statements in Item 8 of this Annual Report on Form 10-K, weentered into a fourth amendment (the "Fourth Amendment") to our then existing 2014 Senior Credit Facility, where we modified various terms of interest ratesapplicable to loans borrowed under the Term Loan B Facility and Term B-2 Loan. We terminated and prepaid in full the amounts outstanding under our 2014Senior Credit Facility in December 2017.In May 2017, as more fully described in Note 2 of Notes to Consolidated Financial Statements in Item 8 of this Annual Report on Form 10-K, wecompleted the acquisition of certain colocation business from Verizon consisting of 29 data center buildings located in the United States, Brazil andColombia, for a cash purchase price of approximately $3.6 billion, which we funded with proceeds of debt and equity financings conducted in January andMarch 2017 as discussed below. The Verizon Data Center Acquisition was accounted for using the acquisition method. The fair value of the assets acquiredand liabilities assumed are currently being appraised by a third-party and have not yet been finalized as of December 31, 2017.In March 2017, as more fully described in Note 11 of Notes to Consolidated Financial Statements in Item 8 of this Annual Report on Form 10-K, weissued and sold 6,069,444 shares of our common stock in a public offering. We received net proceeds of approximately $2,126.3 million, after deductingunderwriting discounts, commissions and offering expenses.In March 2017, as more fully described in Note 10 of Notes to Consolidated Financial Statements in Item 8 of this Annual Report on Form 10-K, weissued $1,250.0 million aggregate principal amount of 5.375% senior notes due May 15, 2027 (the "2027 Senior Notes") and recorded debt issuance costs of$16.8 million.In February 2017, as more fully described in Note 2 of Notes to Consolidated Financial Statements in Item 8 of this Annual Report on Form 10-K, weacquired IO UK's data center operating business for a cash payment of approximately $36.3 million. The acquired facility was renamed as the London 10("LD10") data center. The IO Acquisition was accounted for using the acquisition method. As of December 31, 2017, we have finalized the allocation ofpurchase price for the IO Acquisition from the provisional amounts reported as of March 31, 2017.In January 2017, as more fully described in Note 10 of Notes to Consolidated Financial Statements in Item 8 of this Annual Report on Form 10-K, weborrowed the full amount of the Term B-2 Loan of €1,000.0 million, or approximately $1,059.8 million in U.S. dollars at the exchange rate in effect onJanuary 6, 2017. We prepaid in full the amounts outstanding under our Term B-2 Loan in December 2017.OverviewEquinix provides global data center offerings that protect and connect the world’s most valued information assets. Global enterprises, financial servicescompanies and content and network service providers rely upon Equinix's leading insight and data centers around the world for the safehousing of theircritical IT equipment and the ability to directly connect to the networks that enable today's information-driven economy. The Verizon Data CenterAcquisition, along with the acquisitions of Itconic, LD10 and IS2, expanded the Company's total global footprint to 190 IBX data centers across 48 marketsaround the world. Equinix offers the following solutions: (i) premium data center colocation, (ii) interconnection and (iii) exchange and outsourced ITinfrastructure solutions. As of December 31, 2017, we operated or had partner IBX data centers in Brazil, Canada, Colombia and throughout the U.S. in theAmericas region; Bulgaria, Finland, France, Germany, Ireland, Italy, the Netherlands, Poland, Portugal, Spain, Sweden,42Table of ContentsSwitzerland, Turkey, the United Arab Emirates and the United Kingdom in the EMEA region; and Australia, China, Hong Kong, Indonesia, Japan andSingapore in the Asia-Pacific region. Our data centers in 48 markets around the world are a global platform, which allows our customers to increase information and application deliveryperformance while significantly reducing costs. This global platform and the quality of our IBX data centers have enabled us to establish a critical mass ofcustomers. As more customers choose our IBX data centers, it benefits their suppliers and business partners to colocate with us as well, in order to gain the fulleconomic and performance benefits of our offerings. These partners, in turn, pull in their business partners, creating a "marketplace" for their services. Ourglobal platform enables scalable, reliable and cost-effective colocation, interconnection and traffic exchange that lowers overall cost and increasesflexibility. Our focused business model is built on our critical mass of customers and the resulting "marketplace" effect. This global platform, combined withour strong financial position, continues to drive new customer growth and bookings.Historically, our market has been served by large telecommunications carriers who have bundled telecommunications products and services with theircolocation offerings. The data center market landscape has evolved to include cloud computing/utility providers, application hosting providers and systemsintegrators, managed infrastructure hosting providers and colocation providers. More than 350 companies provide data center solutions in the U.S. alone.Each of these data center solutions providers can bundle various colocation, interconnection and network offerings and outsourced IT infrastructuresolutions. We are able to offer our customers a global platform that reaches 24 countries with proven operational reliability, improved applicationperformance, network choice and a highly scalable set of offerings.Our utilization rate represents the percentage of our cabinet space billing versus net sellable cabinet space available, taking into account powerlimitations. Our utilization rates were approximately 80%, excluding the Verizon Data Center, Paris IBX Data Center, Itconic, Zenium data center and IOacquisitions, as of December 31, 2017, and 81%, excluding the acquisitions of Telecity Group and Bit-isle, as of December 31, 2016. Excluding the impact ofIBX data center expansion projects that have opened during the last 12 months and acquisitions mentioned above, our utilization rate would have increasedto approximately 82% as of December 31, 2017. Our utilization rate varies from market to market among our IBX data centers across the Americas, EMEAand Asia-Pacific regions. We continue to monitor the available capacity in each of our selected markets. To the extent we have limited capacity available in agiven market, it may limit our ability for growth in that market. We perform demand studies on an ongoing basis to determine if future expansion is warrantedin a market. In addition, power and cooling requirements for most customers are growing on a per unit basis. As a result, customers are consumingan increasing amount of power per cabinet. Although we generally do not control the amount of power our customers draw from installed circuits, we havenegotiated power consumption limitations with certain high power-demand customers. This increased power consumption has driven us to build out our newIBX data centers to support power and cooling needs twice that of previous IBX data centers. We could face power limitations in our IBX data centers, eventhough we may have additional physical cabinet capacity available within a specific IBX data center. This could have a negative impact on the availableutilization capacity of a given IBX data center, which could have a negative impact on our ability to grow revenues, affecting our financial performance,operating results and cash flows.Strategically, we will continue to look at attractive opportunities to grow our market share and selectively improve our footprint and offerings. As wasthe case with our recent expansions and acquisitions, our expansion criteria will be dependent on a number of factors, such as demand from new and existingcustomers, quality of the design, power capacity, access to networks, capacity availability in the current market location, amount of incremental investmentrequired by us in the targeted property, lead-time to break even on a free cash flow basis and in-place customers. Like our recent expansions and acquisitions,the right combination of these factors may be attractive to us. Depending on the circumstances, these transactions may require additional capital expendituresfunded by upfront cash payments or through long-term financing arrangements in order to bring these properties up to Equinix standards. Property expansionmay be in the form of purchases of real property, long-term leasing arrangements or acquisitions. Future purchases, construction or acquisitions may becompleted by us or with partners or potential customers to minimize the outlay of cash, which can be significant.Our business is based on a recurring revenue model comprised of colocation and related interconnection and managed infrastructure offerings. Weconsider these offerings recurring because our customers are generally billed on a fixed and recurring basis each month for the duration of their contract,which is generally one to three years in length. Our recurring revenues have comprised more than 90% of our total revenues during the past three years. Inaddition, during any given quarter of the past three years, more than half of our monthly recurring revenue bookings came from existing customers,contributing to our revenue growth. Our largest customer accounted for approximately 3% of our recurring revenues for the years ended December 31, 2017,2016 and 2015. Our 50 largest customers accounted for approximately 37%, 36% and 34%, respectively, of our recurring revenues for the years endedDecember 31, 2017, 2016 and 2015.Our non-recurring revenues are primarily comprised of installation services related to a customer’s initial deployment and professional services that weperform. These services are considered to be non-recurring because they are billed typically once,43Table of Contentsupon completion of the installation or the professional services work performed. The majority of these non-recurring revenues are typically billed on the firstinvoice distributed to the customer in connection with their initial installation. However, revenues from installation services are deferred and recognizedratably over the period the customer is expected to benefit from the installation. Additionally, revenue from contract settlements, when a customer wishes toterminate their contract early, is generally recognized as the termination occurs, when no remaining related performance obligations exist and the customer isdeemed to be creditworthy, to the extent that the revenue has not previously been recognized. As a percentage of total revenues, we expect non-recurringrevenues to represent less than 10% of total revenues for the foreseeable future.The largest components of our cost of revenues are depreciation, rental payments related to our leased IBX data centers, utility costs, includingelectricity, bandwidth access, IBX data center employees’ salaries and benefits, including stock-based compensation, repairs and maintenance, supplies andequipment and security services. A majority of our cost of revenues is fixed in nature and should not vary significantly from period to period, unless weexpand our existing IBX data centers or open or acquire new IBX data centers. However, there are certain costs that are considered more variable in nature,including utilities and supplies that are directly related to growth in our existing and new customer base. We expect the cost of our utilities, specificallyelectricity, will generally increase in the future on a per-unit or fixed basis, in addition to the variable increase related to the growth in consumption by ourcustomers. In addition, the cost of electricity is generally higher in the summer months, as compared to other times of the year. To the extent we incurincreased utility costs, such increased costs could materially impact our financial condition, results of operations and cash flows. Furthermore, to the extentwe incur increased electricity costs as a result of either climate change policies or the physical effects of climate change, such increased costs could materiallyimpact our financial condition, results of operations and cash flows. Sales and marketing expenses consist primarily of compensation and related costs for sales and marketing personnel, including stock-basedcompensation, sales commissions, marketing programs, public relations, promotional materials and travel, as well as bad debt expense and amortization ofcustomer relationship intangible assets.General and administrative expenses consist primarily of salaries and related expenses, including stock-based compensation, accounting, legal and otherprofessional service fees, and other general corporate expenses, such as our corporate regional headquarters office leases and some depreciation expense.We expect our cost of revenues, sales and marketing expenses and general and administrative expenses to grow in absolute dollars in connection withour business growth. We may periodically see a higher cost of revenues as a percentage of revenue when a large expansion project opens or is acquired,before it starts generating any meaningful revenue. Furthermore, in relation to cost of revenues, we note that the Americas region has a lower cost of revenuesas a percentage of revenue than either EMEA or Asia-Pacific. This is due to both the increased scale and maturity of the Americas region, compared to eitherthe EMEA or Asia-Pacific region, as well as a higher cost structure outside of the Americas, particularly in EMEA. While we expect all three regions tocontinue to see lower cost of revenues as a percentage of revenues in future periods, we expect the trend that sees the Americas having the lowest cost ofrevenues as a percentage of revenues to continue. As a result, to the extent that revenue growth outside the Americas grows in greater proportion than revenuegrowth in the Americas, our overall cost of revenues as a percentage of revenues may increase in future periods. Sales and marketing expenses mayperiodically increase as a percentage of revenues as we continue to scale our operations by investing in sales and marketing initiatives to further increase ourrevenue, including the hiring of additional headcount and new product innovations. General and administrative expenses may also periodically increase as apercentage of revenues as we continue to scale our operations to support our growth.Taxation as a REITWe elected to be taxed as a REIT for federal income tax purposes beginning with our 2015 taxable year. As of December 31, 2017, our REIT structureincluded all of our data center operations in the U.S., Canada and Japan, and the data center operations in Europe with the exception of Bulgaria, Portugal,Spain and Turkey. Our data center operations in other jurisdictions are operated as taxable REIT subsidiaries.As a REIT, we generally are permitted to deduct from our federal taxable income the dividends we pay to our stockholders (including, for this purpose,the value of any deemed distributions attributable to anti-dilution adjustments made with respect to our 4.75% convertible subordinated notes prior to theirmaturity in 2016). The income represented by such dividends is not subject to federal income tax at the entity level but is taxed, if at all, at the stockholderlevel. Nevertheless, the income of our TRSs which hold our U.S. operations that may not be REIT compliant is subject, as applicable, to federal and statecorporate income tax. Likewise, our foreign subsidiaries continue to be subject to foreign income taxes in jurisdictions in which they hold assets or conductoperations, regardless of whether held or conducted through TRSs or through QRSs. We are also subject to a separate corporate income tax on any gainrecognized from a sale of a REIT asset where our basis in the asset is determined by reference to the basis of the asset in the hands of a C corporation (such as(i) an asset that we held as of the effective date of our REIT election, that is, January 1, 2015, or (ii) an asset held by us or a QRS following the liquidation orother conversion of a former44Table of ContentsTRS). This built-in-gains tax is generally applicable to any disposition of such an asset during the five-year period after the date we first owned the asset as aREIT asset (e.g., January 1, 2015 in the case of REIT assets we held at the time of our REIT conversion), to the extent of the built-in-gain based on the fairmarket value of such asset on the date we first held the asset as a REIT asset. If we fail to remain qualified for federal income tax as a REIT, we will be subjectto federal income tax at regular corporate tax rates. Even if we remain qualified for federal income tax as a REIT, we may be subject to some federal, state,local and foreign taxes on our income and property in addition to taxes owed with respect to our TRSs’ operations. In particular, while state income taxregimes often parallel the federal income tax regime for REITs, many states do not completely follow federal rules and some may not follow them at all.On March 22, June 21, September 20, and December 13, 2017, we paid quarterly cash dividends of $2.00 per share. We expected these quarterly andother applicable distributions to equal or exceed the taxable income that we recognized in 2017.On December 22, 2017, the United States enacted legislation commonly referred to as the Tax Cuts and Jobs Act ("TCJA") which contains manysignificant changes to the existing U.S. federal income tax laws. The TCJA retains the REIT regime, but contains many significant changes which impactREIT, particularly those with global operations. We are still analyzing the new tax legislation and assessing its impact. Based on our current assessment,which is subject to further interpretation and guidance on the new tax legislation, we believe we can continue to meet all the REIT compliance requirementsin the foreseeable future.We continue to monitor our REIT compliance in order to maintain our qualification for federal income tax as a REIT. For this and other reasons, asnecessary, we may convert some of our data center operations in other countries into the REIT structure in future periods.Results of OperationsOur results of operations for the year ended December 31, 2017 include the results of operations of the IO Acquisition from February 3, 2017, the VerizonData Center Acquisition from May 1, 2017, the Zenium data center acquisition from October 6, 2017 and the Itconic Acquisition from October 9, 2017. Ourresults of operations for the year ended December 31, 2016 include the results of operations of TelecityGroup from January 15, 2016 and the Paris IBX DataCenter Acquisition from August 1, 2016. Our results of operations for the year ended December 31, 2015 include the results of operations of the Nimbo andBit-isle acquisitions from January 15, 2015 and November 2, 2015, respectively.Discontinued OperationsWe present the results of operations associated with the TelecityGroup data centers that were divested in July 2016 as discontinued operations in ourconsolidated statement of operations for the year ended December 31, 2016. We did not have any discontinued operations activity during 2017 or 2015.45Table of ContentsYears ended December 31, 2017 and 2016Revenues. Our revenues for the years ended December 31, 2017 and 2016 were generated from the following revenue classifications and geographicregions (dollars in thousands): Years Ended December 31, % Change 2017 % 2016 % Actual ConstantCurrencyAmericas: Recurring revenues$2,062,352 47% $1,593,084 44% 29% 29%Non-recurring revenues110,408 3% 86,465 3% 28% 27% 2,172,760 50% 1,679,549 47% 29% 29%EMEA: Recurring revenues1,266,971 29% 1,106,652 31% 14% 15%Non-recurring revenues79,285 2% 64,687 1% 23% 23% 1,346,256 31% 1,171,339 32% 15% 15%Asia-Pacific: Recurring revenues790,797 18% 717,638 20% 10% 11%Non-recurring revenues58,615 1% 43,463 1% 35% 36% 849,412 19% 761,101 21% 12% 12%Total: Recurring revenues4,120,120 94% 3,417,374 95% 21% 21%Non-recurring revenues248,308 6% 194,615 5% 28% 28% $4,368,428 100% $3,611,989 100% 21% 21%Americas Revenues. Revenues for our Americas region for the year ended December 31, 2017 included approximately $359.1 million of revenuesattributable to the Verizon Data Center Acquisition. During the years ended December 31, 2017 and 2016, our revenues from the United States, the largestrevenue contributor in the Americas region for the periods, represented approximately 91% and 92%, respectively, of the regional revenues. Excludingrevenues attributable to the Verizon Data Center Acquisition, growth in Americas revenues was primarily due to (i) $34.5 million of revenue generated fromour recently-opened IBX data centers or IBX data center expansions in the Dallas, New York, Sao Paulo, Silicon Valley, Toronto and Washington, D.C. areasand (ii) an increase in orders from both our existing customers and new customers during the period. During the year ended December 31, 2017, the U.S.dollar was generally weaker relative to the Canadian dollar and Brazilian real than during the year ended December 31, 2016, resulting in approximately$11.4 million of favorable foreign currency impact on our Americas revenues during the year ended December 31, 2017 when compared to 2016 usingaverage exchange rates.EMEA Revenues. As compared to 2016, revenues for our EMEA region for the year ended December 31, 2017 include $47.2 million of incrementalrevenues from recently closed acquisitions including the TelecityGroup Acquisition, which closed on January 15, 2016, the Paris IBX Data CenterAcquisition, which closed in August 2016, the IO Acquisition, which closed in February 2017, and the Itconic and Zenium data center acquisitions, whichclosed in October 2017. Our revenues from the U.K., our largest revenue contributor in the EMEA region, represented 30% of regional revenues for the yearended December 31, 2017 compared to 32% of regional revenues for the year ended December 31, 2016. Excluding the acquisitions, our EMEA revenuegrowth was primarily due to (i) approximately $62.3 million of revenue from our recently-opened IBX data centers or IBX data center expansions in theAmsterdam, Dubai, Dublin, Frankfurt, Helsinki, London, Paris and Zurich metro areas and (ii) an increase in orders from both our existing customers and newcustomers during the period. During the year ended December 31, 2017, the impact of foreign currency fluctuations resulted in approximately $4.9 million ofnet unfavorable foreign currency impact to our EMEA revenues primarily due to a generally stronger U.S. dollar relative to the British pound during the yearended December 31, 2017 compared to the year ended December 31, 2016.Asia-Pacific Revenues. Our revenues from Japan, the largest revenue contributor in the Asia-Pacific region, represented approximately 34% and 35%,respectively, for the year ended December 31, 2017 and 2016. Our Asia-Pacific revenue growth was primarily due to (i) approximately $42.6 million ofrevenue generated from our recently-opened IBX data center expansions in the Hong Kong, Osaka and Sydney metro areas and (ii) an increase in orders fromboth our existing customers and new customers during the period. During the year ended December 31, 2017, the U.S. dollar was generally stronger relativeto the Japanese Yen46Table of Contentsthan during the year ended December 31, 2016, resulting in approximately $6.8 million of net unfavorable foreign currency impact to our Asia-Pacificrevenues during the year ended December 31, 2017 when compared to 2016 using average exchange rates.Cost of Revenues. Our cost of revenues for the years ended December 31, 2017 and 2016 were split among the following geographic regions (dollars inthousands): Years Ended December 31, % Change 2017 % 2016 % Actual ConstantCurrencyAmericas$958,845 44% $700,544 38% 37% 36%EMEA749,933 34% 653,766 36% 15% 15%Asia-Pacific484,371 22% 466,560 26% 4% 5%Total$2,193,149 100% $1,820,870 100% 20% 20% Years Ended December 31, 2017 2016Cost of revenues as a percentage of revenues: Americas 44% 42%EMEA 56% 56%Asia-Pacific 57% 61%Total 50% 50%Americas Cost of Revenues. Cost of revenues for our Americas region for the year ended December 31, 2017 included approximately $177.4 million ofcosts of revenues attributable to the Verizon Data Center Acquisition. Excluding the impact from the Verizon Data Center Acquisition, depreciation expensewas $273.0 million and $241.6 million, respectively, for the years ended December 31, 2017 and 2016. The growth in depreciation expense was primarilydue to our IBX expansion activity. In addition to the increase in depreciation expense, the increase in our Americas cost of revenues for the year endedDecember 31, 2017 compared to the year ended December 31, 2016 was primarily due to (i) $30.4 million of higher utilities, repairs and maintenance,property taxes, and other cost of sales in support of our business growth, and (ii) $13.2 million of higher compensation costs, including general salaries,bonuses and stock-based compensation (1,114 Americas cost of revenues employees, excluding the Verizon Data Center Acquisition, as of December 31,2017 versus 1,023 as of December 31, 2016). During the year ended December 31, 2017, the impact of foreign currency fluctuations resulted inapproximately $7.7 million of net unfavorable foreign currency impact to our Americas cost of revenues primarily due to a generally weaker U.S. dollarrelative to the Brazilian real and Canadian dollar during the year ended December 31, 2017 compared to the year ended December 31, 2016. We expectAmericas cost of revenues to increase as we continue to expand our business, including results from the newly acquired business from the Verizon DataCenter Acquisition.EMEA Cost of Revenues. As compared to 2016, cost of revenues for our EMEA region for the year ended December 31, 2017 included $36.7 million ofincremental cost of revenues attributable to recently closed acquisitions, including the TelecityGroup Acquisition that closed on January 15, 2016, the ParisIBX Data Center Acquisition that closed in August 2016, the IO Acquisition, which closed in February 2017, and the Itconic and Zenium data centeracquisitions, which closed in October 2017. Excluding cost of revenues attributable to these acquisitions, the increase in our EMEA cost of revenues wasprimarily due to (i) $25.5 million of higher utilities in support of our business growth, (ii) $16.4 million of higher other cost of sales, including third partyand managed service expenses, (iii) $10.7 million of higher depreciation expense and (iv) $7.2 million of higher compensation costs, including generalsalaries, bonuses and stock-based compensation (743 EMEA cost of revenues employees, excluding TelecityGroup employees, as of December 31, 2017versus 623 as of December 31, 2016). During the year ended December 31, 2017, the impact of foreign currency fluctuations resulted in approximately $2.7million of net favorable foreign currency impact to our EMEA cost of revenues, primarily due to a generally stronger U.S. dollar relative to the British poundduring the year ended December 31, 2017 compared to the year ended December 31, 2016. We expect EMEA cost of revenues to increase as we continue togrow our business and as a result of our acquisitions.Asia-Pacific Cost of Revenues. The increase in our Asia-Pacific cost of revenues was primarily due to (i) $16.7 million of higher utilities, rent, facilitycosts, consulting, bandwidth cost, custom service orders and repairs and maintenance costs in support of our business growth and (ii) $3.3 million of highercompensation costs, including general salaries, bonuses and stock-based compensation and headcount growth (828 Asia-Pacific cost of revenues employeesas of December 31, 2017 versus 787 as of December 31, 2016), partially offset by a decrease of $3.2 million in depreciation and accretion expenses. Duringthe year ended47Table of ContentsDecember 31, 2017, the U.S. dollar was generally stronger relative to the Japanese Yen than during the year ended December 31, 2016, resulting inapproximately $5.0 million of net favorable foreign currency impact to our Asia-Pacific cost of revenues in 2017. We expect Asia-Pacific cost of revenues toincrease as we continue to grow our business.Sales and Marketing Expenses. Our sales and marketing expenses for the years ended December 31, 2017 and 2016 were split among the followinggeographic regions (dollars in thousands): Years ended December 31, % Change 2017 % 2016 % Actual ConstantCurrencyAmericas$349,666 60% $230,900 53% 51% 51%EMEA153,811 26% 137,887 31% 12% 14%Asia-Pacific78,247 14% 69,955 16% 12% 13%Total$581,724 100% $438,742 100% 33% 33% Years Ended December 31, 2017 2016Sales and marketing expenses as a percentage of revenues: Americas16% 14%EMEA11% 12%Asia-Pacific9% 9%Total13% 12%Americas Sales and Marketing Expenses. The increase in our Americas sales and marketing expenses was primarily due to (i) $75.3 million ofamortization of the acquired intangible assets in connection with the Verizon Data Center Acquisition, (ii) $33.1 million of higher compensation costs,including sales compensation, general salaries, bonuses and stock-based compensation and headcount growth (608 Americas sales and marketing employees,including those from the Verizon Data Center Acquisition, as December 31, 2017, versus 553 as of December 31, 2016) and (ii) $4.1 million of higherconsulting expenses to support our growth. During the year ended December 31, 2017, the impact of foreign currency fluctuations to our Americas sales andmarketing expenses was not significant when compared to average exchange rates during the year ended December 31, 2016. We anticipate that we willcontinue to invest in Americas sales and marketing initiatives and expect our Americas sales and marketing expenses to continue to increase as we continueto grow our business, including the impact from the Verizon Data Center Acquisition.EMEA Sales and Marketing Expenses. The increase in the EMEA sales and marketing expense was primarily due to (i) $12.3 million of highercompensation costs, including sales compensation, general salaries, bonuses, stock-based compensation and headcount growth (378 EMEA sales andmarketing employees as of December 31, 2017 versus 349 as of December 31, 2016) and (ii) an increase of $1.8 million in depreciation and amortizationexpense, primarily due to acquisitions made during the current year. During the year ended December 31, 2017, the impact of foreign currency fluctuationsresulted in approximately $2.8 million of net favorable foreign currency impact to our EMEA sales and marketing expenses primarily due to a generallystronger U.S. dollar relative to the British pound during the year ended December 31, 2017 compared to the year ended December 31, 2016. Over the pastseveral years, we have been investing in our EMEA sales and marketing initiatives to further increase our revenue. These investments have included thehiring of additional headcount and new product innovation efforts.Asia-Pacific Sales and Marketing Expenses. The increase in the Asia-Pacific sales and marketing expense is primarily due to (i) $6.5 million of highercompensation costs, including sales compensation, general salaries, bonuses, stock-based compensation and a larger average headcount in 2017 as comparedto 2016 and (ii) $3.2 million of higher rent expense in support of our growth. For the year ended December 31, 2017, the impact of foreign currencyfluctuations to our Asia-Pacific sales and marketing expenses was not significant when compared to average exchange rates for the year ended December 31,2016. Over the past several years, we have been investing in our Asia-Pacific sales and marketing initiatives to further increase our revenue. Theseinvestments have included the hiring of additional headcount and new product innovation efforts.48Table of ContentsGeneral and Administrative Expenses. Our general and administrative expenses for the years ended December 31, 2017 and 2016 were split among thefollowing geographic regions (dollars in thousands): Years Ended December 31, % Change 2017 % 2016 % Actual ConstantCurrencyAmericas$472,942 63% $391,637 56% 21% 20%EMEA195,430 26% 228,310 33% (14)% (12)%Asia-Pacific77,534 11% 74,614 11% 4% 5%Total$745,906 100% $694,561 100% 7% 8% Years Ended December 31, 2017 2016General and Administrative expenses as a percentage of revenues: Americas22% 23%EMEA15% 19%Asia-Pacific9% 10%Total17% 19%Americas General and Administrative Expenses. The increase in our Americas general and administrative expenses was primarily due to (i) $35.5 millionof higher compensation costs, including general salaries, bonuses, stock-based compensation, and headcount growth (1,207 Americas general andadministrative employees, including those from the Verizon Data Center Acquisition, as of December 31, 2017 versus 934 as of December 31, 2016),(ii) $22.9 million of higher depreciation expense associated with certain systems, including revenue, data management and cloud exchange systems, toimprove our quote to order and billing processes and to support the integration and growth of our business and (iii) $16.6 million of higher office expenseand consulting cost to support our growth. During the year ended December 31, 2017, the impact of foreign currency fluctuations to our Americas generaland administrative expenses was not significant when compared to average exchange rates for the year ended December 31, 2016. Over the course of the pastyear, we have been investing in our Americas general and administrative functions to scale this region effectively for growth, which has included additionalinvestments in improving our back office systems. We expect our current efforts to improve our back office systems will continue over the next several years.Going forward, although we are carefully monitoring our spending, we expect Americas general and administrative expenses to increase as we continue tofurther scale our operations to support our growth, including these investments in our back office systems and investments to maintain our REITqualification. We also expect our Americas general and administrative expenses to increase as we continue to grow our business and as a result of the VerizonData Center Acquisition.EMEA General and Administrative Expenses. The decrease in our EMEA general and administrative expenses was primarily due to (i) $20.8 million oflower amortization expenses as a result of fully amortizing the TelecityGroup trade names during the current period and (ii) $8.4 million of lower consultingexpenses which was largely due to the completion of TelecityGroup integration activities in the current period. During the year ended December 31, 2017,the impact of foreign currency fluctuations resulted in approximately $5.7 million of net favorable foreign currency impact to our EMEA general andadministrative expenses primarily due to a generally stronger U.S. dollar relative to the British pound during the year ended December 31, 2017 compared tothe year ended December 31, 2016. Over the course of the past year, we have been investing in our EMEA general and administrative functions as a result ofour ongoing efforts to scale this region effectively for growth. Going forward, although we are carefully monitoring our spending, we expect our EMEAgeneral and administrative expenses to increase in future periods as we continue to scale our operations to support our growth.Asia-Pacific General and Administrative Expenses. The increase in our Asia-Pacific general and administrative expense was primarily due to $5.0million of higher compensation costs, including general salaries, bonuses, stock-based compensation and headcount growth (453 Asia-Pacific general andadministrative employees as of December 31, 2017 versus 358 as of December 31, 2016), partially offset by a $1.3 million decrease in rent, repair andmaintenance expense. For the year ended December 31, 2017, the impact of foreign currency fluctuations on our Asia-Pacific general and administrativeexpenses was not significant when compared to average exchange rates for the year ended December 31, 2016. Going forward, although we are carefullymonitoring our spending, we expect Asia-Pacific general and administrative expenses to increase as we continue to support our growth.Acquisition Costs. During the year ended December 31, 2017, we recorded acquisition costs totaling $38.6 million primarily in the Americas and EMEAregions, of which $28.5 million was related to the Verizon Data Center Acquisition during the year49Table of Contentsended December 31, 2017 attributable to the Americas region. During the year ended December 31, 2016, we recorded acquisition costs totaling $64.2million primarily in the EMEA region due to the acquisitions of Telecity and the Paris IBX Data Center, and to a lesser degree, to the Americas region.Impairment Charges. During the year ended December 31, 2016, we recorded impairment charges totaling $7.7 million in the Asia-Pacific regionrelating to assets held for sale. We did not have impairment charges during the year ended December 31, 2017.Gain on Asset Sales. During the year ended December 31, 2016, we recorded a gain on asset sales of $32.8 million primarily relating to the sale of theLD2 data center in the EMEA region and a parcel of land in San Jose in the Americas region. We did not have any gain on asset sales during the year endedDecember 31, 2017.Income from Operations. Our income from operations for the years ended December 31, 2017 and 2016 was split among the following geographicregions (dollars in thousands): Years Ended December 31, % Change 2017 % 2016 % Actual ConstantCurrencyAmericas$363,220 45% $352,180 57% 3% 3%EMEA237,854 29% 124,853 20% 91% 85%Asia-Pacific207,940 26% 141,706 23% 47% 47%Total$809,014 100% $618,739 100% 31% 30%Americas Income from Continuing Operations. Our Americas income from continuing operations did not change significantly year over year. Whilerevenues increased as described above, this was largely offset by (i) an increase of $18.6 million in acquisition costs, which was primarily related to theVerizon Data Center Acquisition, (ii) additional amortization of the acquired intangible assets resulted from the Verizon Data Center Acquisition and (iii)higher cost of revenues and sales and marketing expense as a percentage of revenues. The impact of foreign currency fluctuations on our Americas incomefrom continuing operations for the year ended December 31, 2017 was not significant when compared to the year ended December 31, 2016.EMEA Income from Continuing Operations. The increase in our EMEA income from continuing operations was primarily due to higher revenues as aresult of our IBX data center expansion activity and acquisitions, as described above, as well as lower operating expenses as a percentage of revenues, loweramortization costs as a result of fully amortizing the TelecityGroup trade names during the current period and lower acquisition costs incurred for the yearended December 31, 2017. We incurred $9.2 million of acquisition costs during the year ended December 31, 2017, as compared to $54.5 million ofacquisition costs during the year ended December 31, 2016, which was primarily related to our acquisition of TelecityGroup. During the year endedDecember 31, 2017, the impact of foreign currency fluctuations resulted in approximately $6.4 million of net favorable foreign currency impact to our EMEAincome from continuing operations primarily due to a generally weaker U.S. dollar relative to the Euro during the year ended December 31, 2017 comparedto the year ended December 31, 2016.Asia-Pacific Income from Continuing Operations. The increase in our Asia-Pacific income from continuing operations was primarily due to higherrevenues as result of our IBX data center expansion activity and organic growth as described above and lower cost of revenues as a percentage of revenues.The impact of foreign currency fluctuations on our Asia-Pacific income from continuing operations for the year ended December 31, 2017 was not significantwhen compared to average exchange rates of the year ended December 31, 2016.Interest Income. Interest income was $13.1 million and $3.5 million for the years ended December 31, 2017 and 2016, respectively. The increase ininterest income was driven by higher cash balances and interest yield rates for the year ended December 31, 2017. The average yield for the year endedDecember 31, 2017 was 0.64% versus 0.37% for the year ended December 31, 2016.Interest Expense. Interest expense increased to $478.7 million for the year ended December 31, 2017 from $392.2 million for the year endedDecember 31, 2016. The increase in interest expense was primarily due to the Term B-2 Loan borrowings of €1.0 billion and the issuance of $1.25 billion of2027 Senior Notes in March 2017, as well as additional financings such as various capital lease and other financing obligations to support our expansionprojects. During the years ended December 31, 2017 and 2016, we capitalized $22.6 million and $13.3 million, respectively, of interest expense toconstruction in progress. We expect to incur higher interest expense going forward in connection with the additional indebtedness that we incurred during2017.50Table of ContentsOther Income (Expense). We recorded net other income of $9.2 million and net expense of $57.9 million for the years ended December 31, 2017 and2016, respectively, primarily due to foreign currency exchange gains and losses during the periods, including $63.5 million in foreign currency lossesrecognized in the first quarter of 2016 as a result of completing the acquisition of TelecityGroup.Loss on Debt Extinguishment. We recorded $65.8 million net loss on debt extinguishment during the year ended December 31, 2017 comprised of (i)$14.6 million of loss on debt extinguishment from the early redemption of the 4.875% Senior Notes due 2020, (ii) $13.2 million of loss on debtextinguishment from the early redemption of the Term B-2 Loan, (iii) $9.3 million of loss on debt extinguishment as a result of the redemption of the Term BLoans, (iv) $16.7 million loss on debt extinguishment as a result of amendments to leases and other financing obligations related to built-to-suitearrangements and (v) $12.0 million of loss on debt extinguishment as a result of the settlement of financing obligations of properties purchased. During theyear ended December 31, 2016, we recorded a $12.3 million loss on debt extinguishment as a result of the settlement of the financing obligations for ourParis 3 IBX data center, a portion of the lender fees associated with the Japanese Yen Term Loan, and the prepayment and termination of our 2012 and 2013Brazil financings.Income Taxes. We operate as a REIT for federal income tax purposes. As a REIT, we are generally not subject to federal income taxes on our taxableincome distributed to stockholders. We intend to distribute or have distributed the entire taxable income generated by the operations of our REIT and QRSsfor the years ended December 31, 2017 and December 31, 2016, respectively. As such, other than built-in-gains recognized and withholding taxes, noprovision for U.S. income taxes for the REIT and QRSs has been included in the accompanying consolidated financial statements for the years endedDecember 31, 2017 and 2016.We have made TRS elections for some of our subsidiaries in and outside the U.S. In general, a TRS may provide services that would otherwise beconsidered impermissible for REITs to provide and may hold assets that REITs cannot hold directly. U.S. income taxes for the TRS entities located in the U.S.and foreign income taxes for our foreign operations regardless of whether the foreign operations are operated as QRSs or TRSs have been accrued, asnecessary, for the years ended December 31, 2017 and 2016.For the years ended December 31, 2017 and 2016, we recorded $53.9 million and $45.5 million of income tax expenses, respectively. Our effective taxrates were 18.8% and 28.4%, respectively, for the years ended December 31, 2017 and 2016. The decrease in the effective tax rate in 2017 as compared to2016 is primarily due to recognition of unrecognized tax benefits related to our tax positions in the U.S. and Brazil as a result of a lapse in statutes oflimitations and lower amount of non-deductible expenses within our EMEA operations. This is partially offset by net deferred tax asset remeasurement in theU.S. TRS due to the corporate income tax rate reduction from 35% to 21% effective January 1, 2018 as a result of the TCJA.Adjusted EBITDA. Adjusted EBITDA is a key factor in how we assess the operating performance of our segments and develop regional growth strategiessuch as IBX data center expansion decisions. We define adjusted EBITDA as income or loss from operations plus depreciation, amortization, accretion, stock-based compensation expense, restructuring charges, impairment charges, acquisition costs and gain on asset sales. See "Non-GAAP Financial Measures"below for more information about adjusted EBITDA and a reconciliation of adjusted EBITDA to income or loss from operations. Our adjusted EBITDA forthe years ended December 31, 2017 and 2016 was split among the following geographic regions (dollars in thousands): Years Ended December 31, % Change 2017 % 2016 % Actual Constant CurrencyAmericas$1,034,694 51% $787,311 47% 31% 31%EMEA582,697 28% 494,263 30% 18% 17%Asia-Pacific434,650 21% 375,900 23% 16% 16%Total$2,052,041 100% $1,657,474 100% 24% 24%Americas Adjusted EBITDA. The increase in our Americas adjusted EBITDA was primarily due to the Verizon Data Center Acquisition, higher revenuesas result of our IBX data center expansion activity and organic growth as described above. During the year ended December 31, 2017, currency fluctuationsresulted in approximately $4.5 million of net favorable foreign currency impact on our Americas adjusted EBITDA primarily due to the U.S. dollar beinggenerally weaker relative to the Canadian dollar and Brazilian real during the year ended December 31, 2017 compared to the year ended December 31,2016.EMEA Adjusted EBITDA. The increase in our EMEA adjusted EBITDA was primarily due to higher revenues as a result of our IBX data center expansionactivity and organic growth as described above and lower operating expenses as a percentage of revenues. During the year ended December 31, 2017,currency fluctuations resulted in approximately $2.1 million of net favorable51Table of Contentsforeign currency impact to our EMEA adjusted EBITDA primarily due to a generally weaker U.S. dollar relative to the Euro during the year endedDecember 31, 2017 compared to the year ended December 31, 2016.Asia-Pacific Adjusted EBITDA. The increase in our Asia-Pacific adjusted EBITDA was primarily due to higher revenues as a result of our IBX data centerexpansion activity and organic growth, as described above, and lower cost of revenues as a percentage of revenues. During the year ended December 31,2017, the U.S. dollar was generally stronger relative to the Japanese Yen than during the year ended December 31, 2016, resulting in approximately $2.7million of net unfavorable foreign currency impact to our Asia-Pacific revenues during the year ended December 31, 2017 when compared to averageexchange rates during the year ended December 31, 2016.Years Ended December 31, 2016 and 2015Revenues. Our revenues for the years ended December 31, 2016 and 2015 were generated from the following revenue classifications and geographicregions (dollars in thousands): Years Ended December 31, % Change 2016 % 2015 % Actual ConstantCurrencyAmericas: Recurring revenues$1,593,084 44% $1,432,084 52% 11% 12%Non-recurring revenues86,465 3% 80,451 3% 7% 8% 1,679,549 47% 1,512,535 55% 11% 11%EMEA: Recurring revenues1,106,652 31% 651,778 24% 70% 75%Non-recurring revenues64,687 1% 47,029 2% 38% 42% 1,171,339 32% 698,807 26% 68% 72%Asia-Pacific: Recurring revenues717,638 20% 485,279 18% 48% 46%Non-recurring revenues43,463 1% 29,246 1% 49% 46% 761,101 21% 514,525 19% 48% 46%Total: Recurring revenues3,417,374 95% 2,569,141 94% 33% 34%Non-recurring revenues194,615 5% 156,726 6% 24% 25% $3,611,989 100% $2,725,867 100% 33% 34%Americas Revenues. During the years ended December 31, 2016 and 2015, our revenues from the United States, the largest revenue contributor in theAmericas region for the periods, represented approximately 92% and 93%, respectively, of the regional revenues. Growth in Americas revenues was primarilydue to (i) $28.9 million of revenue generated from our recently-opened IBX data centers or IBX data center expansions in the Atlanta, Chicago, Dallas,Silicon Valley and Washington, D.C. metro areas and (ii) an increase in orders from both our existing customers and new customers during the period. Duringthe year ended December 31, 2016, the U.S. dollar was generally stronger relative to the Canadian dollar and Brazilian real than during the year endedDecember 31, 2015, resulting in approximately $6.6 million of unfavorable foreign currency impact on our Americas revenues during the year endedDecember 31, 2016 compared to average exchange rates during the year ended December 31, 2015.EMEA Revenues. Revenues for our EMEA region for the year ended December 31, 2016 include $404.1 million of revenues attributable toTelecityGroup, which closed in January 2016, and the Paris IBX Data Center Acquisition, which closed in August 2016. After our acquisition ofTelecityGroup, the U.K. continues to be our largest revenue contributor in the EMEA region, providing 32% of regional revenues for the year endedDecember 31, 2016 compared to 37% of regional revenues for the year ended December 31, 2015. Our EMEA revenue growth was primarily due to (i) $404.1million of revenues attributable to TelecityGroup and the Paris IBX Data Center Acquisition, (ii) approximately $49.7 million of revenue from our recently-opened IBX data centers or IBX data center expansions in the Amsterdam, Frankfurt, Paris and Zurich metro areas and (iii) an increase in orders from both ourexisting customers and new customers during the period. During the year ended December 31, 2016, the impact of foreign currency fluctuations resulted inapproximately $33.5 million of net unfavorable foreign currency impact to our EMEA revenues52Table of Contentsprimarily due to a generally stronger U.S. dollar relative to the British pound during the year ended December 31, 2016 compared to the year endedDecember 31, 2015.Asia-Pacific Revenues. Revenues for our Asia-Pacific region for the year ended December 31, 2016 include $148.7 million of revenues attributable toBit-isle, which closed in November 2015. After our acquisition of Bit-isle, Japan is our largest revenue contributor in the Asia-Pacific region, providing 35%of regional revenues including Bit-isle for the year ended December 31, 2016 compared to 20% for the year ended December 31, 2015. Excluding revenuesattributable to Bit-isle, our revenues from Singapore, which was our largest revenue contributor in the Asia-Pacific region before we acquired Bit-isle,represented approximately 38% and 39%, respectively, of the regional revenues for the years ended December 31, 2016 and December 31, 2015. Our Asia-Pacific revenue growth was primarily due to (i) $148.7 million of revenues attributable to Bit-isle, (ii) approximately $58.2 million of revenue generated fromour recently-opened IBX data center expansions in the Hong Kong, Melbourne, Shanghai, Singapore, Sydney and Tokyo metro areas and (iii) an increase inorders from both our existing customers and new customers during the period. During the year ended December 31, 2016, the U.S. dollar was generallyweaker relative to the Japanese Yen than during the year ended December 31, 2015, resulting in approximately $7.5 million of net favorable foreign currencyimpact to our Asia-Pacific revenues during the year ended December 31, 2016 when compared to average exchange rates during the year ended December 31,2015.Cost of Revenues. Our cost of revenues for the years ended December 31, 2016 and 2015 were split among the following geographic regions (dollars inthousands): Years Ended December 31, % Change 2016 % 2015 % Actual ConstantCurrencyAmericas$700,544 38% $637,604 49% 10% 11%EMEA653,766 36% 350,270 27% 87% 91%Asia-Pacific466,560 26% 303,632 24% 54% 52%Total$1,820,870 100% $1,291,506 100% 41% 42% Years Ended December 31, 2016 2015Cost of revenues as a percentage of revenues: Americas42% 42%EMEA56% 50%Asia-Pacific61% 59%Total50% 47%Americas Cost of Revenues. Our Americas cost of revenues for the years ended December 31, 2016 and 2015 included $241.6 million and $219.1million, respectively, of depreciation expense. The growth in depreciation expense was primarily due to our IBX expansion activity. In addition to theincrease in depreciation expense, the increase in our Americas cost of revenues for the year ended December 31, 2016 compared to the year endedDecember 31, 2015 was primarily due to (i) $22.9 million of higher utilities, rent and facilities costs, office expense, consulting, and repairs and maintenancein support of our business growth, (ii) $10.1 million of higher costs primarily due to custom service orders in support of our revenue growth and (iii) $4.5million of higher compensation costs, including general salaries, bonuses and stock-based compensation. During the year ended December 31, 2016, theimpact of foreign currency fluctuations resulted in approximately $4.9 million of net favorable foreign currency impact to our Americas cost of revenuesprimarily due to a generally stronger U.S. dollar relative to the Brazilian real and Canadian dollar during the year ended December 31, 2016 compared to theyear ended December 31, 2015.EMEA Cost of Revenues. Cost of revenues for our EMEA region for the year ended December 31, 2016 included $273.5 million of cost of revenuesattributable to TelecityGroup, which closed in January 2016, and the Paris IBX Data Center Acquisition, which closed in August 2016. Excluding cost ofrevenues attributable to TelecityGroup and the Paris IBX Data Center Acquisition, EMEA cost of revenues was $380.3 million for the year endedDecember 31, 2016 compared to $350.3 million for the year ended December 31, 2015. Depreciation expense, excluding TelecityGroup and the Paris IBXData Center Acquisition, was $100.8 million and $97.8 million for the years ended December 31, 2016 and 2015, respectively. The growth in depreciationexpense was primarily due to our IBX data center expansion activity. Excluding the impact of TelecityGroup and the Paris IBX Data Center Acquisition, theremaining increase in our EMEA cost of revenues was primarily due to (i) $16.4 million of higher utilities,53Table of Contentsconsulting, and repairs and maintenance costs in support of our business growth, (ii) $4.7 million of higher compensation costs, including general salaries,bonuses and stock-based compensation and headcount growth (623 EMEA cost of revenues employees, excluding TelecityGroup employees, as ofDecember 31, 2016 versus 541 as of December 31, 2015), (iii) $8.3 million of other costs primarily related to the impact from cash flow hedges, offset by $4.0million of lower rent and facilities costs. During the year ended December 31, 2016, the impact of foreign currency fluctuations resulted in approximately$13.6 million of net favorable foreign currency impact to our EMEA cost of revenues, primarily due to a generally stronger U.S. dollar relative to the Britishpound during the year ended December 31, 2016 compared to the year ended December 31, 2015.Asia-Pacific Cost of Revenues. Cost of revenues for our Asia-Pacific region included $116.0 million and $17.4 million of cost of revenues attributable toBit-isle, which closed in November 2015, for the years ended December 31, 2016 and 2015, respectively. Excluding cost of revenues attributable to Bit-isle,Asia-Pacific cost of revenues was $350.6 million for Asia-Pacific for the year ended December 31, 2016 compared to $286.2 million for the year endedDecember 31, 2015. Depreciation expense, excluding Bit-isle, was $149.5 million and $116.9 million for the years ended December 31, 2016 and 2015,respectively. The growth in depreciation expense was primarily due to our IBX data center expansion activity. Excluding the impact of our acquisition ofBit-isle, the remaining increase in our Asia-Pacific cost of revenues was primarily due to (i) $26.0 million of higher utilities, rent, facility costs, consulting,custom service orders, repairs and maintenance costs in support of our business growth and (ii) $4.5 million of higher compensation costs, including generalsalaries, bonuses and stock-based compensation and headcount growth (431 Asia-Pacific cost of revenues employees as of December 31, 2016 versus 390 asof December 31, 2015, excluding Bit-isle employees in both periods). During the year ended December 31, 2016, the U.S. dollar was generally weakerrelative to the Japanese Yen than during the year ended December 31, 2015, resulting in approximately $5.6 million of net unfavorable foreign currencyimpact to our Asia-Pacific cost of revenues during the year ended December 31, 2016 when compared to average exchange rates during the year endedDecember 31, 2015.Sales and Marketing Expenses. Our sales and marketing expenses for the years ended December 31, 2016 and 2015 were split among the followinggeographic regions (dollars in thousands): Years Ended December 31, % Change 2016 % 2015 % Actual ConstantCurrencyAmericas$230,900 53% $208,310 63% 11% 11%EMEA137,887 31% 71,871 22% 92% 98%Asia-Pacific69,955 16% 51,831 15% 35% 34%Total$438,742 100% $332,012 100% 32% 34% Years Ended December 31, 2016 2015Sales and marketing expenses as a percentage of revenues: Americas14% 14%EMEA12% 10%Asia-Pacific9% 10%Total12% 12%Americas Sales and Marketing Expenses. The increase in our Americas sales and marketing expenses was primarily due to (i) $16.4 million of highercompensation costs, including sales compensation, general salaries, bonuses and stock-based compensation and headcount growth (553 Americas sales andmarketing employees as December 31, 2016 versus 497 as of December 31, 2015) and (ii) $7.9 million of higher advertising, promotion, consulting andtravel expenses to support our growth. During the year ended December 31, 2016, the impact of foreign currency fluctuations to our Americas sales andmarketing expenses was not significant when compared to average exchange rates during the year ended December 31, 2015.EMEA Sales and Marketing Expenses. Sales and marketing expenses for our EMEA region for the year ended December 31, 2016 included $53.0 millionattributable to TelecityGroup, which closed in January 2016. Excluding the impact of TelecityGroup, our EMEA sales and marketing expenses were $84.9million for the year ended December 31, 2016 compared to $71.9 million for the year ended December 31, 2015. The increase was primarily due to (i) $6.5million of higher compensation costs, including sales compensation, general salaries, bonuses, stock-based compensation and headcount growth (283 EMEAsales and marketing employees, excluding TelecityGroup employees, as of December 31, 2016 versus 227 as of December 31, 2015), and (ii) $4.0 million ofhigher advertising, promotion, consulting, and other marketing expenses to support our growth. During the year ended54Table of ContentsDecember 31, 2016, the impact of foreign currency fluctuations resulted in approximately $4.8 million of net favorable foreign currency impact to our EMEAsales and marketing expenses primarily due to a generally stronger U.S. dollar relative to the British pound during the year ended December 31, 2016compared to the year ended December 31, 2015.Asia-Pacific Sales and Marketing Expenses. Sales and marketing expenses for our Asia-Pacific region included $15.6 million and $2.2 million of salesand marketing expenses attributable to Bit-isle, which closed in November 2015, for the years ended December 31, 2016 and 2015, respectively. Excludingthe impact of Bit-isle, our Asia-Pacific sales and marketing expenses were $54.4 million for the year ended December 31, 2016 compared to $49.6 million forthe year ended December 31, 2015. The increase was primarily due to $4.9 million of higher compensation costs, including sales compensation, generalsalaries, bonuses, stock-based compensation and headcount growth (205 Asia-Pacific sales and marketing employees as of December 31, 2016 versus 183 asof December 31, 2015, excluding Bit-isle employees in both periods). For the year ended December 31, 2016, the impact of foreign currency fluctuations toour Asia-Pacific sales and marketing expenses was not significant when compared to average exchange rates for the year ended December 31, 2015.General and Administrative Expenses. Our general and administrative expenses for the years ended December 31, 2016 and 2015 were split among thefollowing geographic regions (dollars in thousands): Years Ended December 31, % Change 2016 % 2015 % Actual ConstantCurrencyAmericas$391,637 56% $347,421 70% 13% 13%EMEA228,310 33% 92,803 19% 146% 157%Asia-Pacific74,614 11% 53,060 11% 41% 40%Total$694,561 100% $493,284 100% 41% 43% Years Ended December 31, 2016 2015General and Administrative expenses as a percentage of revenues: Americas23% 23%EMEA19% 13%Asia-Pacific10% 10%Total19% 18%Americas General and Administrative Expenses. The increase in our Americas general and administrative expenses was primarily due to (i) $17.5 millionof higher depreciation expense associated with certain systems to improve our quote to order and billing processes and other systems to support theintegration and growth of our business, (ii) $16.0 million of higher compensation costs, including general salaries, bonuses, stock-based compensation, andheadcount growth (934 Americas general and administrative employees as of December 31, 2016 versus 800 as of December 31, 2015) and (iii) $10.7 millionof higher office expense, rent and facility cost and outside services consulting costs also in line with our overall growth. During the year ended December 31,2016, the impact of foreign currency fluctuations to our Americas general and administrative expenses was not significant when compared to averageexchange rates for the year ended December 31, 2015.EMEA General and Administrative Expenses. General and administrative expenses for our EMEA region for the year ended December 31, 2016 included$92.7 million attributable to TelecityGroup, which closed in January 2016, and the Paris IBX Data Center Acquisition, which closed in August 2016.Excluding the impact of TelecityGroup and the Paris IBX Data Center Acquisition, our EMEA general and administrative expenses were $135.6 million forthe year ended December 31, 2016 compared to $92.8 million for the year ended December 31, 2015. Excluding the impact of TelecityGroup and the ParisIBX Data Center Acquisition, the increase was primarily due to (i) $22.8 million of higher consulting services, travel, office and rent and facility costs tosupport the integration of TelecityGroup and (ii) $18.0 million of higher compensation costs, including general salaries, bonuses, stock-based compensationand headcount growth (562 EMEA general and administrative employees, excluding TelecityGroup employees, as of December 31, 2016 versus 420 as ofDecember 31, 2015). During the year ended December 31, 2016, the impact of foreign currency fluctuations resulted in approximately $10.1 million of netfavorable foreign currency impact to our EMEA general and administrative expenses primarily due to a generally stronger U.S. dollar relative to the Britishpound during the year ended December 31, 2016 compared to the year ended December 31, 2015. The increase in EMEA general and administrativeexpenses as a percentage of revenue is primarily due to an increase in amortization expense of $43.9 million associated with the TelecityGroup acquiredintangibles.55Table of ContentsAsia-Pacific General and Administrative Expenses. General and administrative expenses for our Asia-Pacific region included $17.4 million and $5.8million of general and administrative expenses attributable to Bit-isle, which closed in November 2015, for the years ended December 31, 2016 and 2015,respectively. Excluding the impact of Bit-isle, our Asia-Pacific general and administrative expenses were $57.2 million for the year ended December 31,2016, as compared to $47.3 million for the year ended December 31, 2015. Excluding the impact of Bit-isle, the increase was primarily due to $8.5 million ofhigher compensation costs, including general salaries, bonuses, stock-based compensation and headcount growth (317 Asia-Pacific general andadministrative employees as of December 31, 2016 versus 266 as of December 31, 2015, excluding Bit-isle employees in both periods). For the year endedDecember 31, 2016, the impact of foreign currency fluctuations to our Asia-Pacific general and administrative expenses was not significant when comparedto average exchange rates of the year ended December 31, 2015.Acquisition Costs. During the year ended December 31, 2016, we recorded acquisition costs totaling $64.2 million primarily attributed to the EMEAregion due to the acquisitions of Telecity and the Paris IBX Data Center. During the year ended December 31, 2015, we recorded acquisition costs totaling$41.7 million primarily attributed to the EMEA region, and to a lesser degree, to the Asia-Pacific region.Impairment Charges. During the year ended December 31, 2016, we recorded impairment charges totaling $7.7 million in the Asia-Pacific regionrelating to assets held for sale. We did not have impairment charges during the year ended December 31, 2015.Gain on Asset Sales. During the year ended December 31, 2016, we recorded a gain on asset sales of $32.8 million primarily relating to the sale of theLD2 data center in the EMEA region and a parcel of land in San Jose in the Americas region. We did not have any gain on asset sales during the year endedDecember 31, 2015.Income from Operations. Our income from operations for the years ended December 31, 2016 and 2015 were split among the following geographicregions (dollars in thousands): Years Ended December 31, % Change 2016 % 2015 % Actual ConstantCurrencyAmericas$352,180 57% $324,458 57% 9% 9%EMEA124,853 20% 145,527 26% (14)% (11)%Asia-Pacific141,706 23% 97,357 17% 46% 44%Total$618,739 100% $567,342 100% 9% 10%Americas Income from Continuing Operations. The increase in our Americas income from continuing operations was due to higher revenues as result ofour IBX data center expansion activity and organic growth as described above as well as the gain recognized on the sale of the San Jose land parcel, partiallyoffset by higher cost of revenues and operating expenses primarily attributable to higher compensation and other headcount related expenses to support ourgrowth. The impact of foreign currency fluctuations on our Americas income from continuing operations for the year ended December 31, 2016 was notsignificant when compared to average exchange rates of the year ended December 31, 2015.EMEA Income from Continuing Operations. The decrease in our EMEA income from continuing operations was primarily due to acquisition andintegration costs incurred in connection with our acquisition of TelecityGroup, which closed in January 2016, as well as the increased depreciation andamortization created from the purchase accounting for TelecityGroup and the Paris IBX Data Center Acquisition, partially offset by the gain recognized onthe sale of the LD2 data center. During the year ended December 31, 2016, the impact of foreign currency fluctuations resulted in approximately $5.2 millionof net unfavorable foreign currency impact to our EMEA income from continuing operations primarily due to a generally stronger U.S. dollar relative to theBritish pound during the year ended December 31, 2016 compared to the year ended December 31, 2015.Asia-Pacific Income from Continuing Operations. The increase in our Asia-Pacific income from continuing operations was primarily due to higherrevenues as a result of our acquisition and integration of Bit-isle, which closed in November 2015, as well as our IBX data center expansion activity andorganic growth as described above, partially offset by the impairment charges, higher cost of revenues and operating expenses primarily attributable to ouracquisition of Bit-isle as well as higher compensation and other headcount related expenses and higher professional fees to support our growth. The impact offoreign currency fluctuations on our Asia-Pacific income from continuing operations for the year ended December 31, 2016 was not significant whencompared to average exchange rates of the year ended December 31, 2015.56Table of ContentsInterest Income. Interest income was $3.5 million and $3.6 million for the years ended December 31, 2016 and 2015, respectively. The average yield forthe year ended December 31, 2016 was 0.37% versus 0.38% for the year ended December 31, 2015.Interest Expense. Interest expense increased to $392.2 million for the year ended December 31, 2016 from $299.1 million for the year endedDecember 31, 2015. This increase in interest expense was primarily due to the impact of our $1.1 billion of senior notes issued in December 2015, $614.7million outstanding in seven-year term loans we borrowed in January 2016 and $406.6 million outstanding in five-year term loans we borrowed in October2016, replacing a bridge term loan facility we borrowed to finance our acquisition of Bit-isle, which closed in November 2015, as well as additionalfinancings such as various capital lease and other financing obligations to support our expansion projects. The increase in interest expense is partially offsetby the settlement of the 4.75% convertible debt in June 2016. During the years ended December 31, 2016 and 2015, we capitalized $13.3 million and $10.9million, respectively, of interest expense to construction in progress. Going forward, we expect to incur higher interest expense as we borrowed the €1.0billion Term B-2 Loan in January 2017. We also expect to incur additional indebtedness to support our growth and acquisition opportunities including theVerizon Asset Purchase, resulting in higher interest expense going forward.Other Income (Expense). We recorded net other expense of $57.9 million and $60.6 million for the years December 31, 2016 and 2015, respectively,primarily due to foreign currency exchange losses during the periods.Loss on Debt Extinguishment. During the year ended December 31, 2016, we recorded a $12.3 million loss on debt extinguishment as a result of thesettlement of the financing obligations for our Paris 3 IBX data center, a portion of the lender fees associated with the Japanese Yen Term Loan, and theprepayment and termination of our 2012 and 2013 Brazil financings. During the year ended December 31, 2015, we recorded a $0.3 million loss on debtextinguishment which was attributable to partial conversions of our 4.75% convertible subordinated notes in December 2015.Income Taxes. For the years ended December 31, 2016 and 2015, we recorded $45.5 million and $23.2 million of income tax expenses, respectively. Oureffective tax rates were 28.4% and 11.0%, respectively, for the years ended December 31, 2016 and 2015. The increase in the effective tax rate in 2016 ascompared to 2015 is primarily due to higher profits in the domestic TRS and larger amount of non-deductible interest expenses within our EMEA operations.We recorded excess income tax benefits of $2.8 million and $30.0 thousand during the years ended December 31, 2016 and 2015, respectively, inadditional paid-in capital in our consolidated balance sheets.Adjusted EBITDA. Adjusted EBITDA is a key factor in how we assess the operating performance of our segments and develop regional growth strategiessuch as IBX data center expansion decisions. We define adjusted EBITDA as income or loss from operations plus depreciation, amortization, accretion, stock-based compensation expense, restructuring charges, impairment charges, acquisition costs and gain on asset sales. See "Non-GAAP Financial Measures"below for more information about adjusted EBITDA and a reconciliation of adjusted EBITDA to income or loss from operations. Our adjusted EBITDA forthe years ended December 31, 2016 and 2015 was split among the following geographic regions (dollars in thousands): Years Ended December 31, % Change 2016 % 2015 % Actual ConstantCurrencyAmericas$787,311 47% $698,604 55% 13% 13%EMEA494,263 30% 318,561 25% 55% 59%Asia-Pacific375,900 23% 254,462 20% 48% 46%Total$1,657,474 100% $1,271,627 100% 30% 31%Americas Adjusted EBITDA. The increase in our Americas adjusted EBITDA was due to higher revenues as result of our IBX data center expansionactivity and organic growth as described above. During the year ended December 31, 2016, currency fluctuations resulted in approximately $2.2 million ofnet unfavorable foreign currency impact on our Americas adjusted EBITDA primarily due to the generally stronger U.S. dollar relative to the Brazilian realand Canadian dollar during the year ended December 31, 2016 compared to the year ended December 31, 2015.EMEA Adjusted EBITDA. Adjusted EBITDA for our EMEA region includes $189.0 million of adjusted EBITDA attributable to our acquisition ofTelecityGroup, which closed in January 2016, and the Paris IBX Data Center Acquisition, which closed in August 2016. Excluding adjusted EBITDAattributable to TelecityGroup and the Paris IBX Data Center Acquisition, the decrease in our EMEA adjusted EBITDA was primarily due to higher operatingcosts as result of our IBX data center expansion activity and organic growth as described above and integration costs relating to TelecityGroup acquisition.During the year ended57Table of ContentsDecember 31, 2016, currency fluctuations resulted in approximately $10.7 million of net unfavorable foreign currency impact to our EMEA adjustedEBITDA primarily due to a generally stronger U.S. dollar relative to the British pound during the year ended December 31, 2016 compared to the year endedDecember 31, 2015.Asia-Pacific Adjusted EBITDA. Adjusted EBITDA for our Asia-Pacific region includes $50.3 million and $5.2 million of adjusted EBITDA attributableto our acquisition of Bit-isle, which closed in November 2015, for the years ended December 31, 2016 and 2015, respectively. Excluding adjusted EBITDAattributable to Bit-isle, the increase in our Asia-Pacific adjusted EBITDA was primarily due to higher revenues as result of our IBX data center expansionactivity and organic growth as described above. During the year ended December 31, 2016, the U.S. dollar was generally weaker relative to the Japanese Yenthan during the year ended December 31, 2015, resulting in approximately $4.1 million of net favorable foreign currency impact to our Asia-Pacific revenuesduring the year ended December 31, 2016 when compared to average exchange rates during the year ended December 31, 2015.Non-GAAP Financial MeasuresWe provide all information required in accordance with GAAP, but we believe that evaluating our ongoing operating results may be difficult if limited toreviewing only GAAP financial measures. Accordingly, we use non-GAAP financial measures to evaluate our operations.Non-GAAP financial measures are not a substitute for financial information prepared in accordance with GAAP. Non-GAAP financial measures shouldnot be considered in isolation, but should be considered together with the most directly comparable GAAP financial measures and the reconciliation of thenon-GAAP financial measures to the most directly comparable GAAP financial measures. We have presented such non-GAAP financial measures to provideinvestors with an additional tool to evaluate our operating results in a manner that focuses on what management believes to be our core, ongoing businessoperations. We believe that the inclusion of these non-GAAP financial measures provides consistency and comparability with past reports and provides abetter understanding of the overall performance of the business and ability to perform in subsequent periods. We believe that if we did not provide such non-GAAP financial information, investors would not have all the necessary data to analyze Equinix effectively.Investors should note that the non-GAAP financial measures used by us may not be the same non-GAAP financial measures, and may not be calculated inthe same manner, as those of other companies. Investors should therefore exercise caution when comparing non-GAAP financial measures used by us tosimilarly titled non-GAAP financial measures of other companies.Our primary non-GAAP financial measures, adjusted EBITDA and adjusted funds from operations ("AFFO"), exclude depreciation expense as thesecharges primarily relate to the initial construction costs of our IBX data centers and do not reflect our current or future cash spending levels to support ourbusiness. Our IBX data centers are long-lived assets and have an economic life greater than 10 years. The construction costs of an IBX data center do not recurwith respect to such data center, although we may incur initial construction costs in future periods with respect to additional IBX data centers, and futurecapital expenditures remain minor relative to our initial investment. This is a trend we expect to continue. In addition, depreciation is also based on theestimated useful lives of our IBX data centers. These estimates could vary from actual performance of the asset, are based on historical costs incurred to buildout our IBX data centers and are not indicative of current or expected future capital expenditures. Therefore, we exclude depreciation from our operatingresults when evaluating our operations.In addition, in presenting adjusted EBITDA and AFFO, we exclude amortization expense related to acquired intangible assets. Amortization expense issignificantly affected by the timing and magnitude of our acquisitions and these charges may vary in amount from period to period. We exclude amortizationexpense to facilitate a more meaningful evaluation of our current operating performance and comparisons to our prior periods. We exclude accretion expense,both as it relates to asset retirement obligations as well as accrued restructuring charge liabilities, as these expenses represent costs which we believe are notmeaningful in evaluating our current operations. We exclude stock-based compensation expense, as it can vary significantly from period to period based onshare price, the timing, size and nature of equity awards. As such, we, and many investors and analysts, exclude stock-based compensation expense tocompare our operating results with those of other companies. We also exclude restructuring charges. The restructuring charges relate to our decisions to exitleases for excess space adjacent to several of our IBX data centers, which we did not intend to build out, or our decision to reverse such restructuring charges.We also exclude impairment charges related to certain long-lived assets. The impairment charges are related to expense recognized whenever events orchanges in circumstances indicate that the carrying amount of long-lived assets are not recoverable. We also exclude gain or loss on asset sales as itrepresents profit or loss that is not meaningful in evaluating the current or future operating performance. Finally, we exclude acquisition costs from AFFO andadjusted EBITDA to allow more comparable comparisons of our financial results to our historical operations. The acquisition costs relate to costs we incur inconnection with business combinations. Such charges generally are not relevant to assessing the long-term performance of the company. In addition, thefrequency and amount of such charges vary significantly58Table of Contentsbased on the size and timing of the acquisitions. Management believes items such as restructuring charges, impairment charges, gain or loss on asset sales andacquisition costs are non-core transactions; however, these types of costs may occur in future periods.Adjusted EBITDAWe define adjusted EBITDA as income or loss from operations plus depreciation, amortization, accretion, stock-based compensation expense,restructuring charges, impairment charges, acquisition costs, and gain on asset sales as presented below (in thousands): Years Ended December 31, 2017 2016 2015Income from operations$809,014 $618,739 $567,342Depreciation, amortization, and accretion expense1,028,892 843,510 528,929Stock-based compensation expense175,500 156,148 133,633Acquisition costs38,635 64,195 41,723Impairment charges— 7,698 —Gain on asset sales— (32,816) —Adjusted EBITDA$2,052,041 $1,657,474 $1,271,627Our adjusted EBITDA results have improved each year and in each region in total dollars due to the improved operating results discussed earlier in"Results of Operations", as well as the nature of our business model consisting of a recurring revenue stream and a cost structure which has a large base that isfixed in nature also discussed earlier in "Overview".Funds from Operations ("FFO") and AFFOWe use FFO and AFFO, which are non-GAAP financial measures commonly used in the REIT industry. FFO is calculated in accordance with thestandards established by the National Association of Real Estate Investment Trusts ("NAREIT"). FFO represents net income (loss), excluding gain (loss) fromthe disposition of real estate assets, depreciation and amortization on real estate assets and adjustments for unconsolidated joint ventures’ and non-controlling interests’ share of these items.We use AFFO to evaluate our performance on a consolidated basis and as a metric in the determination of employees’ annual bonuses beginning in 2015and vesting of restricted stock units that were granted beginning in 2015 and that have both service and performance conditions. In presenting AFFO, weexclude certain items that we believe are not good indicators of our current or future operating performance. AFFO represents FFO excluding depreciationand amortization expense on non-real estate assets, accretion, stock-based compensation, restructuring charges, impairment charges, acquisition costs, aninstallation revenue adjustment, a straight-line rent expense adjustment, amortization of deferred financing costs, gain (loss) on debt extinguishment, anincome tax expense adjustment, recurring capital expenditures and adjustments for unconsolidated joint ventures' and noncontrolling interests’ share of theseitems and net income (loss) from discontinued operations, net of tax. The adjustments for both installation revenue and straight-line rent expense areintended to isolate the cash activity included within the straight-lined or amortized results in the consolidated statement of operations. We exclude theamortization of deferred financing costs as these expenses relate to the initial costs incurred in connection with debt financings that have no current or futurecash obligations. We exclude gain (loss) on debt extinguishment since it generally represents the write-off of initial costs incurred in connection with debtfinancings or a cost that is incurred to reduce future interest costs and is not a good indicator of our current or future operating performance. We include anincome tax expense adjustment, which represents the non-cash tax impact due to changes in valuation allowances, uncertain tax positions and deferred taxesthat do not relate to current period’s operations. We deduct recurring capital expenditures, which represent expenditures to extend the useful life of its IBXdata centers or other assets that are required to support current revenues. We also exclude net income (loss) from discontinued operations, net of tax, whichrepresents results that may not recur and are not a good indicator of our current future operating performance.59Table of ContentsOur FFO and AFFO were as follows (in thousands): Years Ended December 31, 2017 2016 2015Net income$232,982 $126,800 $187,774Adjustments: Real estate depreciation and amortization754,351 626,564 439,969(Gain) loss on disposition of real estate property4,945 (28,388) 1,382Adjustments for FFO from unconsolidated joint ventures85 113 113NAREIT FFO attributable to common stockholders$992,363 $725,089 $629,238 Years Ended December 31, 2017 2016 2015NAREIT FFO attributable to common stockholders$992,363 $725,089 $629,238Adjustments: Installation revenue adjustment24,496 20,161 35,498Straight-line rent expense adjustment8,925 7,700 7,931Amortization of deferred financing costs24,449 18,696 16,135Stock-based compensation expense175,500 156,149 133,633Non-real estate depreciation expense111,121 87,781 58,165Amortization expense177,008 122,862 27,446Accretion expense (adjustment)(13,588) 6,303 3,349Recurring capital expenditures(167,995) (141,819) (120,281)Loss on debt extinguishment65,772 12,276 289Acquisition costs38,635 64,195 41,723Impairment charges— 7,698 —Net income from discontinued operations, net of tax— (12,392) —Income tax expense adjustment371 3,680 (1,270)Adjustments for AFFO from unconsolidated joint ventures(17) (40) (58)AFFO$1,437,040 $1,078,339 $831,798Our AFFO results have improved due to the improved operating results discussed earlier in "Results of Operations," as well as due to the nature of ourbusiness model which consists of a recurring revenue stream and a cost structure which has a large base that is fixed in nature as discussed earlier in"Overview."Constant Currency PresentationOur revenues and certain operating expenses (cost of revenues, sales and marketing and general and administrative expenses) from our internationaloperations have represented and will continue to represent a significant portion of our total revenues and certain operating expenses. As a result, our revenuesand certain operating expenses have been and will continue to be affected by changes in the U.S. dollar against major international currencies such as theEuro, British pound, Japanese yen, Singapore dollar, Australian dollar and Brazilian real. In order to provide a framework for assessing how each of ourbusiness segments performed excluding the impact of foreign currency fluctuations, we present period-over-period percentage changes in our revenues andcertain operating expenses on a constant currency basis in addition to the historical amounts as reported. Presenting constant currency results of operations isa non-GAAP financial measure and is not meant to be considered in isolation or as an alternative to GAAP results of operations. However, we have presentedthis non-GAAP financial measure to provide investors with an additional tool to evaluate our operating results. To present this information, our current andcomparative prior period revenues and certain operating expenses from entities reporting in currencies other than the U.S. dollar are converted into U.S.dollars at constant exchange rates rather than the actual exchange rates in effect during the respective periods (i.e. average rates in effect for the year endedDecember 31, 2016 are used as exchange rates for the year ended December 31, 2017 when comparing the year ended December 31, 2017 with the year endedDecember 31, 2016, and average rates in effect for the year ended December 31,60Table of Contents2015 are used as exchange rates for the year ended December 31, 2016 when comparing the year ended December 31, 2016 with the year ended December 31,2015).Liquidity and Capital ResourcesAs of December 31, 2017, our total indebtedness was comprised of debt and financing obligations totaling approximately $10.2 billion consisting of (a)approximately $7,002.0 million of principal from our senior notes, (b) approximately $1,699.0 million from our capital lease and other financing obligationsand (c) $1,468.3 million of principal from our mortgage and other loans payable (gross of debt issuance cost, debt discount, plus debt premium).We believe we have sufficient cash, coupled with anticipated cash generated from operating activities, to meet our operating requirements, includingrepayment of the current portion of our debt as it becomes due, payment of regular dividend distributions and completion of our publicly-announcedexpansion projects. As of December 31, 2017, we had $1,450.0 million of cash, cash equivalents and short-term and long-term investments, of whichapproximately $929.3 million was held in the U.S. In addition to our cash and investment portfolio, we have additional liquidity available to us from our$2,000.0 million Revolving Facility and the ATM program described below. On May 1, 2017, we completed the acquisition of Verizon's colocation datacenters and their operations located in the United States, Brazil and Colombia for a cash purchase price of approximately $3,594.7 million. The Verizon DataCenter Acquisition was funded by the borrowing of our then existing €1,000.0 million Term B-2 Loan and proceeds from the issuance of our $1,250.0million 2027 Senior Notes and the issuance of common stock. During the three months ended March 31, 2017, we borrowed the full amount of our €1,000.0million Term B-2 Loan (see Note 10 of Notes to Consolidated Financial Statements in Item 8 of this Annual Report on Form 10-K), issued $1,250.0 million of5.375% senior notes due 2027 (see Note 10 of Notes to Consolidated Financial Statements in Item 8 of this Annual Report on Form 10-K) and sold 6,069,444shares of common stock in a public offering for net proceeds of $2,126.3 million (see Note 11 of Notes to Consolidated Financial Statements in Item 8 of thisAnnual Report on Form 10-K).In August 2017, we entered into an equity distribution agreement to sell up to $750.0 million of common stock in at the market ("ATM") offerings. Forthe year ended December 31, 2017, we sold 763,201 shares for approximately $355.1 million, net of payment of commissions to the sales agents andestimated equity offering costs under the ATM program.In September 2017, we issued €1,000.0 million 2025 Euro Senior Notes and redeemed the entire $500.0 million principal amount of our 4.875% SeniorNotes due 2020. In December 2017, we issued €1,000.0 million 2026 Euro Senior Notes and entered into a credit agreement with a group of lenders for a$3,000.0 million Senior Credit Facility, comprised of a $2,000.0 million Revolving Facility and approximately a $1,000.0 million Term Loan Facility. Weborrowed £500.0 million and SEK 2,800.0 million under the Term Loan Facility on December 12, 2017, or approximately $997.1 million at the exchangerate in effect on that date. Using the proceeds borrowed from the Term Loan Facility and the €1,000.0 million 2026 Euro Senior Notes and cash on hand, weterminated and repaid in full amounts outstanding under the 2014 Senior Credit Facility.As of December 31, 2017, we had 41 irrevocable letters of credit totaling $62.6 million issued and outstanding under the Revolving Facility; as a resultof these letters of credit, we had a total of approximately $1,937.4 million of additional liquidity available to us under the Revolving Facility. Besides anyfurther financing activity we may pursue, customer collections are our primary source of cash. While we believe we have a strong customer base, and havecontinued to experience relatively strong collections, if the current market conditions were to deteriorate, some of our customers may have difficulty payingus and we may experience increased churn in our customer base, including reductions in their commitments to us, all of which could have a material adverseeffect on our liquidity. Additionally, we may pursue additional expansion opportunities, primarily the build out of new IBX data centers, in certain of ourexisting markets which are at or near capacity within the next year, as well as potential acquisitions. While we expect to fund these plans with our existingresources, additional financing, either debt or equity, may be required, and if current market conditions were to deteriorate, we may be unable to secureadditional financing or any such additional financing may only be available to us on unfavorable terms. An inability to pursue additional expansionopportunities will have a material adverse effect on our ability to maintain our desired level of revenue growth in future periods.We completed our conversion to a REIT in 2014 and began operating as a REIT effective January 1, 2015. As a result of our conversion to a REIT, wemade special distributions to our stockholders in 2015 and 2014. The distributions were payable in common stock or cash at the election of our stockholders,with the cash portion of the distributions subject to certain maximum amounts. As a result of the special distributions, we paid a total of $125.5 million in2015 and $83.3 million in 2014 and distributed 1.7 million and 1.5 million shares of common stock in 2015 and 2014, respectively. Also as a result of ourconversion to a REIT, we began paying quarterly dividends in 2015. We paid an aggregate of $621.5 million and $499.5 million of quarterly cash dividendsduring 2017 and 2016, respectively, and $521.5 million of quarterly cash dividends and special distribution during 2015.61Table of ContentsSources and Uses of Cash Years Ended December 31, 2017 2016 2015 (in thousands)Net cash provided by operating activities$1,439,233 $1,019,353 $894,823Net cash used in investing activities(5,400,826) (2,045,668) (637,797)Net cash provided by (used in) financing activities4,607,860 (897,065) 1,873,152Operating ActivitiesOur cash provided by our operations is generated by colocation, interconnection, managed infrastructure and other revenues. Our primary use of cashfrom our operating activities include compensation and related costs, interest payments, other general corporate expenditures and taxes. The increase in netcash provided by operating activities during 2017 compared to 2016 was primarily due to improved operating results combined with incremental operatingcash provided by the Verizon Data Center Acquisition and other acquisitions in 2017, offset by timing of collections on our receivables and increases in cashpaid for cost of revenues, operating expenses, interest expense and income taxes. The increase in net cash provided by operating activities during 2016compared to 2015 was primarily due to improved operating results combined with incremental operating cash provided by the acquisition of TelecityGroupin January 2016 and inclusion of full year operating results of Bit-isle.Investing ActivitiesThe increase in net cash used in investing activities during 2017 compared to 2016 was primarily due to the increase in spending for businessacquisitions of approximately of $2,196.7 million, primarily related to the Verizon Data Center Acquisition, a decrease in proceeds from asset sales of $803.8million, $265.4 million of higher capital expenditures and $67.0 million of higher purchases of real estate, primarily as a result of expansion activity. Theincrease in net cash used in investing activities during 2016 compared to 2015 was primarily due to the increase in spending for the acquisitions ofTelecityGroup and the Paris IBX Data Center of $1,521.4 million, net of cash acquired, over prior year acquisition spending, a decrease in sales andmaturities of investments, net of purchases, of $503.3 million and $245.2 million of higher capital expenditures, primarily a result of expansion activity. Thiswas partially offset by proceeds from sales of assets of $851.6 million, net of cash transferred.During 2018, we expect to complete the acquisitions of Metronode and the Infomart Dallas. We also anticipate our IBX expansion construction activitywill increase from our 2017 levels. If the opportunity to expand is greater than planned and we have sufficient funding to pursue such expansionopportunities, we may further increase the level of capital expenditures to support this growth as well as pursue additional business acquisitions, propertyacquisitions or joint ventures.Financing ActivitiesNet cash provided by financing activities during 2017 was primarily due to (i) borrowings under our €1,000.0 million Term B-2 Loan, approximately$1,059.8 million at the exchange rate in effect on January 6, 2017, (ii) the issuance of $1,250.0 million 2027 Senior Notes, (iii) the issuance of €1,000.0million 2025 Euro Senior Notes, approximately $1,199.7 million at the exchange rate on September 20, 2017, (iv) the issuance of €1,000.0 million 2026Euro Senior Notes, approximately $1,179.0 million at the exchange rate on December 12, 2017, (v) borrowings under our Term Loan Facility ofapproximately $997.1 million on December 12, 2017, at the exchange rate in effect on that day, (vi) the sale of common stock for net proceeds of $2,481.4million and (vii) proceeds from employee awards of $41.7 million, partially offset by (i) repayment of the entire $500.0 million principal amount of our4.875% Senior Notes due 2020 (ii) repayment in full of amounts outstanding under the 2014 Senior Credit Facility of approximately $2,207.7 million intotal at the exchange rate on December 12, 2017, (iii) dividend distributions of $621.5 million, (iv) repayments of capital lease and other financingobligations of $93.5 million and (v) debt issuance costs of $81.0 million. Net cash used in financing activities during 2016 was primarily due to (i) $1,462.9million repayment of loans payable including repayment of loans assumed in the TelecityGroup acquisition, bridge term loan and revolving credit facility,(ii) $114.4 million repayment of capital lease and other financing obligations and (iii) $499.5 million payment of dividends, partially offset by (iv) $1,168.3million of proceeds from loans payable including proceeds from our Term Loan B and Japanese Yen Term Loan. Net cash provided by financing activitiesduring 2015 was primarily due to (i) $1,100.0 million of gross proceeds from the senior notes offering in December 2015, (ii) $829.5 million of net proceedsfrom our public offering of common stock in November 2015, (iii) $1,197.1 million of proceeds from loans payable including proceeds from our term loanmodification, our bridge term loan and our revolving credit facility, partially offset by (iv) $715.3 million repayment of mortgage and loans payableincluding repayment of $171.2 million of loans assumed in the Bit-isle acquisition and repayment of $544.1 million of U.S. dollar-denominated term loanand other mortgage and loan payments, (v) $396.0 million of quarterly dividend distributions and (vi) $125.5 million of special distributions. Going forward,we expect that our financing activities will consist primarily of repayment and refinancing62Table of Contentsof our debt and additional financings needed to support expansion opportunities, additional acquisitions or joint ventures, and the payment of our regularcash dividends.Debt ObligationsDebt FacilitiesWe have various debt obligations with maturity dates ranging from 2018 to 2027 under which a total principal balance of $8,470.3 million remainedoutstanding (gross of debt issuance cost and discounts) as of December 31, 2017. For further information on debt obligations, see "Debt Facilities" in Note 10of Notes to Consolidated Financial Statements in Item 8 of this Annual Report on Form 10-K.Capital Lease and Other Financing ObligationsWe have numerous capital lease and other financing obligations with maturity dates ranging from 2018 to 2053 under which a total principal balance of$1,699.0 million remained outstanding as of December 31, 2017 with a weighted average effective interest rate of 7.86%. For further information on ourcapital leases and other financing obligations, see "Capital Lease and Other Financing Obligations" in Note 9 of Notes to Consolidated Financial Statementsin Item 8 of this Annual Report on Form 10-K.Contractual Obligations and Off-Balance-Sheet ArrangementsWe lease a majority of our IBX data centers and certain equipment under non-cancelable lease agreements expiring through 2065. The followingrepresents our debt maturities, financings, leases and other contractual commitments as of December 31, 2017 (in thousands): 2018 2019 2020 2021 2022 Thereafter TotalSenior notes (1)$— $— $— $— $750,000 $6,252,000 $7,002,000Term loans and other loanspayable (1)64,472 77,309 77,237 387,762 857,402 4,093 1,468,275Interest (2)342,886 353,152 351,897 349,754 323,925 852,118 2,573,732Capital lease and other financingobligations (3)201,910 182,262 182,085 182,050 182,379 1,687,514 2,618,200Operating leases (4)176,789 164,711 154,329 144,706 140,451 1,132,964 1,913,950Other contractual commitments (5)823,764 69,466 20,965 17,929 18,621 201,043 1,151,788Asset retirement obligations (6)1,716 12,357 6,741 3,516 11,794 62,415 98,539 $1,611,537 $859,257 $793,254 $1,085,717 $2,284,572 $10,192,147 $16,826,484_________________________(1)Represents principal and premium only.(2)Represents interest on mortgage payable, senior notes, term loan facilities and other loans payable based on their approximate interest rates as of December 31, 2017, aswell as the credit facility fee for the revolving credit facility.(3)Represents principal and interest.(4)Represents minimum operating lease payments, excluding potential lease renewals.(5)Represents unaccrued contractual commitments. Other contractual commitments are described below.(6)Represents liability, net of future accretion expense.In connection with certain of our leases and other contracts requiring deposits, we entered into 41 irrevocable letters of credit totaling $62.6 millionunder the revolving credit facility. These letters of credit were provided in lieu of cash deposits. If the landlords for these IBX leases decide to draw down onthese letters of credit triggered by an event of default under the lease, we will be required to fund these letters of credit either through cash collateral orborrowing under the revolving credit facility. These contingent commitments are not reflected in the table above.We had accrued liabilities related to uncertain tax positions totaling approximately $57.5 million as of December 31, 2017. These liabilities, which arereflected on our balance sheet, are not reflected in the table above since it is unclear when these liabilities will be paid.Primarily as a result of our various IBX data center expansion projects, as of December 31, 2017, we were contractually committed for $508.2 million ofunaccrued capital expenditures, primarily for IBX equipment not yet delivered and labor not yet provided in connection with the work necessary to completeconstruction and open these IBX data centers prior to making them available to customers63Table of Contentsfor installation. This amount, which is expected to be paid during 2018 and thereafter, is reflected in the table above as "other contractual commitments."We had other non-capital purchase commitments in place as of December 31, 2017, such as commitments to purchase power in select locations and otheropen purchase orders, which contractually bind us for goods or services to be delivered or provided during 2018 and beyond. Such other purchasecommitments as of December 31, 2017, which total $643.6 million, are also reflected in the table above as "other contractual commitments."On October 13, 2017, we entered into an agreement to purchase certain real property in Sydney, Australia, for a purchase price of A$110.0 million orapproximately $86.7 million, subject to certain closing conditions, which is not reflected in the table above. We expect to close this transaction in 2018.In December 2017, we entered into a transaction agreement to acquire the Metronode group of companies, for a cash purchase price of A$1.035 billion,or approximately $791.2 million at the exchange rate in effect on December 15, 2017. The transaction is expected to close in the first half of 2018, subject tocertain closing conditions, which is not reflected in the table above.Other Off-Balance-Sheet ArrangementsWe have various guarantor arrangements with both our directors and officers and third parties, including customers, vendors and business partners. As ofDecember 31, 2017, there were no significant liabilities recorded for these arrangements. For additional information, see "Guarantor Arrangements" in Note14 of Notes to Consolidated Financial Statements in Item 8 of this Annual Report on Form 10-K.Critical Accounting Policies and EstimatesOur consolidated financial statements are prepared in accordance with U.S. GAAP. The preparation of our financial statements requires management tomake estimates and assumptions about future events that affect the reported amounts of assets and liabilities and the disclosure of contingent assets andliabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. On an ongoing basis,management evaluates the accounting policies, assumptions, estimates and judgments to ensure that our consolidated financial statements are presentedfairly and in accordance with GAAP. Management bases its assumptions, estimates and judgments on historical experience, current trends and various otherfactors that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values ofassets and liabilities that are not readily apparent from other sources. However, because future events and their effects cannot be determined with certainty,actual results may differ from these assumptions and estimates, and such differences could be material.Our significant accounting policies are discussed in Note 1 to Consolidated Financial Statements in Item 8 of this Annual Report on Form 10-K.Management believes that the following critical accounting policies and estimates are the most critical to aid in fully understanding and evaluating ourconsolidated financial statements, and they require significant judgments, resulting from the need to make estimates about the effect of matters that areinherently uncertain:•Accounting for income taxes;•Accounting for business combinations;•Accounting for impairment of goodwill; and•Accounting for property, plant and equipment.64Table of ContentsDescriptionJudgments and UncertaintiesEffect if Actual Results Differ from AssumptionsAccounting for Income Taxes.Deferred tax assets and liabilities arerecognized based on the future taxconsequences attributable to temporarydifferences that exist between the financialstatement carrying value of assets and liabilitiesand their respective tax bases, and operatingloss and tax credit carryforwards on a taxingjurisdiction basis. We measure deferred taxassets and liabilities using enacted tax rates thatwill apply in the years in which we expect thetemporary differences to be recovered orsettled. The accounting standard for income taxesrequires a reduction of the carrying amounts ofdeferred tax assets by recording a valuationallowance if, based on the available evidence, itis more likely than not (defined by theaccounting standard as a likelihood of morethan 50%) that such assets will not be realized.A tax benefit from an uncertain income taxposition may be recognized in the financialstatements only if it is more likely than not thatthe position is sustainable, based solely on itstechnical merits and consideration of therelevant taxing authority’s widely understoodadministrative practices and precedents.The valuation of deferred tax assets requires judgment inassessing the likely future tax consequences of events thathave been recognized in our financial statements or taxreturns. Our accounting for deferred tax consequencesrepresents our best estimate of those future events.In assessing the need for a valuation allowance, we considerboth positive and negative evidence related to the likelihoodof realization of the deferred tax assets. If, based on theweight of that available evidence, it is more likely than not thedeferred tax assets will not be realized, we record a valuationallowance. The weight given to the positive and negativeevidence is commensurate with the extent to which theevidence may be objectively verified.This assessment, which is completed on a taxing jurisdictionbasis, takes into account a number of types of evidence,including the following: 1) the nature, frequency and severityof current and cumulative financial reporting losses, 2)sources of future taxable income and 3) tax planningstrategies.In assessing the tax benefit from an uncertain income taxposition, the tax position that meets the more-likely-than-notrecognition threshold is initially and subsequently measuredas the largest amount of tax benefit that is greater than 50%likely of being realized upon ultimate settlement with a taxingauthority that has full knowledge of all relevant information.As of December 31, 2017 and 2016, we had net total deferred taxliabilities of $186.3 million and $212.0 million, respectively. As ofDecember 31, 2017 and 2016, we had a total valuation allowanceof $84.6 million and $29.2 million, respectively. If and when wereduce our remaining valuation allowances, it may have a favorableimpact to our financial position and results of operations in theperiods when such determinations are made. We will continue toassess the need for our valuation allowances, by country orlocation, in the futureDuring the year ended December 31, 2017, we provided full andpartial valuation allowances on the Spanish and Turkish deferredtax assets acquired from the Itconic and Zenium data centeracquisitions, respectively. In addition, we set up a full valuationallowance on the deferred tax asset associated with tax goodwillobtained as a result of a reorganization in Brazil. During the yearended December 31, 2016, we decided to release the valuationallowances related to the historical data center operations in Japan.This reduction in valuation allowance was partially offset by thefull valuation allowance setups in Brazil and Canada as well as theincrease in valuation allowances in Europe due to theTelecityGroup acquisition and integration.As of December 31, 2017 and 2016, we had unrecognized taxbenefits of $82.4 million and $72.2 million, respectively, exclusiveof interest and penalties. During the year ended December 31,2017, the unrecognized tax benefits increased by $10.2 millionprimarily due to the TelecityGroup integrations which was partiallyoffset by the recognition of unrecognized tax benefits related to theCompany’s tax positions in the U.S. and Brazil as a result of alapse in statutes of limitations. During the year ended December31, 2016, the unrecognized tax benefits increased by $41.4 millionprimarily due to the TelecityGroup acquisition and integration. Theunrecognized tax benefits of $82.4 million as of December 31,2017, if subsequently recognized, will affect our effective tax ratefavorably at the time when such benefits are recognized.65Table of ContentsDescriptionJudgments and UncertaintiesEffect if Actual Results Differ from AssumptionsAccounting for Business CombinationsIn accordance with the accounting standard forbusiness combinations, we allocate thepurchase price of an acquired business to itsidentifiable assets and liabilities based onestimated fair values. The excess of thepurchase price over the fair value of the assetsacquired and liabilities assumed, if any, isrecorded as goodwill. We use all available information to estimate fairvalues. We typically engage outside appraisalfirms to assist in determining the fair value ofidentifiable intangible assets such as customercontracts, leases and any other significantassets or liabilities and contingentconsideration, as well as the estimated usefullife of intangible assets. We adjust thepreliminary purchase price allocation, asnecessary, up to one year after the acquisitionclosing date if we obtain more informationregarding asset valuations and liabilitiesassumed.Our purchase price allocation methodology containsuncertainties because it requires assumptions andmanagement’s judgment to estimate the fair value of assetsacquired and liabilities assumed at the acquisition date. Keyjudgment used to estimate the fair value of intangible assetsinclude projected revenue growth and operating margins,discount rates, customer attrition rates, as well as theestimated useful life of intangible assets. Managementestimates the fair value of assets and liabilities based uponquoted market prices, the carrying value of the acquired assetsand widely accepted valuation techniques, includingdiscounted cash flows and market multiple analyses. Ourestimates are inherently uncertain and subject to refinement.Unanticipated events or circumstances may occur whichcould affect the accuracy of our fair value estimates, includingassumptions regarding industry economic factors andbusiness strategies.During the last three years, we have completed a number ofbusiness combinations, including the Itconic Acquisition inOctober, 2017, Zenium data center acquisition in October, 2017,the Verizon Data Center Acquisition in May, 2017, IO Acquisitionin February, 2017, the Paris IBX Data Center Acquisition inAugust 2016, TelecityGroup acquisition in January 2016, Bit-isleacquisition in November 2015, and Nimbo acquisition in January2015. In 2017, we have finalized the purchase price allocation forthe Paris IBX Data Center and IO acquisitions in the first andfourth quarters, respectively. The purchase price allocation for theTelecityGroup and Bit-isle acquisitions were completed in thefourth quarters of 2016 and 2015, respectively.As of December 31, 2017, 2016 and 2015, we had net intangibleassets of $2.4 billion, $719.2 million and $224.6 million,respectively. We recorded amortization expense for intangibleassets of $177.0 million, $122.9 million and $27.4 million for theyears ended December 31, 2017, 2016 and 2015, respectively. We do not believe there is a reasonable likelihood that there will bea material change in the estimates or assumptions we used tocomplete the purchase price allocations and the fair value of assetsacquired and liabilities assumed. However, if actual results are notconsistent with our estimates or assumptions, we may be exposedto losses or gains that could be material, which would be recordedin our consolidated statements of operations in 2018 or beyond.66Table of ContentsDescriptionJudgments and UncertaintiesEffect if Actual Results Differ from AssumptionsAccounting for Impairment of Goodwill andOther Intangible AssetsIn accordance with the accounting standard forgoodwill and other intangible assets, weperform goodwill and other intangible assetsimpairment reviews annually, or wheneverevents or changes in circumstances indicate thatthe carrying value of an asset may not berecoverable. We complete the annual goodwill impairmentassessment for the Americas reporting unit, theEMEA reporting unit and the Asia-Pacificreporting unit to determine if the fair values ofthe reporting units exceeded their carryingvalues. If goodwill is not considered impairedand we are not required to perform step two ofgoodwill impairment test. We perform a review of other intangible assetsfor impairment by assessing events or changesin circumstances that indicate the carryingamount of an asset may not be recoverable.In 2017, we elected to assess qualitative factors to determinewhether it is more likely than not that the fair value of areporting unit is less than its carrying value, this analysisrequires assumptions and estimates before performing thetwo-step goodwill impairment test, where the assessmentrequires assumptions and estimates derived from a review ofour actual and forecasted operating results, approved businessplans, future economic conditions and other market data.In 2016, we elected to perform the first step of the two-stepgoodwill impairment test, we used both the income andmarket approach. The income approach is based on the ten-year business plan. We apply the weighted-average cost ofcapital applicable to our reporting units as discount rates. Thisrequires assumptions and estimates derived from a review ofour actual and forecasted operating results, approved businessplans, future economic conditions and other market data. Themarket approach requires judgment in determining theappropriate market comparables. These assumptions requiresignificant management judgment and are inherently subjectto uncertainties.In 2017 and 2016, we performed our annual review of otherintangible assets by assessing if there were events or changesin circumstances indicating that the carrying amount of anasset may not be recoverable, such as a significant decrease inmarket price of an asset, a significant adverse change in theextent or manner in which an asset is being used, a significantadverse change in legal factors or business climate that couldaffect the value of an asset or a continuous deterioration ofour financial condition. This assessment requires assumptionsand estimates derived from a review of our actual andforecasted operating results, approved business plans, futureeconomic conditions and other market data. There were nospecific events in 2016 or 2017 that indicated a significantpotential impairment.As of December 31, 2017, goodwill attributable to the Americasreporting unit, the EMEA reporting unit and the Asia-Pacificreporting unit was $1.6 billion, $2.6 billion and $239.4 million,respectively. Future events, changing market conditions and any changes in keyassumptions may result in an impairment charge. While we havenot recorded an impairment charge against our goodwill to date, thedevelopment of adverse business conditions in our Americas,EMEA or Asia-Pacific reporting units, such as higher thananticipated customer churn or significantly increased operatingcosts, or significant deterioration of our market comparables thatwe use in the market approach, could result in an impairmentcharge in future periods. The balance of our other intangible assets, net, for the year endedDecember 31, 2017 was $2.4 billion. While we have not recordedan impairment charge against our other intangible assets to date,future events or changes in circumstances, such as a significantdecrease in market price of an asset, a significant adverse change inthe extent or manner in which an asset is being used, a significantadverse change in legal factors or business climate, may result in animpairment charge in future periods.Any potential impairment charge against our goodwill and otherintangible assets would not exceed the amounts recorded on ourconsolidated balance sheets.67Table of ContentsDescriptionJudgments and UncertaintiesEffect if Actual Results Differ from AssumptionsAccounting for Property, Plant andEquipmentWe have a substantial amount of property, plantand equipment recorded on our consolidatedbalance sheet. The vast majority of ourproperty, plant and equipment represent thecosts incurred to build out or acquire our IBXdata centers. Our IBX data centers are long-lived assets. The majority of our IBX datacenters are in properties that are leased. Wedepreciate our property, plant and equipmentusing the straight-line method over theestimated useful lives of the respective assets(subject to the term of the lease in the case ofleased assets or leasehold improvements andintegral equipment located in leased properties).Accounting for property, plant and equipmentincludes determining the appropriate period inwhich to depreciate such assets, makingassessments for leased properties to determinewhether they are capital or operating leases,determining if construction projects performedat leased properties trigger build-to-suit leaseaccounting, assessing such assets for potentialimpairment, capitalizing interest during periodsof construction and assessing the assetretirement obligations required for certainleased properties that require us to return theleased properties back to their originalcondition at the time we decide to exit a leasedproperty.While there are numerous judgments and uncertaintiesinvolved in accounting for property, plant and equipment thatare significant, arriving at the estimated useful life of an assetrequires the most critical judgment for us and changes tothese estimates would have the most significant impact on ourfinancial position and results of operations. When we lease aproperty for our IBX data centers, we generally enter intolong-term arrangements with initial lease terms of at least 8-10 years and with renewal options generally available to us.During the next several years, a number of leases for our IBXdata centers will come up for renewal. As we startapproaching the end of these initial lease terms, we will needto reassess the estimated useful lives of our property, plantand equipment. In addition, we may find that our estimatesfor the useful lives of non-leased assets may also need to berevised periodically. We periodically review the estimateduseful lives of certain of our property, plant and equipmentand changes in these estimates in the future are possible.Another area of judgment for us in connection with ourproperty, plant and equipment is related to lease accounting.Most of our IBX data centers are leased. Each time we enterinto a new lease or lease amendment for one of our IBX datacenters, we analyze each lease or lease amendment for theproper accounting. This requires certain judgments on ourpart such as establishing the lease term to include in a leasetest, establishing the remaining estimated useful life of theunderlying property or equipment and estimating the fairvalue of the underlying property or equipment, establishingthe incremental borrowing rate to calculate the present valueof the minimum lease payment for the lease test. All of thesejudgments are inherently uncertain. Different assumptions orestimates could result in a different accounting treatment for alease.The assessment of long-lived assets for impairment requiresassumptions and estimates of undiscounted and discountedfuture cash flows. These assumptions and estimates requiresignificant judgment and are inherently uncertain.As of December 31, 2017, 2016 and 2015, we had property, plantand equipment of $9.4 billion, $7.2 billion, and $5.6 billion,respectively. During the years ended December 31, 2017, 2016 and2015, we recorded depreciation expense of $865.5 million, $714.3million, and $498.1 million, respectively. While we evaluated theappropriateness, we did not revise the estimated useful lives of ourproperty, plant and equipment during the years ended December31, 2017, 2016 and 2015. Further changes in our estimated usefullives of our property, plant and equipment could have a significantimpact on our results of operations.As of December 31, 2017, 2016 and 2015, we had property, plantand equipment under capital leases and other financing obligationsof $1.8 billion, $1.6 billion and $1.5 billion, respectively. Werecorded accumulated depreciation for assets under capital leasesand other financing obligations of $348.4 million, $283.7 millionand $221.8 million as of December 31, 2017, 2016 and 2015,respectively.Additionally, during the years ended December 31, 2017, 2016 and2015, we recorded rent expense of $157.9 million, $140.6 million,and $101.5 million under operating leases.Recent Accounting PronouncementsSee "Recent Accounting Pronouncements" in Note 1 of Notes to Consolidated Financial Statements in Item 8 of this Annual Report on Form 10-K.68Table of ContentsITEM 7A QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKMarket RiskThe following discussion about market risk involves forward-looking statements. Actual results could differ materially from those projected in theforward-looking statements. We may be exposed to market risks related to changes in interest rates and foreign currency exchange rates and fluctuations inthe prices of certain commodities, primarily electricity.We employ foreign currency forward exchange contracts for the purpose of hedging certain specifically-identified exposures. The use of these financialinstruments is intended to mitigate some of the risks associated with fluctuations in currency exchange rates, but does not eliminate such risks. We do not usefinancial instruments for trading or speculative purposes.Investment Portfolio RiskWe maintain an investment portfolio of various holdings, types, and maturities that is prioritized on meeting REIT asset requirements. All of ourmarketable securities are recorded on our consolidated balance sheets at fair value with unrealized gains or losses reported as a component of othercomprehensive income, net of tax. We consider various factors in determining whether we should recognize an impairment charge for our securities,including the length of time and extent to which the fair value has been less than our cost basis and our intent and ability to hold the investment for a periodof time sufficient to allow for any anticipated recovery. We anticipate that we will recover the entire cost basis of these securities and have determined that noother-than-temporary impairments associated with credit losses were required to be recognized during the year ended December 31, 2017.As of December 31, 2017, our investment portfolio of cash equivalents and marketable securities consisted of money market funds, certificates ofdeposits and publicly traded equity securities. The amount in our investment portfolio that could be susceptible to market risk totaled $464.6 million.Interest Rate Risk We are exposed to interest rate risk related to our outstanding debt. An immediate 10% increase or decrease in current interest rates from their position asof December 31, 2017 would not have a material impact on our debt obligations due to the fixed nature of the majority of our debt obligations. However, theinterest expense associated with our senior credit facility and term loans, which bear interest at variable rates, could be affected. For every 100 basis pointchange in interest rates, our annual interest expense could increase by a total of approximately $12.6 million or decrease by a total of approximately $3.8million based on the total balance of our primary borrowings under the Term A loan facility and the Japanese yen term loan as of December 31, 2017. As ofDecember 31, 2017, we had not employed any interest rate derivative products against our debt obligations. However, we may enter into interest rate hedgingagreements in the future to mitigate our exposure to interest rate risk.The fair value of our long-term fixed interest rate debt is subject to interest rate risk. Generally, the fair value of fixed interest rate debt will increase asinterest rates fall and decrease as interest rates rise. These interest rate changes may affect the fair value of the fixed interest rate debt but do not impact ourearnings or cash flows. The fair value of our senior notes, which are traded in the market, was based on quoted market prices. The fair value of our mortgageand loans payable, which are not traded in the market, is estimated by considering our credit rating, current rates available to us for debt of the sameremaining maturities and the terms of the debt. The following table represents the carrying value and estimated fair value of our mortgage and loans payableand senior notes as of (in thousands): December 31, 2017 December 31, 2016 CarryingValue (1) Fair Value Carrying Value (1) Fair ValueMortgage and loans payable$1,468,275 $1,464,877 $1,459,826 $1,461,954Senior notes7,002,000 7,288,673 3,850,000 4,033,985___________________(1)The carrying value is gross of debt issuance cost and discount.Foreign Currency RiskA significant portion of our revenue is denominated in U.S. dollars, however, approximately 54.8% of our revenues and 53.8% of our operating costs areattributable to Brazil, Canada and the EMEA and Asia-Pacific regions, and a large portion of those revenues and costs are denominated in a currency otherthan the U.S. dollar, primarily the Euro, British pound, Japanese yen,69Table of ContentsSingapore dollar, Hong Kong dollar, Australian dollar and Brazilian real. To help manage the exposure to foreign currency exchange rate fluctuations, wehave implemented a number of hedging programs, in particular (i) a cash flow hedging program to hedge the forecasted revenues and expenses in our EMEAregion, (ii) a balance sheet hedging program to hedge the remeasurement of monetary assets and liabilities denominated in foreign currencies, and (iii) a netinvestment hedging program to hedge the long term investments in our foreign subsidiaries. Our hedging programs reduce, but do not entirely eliminate, theimpact of currency exchange rate movements and its impact on the consolidated statements of operations. As of December 31, 2017, the outstanding foreigncurrency forward contracts had maturities of up to two years.We have entered into various foreign currency loans and senior notes which are designated as hedges against our net investment in foreign subsidiaries.As of December 31, 2017, the total principal amount of foreign currency loans and senior notes was $3,819.4 million, including $2,402.0 milliondenominated in Euro, $675.9 million denominated in British pound, $341.9 million denominated in Swedish krona and $399.6 million denominated inJapanese Yen. As of December 31, 2017, we have designated $3,149.5 million of the total principal amount of foreign currency loans and senior notes as netinvestment hedges. For a net investment hedge, changes in the fair value of the hedging instrument designated as a net investment hedge, except theineffective portion and forward points, are recorded as a component of other comprehensive income in the consolidated balance sheets. We did not recordany ineffectiveness during 2017. Any remaining change in the carrying value of the foreign currency loans and senior notes is recognized in other income(expense) in our consolidated statements of operations.Fluctuations in the exchange rates between these foreign currencies (i.e. Euro, British pound, Swedish krona and Japanese Yen) and the U.S. Dollar willimpact the amount of U.S. Dollars that we will require to settle the foreign currency loans and senior notes at maturity. If the U.S. Dollar would have beenweaker or stronger by 10% in comparison to these foreign currencies as of December 31, 2017, we estimate our obligation to cash settle the principal of theseforeign currency loans and senior notes in U.S. Dollars would have increased or decreased by approximately $382.0 million respectively.For the foreseeable future, we anticipate that approximately 50% or less of our revenues and operating costs will continue to be generated and incurredoutside of the U.S. in currencies other than the U.S. dollar. During fiscal 2017, the U.S. dollar became generally weaker relative to certain of the currencies ofthe foreign countries in which we operate. This overall weakening of the U.S. dollar had a positive impact on our consolidated results of operations becausethe foreign denominations translated into more U.S. dollars. In future periods, the volatility of the U.S. dollar as compared to the other currencies in which wedo business could have a significant impact on our consolidated financial position and results of operations including the amount of revenue that we reportin future periods.With the existing cash flow hedges in place, a hypothetical additional 10% strengthening of the U.S. dollar during the year ended December 31, 2017would have resulted in a reduction of our revenues and operating expenses, including depreciation and amortization expenses, for the year by approximately$132.4 million and $134.4 million, respectively.With the existing cash flow hedges in place, a hypothetical additional 10% weakening of the U.S. dollar during the year ended December 31, 2017would have resulted in an increase of our revenues and operating expenses, including depreciation and amortization expenses, for the year by approximately$127.3 million and $136.0 million, respectively.We may enter into additional hedging activities in the future to mitigate our exposure to foreign currency risk as our exposure to foreign currency riskcontinues to increase due to our growing foreign operations; however, we do not currently intend to eliminate all foreign currency transaction exposure.Commodity Price RiskCertain operating costs incurred by us are subject to price fluctuations caused by the volatility of underlying commodity prices. The commodities mostlikely to have an impact on our results of operations in the event of price changes are electricity, supplies and equipment used in our IBX data centers. Weclosely monitor the cost of electricity at all of our locations. We have entered into several power contracts to purchase power at fixed prices in certainlocations in the U.S., Australia, Brazil, France, Germany, Japan, the Netherlands, Singapore and the United Kingdom.In addition, as we are building new, or expanding existing, IBX data centers, we are subject to commodity price risk for building materials related to theconstruction of these IBX data centers, such as steel and copper. In addition, the lead-time to procure certain pieces of equipment, such as generators, issubstantial. Any delays in procuring the necessary pieces of equipment for the construction of our IBX data centers could delay the anticipated openings ofthese new IBX data centers and, as a result, increase the cost of these projects.We do not currently employ forward contracts or other financial instruments to address commodity price risk other than the power contracts discussedabove.70Table of ContentsITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATAThe financial statements and supplementary data required by this Item 8 are listed in Item 15(a)(1) and begin at page F-1 of this Annual Report on Form10-K.ITEM 9.CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSUREThere is no disclosure to report pursuant to Item 9.ITEM 9A. CONTROLS AND PROCEDURESConclusion Regarding the Effectiveness of Disclosure Controls and ProceduresUnder the supervision and with the participation of our management, including our Chief Executive Officer and our Chief Financial Officer, weconducted an evaluation of our disclosure controls and procedures, as such term is defined under Rule 13a-15(e) promulgated under the Securities ExchangeAct of 1934, as amended (the "Exchange Act"). Based on this evaluation, our Chief Executive Officer and our Chief Financial Officer concluded that ourdisclosure controls and procedures were effective at the reasonable assurance level as of December 31, 2017.Management’s Report on Internal Control Over Financial ReportingOur management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in ExchangeAct Rule 13a-15(f). Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections ofany evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that thedegree of compliance with the policies or procedures may deteriorate.Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we conductedan evaluation of the effectiveness of our internal control over financial reporting based on the framework in Internal Control – Integrated Framework (2013)issued by the Committee of Sponsoring Organizations of the Treadway Commission.Based on our evaluation under the framework in Internal Control – Integrated Framework (2013), our management concluded that our internal controlover financial reporting was effective as of December 31, 2017.The effectiveness of our internal control over financial reporting as of December 31, 2017 has been audited by PricewaterhouseCoopers LLP, anindependent registered public accounting firm, as stated in their report which is included herein on page F-1 of this Annual Report on Form 10-K.Limitations on the Effectiveness of ControlsOur management, including our Chief Executive Officer and Chief Financial Officer, believes that our disclosure controls and procedures and internalcontrol over financial reporting are designed and operated to be effective at the reasonable assurance level. However, our management does not expect thatour disclosure controls and procedures or our internal control over financial reporting will prevent all errors and all fraud. A control system, no matter howwell conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of acontrol system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of theinherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, havebeen detected. These inherent limitations include the realities that judgments in decision making can be faulty, and that breakdowns can occur because of asimple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people or bymanagement override of the controls. The design of any system of controls is also based in part upon certain assumptions about the likelihood of futureevents, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions; over time, controls maybecome inadequate because of changes in conditions, or the degree of compliance with policies or procedures may deteriorate. Because of the inherentlimitations in a cost effective control system, misstatements due to error or fraud may occur and not be detected.71Table of ContentsChanges in Internal Control Over Financial ReportingThere was no change in our internal controls over financial reporting during the fourth quarter of fiscal 2017 that has materially affected, or is reasonablelikely to affect, our internal controls over financial reporting.ITEM 9B. OTHER INFORMATIONThere is no disclosure to report pursuant to Item 9B. PART IIIITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE Information required by this item is incorporated by reference to the Equinix proxy statement for the 2018 Annual Meeting of Stockholders.We have adopted a Code of Ethics applicable for the Chief Executive Officer and Senior Financial Officers and a Code of Business Conduct. Thisinformation is incorporated by reference to the Equinix proxy statement for the 2018 Annual Meeting of Stockholders and is also available on our website,www.equinix.com.ITEM 11. EXECUTIVE COMPENSATIONInformation required by this item is incorporated by reference to the Equinix proxy statement for the 2018 Annual Meeting of Stockholders.ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERSInformation required by this item is incorporated by reference to the Equinix proxy statement for the 2018 Annual Meeting of Stockholders.ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCEInformation required by this item is incorporated by reference to the Equinix proxy statement for the 2018 Annual Meeting of Stockholders.ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICESInformation required by this item is incorporated by reference to the Equinix proxy statement for the 2018 Annual Meeting of Stockholders.72Table of ContentsPART IVITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES(a)(1) Financial Statements:Report of Independent Registered Public Accounting FirmF-1Consolidated Balance Sheets as of December 31, 2017 and 2016F-3Consolidated Statements of Operations for the years ended December 31, 2017, 2016 and 2015 F-4Consolidated Statements of Comprehensive Income (Loss) for the years ended December 31, 2017, 2016 and 2015F-5Consolidated Statements of Stockholders’ Equity and Other Comprehensive Income (Loss) for the years ended December 31,2017, 2016 and 2015F-6Consolidated Statements of Cash Flows for the years ended December 31, 2017, 2016 and 2015F-8Notes to Consolidated Financial StatementsF-9(a)(2) Financial statements and schedules:Schedule III- Schedule of Real Estate and Accumulated Depreciation at December 31, 2017 with reconciliations for the years endedDecember 31, 2017, 2016 and 2015F-66(a)(3) Exhibits: Incorporated by Reference ExhibitNumber Exhibit Description Form Filing Date/Period End Date Exhibit FiledHerewith 2.1 Rule 2.7 Announcement, dated as May 29, 2015. RecommendedCash and Share Offer for Telecity Group plc by Equinix, Inc. 8-K 5/29/15 2.1 2.2 Cooperation Agreement, dated as of May 29, 2015, by andbetween Equinix, Inc. and Telecity Group plc. 8-K 5/29/15 2.2 2.3 Amendment to Cooperation Agreement, dated as of November24, 2015, by and between Equinix, Inc. and Telecity Group plc. 10-K 12/31/15 2.3 2.4 Transaction Agreement, dated as of December 6, 2016, by andbetween Verizon Communications Inc. and Equinix, Inc. 8-K 12/6/16 2.1 2.5 Amendment No. 1 to the Transaction Agreement, dated February23, 2017, by and between Verizon Communications Inc. andEquinix, Inc. 10-K 12/31/16 2.5 2.6 Amendment No.2 to the Transaction Agreement, dated April 30,2017, by and between Verizon Communications Inc. andEquinix, Inc. 8-K 5/1/17 2.1 3.1 Amended and Restated Certificate of Incorporation of theRegistrant, as amended to date. 10-K/A 12/31/02 3.1 3.2 Certificate of Amendment to the Amended and RestatedCertificate of Incorporation of the Registrant 8-K 6/14/11 3.1 3.3 Certificate of Amendment to the Amended and RestatedCertificate of Incorporation of the Registrant 8-K 6/11/13 3.1 73Table of Contents Incorporated by Reference ExhibitNumber Exhibit Description Form Filing Date/Period End Date Exhibit FiledHerewith3.4 Certificate of Amendment to the Amended and RestatedCertificate of Incorporation of the Registrant 10-Q 6/30/2014 3.4 3.5 Certificate of Designation of Series A and Series A-1 ConvertiblePreferred Stock. 10-K/A 12/31/02 3.3 3.6 Amended and Restated Bylaws of the Registrant. 8-K 3/29/16 3.1 4.1 Reference is made to Exhibits 3.1, 3.2, 3.3, 3.4, 3.5 and 3.6. 4.2 Indenture for the 2023 Notes dated March 5, 2013 betweenEquinix, Inc. and U.S. Bank National Association as trustee 8-K 3/5/13 4.3 4.3 Form of 5.375% Senior Note due 2023 (see Exhibit 4.2) 4.4 Indenture, dated as of November 20, 2014, between Equinix, Inc.and U.S. Bank National Association, as trustee 8-K 11/20/14 4.1 4.5 First Supplemental Indenture, dated as of November 20, 2014,between Equinix, Inc. and U.S. Bank National Association, astrustee 8-K 11/20/14 4.2 4.6 Form of 5.375% Senior Note due 2022 (see Exhibit 4.5) 4.7 Second Supplemental Indenture, dated as of November 20, 2014,between Equinix, Inc. and U.S. Bank National Association, astrustee 8-K 11/20/14 4.4 4.8 Form of 5.750% Senior Note due 2025 (see Exhibit 4.7) 4.9 Third Supplemental Indenture, dated as of December 4, 2015,between Equinix, Inc. and U.S. Bank National Association, astrustee 8-K 12/04/15 4.2 4.10 Form of 5.875% Senior Note due 2026 (see Exhibit 4.9) 4.11 Fourth Supplemental Indenture, dated as of March 22, 2017between Equinix, Inc. and U.S. Bank National Association, astrustee 8-K 3/22/17 4.2 4.12 Form of 5.375% Senior Notes due 2027 (see Exhibit 4.11) 4.13 Fifth Supplemental Indenture, dated as of September 20, 2017among Equinix, Inc. and U.S. Bank National Association, astrustee, and Elavon Financial Services DAC, UK Branch, aspaying agent 8-K 9/20/17 4.2 4.14 Form of 2.875% Senior Notes due 2025 (see Exhibit 4.13) 4.15 Indenture, dated as of December 12, 2017, between Equinix, Inc.and U.S. Bank National Association, as trustee 8-K 12/05/17 4.1 74Table of Contents Incorporated by Reference ExhibitNumber Exhibit Description Form Filing Date/Period End Date Exhibit FiledHerewith4.16 Supplemental Indenture, dated as of December 12, 2017, amongEquinix, Inc. and U.S. Bank National Association, as trustee, andElavon Financial Services DAC, UK Branch, as paying agent 8-K 12/05/17 4.2 4.17 Form of 2.875% Senior Notes due 2026 (see Exhibit 4.16) 4.18 Form of Registrant’s Common Stock Certificate 10-K 12/31/14 4.13 10.1** Form of Indemnification Agreement between the Registrant andeach of its officers and directors. S-4 (File No. 333-93749) 12/29/1999 10.5 10.2** 2000 Equity Incentive Plan, as amended. 10-K 12/31/16 10.2 10.3** 2000 Director Option Plan, as amended. 10-K 12/31/16 10.3 10.4** 2001 Supplemental Stock Plan, as amended. 10-K 12/31/16 10.4 10.5** Equinix, Inc. 2004 Employee Stock Purchase Plan, as amended. 10-Q 6/30/14 10.5 10.6** Severance Agreement by and between Stephen Smith andEquinix, Inc. dated December 18, 2008. 10-K 12/31/08 10.31 10.7** Severance Agreement by and between Peter Van Camp andEquinix, Inc. dated December 10, 2008. 10-K 12/31/08 10.32 10.8** Severance Agreement by and between Keith Taylor and Equinix,Inc. dated December 19, 2008. 10-K 12/31/08 10.33 10.9** Change in Control Severance Agreement by and between EricSchwartz and Equinix, Inc. dated December 19, 2008. 10-K 12/31/08 10.35 10.10** Switch & Data 2007 Stock Incentive Plan. S-1/A (File No. 333-137607) filed bySwitch & DataFacilities Company 2/5/07 10.9 10.11** Change in Control Severance Agreement by and between CharlesMeyers and Equinix, Inc. dated September 30, 2010. 10-Q 9/30/10 10.42 10.12** Form of amendment to existing severance agreement between theRegistrant and each of Messrs. Meyers, Smith, Taylor and VanCamp 10-K 12/31/10 10.33 10.13** Letter amendment, dated December 14, 2010, to Change inControl Severance Agreement, dated December 18, 2008, andletter agreement relating to expatriate benefits, dated April 22,2008, as amended, by and between the Registrant and EricSchwartz. 10-K 12/31/10 10.34 10.14** International Long-Term Assignment Letter by and betweenEquinix, Inc. and Eric Schwartz, dated May 21, 2013. 10-Q 6/30/13 10.51 75Table of Contents Incorporated by Reference ExhibitNumber Exhibit Description Form Filing Date/Period End Date Exhibit FiledHerewith10.15** Employment Agreement by and between Equinix (EMEA) B.V.and Eric Schwartz, dated as of August 7, 2013. 10-Q 9/30/13 10.54 10.16** Restricted Stock Unit Agreement dated August 14, 2013 forCharles Meyers under the Equinix, Inc. 2000 Equity IncentivePlan. 10-Q 9/30/13 10.55 10.17** Offer Letter from Equinix, Inc. to Karl Strohmeyer dated October28, 2013. 10-Q 3/31/14 10.49 10.18** Restricted Stock Unit Agreement for Karl Strohmeyer under theEquinix, Inc. 2000 Equity Incentive Plan. 10-Q 3/31/14 10.50 10.19** Change in Control Severance Agreement by and between KarlStrohmeyer and Equinix, Inc. dated December 2, 2013. 10-Q 3/31/14 10.51 10.20** 2015 Form of Revenue/AFFO Restricted Stock Unit Agreementfor executives. 10-Q 3/31/15 10.50 10.21** 2015 Form of TSR Restricted Stock Unit Agreement forexecutives. 10-Q 3/31/15 10.51 10.22** 2015 Form of Time-Based Restricted Stock Unit Agreement forexecutives. 10-Q 3/31/15 10.52 10.23** 2016 Form of Revenue/AFFO Restricted Stock Unit Agreementfor executives. 10-Q 3/31/16 10.57 10.24** 2016 Form of TSR Restricted Stock Unit Agreement forexecutives. 10-Q 3/31/16 10.58 10.25** 2016 Form of Time-Based Restricted Stock Unit Agreement forexecutives. 10-Q 3/31/16 10.59 10.26** 2017 Form of Revenue/AFFO Restricted Stock Unit Agreementfor Executives. 10-Q 3/31/17 10.35 10.27** 2017 Form of TSR Restricted Stock Unit Agreement forExecutives. 10-Q 3/31/17 10.36 10.28** 2017 Form of Time-Based Restricted Stock Unit Agreement forExecutives. 10-Q 3/31/17 10.37 10.29** Equinix, Inc. Annual Incentive Plan. 10-Q 3/31/17 10.39 10.30** Equinix, Inc. Annual Incentive Plan 2017 Award Agreement forExecutive Staff Employees. 10-Q 3/31/17 10.40 10.31 Agreement for Purchase and Sale of Shares Among RW BrasilFundo de Investimentos em Participação, Antônio Eduardo ZagoDe Carvalho and Sidney Victor da Costa Breyer, as Sellers, andEquinix Brasil Participaçãoes Ltda., as Purchaser, and EquinixSouth America Holdings LLC., as a Party for Limited Purposesand ALOG Soluções de Tecnologia em Informática S.A. asIntervening Consenting Party dated July 18, 2014. 10-Q 9/30/14 10.67 76Table of Contents Incorporated by Reference ExhibitNumber Exhibit Description Form Filing Date/Period End Date Exhibit FiledHerewith10.32 Credit Agreement, by and among Equinix, Inc., as borrower,Equinix LLC and Switch & Data LLC as guarantors, the Lenders(defined therein), Bank of America, N.A., as administrative agent,a Lender and L/C issuer, JPMorgan Chase Bank, N.A., and TDSecurities (USA) LLC, as co-syndication agents, Barclays BankPLC, Citibank, N.A., Royal Bank of Canada and ING Bank N.V.,Singapore Branch, as Co-Documentation Agents and MerrillLynch, Pierce, Fenner & Smith Incorporated, J.P. MorganSecurities LLC, and TD Securities (USA) LLC, as joint leadarrangers and book runners, dated December 17, 2014. 10-K 12/31/14 10.48 10.33 First Amendment to Credit Agreement and first Amendment toPledge and Security Agreement by and among Equinix, Inc., asborrower, the Guarantors (defined therein), the Lenders (definedtherein) and Bank of America, N.A., as administrative agent,dated April 30, 2015. 10-Q 9/30/15 10.52 10.34 Second Amendment to Credit Agreement by and among Equinix,Inc., as borrower, the Guarantors (defined therein), the Lenders(defined therein) and Bank of America, N.A., as administrativeagent, dated December 8, 2015. 10-K 12/31/15 10.55 10.35 Third Amendment to Credit Agreement and Second Amendmentto Pledge and Security Agreement by and among Equinix, Inc., asborrower, the Guarantors (defined therein), the Lenders (definedtherein) and Bank of America, N.A., as administrative agent,dated December 22, 2016. 10-K 12/31/16 10.39 10.36 Fourth Amendment to Credit Agreement by and among Equinix,Inc., as borrower, the Guarantors (defined therein), the Lenders(defined therein) and Bank of America, N.A., as administrativeagent, dated August 15, 2017. 10-Q 9/30/17 10.1 10.37 Share Purchase Agreement with Digital Realty Trust, L.P.,relating to the sale and purchase of shares in TelecityGroup UKLON Limited, Telecity Netherlands AMS01 AMS04 BV, EquinixReal Estate (TCY AMS04) B.V. and TelecityGroup Germany Fra2GmbH, dated May 14, 2016. 10-Q 6/30/16 10.55 10.38** Letter Agreement dated June 9, 2016, by and between Equinix,Inc. and Eric Schwartz, amending his International Long TermAssignment letter dated May 21, 2013 and EmploymentAgreement with Equinix (EMEA) B.V. dated August 7, 2013. 10-Q 6/30/16 10.56 10.39 Term Loan Agreement dated as of September 30, 2016 amongEquinix Japan K.K. as Borrower, the Lenders (defined therein)and Bank of Tokyo-Mitsubishi UFJ, Ltd., as Arranger and Agent. 10-Q 9/30/16 10.42 77Table of Contents Incorporated by Reference ExhibitNumber Exhibit Description Form Filing Date/Period End Date Exhibit FiledHerewith10.40 Credit Agreement dated as of December 12, 2017 amongEquinix, Inc. as Borrower, The Guarantors Parties (definedtherein), Bank of America, N.A., as Administrative Agent, Lenderand L/C issuer, Barclays Bank PLS, Goldman Sachs Bank USA,HSBC Securities (USA) Inc. ING Capital LLC, TD Securities(USA) LLC, and Wells Fargo Bank, National Association as Co-Documentation Agents, the Other Lenders Party (defined therein)and Bank of America, N.A., Citibank, N.A., JPMorgan ChaseBank, N.A., MUFG, and RBC Capital Markets as Joint LeadArrangers and Joint Book Runners. X 12.1 Statement of Computation of Ratios X 21.1 Subsidiaries of Equinix, Inc. X 23.1 Consent of PricewaterhouseCoopers LLP, IndependentRegistered Public Accounting Firm X 31.1 Chief Executive Officer Certification pursuant to Section 302 ofthe Sarbanes-Oxley Act of 2002. X 31.2 Chief Financial Officer Certification pursuant to Section 302 ofthe Sarbanes-Oxley Act of 2002. X 32.1 Chief Executive Officer Certification pursuant to Section 906 ofthe Sarbanes-Oxley Act of 2002. X 32.2 Chief Financial Officer Certification pursuant to Section 906 ofthe Sarbanes-Oxley Act of 2002. X 101.INS XBRL Instance Document. X 101.SCH XBRL Taxonomy Extension Schema Document. X 101.CAL XBRL Taxonomy Extension Calculation Document. X 101.DEF XBRL Taxonomy Extension Definition Document. X 101.LAB XBRL Taxonomy Extension Labels Document. X 101.PRE XBRL Taxonomy Extension Presentation Document. X** Management contracts or compensation plans or arrangements in which directors or executive officers are eligible to participate.(b)Exhibits.See (a) (3) above.(c)Financial Statement Schedule.See (a) (2) above.ITEM 16. FORM 10-K SUMMARYNot applicable.78Table of ContentsSIGNATURESPursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this Annual Report on Form10-K to be signed on its behalf by the undersigned, thereunto duly authorized. EQUINIX, INC.(Registrant) February 26, 2018By/s/ PETER F. VAN CAMP Peter F. Van Camp Chief Executive Officer and PresidentPOWER OF ATTORNEYKNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Peter F. Van Camp or Keith D.Taylor, or either of them, each with the power of substitution, their attorney-in-fact, to sign any amendments to this Annual Report on Form 10-K (includingpost-effective amendments), and to file the same, with exhibits thereto and other documents in connection therewith, with the Securities and ExchangeCommission, hereby ratifying and confirming all that each of said attorneys-in-fact, or their substitute or substitutes, may do or cause to be done by virtuehereof.Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of theregistrant and in the capacities and on the dates indicated.SignatureTitleDate/s/ PETER F. VAN CAMPChief Executive Officer (Principal Executive Officer), President andExecutive ChairmanFebruary 26, 2018Peter F. Van Camp/s/ KEITH D. TAYLORChief Financial Officer (Principal Financial and Accounting Officer)February 26, 2018Keith D. Taylor/s/ THOMAS A. BARTLETTDirectorFebruary 26, 2018Thomas A. Bartlett/s/ NANCI CALDWELLDirectorFebruary 26, 2018Nanci Caldwell/s/ GARY F. HROMADKODirectorFebruary 26, 2018Gary F. Hromadko/s/ SCOTT G. KRIENSDirectorFebruary 26, 2018Scott G. Kriens/s/ WILLIAM K. LUBYDirectorFebruary 26, 2018William K. Luby/s/ IRVING F. LYONS, IIIDirectorFebruary 26, 2018Irving F. Lyons, III/s/ CHRISTOPHER B. PAISLEYDirectorFebruary 26, 2018Christopher B. Paisley79Table of ContentsINDEX TO EXHIBITSExhibitNumber Description of Document 10.40 Credit Agreement dated as of December 12, 2017 among Equinix, Inc. as Borrower, The Guarantors Parties (defined therein), Bank ofAmerica, N.A., as Administrative Agent, Lender and L/C issuer, Barclays Bank PLS, Goldman Sachs Bank USA, HSBC Securities (USA)Inc. ING Capital LLC, TD Securities (USA) LLC, and Wells Fargo Bank, National Association as Co-Documentation Agents, the OtherLenders Party (defined therein) and Bank of America, N.A., Citibank, N.A., JPMorgan Chase Bank, N.A., MUFG, and RBC CapitalMarkets as Joint Lead Arrangers and Joint Book Runners. 12.1 Statement of Computation of Ratios 21.1 Subsidiaries of Equinix, Inc. 23.1 Consent of PricewaterhouseCoopers LLP, Independent Registered Public Accounting Firm 31.1 Chief Executive Officer Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. 31.2 Chief Financial Officer Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. 32.1 Chief Executive Officer Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 32.2 Chief Financial Officer Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 101.INS XBRL Instance Document. 101.SCH XBRL Taxonomy Extension Schema Document. 101.CAL XBRL Taxonomy Extension Calculation Document. 101.DEF XBRL Taxonomy Extension Definition Document. 101.LAB XBRL Taxonomy Extension Labels Document. 101. PRE XBRL Taxonomy Extension Presentation Document.80Table of ContentsReport of Independent Registered Public Accounting FirmTo the Board of Directors and Stockholders of Equinix, Inc.Opinions on the Financial Statements and Internal Control over Financial ReportingWe have audited the accompanying consolidated balance sheets of Equinix, Inc. and its subsidiaries as of December 31, 2017 and December 31, 2016, andthe related consolidated statements of operations, comprehensive income (loss), stockholders’ equity and other comprehensive income (loss), and cash flowsfor each of the three years in the period ended December 31, 2017, including the related notes and financial statement schedule listed in the index appearingunder item 15(a)(2) (collectively referred to as the “consolidated financial statements”). We also have audited the Company's internal control over financialreporting as of December 31, 2017, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of SponsoringOrganizations of the Treadway Commission (COSO).In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as ofDecember 31, 2017 and December 31, 2016, and the results of their operations and their cash flows for each of the three years in the period endedDecember 31, 2017 in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, the Companymaintained, in all material respects, effective internal control over financial reporting as of December 31, 2017, based on criteria established in InternalControl - Integrated Framework (2013) issued by the COSO.Basis for OpinionsThe Company's management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, andfor its assessment of the effectiveness of internal control over financial reporting, included in Management’s Report on Internal Control Over FinancialReporting appearing under Item 9A. Our responsibility is to express opinions on the Company’s consolidated financial statements and on the Company'sinternal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting OversightBoard (United States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and theapplicable rules and regulations of the Securities and Exchange Commission and the PCAOB.We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonableassurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internalcontrol over financial reporting was maintained in all material respects.Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financialstatements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis,evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles usedand significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internalcontrol over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weaknessexists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performingsuch other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.Definition and Limitations of Internal Control over Financial ReportingA company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reportingand the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal controlover financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairlyreflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permitpreparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are beingmade only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention ortimely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.F-1Table of ContentsBecause of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation ofeffectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliancewith the policies or procedures may deteriorate./s/PricewaterhouseCoopers LLPSan Jose, CaliforniaFebruary 26, 2018We have served as the Company’s auditor since 2000.F-2Table of ContentsEQUINIX, INC.Consolidated Balance Sheets(in thousands, except share and per share data)December 31,20172016AssetsCurrent assets:Cash and cash equivalents$1,412,517$748,476Short-term investments28,2713,409Accounts receivable, net of allowance for doubtful accounts of $18,228 and $15,675576,313396,245Other current assets232,027319,396Total current assets2,249,1281,467,526Long-term investments9,24310,042Property, plant and equipment, net9,394,6027,199,210Goodwill4,411,7622,986,064Intangible assets, net2,384,972719,231Other assets241,750226,298Total assets$18,691,457$12,608,371Liabilities and Stockholders' EquityCurrent liabilities:Accounts payable and accrued expenses$719,257$581,739Accrued property, plant and equipment220,367144,842Current portion of capital lease and other financing obligations78,705101,046Current portion of mortgage and loans payable64,49167,928Other current liabilities159,914133,140Total current liabilities1,242,7341,028,695Capital lease and other financing obligations, less current portion1,620,2561,410,742Mortgage and loans payable, less current portion1,393,1181,369,087Senior notes6,923,8493,810,770Other liabilities661,710623,248Total liabilities11,841,6678,242,542Commitments and contingencies (Note 14)Stockholders' equity:Preferred stock, $0.001 par value per share: 100,000,000 shares authorized in 2017 and 2016; zero shares issuedand outstanding——Common stock, $0.001 par value per share: 300,000,000 shares authorized in 2017 and 2016; 79,440,404issued and 79,038,062 outstanding in 2017 and 71,817,430 issued and 71,409,015 outstanding in 20167972Additional paid-in capital10,121,3237,413,519Treasury stock, at cost; 402,342 shares in 2017 and 408,415 shares in 2016(146,320)(147,559)Accumulated dividends(2,592,792)(1,969,645)Accumulated other comprehensive loss(785,189)(949,142)Retained earnings252,68918,584Total stockholders' equity6,849,7904,365,829Total liabilities and stockholders' equity$18,691,457$12,608,371See accompanying notes to consolidated financial statements.F-3Table of ContentsEQUINIX, INC.Consolidated Statements of Operations(in thousands, except per share data) Years Ended December 31, 2017 2016 2015Revenues$4,368,428 $3,611,989 $2,725,867Costs and operating expenses: Cost of revenues2,193,149 1,820,870 1,291,506Sales and marketing581,724 438,742 332,012General and administrative745,906 694,561 493,284Acquisition costs38,635 64,195 41,723Impairment charges— 7,698 —Gain on asset sales— (32,816) —Total costs and operating expenses3,559,414 2,993,250 2,158,525Income from operations809,014 618,739 567,342Interest income13,075 3,476 3,581Interest expense(478,698) (392,156) (299,055)Other income (expense)9,213 (57,924) (60,581)Loss on debt extinguishment(65,772) (12,276) (289)Income from continuing operations before income taxes286,832 159,859 210,998Income tax expense(53,850) (45,451) (23,224)Net income from continuing operations232,982 114,408 187,774Net income from discontinued operations, net of tax— 12,392 —Net income$232,982 $126,800 $187,774 Earnings per share ("EPS"): Basic EPS from continuing operations$3.03 $1.63 $3.25Basic EPS from discontinued operations— 0.18 —Basic EPS$3.03 $1.81 $3.25Weighted-average shares76,854 70,117 57,790Dilutive EPS from continuing operations$3.00 $1.62 $3.21Dilutive EPS from discontinued operations— 0.17 —Diluted EPS$3.00 $1.79 $3.21Weighted-average shares77,535 70,816 58,483Cash dividends declared per common share$8.00 $7.00 $17.71See accompanying notes to consolidated financial statements.F-4Table of ContentsEQUINIX, INC.Consolidated Statements of Comprehensive Income (Loss)(in thousands) Years Ended December 31, 2017 2016 2015Net income$232,982 $126,800 $187,774Other comprehensive income (loss), net of tax: Foreign currency translation adjustment ("CTA") gain (loss)454,269 (507,420) (186,763)Net investment hedge CTA gain (loss)(235,292) 45,505 4,484Unrealized gain (loss) on available-for-sale securities, net of tax effects of $(10), $(784)and $(4)14 2,249 (40)Unrealized gain (loss) on cash flow hedges, net of tax effects of $18,542, $(6,760) and$(1,840)(54,895) 19,551 4,550Net actuarial gain (loss) on defined benefit plans, net of tax effects of $39, $(8) and $(214)(143) 32 1,153Total other comprehensive income (loss), net of tax163,953 (440,083) (176,616)Comprehensive income (loss), net of tax$396,935 $(313,283) $11,158See accompanying notes to consolidated financial statements.F-5Table of ContentsEQUINIX, INC.Consolidated Statements of Stockholders’ Equity and Other Comprehensive Income (Loss)For the Three Years Ended December 31, 2017(in thousands, except share data) AccumulatedOtherComprehensiveIncome (Loss) RetainedEarnings(AccumulatedDeficit) TotalStockholders'Equity Common stock Treasury stock AdditionalPaid-inCapital AccumulatedDividends Shares Amount Shares Amount Balance as of December 31, 201456,505,122 $57 (53,867) $(11,411) $3,334,305 $(424,387) $(332,443) $(295,990) $2,270,131Net income— — — — — — — 187,774 187,774Other comprehensive loss— — — — — — (176,616) — (176,616)Issuance of common stock in publicoffering of common stock, net2,994,792 3 — — 829,493 — — — 829,496Issuance of common stock and release oftreasury stock for employee equity awards856,406 1 7,348 1,546 28,493 — — — 30,040Issuance of common stock and release oftreasury stock for the exchanges andconversions of 4.75% convertible debt90,163 — 11,784 2,492 5,392 — — — 7,884Dividend distributions— — — — — (393,584) — — (393,584)Settlement of accrued dividends on vestedequity awards— — — — 3,775 — — — 3,775Issuance of common stock and cashpayment for special distribution1,688,411 1 — — 501,513 (627,221) — — (125,707)Accrued dividends on unvested equityawards— — — — — (23,280) — — (23,280)Tax benefit from employee stock plans— — — — 30 — — — 30Stock-based compensation, net of estimatedforfeitures— — — — 135,443 — — — 135,443Balance as of December 31, 201562,134,894 62 (34,735) (7,373) 4,838,444 (1,468,472) (509,059) (108,216) 2,745,386Net income— — — — — — — 126,800 126,800Other comprehensive loss— — — — — — (440,083) — (440,083)Issuance of common stock and release oftreasury stock for employee equity awards847,374 1 7,099 1,502 33,172 — — — 34,675Issuance of common stock forTelecityGroup acquisition6,853,500 7 — — 2,077,905 — — — 2,077,912Issuance of common stock, net and releaseof treasury stock for the exchanges andconversions of 4.75% convertible debt1,981,662 2 (380,779) (141,688) 291,711 — — — 150,025Dividend distributions— — — — — (492,403) — — (492,403)Settlement of accrued dividends on vestedequity awards— — — — 8,270 (1,000) — — 7,270Accrued dividends on unvested equityawards— — — — — (7,770) — — (7,770)Tax benefit from employee stock plans— — — — 2,773 — — — 2,773Stock-based compensation, net of estimatedforfeitures— — — — 161,244 — — — 161,244F-6Table of ContentsEQUINIX, INC.Consolidated Statements of Stockholders’ Equity and Other Comprehensive Income (Loss) - continuedFor the Three Years Ended December 31, 2017(in thousands, except share data) AccumulatedOtherComprehensiveIncome (Loss) RetainedEarnings(AccumulatedDeficit) TotalStockholders'Equity Common stock Treasury stock AdditionalPaid-inCapital AccumulatedDividends Shares Amount Shares Amount Balance as of December 31, 201671,817,430 72 (408,415) (147,559) 7,413,519 (1,969,645) (949,142) 18,584 4,365,829Adjustment from adoption of newaccounting standard— — — — — — — 1,123 1,123Net income— — — — — — — 232,982 232,982Other comprehensive income— — — — — — 163,953 — 163,953Issuance of common stock in publicoffering of common stock, net6,069,444 6 — — 2,126,333 — — — 2,126,339Issuance of common stock and release oftreasury stock for employee equityawards790,329 1 6,073 1,239 40,449 — — — 41,689Issuance of common stock under ATMProgram, net763,201 — — — 355,082 — — — 355,082Dividend distributions— — — — — (612,085) — — (612,085)Settlement of accrued dividends onvested equity awards— — — — 4,280 (890) — — 3,390Accrued dividends on unvested equityawards— — — — — (10,172) — — (10,172)Stock-based compensation, net ofestimated forfeitures— — — — 181,660 — — — 181,660Balance as of December 31, 201779,440,404 $79 (402,342) $(146,320) $10,121,323 $(2,592,792) $(785,189) $252,689 $6,849,790See accompanying notes to consolidated financial statements.F-7Table of ContentsEQUINIX, INC.Consolidated Statements of Cash Flows(in thousands) Years Ended December 31, 2017 2016 2015Cash flows from operating activities: Net income$232,982 $126,800 $187,774Adjustments to reconcile net income to net cash provided by operating activities: Depreciation865,472 714,345 498,134Stock-based compensation175,500 155,567 132,443Amortization of intangible assets177,008 122,862 27,446Amortization of debt issuance costs and debt discounts24,449 19,137 16,050Provision for allowance for doubtful accounts5,627 8,260 5,037Impairment charges— 7,698 —Gain on asset sales— (32,816) —Gain on sale of discontinued operations— (2,351) —Loss on debt extinguishment65,772 12,276 289Other items(11,243) 20,609 16,490Changes in operating assets and liabilities: Accounts receivable(161,774) (100,230) (44,583)Income taxes, net(34,936) 29,020 (109,579)Other assets20,180 (72,831) (70,371)Accounts payable and accrued expenses74,488 61,565 109,125Other liabilities5,708 (50,558) 126,568Net cash provided by operating activities1,439,233 1,019,353 894,823Cash flows from investing activities: Purchases of investments(57,926) (42,325) (359,031)Sales and maturities of investments46,421 53,164 873,139Business acquisitions, net of cash and restricted cash acquired(3,963,280) (1,766,606) (245,503)Purchases of real estate(95,083) (28,118) (38,282)Purchases of other property, plant and equipment(1,378,725) (1,113,365) (868,120)Proceeds from sale of assets, net of cash transferred47,767 851,582 —Net cash used in investing activities(5,400,826) (2,045,668) (637,797)Cash flows from financing activities: Proceeds from employee equity awards41,696 34,179 30,040Payment of dividends and special distribution(621,497) (499,463) (521,461)Proceeds from public offering of common stock, net of issuance costs2,481,421 — 829,496Proceeds from senior notes3,628,701 — 1,100,000Proceeds from loans payable2,056,876 1,168,304 1,197,108Repayment of senior notes(500,000) — —Repayment of capital lease and other financing obligations(93,470) (114,385) (28,663)Repayment of mortgage and loans payable(2,277,798) (1,462,888) (715,270)Debt extinguishment costs(26,122) (11,380) —Debt issuance costs(81,047) (11,381) (18,098)Other financing activities(900) (51) —Net cash provided by (used in) financing activities4,607,860 (897,065) 1,873,152Effect of foreign currency exchange rates on cash, cash equivalents and restricted cash31,187 (21,800) (39,784)Net increase (decrease) in cash, cash equivalents and restricted cash677,454 (1,945,180) 2,090,394Cash, cash equivalents and restricted cash at beginning of period773,247 2,718,427 628,033Cash, cash equivalents and restricted cash at end of period$1,450,701 $773,247 $2,718,427Supplemental cash flow information Cash paid for taxes$72,641 $39,320 $132,302Cash paid for interest$444,793 $350,083 $237,410 Cash and cash equivalents$1,412,517 $748,476 $2,228,838Current portion of restricted cash included in other current assets26,919 15,065 479,417Non-current portion of restricted cash included in other assets11,265 9,706 10,172Total cash, cash equivalents, and restricted cash shown in the consolidated statement of cash flows$1,450,701 $773,247 $2,718,427 See accompanying notes to consolidated financial statements.F-8Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS1. Nature of Business and Summary of Significant Accounting PoliciesNature of BusinessEquinix, Inc. ("Equinix" or the "Company") was incorporated in Delaware on June 22, 1998. Equinix provides colocation space and related services.Global enterprises, content providers, financial companies and network service providers rely upon Equinix’s insight and expertise to safehouse and connecttheir most valued information assets. The Company operates International Business ExchangeTM ("IBX®") data centers, or IBX data centers, across theAmericas; Europe, Middle East and Africa ("EMEA") and Asia-Pacific geographic regions where customers directly interconnect with a network ecosystem ofpartners and customers. More than 1,700 network service providers offer access to the world’s internet routes inside the Company’s IBX data centers. Thisaccess to internet routes provides Equinix customers improved reliability and streamlined connectivity while significantly reducing costs by reaching acritical mass of networks within a centralized physical location.The Company has been operating as a Real Estate Investment Trust for federal income tax purposes ("REIT") effective January 1, 2015. See "IncomeTaxes" in Note 13 below for additional information.On January 14, 2015, the Company acquired all of the issued and outstanding share capital of Nimbo Technologies Inc. ("Nimbo"). On November 2,2015, the Company acquired Bit-isle, Inc. ("Bit-isle"), a Tokyo-based company which primarily provided data center solutions in Japan. On January 15,2016, the Company completed its acquisition of Telecity Group plc ("TelecityGroup") which provided data center solutions in Europe. On August 1, 2016,the Company completed the purchase of Digital Realty's operating business in Paris (the "Paris IBX Data Center Acquisition"), which housed Equinix' Paris 2and Paris 3 data centers. On February 3, 2017, the Company acquired IO UK's data center operating business in Slough, United Kingdom ("IO Acquisition").On May 1, 2017, the Company completed the acquisition of certain colocation business from Verizon Communications Inc. ("Verizon") consisting of 29 datacenter buildings located in the United States, Brazil and Colombia (the "Verizon Data Center Acquisition"). On October 6, 2017, the Company completed theacquisition of Zenium's data center business in Istanbul and on October 9, 2017, the Company completed the acquisition of Itconic, a data center business inSpain and Portugal. As a result of these acquisitions, the Company operates 190 IBX data centers in 48 markets across five continents.Basis of Presentation, Consolidation and Foreign CurrencyThe accompanying consolidated financial statements include the accounts of Equinix and its subsidiaries, including the acquisitions of Itconic fromOctober 9, 2017, the Zenium data center from October 6, 2017, the Verizon data center business from May 1, 2017, the IO UK data center operating businessfrom February 3, 2017, the Paris IBX Data Center from August 1, 2016, TelecityGroup from January 15, 2016, Bit-isle from November 2, 2015 and Nimbofrom January 14, 2015. All intercompany accounts and transactions have been eliminated in consolidation. Foreign exchange gains or losses resulting fromforeign currency transactions, including intercompany foreign currency transactions, that are anticipated to be repaid within the foreseeable future, arereported within other income (expense) on the Company’s accompanying consolidated statements of operations. For additional information on the impact offoreign currencies to the Company’s consolidated financial statements, see "Accumulated Other Comprehensive Loss" in Note 11.Use of EstimatesThe preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States ("U.S.") requiresmanagement to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities atthe date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differfrom these estimates. On an ongoing basis, the Company evaluates its estimates, including, but not limited to, those related to the allowance for doubtfulaccounts, fair values of financial instruments, intangible assets and goodwill, useful lives of intangible assets and property, plant and equipment, assetsacquired and liabilities assumed from acquisitions, asset retirement obligations and income taxes. The Company bases its estimates on historical experienceand on various other assumptions that are believed to be reasonable.Cash, Cash Equivalents and Short-Term and Long-Term InvestmentsThe Company considers all highly liquid instruments with an original maturity from the date of purchase of three months or less to be cash equivalents.Cash equivalents consist of money market mutual funds and certificates of deposit with original maturities up to 90 days. Short-term investments generallyconsist of certificates of deposit with original maturities of betweenF-9Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)90 days and one year. Long-term investments consist of certificates of deposit with original maturities of one year or more and publicly traded equitysecurities. The Company’s investments in publicly traded equity securities are classified as "available-for-sale" and are carried at fair value with unrealizedgains and losses reported in stockholders’ equity as a component of other comprehensive income (loss). The cost of securities sold is based on the specificidentification method. The Company reviews its investment portfolio quarterly to determine if any securities may be other-than-temporarily impaired due toincreased credit risk, changes in industry or sector of a certain instrument or ratings downgrades.Equity Method and Cost Method InvestmentsThe Company's investments in non-marketable equity securities are accounted under the cost method or the equity method. For cost methodinvestments, the Company records the dividends declared by the investees in other income and expense in the consolidated statement of operations andrecords any dividends in excess of earnings as a reduction of cost of investment. For equity method investments, the Company adjusts the carrying amount ofan investment for its share of the earnings and losses of the investees and recognizes its share of income or loss in other income and expense in theconsolidated statement of operations. The Company records cost method and equity method investments in other assets in the consolidated balance sheet.The Company reviews these investments periodically to determine if any investments may be other-than-temporarily impaired primarily based on thefinancial condition and near-term prospects of these companies and funds.Financial Instruments and Concentration of Credit RiskFinancial instruments which potentially subject the Company to concentrations of credit risk consist of cash and cash equivalents, short-terminvestments, long-term investments and accounts receivable. Risks associated with cash and cash equivalents, short-term investments and long-terminvestments are mitigated by the Company’s investment policy, which limits the Company’s investing to only those marketable securities rated at least A-1/P-1 Short Term Rating and A-/A3 Long Term Rating, as determined by independent credit rating agencies.A significant portion of the Company’s customer base is comprised of businesses throughout the Americas. However, a portion of the Company’srevenues are derived from the Company’s EMEA and Asia-Pacific operations. The following table sets forth percentages of the Company’s revenues bygeographic region for the years ended December 31: 2017 2016 2015Americas50% 47% 55%EMEA31% 32% 26%Asia-Pacific19% 21% 19%No single customer accounted for greater than 10% of accounts receivable or revenues as of or for the years ended December 31, 2017, 2016 and 2015.Property, Plant and EquipmentProperty, plant and equipment are stated at the Company’s original cost or at fair value for property, plant and equipment acquired through acquisitions,net of depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of the respective assets. Leasehold improvementsand integral equipment at leased locations are amortized over the shorter of the lease term or the estimated useful life of the asset or improvement. Leaseholdimprovements acquired through acquisition are amortized over the shorter of the useful life of the assets or terms that include required lease periods andrenewals that are deemed to be reasonably assured at the date of acquisition. Leasehold improvements that are placed into service significantly after and notcontemplated at or near the beginning of the lease term are amortized over the shorter of the useful life of the assets or a term that includes required leaseperiods and renewals that are deemed to be reasonably assured at the date the leasehold improvements are purchased.F-10Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)The Company’s estimated useful lives of its property, plant and equipment are as follows:Core systems3-25 yearsBuildings12-50 yearsLeasehold improvements12-40 yearsPersonal Property3-10 yearsThe Company’s construction in progress includes direct and indirect expenditures for the construction and expansion of IBX data centers and is stated atoriginal cost. The Company has contracted out substantially all of the construction and expansion efforts of its IBX data centers to independent contractorsunder construction contracts. Construction in progress includes costs incurred under construction contracts including project management services,engineering and schematic design services, design development, construction services and other construction-related fees and services. In addition, theCompany has capitalized interest costs during the construction phase. Once an IBX data center or expansion project becomes operational, these capitalizedcosts are allocated to certain property, plant and equipment categories and are depreciated over the estimated useful life of the underlying assets.The Company reviews its property, plant and equipment for impairment whenever events or changes in circumstances indicate that the carrying amountof an asset may not be recoverable such as a significant decrease in market price of an asset, a significant adverse change in the extent or manner in which anasset is being used or in its physical condition, a significant adverse change in legal factors or business climate that could affect the value of an asset or acontinuous deterioration of the Company’s financial condition. Recoverability of assets to be held and used is assessed by comparing the carrying amount ofan asset to estimated undiscounted future net cash flows expected to be generated by the asset. If the carrying amount of the asset exceeds its estimateddiscounted future cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds the fair value of the asset.The Company did not record any impairment charges related to its property, plant and equipment during the years ended December 31, 2017 and 2015.However, the Company recorded an impairment charge of $7.7 million relating to assets held for sale for the year ended December 31, 2016 as describedbelow.Assets Held for Sale and Discontinued OperationsAssets and liabilities to be disposed of that meet all of the criteria to be classified as held for sale as set forth in the accounting standard for impairment ordisposal of long-lived assets are reported at the lower of their carrying amounts or fair values less costs to sell. Assets are not depreciated or amortized whilethey are classified as held for sale. A component of a reporting entity or a group of components of a reporting entity that are disposed or meet the criteria to beclassified as held for sale should be reported in discontinued operations if the disposal represents a strategic shift that has (or will have) a major effect on anentity's operations and financial results. The accounting guidance requires a business activity that, on acquisition, meets the criteria to be classified as heldfor sale be reported as a discontinued operation. For further information on the Company's assets held for sale and discontinued operations, see Notes 4 and 5.Asset Retirement CostsThe fair value of a liability for an asset retirement obligation is recognized in the period in which it is incurred. The associated retirement costs arecapitalized and included as part of the carrying value of the long-lived asset and amortized over the useful life of the asset. Subsequent to the initialmeasurement, the Company accretes the liability in relation to the asset retirement obligations over time and the accretion expense is recorded as a cost ofrevenue. The Company’s asset retirement obligations are primarily related to its IBX data centers, of which the majority are leased under long-termarrangements, and, in certain cases, are required to be returned to the landlords in their original condition. The majority of the Company’s IBX data centerleases have been subject to significant development by the Company in order to convert them from, in most cases, vacant buildings or warehouses into IBXdata centers. The majority of the Company’s IBX data centers’ initial lease terms expire at various dates ranging from 2018 to 2065 and most of them enablethe Company to extend the lease terms.Goodwill and Other Intangible AssetsThe Company has three reportable segments comprised of the 1) Americas, 2) EMEA and 3) Asia-Pacific geographic regions, which the Company alsodetermined are its reporting units. Goodwill will not be amortized and will be tested for impairment atF-11Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)lease annually. As of December 31, 2017, the Company had goodwill attributable to its Americas, EMEA and Asia-Pacific reporting units.The Company has the option to assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less thanits carrying value. If, after assessing the qualitative factors, the Company determines that it is not more likely than not that the fair value of a reporting unit isless than its carrying value, then performing the two-step impairment test is unnecessary. However, if the Company concludes otherwise, then it is required toperform the first step of the two-step goodwill impairment test. The first step, identifying a potential impairment, compares the fair value of a reporting unitwith its carrying amount, including goodwill. If the carrying value of the reporting unit exceeds its fair value, the second step would need to be conducted;otherwise, no further steps are necessary as no potential impairment exists. The second step, measuring the impairment loss, compares the implied fair valueof the reporting unit goodwill with the carrying amount of that goodwill. Any excess of the reporting unit goodwill carrying value over the respectiveimplied fair value is recognized as an impairment loss.The Company assessed qualitative and quantitative factors during the fourth quarter of 2017 to determine whether it was more likely than not that thefair value of its Americas reporting unit, EMEA reporting unit and Asia-Pacific reporting unit was less than its carrying value. Qualitative factors consideredin the assessment include industry and market conditions, overall financial performance, and other relevant events and factors affecting the reporting unit.Additionally, as part of this analysis, the Company may perform a quantitative analysis to support the qualitative factors by evaluating sensitivities toassumptions and inputs used in measuring a reporting unit's fair value. In 2016, the Company elected to bypass the qualitative assessment and performed thefirst step of the two-step goodwill impairment test for its Americas, EMEA and Asia-Pacific reporting units during the fourth quarter of 2016. In order todetermine the fair value of each reporting unit, the Company utilizes the discounted cash flow and market methods. The assumptions supporting thediscounted cash flow method was determined using the Company’s best estimates as of the date of the impairment review. As of December 31, 2017 and December 31, 2016, the Company concluded that it was more likely than not that goodwill attributed to the Company’sAmericas, EMEA and Asia-Pacific reporting units was not impaired as the fair value of each reporting unit exceeded the carrying value of its respectivereporting unit, including goodwill.Impairment assessments inherently involve judgment as to assumptions about expected future cash flows and the impact of market conditions on thoseassumptions. Future events and changing market conditions may impact the Company’s assumptions as to prices, costs, growth rates or other factors that mayresult in changes in the Company’s estimates of future cash flows. Although the Company believes the assumptions it used in its evaluation of impairmentare reasonable, significant changes in any one of the Company’s assumptions could produce a significantly different result. Indicators of potentialimpairment that might lead the Company to perform interim goodwill impairment assessments include significant and unforeseen customer losses, asignificant adverse change in legal factors or in the business climate, a significant adverse action or assessment by a regulator, a significant stock pricedecline or unanticipated competition.All of our intangible assets are subject to amortization and are amortized using the straight-line method over their estimated period of benefit. Weperform a review of other intangible assets for impairment by assessing events or changes in circumstances that indicate the carrying amount of an asset maynot be recoverable. Recoverability of assets to be held and used is assessed by comparing the carrying amount of an asset to estimated undiscounted futurenet cash flows expected to be generated by the asset. If the carrying amount of the asset exceeds its estimated discounted future cash flows, an impairmentcharge is recognized by the amount by which the carrying amount of the asset exceeds the fair value of the asset. The Company did not record anyimpairment charges related to its other intangible assets during the years ended December 31, 2017, 2016 and 2015.For further information on goodwill and other intangible assets, see Note 2 and Note 6 below.Debt Issuance CostsLoan fees and costs are capitalized and are amortized over the life of the related loans based on the effective interest method. Such amortization isincluded as a component of interest expense. Debt issuance costs related to outstanding debt are presented as a reduction of the carrying amount of the debtliability and debt issuance costs related to the revolving credit facility are presented as other assets. For the year ended December 31, 2016, debt issuancecosts related to the unsecured bridge facility and undrawn term B-2 Loan are presented as other current assets.F-12Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)Derivatives and Hedging ActivitiesThe Company recognizes all derivatives on the Company's consolidated balance sheets at fair value. The accounting for changes in the value of aderivative depends on whether or not the contract has been designated and qualifies for hedge accounting. In order to qualify for hedge accounting, aderivative must be considered highly effective at reducing the risk associated with the exposure being hedged. In order for a derivative to be designated as ahedge, there must be documentation of the risk management objective and strategy, including identification of the hedging instrument, the hedged item andthe risk exposure, and how effectiveness is to be assessed prospectively and retrospectively. To assess effectiveness of derivatives that qualify for hedgeaccounting, the Company uses a regression analysis. The extent to which a hedging instrument has been and is expected to continue to be effective atachieving offsetting changes in cash flows is assessed and documented at least quarterly. For qualifying cash flow hedges, the effective portion of the changein the fair value of the derivative is recorded in other comprehensive income (loss) and recognized in the consolidated statements of operations when thehedged cash flows affect earnings in the same statement of operations line item as the hedged item. The ineffective portion of cash flow hedges isimmediately recognized in earnings. If it is determined that a derivative is not highly effective at hedging the designated exposure, hedge accounting isdiscontinued. If the hedge relationship is terminated, then the change in fair value of the derivative recorded in other comprehensive income (loss) isrecognized in earnings when the cash flows that were hedged occur, consistent with the original hedge strategy. For hedge relationships discontinuedbecause the forecasted transaction is not expected to occur according to the original strategy, any related derivative amounts recorded in othercomprehensive income (loss) are immediately recognized in earnings.Foreign currency gains or losses associated with derivatives that do not qualify for hedge accounting are recorded within other income (expense) in theCompany’s consolidated statements of operations, with the exception of foreign currency embedded derivatives contained in certain of the Company’scustomer contracts (see "Revenue Recognition" below), which are recorded within revenues in the Company’s consolidated statements of operations. TheCompany does not use derivatives for speculative or trading purposes.For further information on derivatives and hedging activities, see Note 7 below.Fair Value of Financial InstrumentsThe carrying value of the Company’s cash and cash equivalents, short-term investments, long-term investments and derivative instruments representtheir fair value, while the Company’s accounts receivable, accounts payable and accrued expenses and accrued property, plant and equipment approximatetheir fair value due primarily to the short-term maturity of the related instruments. The fair value of the Company’s debt, which is traded in the public debtmarket, is based on quoted market prices. The fair value of the Company’s debt, which is not publicly traded, is estimated by considering the Company’scredit rating, current rates available to the Company for debt of the same remaining maturities and terms of the debt.Fair Value MeasurementsThe Company measures and reports certain financial assets and liabilities at fair value on a recurring basis, including its investments in money marketfunds, certificates of deposit, publicly traded equity securities and derivatives.The Company also follows the accounting standard for the measurement of fair value for non-financial assets and liabilities on a nonrecurring basis.These include:•Non-financial assets and non-financial liabilities initially measured at fair value in a business combination or other new basis event, but notmeasured at fair value in subsequent reporting periods;•Reporting units and non-financial assets and non-financial liabilities measured at fair value for goodwill impairment tests;•Indefinite-lived intangible assets measured at fair value for impairment assessments;•Non-financial long-lived assets or asset groups measured at fair value for impairment assessments or disposal; and•Asset retirement obligations initially measured at fair value but not subsequently measured at fair value.For further information on fair value measurements, see Note 8 below.F-13Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)Revenue RecognitionEquinix derives more than 90% of its revenues from recurring revenue streams, consisting primarily of (1) colocation, which includes the licensing ofcabinet space and power; (2) interconnection offerings, such as cross connects and Equinix Exchange ports; (3) managed infrastructure solutions and (4)other revenues consisting of rental income from tenants or subtenants. The remainder of the Company’s revenues are from non-recurring revenue streams,such as installation revenues, certain professional services, contract settlements and equipment sales. Revenues from recurring revenue streams are generallybilled monthly and recognized ratably over the term of the contract, generally one to three years for IBX data center colocation customers. Non-recurringinstallation fees, although generally paid in a lump sum upon installation, are deferred and recognized ratably over the period the customer is expected tobenefit from the installation. Professional service fees are recognized in the period in which the services were provided and represent the culmination of aseparate earnings process as long as they meet the criteria for separate recognition under the accounting standard related to revenue arrangements withmultiple deliverables. Revenue from providing bandwidth access and equipment sales is recognized on a gross basis in accordance with the accountingstandard related to reporting revenue gross as a principal versus net as an agent, primarily because the Company acts as the principal in the transaction, takestitle to products and services and bears inventory and credit risk. To the extent the Company does not meet the criteria for recognizing bandwidth access andequipment services as gross revenue, the Company records the revenue on a net basis. Revenue from contract settlements, when a customer wishes toterminate their contract early, is generally recognized as the termination occurs, when no remaining related performance obligations exist and the customer isdeemed to be creditworthy, to the extent that the revenue has not previously been recognized.The Company guarantees certain service levels, such as uptime, as outlined in individual customer contracts. If these service levels are not achieved dueto any failure of the physical infrastructure or offerings, or in the event of certain instances of damage to customer infrastructure within the Company’s IBXdata centers, the Company would generally reduce revenue for any credits or cash payments given to the customer as a result. The Company generallydetermines such service level credits and cash payments prior to the associated revenue being recognized, and historically, these credits and cash paymentshave generally not been significant.Revenue is recognized only when the service has been provided and when there is persuasive evidence of an arrangement, the fee is fixed ordeterminable and collection of the receivable is reasonably assured. It is the Company’s customary business practice to obtain a signed master salesagreement and sales order prior to recognizing revenue in an arrangement. Taxes collected from customers and remitted to governmental authorities arereported on a net basis and are excluded from revenue.As a result of certain customer agreements being priced in currencies different from the functional currencies of the parties involved, under applicableaccounting rules, the Company is deemed to have foreign currency forward contracts embedded in these contracts. The Company refers to these as foreigncurrency embedded derivatives (see Note 7). These instruments are separated from their host contracts and held on the Company’s consolidated balance sheetat their fair value. The majority of these foreign currency embedded derivatives arise in certain of the Company’s subsidiaries where the local currency is thesubsidiary’s functional currency and the customer contract is denominated in the U.S. dollar. Changes in their fair values are recognized within revenues inthe Company’s consolidated statements of operations.The Company assesses collectability based on a number of factors, including past transaction history with the customer and the credit-worthiness of thecustomer. The Company generally does not request collateral from its customers although in certain cases the Company obtains a security interest in acustomer’s equipment placed in its IBX data centers or obtains a deposit. If the Company determines that collection of a fee is not reasonably assured, the feeis deferred and revenue is recognized at the time collection becomes reasonably assured, which is generally upon receipt of cash. In addition, the Companyalso maintains an allowance for doubtful accounts for estimated losses resulting from the inability of its customers to make required payments for which theCompany had expected to collect the revenues. If the financial condition of the Company’s customers were to deteriorate or if they became insolvent,resulting in an impairment of their ability to make payments, greater allowances for doubtful accounts may be required. Management specifically analyzesaccounts receivable and current economic news and trends, historical bad debts, customer concentrations, customer credit-worthiness and changes incustomer payment terms when evaluating revenue recognition and the adequacy of the Company’s reserves. Any amounts that were previously recognized asrevenue and subsequently determined to be uncollectable are charged to bad debt expense included in general and administrative expense in theconsolidated statements of operations. A specific bad debt reserve of up to the full amount of a particular invoice value is provided for certain problematiccustomer balances. An additional reserve is established for all other accounts based on the age of the invoices and an analysis of historical credits issued.Delinquent account balances are written-off after management has determined that the likelihood of collection is not probable.F-14Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)Income TaxesIncome taxes are accounted for under the asset and liability method. Under this method, deferred tax assets and liabilities are recognized for the futuretax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases.Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the year in which those temporary differencesare expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period thatincludes the enactment date. Valuation allowances are established when necessary to reduce deferred tax assets to the amounts that are expected more likelythan not to be realized in the future. A tax benefit from an uncertain income tax position may be recognized in the financial statements only if it is morelikely than not that the position is sustainable, based solely on its technical merits and consideration of the relevant taxing authority’s widely understoodadministrative practices and precedents.The Company has been operating as a REIT for federal income tax purposes effective January 1, 2015. As a result, the Company may deduct thedistributions made to its stockholders from taxable income generated by the Company and its qualified REIT subsidiaries ("QRSs"). The Company’sdividends paid deduction generally eliminates the U.S. taxable income of the Company and its QRSs, resulting in no U.S. income tax due. However, theCompany's taxable REIT subsidiaries ("TRSs") will continue to be subject to income taxes on any taxable income generated by them. In addition, the foreignoperations of the Company will continue to be subject to local income taxes regardless of whether the foreign operations are operated as a QRS or TRS.Stock-Based CompensationStock-based compensation cost is measured at the grant date for all stock-based awards made to employees and directors based on the fair value of theaward and is recognized as expense over the requisite service period, which is generally the vesting period.The Company grants restricted stock units to its employees and these equity awards generally have only a service condition. The Company grantsrestricted stock units to its executives and these awards generally have a service and performance condition or a service and market condition. To date, anyperformance conditions contained in an equity award are tied to the financial performance of the Company or a specific region of the Company. TheCompany assesses the probability of meeting these performance conditions on a quarterly basis. The majority of the Company’s equity awards vest over fouryears, although certain of the equity awards for executives vest over a range of two to four years. The valuation of restricted stock units with only a servicecondition or a service and performance condition requires no significant assumptions as the fair value for these types of equity awards is based solely on thefair value of the Company’s stock price on the date of grant. The Company uses a Monte Carlo simulation option-pricing model to determine the fair value ofrestricted stock units with a service and market condition.The Company uses the Black-Scholes option-pricing model to determine the fair value of its employee stock purchase plan. The determination of the fairvalue of shares purchased under the employee stock purchase plan is affected by assumptions regarding a number of complex and subjective variablesincluding the Company’s expected stock price volatility over the term of the awards and actual and projected employee stock purchase behaviors. TheCompany estimated the expected volatility by using the average historical volatility of its common stock that it believed was best representative of futurevolatility. The risk-free interest rate used was based on U.S. Treasury zero-coupon issues with remaining terms similar to the expected term of the equityawards. The expected dividend rate used was based on average dividend yields and the expected term used was equal to the term of each purchase window.The accounting standard for stock-based compensation does not allow the recognition of unrealized tax benefits associated with the tax deductions inexcess of the compensation recorded (excess tax benefit) until the excess tax benefit is realized (i.e., reduces taxes payable). In periods prior to 2017, theCompany recognized the benefit from stock-based compensation in equity when the excess tax benefit is realized by following the "with-and-without"approach. Upon adoption of ASU No. 2016-09, Compensation - Stock Compensation (Topic 718) on January 1, 2017, the Company records the excess taxbenefits from stock-based compensation as income tax expense through the statement of operations instead of additional paid-in capital as required under theprevious guidance.For further information on stock-based compensation, see Note 12 below.Foreign Currency TranslationThe financial position of foreign subsidiaries is translated using the exchange rates in effect at the end of the period, while income and expense items aretranslated at average rates of exchange during the period. Gains or losses from translation of foreignF-15Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)operations where the local currency is the functional currency are included as other comprehensive income (loss). The net gains and losses resulting fromforeign currency transactions are recorded in net income (loss) in the period incurred and reported within other income and expense. Certain inter-companybalances are designated as loans of a long-term investment-type nature. Accordingly, exchange gains and losses associated with these long-term inter-company balances are recorded as a component of other comprehensive income (loss), along with translation adjustments.Earnings Per ShareThe Company computes basic and diluted EPS for net income. Basic EPS is computed using net income and the weighted-average number of commonshares outstanding. Diluted EPS is computed using net income, adjusted for interest expense as a result of the assumed conversion of the Company’s 4.75%Convertible Subordinated Notes, if dilutive, and the weighted-average number of common shares outstanding plus any dilutive potential common sharesoutstanding. Dilutive potential common shares include the assumed exercise, vesting and issuance activity of employee equity awards using the treasurystock method, as well as shares issuable upon the assumed conversion of the 4.75% Convertible Subordinated Notes. See Note 3 below.Treasury StockThe Company accounts for treasury stock under the cost method. When treasury stock is re-issued at a higher price than its cost, the difference is recordedas a component of additional paid-in capital to the extent that there are gains to offset the losses. If there are no treasury stock gains in additional paid-incapital, the losses are recorded as a component of retained earnings (accumulated deficit).Recent Accounting PronouncementsAccounting Standards Not Yet AdoptedIn August 2017, Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2017-12 Derivatives and Hedging(Topic 815): Targeted Improvements to Accounting for Hedging Activities. This ASU was issued to improve the financial reporting of hedging relationshipsto better portray the economic results of an entity’s risk management activities in its financial statements and to simplify the application of the hedgeaccounting guidance in current generally accepted accounting principles ("GAAP"). This ASU permits hedge accounting for risk components involvingnonfinancial risk and interest rate risk, requires an entity to present the earnings effect of the hedging instrument in the same income statement line item inwhich the hedged item is reported, no longer requires separate measurement and reporting of hedge ineffectiveness, eases the requirement for hedgeeffectiveness assessment, and requires a tabular disclosure related to the effect on the income statement of fair value and cash flow hedges. This ASU iseffective for annual or any interim reporting periods beginning after December 15, 2018 with early adoption permitted. The Company is currently evaluatingthe impact that the adoption of this standard will have on its consolidated financial statements.In May 2017, FASB issued ASU No. 2017-09 Compensation–Stock Compensation (Topic 718). This ASU was issued primarily to provide clarity andreduce both diversity in practice and cost and complexity when applying the guidance in Topic 718 to a change to the terms or conditions of a share-basedpayment award. This ASU affects any entity that changes the terms or conditions of a share-based payment award. This ASU provides guidance about whichchanges to the terms or conditions of a share-based payment award require an entity to apply modification accounting in Topic 718. This ASU is effective forannual or any interim reporting periods beginning after December 15, 2017 with early adoption permitted. The Company will adopt this standard effectiveJanuary 1, 2018. The adoption of ASU 2017-09 is not expected to have a significant impact on its consolidated financial statements.In March 2017, FASB issued ASU No. 2017-07 Compensation–Retirement Benefits (Topic 715). This ASU was issued primarily to improve thepresentation of net periodic pension cost and net periodic post-retirement benefit cost. This ASU requires that an employer reports the service cost componentin the same line item or items as other compensation costs arising from services rendered by the pertinent employees during the period. It also requires theother components of net periodic pension cost and net periodic post-retirement benefit cost to be presented in the income statement separately from theservice cost component and outside a subtotal of income from operations, if one is presented. Additionally, only the service cost component is eligible forcapitalization, when applicable. This ASU is effective for annual or any interim reporting periods beginning after December 15, 2017. The Company willadopt this standard effective January 1, 2018. The adoption of ASU 2017-07 is not expected to have a significant impact on its consolidated financialstatements.In February 2017, FASB issued ASU No. 2017-05 Other Income—Gains and Losses from the Derecognition of Non-Financial Assets (Subtopic 610-20).This ASU is to clarify the scope of the non-financial asset guidance in Subtopic 610-20 and to addF-16Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)guidance for partial sales of non-financial assets. This ASU defines the term in substance non-financial asset and clarifies that non-financial assets within thescope of Subtopic 610-20 may include non-financial assets transferred within a legal entity to a counterparty. The ASU also provides guidance on theaccounting for what often are referred to as partial sales of non-financial assets within the scope of Subtopic 610-20 and contributions of non-financial assetsto a joint venture or other non-controlled investee. This ASU is effective for annual or any interim reporting periods beginning after December 15, 2017.Early adoption is permitted for interim or annual reporting periods beginning after December 15, 2016. The Company will adopt this standard effectiveJanuary 1, 2018. The adoption of this standard is not expected to have a significant impact on its consolidated financial statements.In January 2017, FASB issued ASU No. 2017-04 Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. This ASUis to simplify the subsequent measurement of goodwill. The ASU eliminates step 2 from the goodwill impairment test and the requirements for any reportingunit with a zero or negative carrying amount to perform a qualitative assessment and, if it fails that qualitative test, to perform step 2 of the goodwillimpairment test. An entity still has the option to perform the qualitative assessment for a reporting unit to determine if the quantitative impairment test isnecessary. This ASU should be applied on a prospective basis. This ASU is effective for the Company for its annual or any interim goodwill impairment testsin fiscal years beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing datesafter January 1, 2017. The Company elected to early adopt the standard effective January 1, 2018. The adoption of this standard is not expected to have asignificant impact on its consolidated financial statements.In January 2017, FASB issued ASU No. 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business. The ASU provides newguidance to assist entities with evaluating when a set of transferred assets and activities is a business. The definition of a business affects many areas ofaccounting including acquisitions, disposals, goodwill, and consolidation. The ASU is effective for annual periods beginning after December 15, 2017,including interim periods within those periods with early adoption being permitted. The Company will adopt this standard prospectively effective January 1,2018. The adoption of this standard may impact the accounting of future transactions.In October 2016, FASB issued ASU 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory. This ASU requires therecognition of the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. This ASU is effective forfiscal years and interim period within those fiscal years, beginning after December 15, 2017, with early adoption permitted. The Company will adopt thisstandard effective January 1, 2018. The adoption of this standard is not expected to have a significant impact on its consolidated financial statements.In June 2016, FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.The ASU requires the measurement of all expected credit losses for financial assets held at the reporting date based on historical experience, currentconditions, and reasonable and supportable forecasts. The ASU requires enhanced disclosures to help investors and other financial statement users betterunderstand significant estimates and judgments used in estimating credit losses, as well as the credit quality and underwriting standards of an organization'sportfolio. These disclosures include qualitative and quantitative requirements that provide additional information about the amounts recorded in thefinancial statements. In addition, the ASU amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets withcredit deterioration. The ASU is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019, with earlyadoption permitted for all organizations for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. The Companyexpects this ASU to impact its accounts receivable and is currently evaluating the extent of the impact that the adoption of this standard will have on itsconsolidated financial statements.In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) ("ASU 2016-02"). In September 2017, the FASB issued ASU 2017-13 and ASU2018-01, which provide additional implementation guidance on the previously issued ASU 2016-02. Under the new guidance, lessees will be required torecognize the following for all leases (with the exception of short-term leases) at the commencement date: (1) a lease liability, which is a lessee's obligation tomake lease payments arising from a lease, measured on a discounted basis; and (2) a right-of-use asset, which is an asset that represents the lessee's right touse, or control the use of, a specified asset for the lease term. The new lease guidance simplified the accounting for sale and leaseback transactions primarilybecause lessees must recognize lease assets and lease liabilities. Lessees (for capital and operating leases) and lessors (for sales-type, direct financing, andoperating leases) must apply a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparativeperiod presented in the financial statements. The modified retrospective approach would not require any transition accounting for leases that expired beforethe earliest comparative period presented. Lessees and lessors may not apply a full retrospective transition approach. The ASU is effective for fiscal yearsbeginning after December 15, 2018, including interim periods within those fiscal years, with early adoption permitted. The Company plans to elect thepractical expedient that it will not reassess whether any expired or existing contracts are or contain leases, the lease classification for any expired or existingleases or initial direct costs for any existing leases. The Company does not plan to electF-17Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)the practical expedient to use hindsight in determining the lease term and in assessing impairment of right-of-use assets. The Company expects to record asignificant increase in assets and liabilities on the consolidated balance sheet at adoption due to the recording of right-of-use assets and corresponding leaseliabilities.In January 2016, the FASB issued ASU 2016-01, Financial Instruments- Overall (Subtopic 825-10) ("ASU 2016-01"), which requires all equityinvestments to be measured at fair value with changes in the fair value recognized through net income other than those accounted for under equity method ofaccounting or those that result in consolidation of the investees. The ASU also requires that an entity present separately in other comprehensive income theportion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk when the entity has elected to measurethe liability at fair value in accordance with the fair value option for financial instruments. In addition, the ASU eliminates the requirement to disclose the fairvalue of financial instruments measured at amortized cost for entities that are not public business entities and the requirement to disclose the method(s) andsignificant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost on the balancesheet for public business entities. ASU 2016-01 is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscalyears. The Company currently holds publicly traded equity securities that are classified as "available-for-sale" and are carried at fair value with unrealizedgains and losses reported in stockholders’ equity as a component of accumulated other comprehensive income (loss). Upon the adoption of this ASU, theunrealized gains and losses will be recognized through net income. The Company will adopt this standard effective January 1, 2018. The adoption of thisstandard is not expected to have a significant impact on its consolidated financial statements.In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers ("ASU 2014-09") and issued subsequent amendments to the initialguidance with ASU 2015-14, ASU 2016-08, ASU 2016-10, ASU 2016-11, ASU 2016-12, ASU 2016-20, ASU 2017-13 and ASU 2017-14 collectively referredas "Topic 606." Topic 606 supersedes the existing guidance and requires the entity to recognize revenue for the transfer of goods or services equal to theamount that it expects to be entitled to receive for those goods or services. Topic 606 requires additional disclosure about the nature, amount, timing anduncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments. Topic 606 is effective forentities beginning January 1, 2018, with early adoption permitted.The standard allows entities to adopt with one of these two methods: full retrospective, which applies retrospectively to each prior reporting periodpresented, or modified retrospective, which recognizes the cumulative effect of initially applying the revenue standard as an adjustment to the openingbalance of retained earnings in the period of initial application. On January 1, 2018, the Company adopted Topic 606 using the modified retrospectiveapproach applied to the contracts which were not completed as of January 1, 2018 and expects to recognize an increase to retained earnings of approximately$267 million to $307 million before any potential tax impact. The Company is still assessing tax impacts related to this adjustment.The most significant impact to the Company from this standard relates to installation revenue and cost to obtain contracts. Under the new standard, theCompany expects to recognize installation revenue over the contract period rather than over the estimated installation life under the prior revenue standard.Under the new standard, the Company is also required to capitalize and amortize certain costs to obtain contracts, rather than expense them immediatelyunder existing GAAP.Accounting Standards AdoptedIn January 2017, FASB issued ASU No. 2017-03, Accounting Changes and Error Corrections (Topic 250). The ASU adds SEC disclosure requirements forboth the quantitative and qualitative impacts that certain recently issued accounting standards will have on the financial statements of a registrant when suchstandards are adopted in a future period. Specially, these disclosure requirements apply to the adoption of ASU No. 2014-09, Revenue from Contracts withCustomers (Topic 606); ASU No. 2016-02, Leases (Topic 842); and ASU No. 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement ofCredit Losses on Financial Instruments. This ASU is effective immediately. The Company adopted ASU 2017-03 in the three months ended March 31, 2017by including appropriate disclosure requirements within its condensed consolidated financial statements to adhere to this new standard.In December 2016, FASB issued ASU No. 2016-19, Technical Corrections and Improvements. This ASU covers a wide range of Topics in the AccountingStandards Codification. Certain aspects of this ASU were effective immediately, while a few of the corrections are effective for the Company for its fiscalyears beginning after December 15, 2016, and interim periods within those fiscal years. The Company adopted ASU 2016-19 in the three months endedMarch 31, 2017. The adoption of ASU 2016-19 did not impact the Company's consolidated financial statements.F-18Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)In November 2016, FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash. This ASU applies to all entities that haverestricted cash or restricted cash equivalents and are required to present a statement of cash flows. The ASU requires that a statement of cash flows explain thechange during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. As a result,amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling thebeginning-of-period and end-of-period total amounts shown on the statement of cash flows. This ASU is effective for the Company for its fiscal yearsbeginning after December 15, 2017, and interim periods within those fiscal years with early adoption being permitted. This ASU should be applied using aretrospective transition method to each period presented. The Company adopted ASU 2016-18 in the three months ended March 31, 2017 and applied thisASU retrospectively to the periods presented in the Company's consolidated statements of cash flows. Net cash used in investing activities were adjusted toexclude the change in restricted cash primarily related to restricted cash set aside for the TelecityGroup acquisition, resulting in an increased in thepreviously reported amount by $453.5 million for the year ended December 31, 2016 and a decrease in the previously reported amount by $497.1 million forthe year ended December 31, 2015. Restricted cash amounts are primarily time deposits or cash set side as a pledge for our mortgage loan in Germany, anescrow account for a data center project and collateral for the Company's various bank guarantees for the periods ended December 31, 2017 and 2016.In October 2016, FASB issued ASU No. 2016-17, Consolidation (Topic 810): Interests Held through Related Parties That Are under Common Control.This ASU alters how a decision maker needs to consider indirect interests in a variable interest entity ("VIE") held through an entity under common control.Under this ASU, if a decision maker is required to evaluate whether it is the primary beneficiary of a VIE, it will need to consider only its proportionateindirect interest in the VIE held through a common control party. This ASU is effective for fiscal years beginning after December 15, 2016, including interimperiods within those fiscal years, with early adoption permitted. The Company adopted ASU 2016-17 in the three months ended March 31, 2017. Theadoption of this standard did not impact the Company's consolidated financial statements as it does not hold any interests in a VIE through related partiesthat are under common control.In August 2016, FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. ThisASU provides guidance on the classification of eight cash flow issues to reduce the existing diversification in practice, including (a) debt prepayment or debtextinguishment costs; (b) settlement of zero-coupon debt instruments or other debt instruments with coupon interest rates that are not significant in relationto the effective interest rate of the borrowing; (c) contingent consideration payments made after a business combination; (d) proceeds from settlement ofinsurance claims; (e) proceeds from the settlement of corporate-owned life insurance policies, including bank-owned life insurance policies; (f) distributionsreceived from equity method investees; (g) beneficial interests in securitization transactions; and (h) separately identifiable cash flows and application of thepredominance principle. The ASU is effective for fiscal years and interim period within those fiscal years, beginning after December 15, 2017, with earlyadoption permitted. The Company adopted ASU 2016-15 in the three months ended March 31, 2017 and applied this ASU using a retrospective transitionmethod to each period presented in the Company's consolidated statements of cash flows. The adoption of ASU 2016-15 did not impact the Company'sconsolidated statements of cash flows.In March 2016, the FASB issued ASU 2016-09, Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based PaymentAccounting ("ASU 2016-09"). This ASU simplifies several areas of the accounting for share-based payment award transactions, including (a) income taxconsequences; (b) classification of awards as either equity or liabilities; and (c) classification on the statement of cash flows. This ASU is effective for annualperiods beginning after December 15, 2016, and interim periods within those annual periods, with early adoption permitted. The Company adopted ASU2016-09 in the three months ended March 31, 2017. Beginning on January 1, 2017, the Company began to record the excess tax benefits from stock-basedcompensation as income tax expense through the statement of operations instead of additional paid-in capital as required under the previous guidance. Therewas no adjustment to excess tax benefits from stock-based compensation recorded as additional paid-in capital in prior years. Excess tax benefits that werenot previously recognized, as well as a valuation allowance recognized for deferred tax assets as a result of the adoption of this ASU, were recorded on amodified retrospective basis through a cumulative-effect adjustment to retained earnings as of the beginning of 2017 totaling $1.1 million. As a part of theadoption of this ASU, stock compensation awards will have more dilutive effect on the Company's earnings per share prospectively.Under this guidance, cash flows related to excess tax benefits will no longer be separately classified as financing activities apart from other income taxcash flow. The Company elected to apply this part of the guidance retrospectively, which resulted in a change of $2.8 million and $30.0 thousand in both netcash provided by operating activities and net cash used in financing activities in the Company's consolidated statements of cash flows for the years endedDecember 31, 2016 and December 31, 2015 respectively, to conform with the current period presentation. Additionally, this guidance permits entities tomake an accounting policy to estimate forfeitures each period or to account for forfeitures as they occur. The Company elected to continue to estimateforfeitures.F-19Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)In March 2016, the FASB issued ASU 2016-06, Derivatives and Hedging (Topic 815), Contingent Put and Call Options in Debt Instruments ("ASU 2016-06"). This ASU clarifies the requirements for assessing whether contingent call (put) options that can accelerate the payment of principal on debt instrumentsare clearly and closely related to their debt hosts. An entity performing the assessment under the amendments in this ASU is required to assess the embeddedcall (put) options solely in accordance with the four-step decision sequence. This guidance is to be applied on a modified retrospective basis to existing debtinstruments as of the beginning of the fiscal year in which the amendments are effective, and is effective for fiscal years beginning after December 15, 2016,including interim periods within those fiscal years. The Company adopted ASU 2016-06 in the three months ended March 31, 2017. The adoption of thisstandard did not impact the Company's consolidated financial statements.In March 2016, the FASB issued ASU 2016-05, Derivatives and Hedging (Topic 815), Effect of Derivative Contract Novations on Existing HedgeAccounting Relationships ("ASU 2016-05"). This ASU clarifies that a change in the counterparty to a derivative instrument that has been designated as ahedging instrument under Topic 815 does not, in and of itself, require dedesignation of that hedging relationship provided that all other hedge accountingcriteria continue to be met. This ASU may be applied prospectively or using a modified retrospective approach, and is effective for fiscal years beginningafter December 15, 2016, including interim periods within those fiscal years. The Company adopted ASU 2016-05 in the three months ended March 31,2017. The adoption of ASU 2016-05 did not impact the Company's consolidated financial statements.2. AcquisitionsProposed Acquisition of the Metronode group of companiesOn December 15, 2017, the Company entered into a transaction agreement with Ontario Teachers’ Pension Plan to acquire all of the equity interests inthe Metronode group of companies, an Australian data center business, in an all-cash transaction for A$1.035 billion, or approximately $791.2 million at theexchange rate in effect on December 15, 2017. Metronode operates 10 data centers in six metro areas in Australia. The acquisition will further strengthen theCompany’s leadership position in the Asia-Pacific region and support its ongoing global expansion. The acquisition is expected to close in the first half of2018 and is subject to customary closing conditions including regulatory approval. The Company expects to account for the Metronode acquisition as abusiness combination using the acquisition method of accounting.Certain Verizon Data Center Assets AcquisitionOn May 1, 2017, the Company completed the acquisition of certain colocation business from Verizon consisting of 29 data center buildings located inthe United States, Brazil and Colombia, for a cash purchase price of approximately $3.6 billion. The addition of these facilities and customers will furtherstrengthen the Company's global platform by increasing interconnections and accelerating the Company's penetration of the enterprise and strategic markets,including government and energy. The Company funded the Verizon Data Center Acquisition with proceeds from debt and equity financings, which closedin January and March 2017 (See further discussions on the term loan borrowing and senior notes issuance in Note 10 and common stock issuance in Note 11).In connection with the Verizon Data Center Acquisition, the Company entered into a commitment letter (the "Commitment Letter"), dated December 6,2016, pursuant to which a group of lenders committed to provide a senior unsecured bridge facility in an aggregate principal amount of $2.0 billion for thepurposes of funding a portion of the cash consideration for the Verizon Data Center Acquisition. Following the completion of the debt and equity financingsassociated with the Verizon Data Center Acquisition in March 2017, the Company terminated the Commitment Letter. The Company paid $10.0 million ofcommitment fees associated with the Commitment Letter and recorded $2.2 million for the year ended December 31, 2016 and $7.8 million for the yearended December 31, 2017 to interest expense in the consolidated statements of operations.The Company included the Verizon Data Center Acquisition's results of operations from May 1, 2017 in its consolidated statements of operations andthe estimated fair value of assets acquired and liabilities assumed in its consolidated balance sheets beginning May 1, 2017. The Company incurredacquisition costs of approximately $28.5 million and $7.6 million during the year ended December 31, 2017 and December 31, 2016, respectively, related tothe Verizon Data Center Acquisition.Purchase Price AllocationThe Verizon Data Center Acquisition constitutes a business under the accounting standard for business combinations and, therefore, was accounted for asa business combination using the acquisition method of accounting. Under the acquisition method of accounting, the total purchase price is allocated to theassets acquired and liabilities assumed measured at fair value on the date of acquisition. As of December 31, 2017, the Company has not completed thedetailed valuation analysis to derive the fair value of the following items, including but not limited to: property, plant and equipment, intangible assets anddeferred taxes. Therefore,F-20Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)the allocation of the purchase price to assets acquired and liabilities assumed is based on provisional estimates and is subject to continuing managementanalysis, with assistance from third party valuation advisers. As of December 31, 2017, the Company has updated the preliminary allocation of purchase pricefor Verizon Data Center Acquisition from the provisional amounts reported as of June 30, 2017, which primarily resulted in a decrease in intangible assetsof $9.0 million and an increase in goodwill of $7.7 million. The changes in fair value of acquired assets and liabilities assumed did not have a significantimpact on the Company’s results of operations for any reporting periods prior to December 31, 2017.The Company may further adjust these amounts as valuations are finalized and the Company obtains information necessary to complete the analyses, butno later than one year from the acquisition date. The preliminary purchase price allocation is as follows (in thousands): Certain VerizonData Center AssetsCash and cash equivalents$1,073Accounts receivable2,019Other current assets7,319Property, plant, and equipment840,335Intangible assets (1)1,693,900Goodwill1,095,262Total assets acquired3,639,908Accounts payable and accrued liabilities(1,725)Other current liabilities(2,020)Capital lease and other financing obligations(17,659)Deferred tax liabilities(18,129)Other liabilities(5,689)Net assets acquired$3,594,686(1)The nature of the intangible assets acquired is customer relationships with an estimated useful life of 15 years. Included in this amount is a customer relationship intangibleasset for Verizon totaling $245.3 million. Pursuant to the acquisition agreement, the Company formalized agreements to provide pre-existing space and services to Verizon atthe acquired data centers.The fair value of customer relationships was estimated by applying an income approach. The fair value was determined by calculating the present valueof estimated future operating cash flows generated from existing customers less costs to realize the revenue. The Company applied discount rates rangingfrom 7.7% to 12.2%, which reflected the nature of the assets as they relate to the risk and uncertainty of the estimated future operating cash flows. Othersignificant assumptions used to estimate the fair value of customer relationships include projected revenue growth, customer attrition rates, sales andmarketing expenses and operating margins. The fair value measurements were based on significant inputs that are not observable in the market and thusrepresent Level 3 measurements as defined in the accounting standard for fair value measurements.The fair value of property, plant and equipment was estimated by applying the cost approach. The cost approach is to use the replacement orreproduction cost as an indicator of fair value. The premise of the cost approach is that a market participant would pay no more for an asset than the amountfor which the asset could be replaced or reproduced. The key assumptions of the cost approach include replacement cost new, physical deterioration,functional and economic obsolescence, economic useful life, remaining useful life, age and effective age.Goodwill represents the excess of the purchase price over the fair value of the net tangible and intangible assets acquired and liabilities assumed. Thegoodwill is attributable to the workforce of the acquired business and the projected revenue increase expected to arise from future customers after the VerizonData Center Acquisition. The goodwill is not expected to be deductible for local tax purposes. Goodwill recorded as a result of the Verizon Data CenterAcquisition was attributable to the Company's Americas region. The Company's results of continuing operations include the Verizon Data CenterAcquisition's revenues of $359.1 million and net income from continuing operations of $87.8 million for the period May 1, 2017 through December 31,2017.F-21Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)Other 2017 AcquisitionsIn addition to the Verizon Data Center Acquisition, the Company completed three other acquisitions during 2017. The Company incurred acquisitioncosts of approximately $8.1 million in total during the year ended December 31, 2017 related to these acquisitions. A summary of the allocation of totalpurchase consideration is presented as follows (in thousands): Itconic Zeniumdata center IO UK'sdata centerCash and cash equivalents$15,659 $692 $1,388Accounts receivable16,429 198 7Other current assets1,885 6,430 1,082Property, plant, and equipment68,051 53,749 40,251Intangible assets99,993 6,400 6,252Goodwill125,112 23,077 15,804Deferred tax assets— — 6,714Other assets4,025 5,494 3,396Total assets acquired331,154 96,040 74,894Accounts payable and accrued liabilities(15,846) (1,012) (439)Other current liabilities(12,374) (451) (168)Capital lease and other financing obligations(30,666) — (33,091)Loans payable(3,253) — (4,067)Deferred tax liabilities(2,389) (1,969) —Other liabilities(7,515) (614) (828)Net assets acquired$259,111 $91,994 $36,301On October 9, 2017, the Company completed the acquisition of Itconic for a cash purchase price of €220.5 million or $259.1 million at the exchange ratein effect on October 9, 2017. Itconic is a data center provider in Spain and Portugal, and also includes CloudMas, an Itconic subsidiary which is focused onsupporting enterprise adoption and use of cloud services. The acquisition includes five data centers in four metro areas, with two located in Madrid and oneeach in Barcelona, Seville and Lisbon. Itconic’s operating results will be reported in the EMEA region following the date of acquisition.The nature of the intangible assets acquired from the Itconic acquisition is customer relationships with an estimated useful life of 15 years. The fair valueof customer relationships was estimated by applying an income approach, by calculating the present value of estimated future operating cash flows generatedfrom existing customers less costs to realize the revenue. The Company applied discount rate of 16.0%, which reflects the risk and uncertainty of theestimated future operating cash flows. Other significant assumptions include projected revenue growth, customer attrition rates and operating margins. Thefair value measurements were based on significant inputs that are not observable in the market and thus represent Level 3 measurements as defined in theaccounting standard for fair value measurements. Goodwill is attributable to the workforce of the acquired business and the projected revenue increase fromfuture customers expected to arise after the acquisition.On October 6, 2017, the Company acquired Zenium's a data center business in Istanbul for a cash payment of approximately $92.0 million. The acquiredfacility located in Istanbul, Turkey will be renamed as the Istanbul 2 ("IS2") data center. IS2’s operating results will be reported in the EMEA regionfollowing the date of acquisition. The nature of the intangible assets acquired from this acquisition is customer relationships with an estimated useful life of15 years.As of December 31, 2017, the Company has not completed the detailed valuation analysis of Itconic or the Zenium data center to derive the fair value ofthe following items including, but not limited to: property, plant and equipment, intangible assets and deferred taxes; therefore, the allocation of thepurchase price to assets acquired and liabilities assumed is based on provisional estimates and is subject to continuing management analysis.On February 3, 2017, the Company acquired IO UK's data center operating business in Slough, United Kingdom, for a cash payment of approximately$36.3 million. The acquired facility was renamed as the London 10 ("LD10") data center. LD10's operating results will be reported in the EMEA regionfollowing the date of acquisition. The nature of the intangible assets acquired from this acquisition is customer relationships with an estimated useful life of10 years. As of December 31, 2017, the CompanyF-22Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)has finalized the allocation of purchase price for the IO Acquisition from the provisional amounts first reported as of March 31, 2017 and the adjustmentsmade during the year ended December 31, 2017 were not significant. The changes in fair value of acquired assets and liabilities assumed did not have asignificant impact on the Company’s results of operations for any reporting periods prior to December 31, 2017.Goodwill from the acquisitions of Itconic, the Zenium data center and IO UK's data center is not expected to be deductible for local tax purposes and isattributable to the Company's EMEA region. The Company's results of continuing operations include $22.4 million of revenues from the combinedoperations of Itconic, the Zenium data center and IO UK’s data center and an insignificant net loss from continuing operations for the periods from theirrespective dates of acquisition through December 31, 2017.TelecityGroup AcquisitionOn January 15, 2016, the Company completed the acquisition of the entire issued and to be issued share capital of TelecityGroup. TelecityGroupoperated data center facilities in cities across Europe. The acquisition of TelecityGroup enhances the Company's existing data center portfolio by adding newIBX metro markets in Europe including Dublin, Helsinki, Istanbul, Manchester, Milan, Sofia, Stockholm and Warsaw. As a result of the transaction,TelecityGroup has become a wholly-owned subsidiary of Equinix.Under the terms of the acquisition, the Company acquired all outstanding shares of TelecityGroup and all vested equity awards of TelecityGroup at572.5 pence in cash and 0.0336 new shares of Equinix common stock for a total purchase consideration of approximately £2,624.5 million or approximately$3,743.6 million at the exchange rate in effect on the acquisition date. In addition, the Company assumed $1.3 million of vested TelecityGroup's employeeequity awards as part of consideration transferred. The Company incurred acquisition costs of approximately $42.5 million and $38.3 million during the yearended December 31, 2016 and December 31, 2015, respectively, related to the TelecityGroup acquisition.In connection with the TelecityGroup acquisition, the Company placed £322.9 million or approximately $475.7 million into a restricted cash account,which was included in the current portion of restricted cash in the consolidated balance sheet as of December 31, 2015. The cash was released uponcompletion of the acquisition.Also, in connection with the TelecityGroup acquisition, the Company entered into a bridge credit agreement with a group of lenders for a principalamount of £875.0 million or approximately $1,289.0 million at the exchange rate in effect on December 31, 2015 (the "Bridge Loan"). The Company did notmake any borrowings under the Bridge Loan and the Bridge Loan was terminated on January 8, 2016.Purchase Price AllocationUnder the acquisition method of accounting, the assets acquired and liabilities assumed in a business combination shall be measured at fair value at thedate of the acquisition. As of December 31, 2016, the Company had completed the detailed valuation analysis to derive the fair value of assets acquired andliabilities assumed and had updated the final allocation of purchase price from provisional amounts reported as of March 31, 2016, which primarily resultedin increases to intangible assets of $36.8 million and deferred tax liabilities of $19.5 million and decreases in capital lease and other financing obligations of$34.4 million, goodwill of $22.5 million and assets held for sale of $36.9 million. The adjustments in fair value of acquired assets and liabilities assumed didnot have a significant impact on the Company’s results of operations for any reporting periods prior to December 31, 2016.F-23Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)As of the acquisition date, the allocation of the purchase price was as follows (in thousands): TelecityGroupCash and cash equivalents$73,368Accounts receivable24,042Other current assets41,079Assets held for sale877,650Property, plant and equipment1,058,583Goodwill2,215,567Intangible assets694,243Deferred tax assets994Other assets4,102Total assets acquired4,989,628Accounts payable and accrued expenses(84,367)Accrued property, plant and equipment(3,634)Other current liabilities(27,233)Liabilities held for sale(155,650)Capital lease and other financing obligations(165,365)Mortgage and loans payable(592,304)Deferred tax liabilities(176,168)Other liabilities(40,021)Net assets acquired$3,744,886The purchase price allocation above, as of the acquisition date, included acquired assets and liabilities that were classified by the Company as held forsale (Note 4).The following table presents certain information on the acquired intangible assets (dollars in thousands):Intangible AssetsFair Value Estimated UsefulLives (Years) Weighted-averageEstimated UsefulLives (Years)Customer relationships$591,956 13.5 13.5Trade names72,033 1.5 1.5Favorable leases30,254 2.0 - 25.4 19.7The fair value of customer relationships was estimated by applying an income approach. The fair value was determined by calculating the present valueof estimated future operating cash flows generated from existing customers less costs to realize the revenue. The Company applied a weighted-averagediscount rate of approximately 8.5%, which reflected the nature of the assets as it relates to the estimated future operating cash flows. Other significantassumptions used to estimate the fair value of the customer relationships include projected revenue growth, customer attrition rates, sales and marketingexpenses and operating margins. The fair value of the TelecityGroup's trade names was estimated using the relief of royalty approach. The Company applieda relief of royalty rate of 2.0% and a weighted-average discount rate of approximately 9.0%. The other acquired identifiable intangible assets were estimatedby applying a relief of royalty or cost approach as appropriate. The fair value measurements were based on significant inputs that are not observable in themarket and thus represent Level 3 measurements as defined in the accounting standard for fair value measurements.The fair value of the property, plant and equipment was estimated by applying the income approach or cost approach. The income approach is used toestimate fair value based on the income stream, such as cash flows or earnings that an asset can be expected to generate over its useful life. There are twoprimary methods of applying the income approach to determine the fair value of assets: the discounted cash flow method and the direct capitalizationmethod. The key assumptions include the estimated earnings, discount rate and direct capitalization rate. The cost approach is to use the replacement orreproduction cost as an indicator of fair value. The premise of the cost approach is that a market participant would pay no more for an asset than the amountforF-24Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)which the asset could be replaced or reproduced. The key assumptions of the cost approach include replacement cost, physical deterioration, functional andeconomic obsolescence, economic useful life, remaining useful life, age and effective age.The Company determined the fair value of the loans payable assumed in the TelecityGroup acquisition by estimating TelecityGroup’s debt rating andreviewing market data with a similar debt rating and other characteristics of the debt, including the maturity date and security type. On January 15, 2016, theCompany prepaid and terminated these loans payable. In conjunction with the repayment of the loans payable, the Company incurred an insignificantamount of pre-payment penalties and interest rate swap termination costs, which were recorded as interest expense in the consolidated statement ofoperations.Goodwill represents the excess of the purchase price over the fair value of the net tangible and intangible assets acquired and liabilities assumed. Thegoodwill is attributable to the workforce of the acquired business and the significant synergies expected to arise after the acquisition. Goodwill is notexpected to be deductible for local tax purposes. Goodwill recorded as a result of the TelecityGroup acquisition, except for the goodwill associated with assetheld for sale, is attributable to the Company’s EMEA region. The Company's results of continuing operations include TelecityGroup revenues of $400.0million and net loss from continuing operations of $47.1 million for the period January 15, 2016 through December 31, 2016.Other 2016 AcquisitionIn addition to the TelecityGroup Acquisition, the Company completed one other acquisition during 2016. A summary of the allocation of total purchaseconsideration is presented as follows (in thousands): Paris IBXdata centerCash and cash equivalent$4,073Accounts receivable1,507Other current assets794Property, plant and equipment143,972Intangible assets11,758Goodwill48,835Other assets81Total assets acquired211,020Accounts payable and accrued liabilities(2,044)Other current liabilities(2,798)Deferred tax liabilities(42,395)Other liabilities(755)Net assets acquired$163,028On August 1, 2016, the Company completed the purchase of Digital Realty Trust, Inc.'s ("Digital Realty's") operating business, including its real estateand facility, located in St. Denis, Paris for cash consideration of approximately €193.8 million or $216.4 million at the exchange rate in effect on August 1,2016. A portion of the building was leased to the Company and was being used by the Company as its Paris 2 and Paris 3 data centers. The Paris 2 lease wasaccounted for as an operating lease and the Paris 3 lease was accounted for as a financing lease. Upon acquisition, the Company in effect terminated bothleases. The Company settled the financing lease obligation of Paris 3 for €47.8 million or approximately $53.4 million and recognized a loss on debtextinguishment of €8.8 million or approximately $9.9 million. The nature of the purchased intangible assets acquired is in-place leases and favorableleasehold interests with weighted average estimated useful lives of 4.3 and 5.3 years, respectively. The goodwill is attributable to the Company's EMEAsegment and is not expected to be deductible for local tax purposes.The Company's results of continuing operations include the Paris IBX Data Center Acquisition revenues of $4.1 million and insignificant net incomefrom continuing operations for the period August 1, 2016 through December 31, 2016. The Company incurred acquisition costs of approximately $12.0million for the year ended December 31, 2016 related to the Paris IBX Data Center Acquisition.F-25Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)Bit-isle AcquisitionOn November 2, 2015, the Company, acting through its Japanese subsidiary, completed a cash tender offer for approximately 97% of the equityinstruments, including stock options, of Tokyo-based Bit-isle. The Company acquired the remaining outstanding equity instruments of Bit-isle in December2015. The offer price was JPY 922 per share, in an all cash transaction totaling ¥33,196.0 million or approximately $275.4 million at the exchange rate ineffect on the date of the acquisition.On September 30, 2015, the Company, acting through its Japanese subsidiaries as borrowers, entered into a term loan agreement (the "Bridge Term LoanAgreement") with the Bank of Tokyo-Mitsubishi UFJ, Ltd. ("BTMU"). Pursuant to the Bridge Term Loan Agreement, BTMU committed to provide a seniorbridge loan facility (the "Bridge Term Loan") in the amount of up to ¥47,500.0 million, or approximately $395.7 million at the exchange rate in effect onSeptember 30, 2015. Proceeds from the Bridge Term Loan were to be used exclusively for the acquisition of Bit-isle, the repayment of Bit-isle’s existing debtand transaction costs incurred in connection with the closing of the Bridge Term Loan and the acquisition of Bit-isle. In October 2016, the Companyborrowed ¥47,500.0 million on a five year term loan agreement with BTMU and repaid the Bridge Term Loan. See Note 10 for further information.Purchase Price AllocationUnder the acquisition method of accounting, the total purchase price was allocated to Bit-isle’s net tangible and intangible assets based upon their fairvalue as of the Bit-isle acquisition date. Based upon the purchase price and the valuation of Bit-isle, the final purchase price allocation was as follows (inthousands): Bit-isleCash and cash equivalent$33,198Accounts receivable7,359Other current assets51,038Long-term investments3,806Property, plant and equipment308,985Goodwill95,444Intangible assets111,374Other assets22,981Total assets acquired634,185Accounts payable and accrued expenses(15,028)Accrued property, plant and equipment(465)Capital lease and other financing obligations(108,833)Mortgage and loans payable(190,227)Other current liabilities(8,689)Deferred tax liabilities(32,192)Other liabilities(3,384)Net assets acquired$275,367The following table presents certain information on the acquired identifiable intangible assets (dollars in thousands):Intangible AssetsFair Value Estimated UsefulLives (Years) Weighted-averageEstimated UsefulLives (Years)Customer relationships$105,434 13 13Trade name3,455 2 2Favorable solar contracts2,410 18 18Other intangible assets75 0.25 0.25F-26Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)The fair value of customer relationships was estimated by applying an income approach. The fair value was determined by calculating the present valueof estimated future operating cash flows generated from existing customers less costs to realize the revenue. The Company applied a weighted-averagediscount rate of approximately 11.0%, which reflected the nature of the assets as it relates to the estimated future operating cash flows. Other significantassumptions used to estimate the fair value of the customer relationships include projected revenue growth, customer attrition rates, sales and marketingexpenses and operating margins. The fair value of the Bit-isle trade name was estimated using the relief of royalty approach. The Company applied a relief ofroyalty rate of 2.0% and a weighted-average discount rate of approximately 12.0%. The other acquired identifiable intangible assets were estimated byapplying an income or cost approach as appropriate. The fair value measurements were based on significant inputs that are not observable in the market andthus represent Level 3 measurements as defined in the accounting standard for fair value measurements.The fair value of the property, plant and equipment was estimated by applying the income approach or cost approach. The income approach is used toestimate fair value based on the income stream, such as cash flows or earnings that an asset can be expected to generate over its useful live. There are twoprimary methods of applying the income approach to determine the fair value assets: the discounted cash flow method and the direct capitalization method.The key assumptions include the estimated earnings, discount rate and direct capitalization rate. The cost approach is to use the replacement or reproductioncost as an indicator of fair value. The premise of the cost approach is that a market participant would pay no more for an asset than the amount that the assetcould be replaced or reproduced. The key assumptions of the cost approach include replacement cost new, physical deterioration, functional and economicobsolescence, economic useful life, remaining useful life, age and effective age.The goodwill is attributable to the workforce of the acquired business and the significant synergies expected to arise after the acquisition. The goodwill isnot expected to be deductible for local tax purposes. Goodwill recorded as a result of the Bit-isle acquisition is attributable to the Company’s Asia-Pacificreportable segment.The Company's results of continuing operations include Bit-isle revenues of $21.6 million and net losses from continuing operations of $3.2 million forthe period from November 2, 2015 through December 31, 2015. The Company incurred acquisition costs of approximately $8.6 million for the year endedDecember 31, 2015 related to the Bit-isle Acquisition.In June 2016, the Company approved the divestiture of the solar power assets of Bit-isle. See Note 4 below for further information.Nimbo AcquisitionOn January 14, 2015, the Company acquired all of the issued and outstanding share capital of Nimbo Technologies Inc., a company which specializes inmigrating business applications to the cloud with extensive experience moving legacy applications into a hybrid cloud architecture, and connecting legacydata centers to the cloud, for a cash payment of $10.0 million (the "Nimbo Acquisition"). As a result of the Nimbo Acquisition, the Company recordedgoodwill of $17.2 million. Nimbo continues to operate under the Nimbo name. The results of operations for Nimbo are not significant to the Company.Unaudited Pro Forma Combined Consolidated Financial InformationThe following unaudited pro forma combined consolidated financial information has been prepared by the Company using the acquisition method ofaccounting to give effect to the Verizon Data Center Acquisition as though it occurred on January 1, 2016 and the TelecityGroup acquisition as though itoccurred on January 1, 2015. The incremental results of operations from the other acquisitions are not significant and are therefore not reflected in the proforma combined results of operations.The Company completed the Verizon Data Center Acquisition on May 1, 2017. The unaudited pro forma combined consolidated financial informationfor the years ending December 31, 2017 and 2016 combine the actual results of the Company and the actual Verizon Data Center Acquisition operatingresults for the period prior to the acquisition date and reflect certain adjustments, such as additional depreciation, amortization and interest expense on assetsand liabilities acquired and acquisition financings.The Company and Verizon entered into agreements at the closing of the Verizon Data Center Acquisition pursuant to which the Company will providespace and services to Verizon at the acquired data centers. These arrangements are not reflected in the unaudited pro forma combined financial information.The Company recognized $359.1 million of revenues attributed to the Verizon Data Center Acquisition, which included these arrangements, from May 1through December 31, 2017.The Company completed the TelecityGroup acquisition on January 15, 2016. The unaudited pro forma combined consolidated financial information forthe year ending December 31, 2015 combine the actual results of the Company and the actual TelecityGroup's operating results for the year ending December31, 2015 and reflect certain adjustments, such as additionalF-27Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)depreciation, amortization and interest expense on assets and liabilities acquired and acquisition financings. The pro forma effect for the period January 1through January 14, 2016 was not significant.The unaudited pro forma combined consolidated financial information is presented for illustrative purposes only and is not necessarily indicative of theresults of operations that would have actually been reported had the acquisition occurred on the above dates, nor is it necessarily indicative of the futureresults of operations of the combined company.The following table sets forth the unaudited pro forma consolidated combined results of operations for the years ended December 31, 2017, 2016 and2015 (in thousands): 2017 2016 2015Revenues$4,509,602 $4,053,280 $3,244,349Net income from continuing operations258,618 19,248 141,496Basic EPS3.31 0.25 2.10Diluted EPS3.28 0.25 2.083. Earnings Per ShareThe following table sets forth the computation of basic and diluted EPS for the years ended December 31 (in thousands, except per share amounts): 2017 2016 2015Net income from continuing operations$232,982 $114,408 $187,774Net income from discontinued operations, net of tax— 12,392 —Net income$232,982 $126,800 $187,774 Weighted-average shares used to calculate basic EPS76,854 70,117 57,790Effect of dilutive securities: Employee equity awards681 699 693Weighted-average shares used to calculate diluted EPS77,535 70,816 58,483 Basic EPS: Continuing operations$3.03 $1.63 $3.25Discontinued operations— 0.18 —Basic EPS$3.03 $1.81 $3.25 Diluted EPS: Continuing operations$3.00 $1.62 $3.21Discontinued operations— 0.17 —Diluted EPS$3.00 $1.79 $3.21The following table sets forth potential shares of common stock that are not included in the diluted EPS calculation above because to do so would beanti-dilutive for the years ended December 31 (in thousands): 2017 2016 2015Shares related to the potential conversion of 4.75% convertible subordinated notes— 893 1,977Common stock related to employee equity awards63 27 88 63 920 2,065F-28Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)4. Assets Held for SaleIn June 2016, the Company approved the divestiture of the solar power assets of Bit-isle. In October 2016, the Company entered into a Share TransferAgreement for the transfer of common stock of Terra Power Co., Ltd., relating to the divestiture of the solar power assets of Bit-isle. The Company received¥400.0 million upon the closing of the transaction, or approximately $3.8 million at the exchange rate in effect on October 31, 2016. In November 2016, theCompany had received an additional ¥2,500.0 million, or approximately $22.1 million at the exchange rate in effect at the time of receipt. The Companyreceived the remaining payment of ¥5,313.4 million in the first quarter of 2017, or approximately $47.8 million at the exchange rate in effect on March 31,2017. During the three months ended September 30, 2016, the Company evaluated the recoverability of the carrying value of its assets held for sale related tothe sales agreement signed in October, as discussed above, and concluded that the Company would not recover the carrying value of certain assets.Accordingly, the Company recorded an impairment charge on other current assets of $7.7 million at September 30, 2016, reducing the carrying value of suchassets from $79.5 million to the estimated fair value of $71.8 million. The associated loss on the sale was not significant. Furthermore, the revenue and netincome generated by the solar power assets of Bit-isle during the years ended December 31, 2016 and 2015 were not significant.During the fourth quarter of 2015, the Company and TelecityGroup agreed to divest certain data centers, including the Company’s London 2 ("LD2")data center and certain data centers of TelecityGroup in the United Kingdom, Netherlands and Germany, in order to obtain the approval of the EuropeanCommission for the acquisition of TelecityGroup. The assets and liabilities of LD2 were classified as held for sale in the fourth quarter of 2015 and, therefore,the corresponding depreciation and amortization expense was ceased at that time. This divestiture was not presented as discontinued operations in theconsolidated statements of operations, because it did not represent a strategic shift in the Company's business, as the Company continued operating similarbusinesses after the divestiture. The assets and liabilities of data centers from TelecityGroup were classified as held for sale on January 15, 2016, upon closeTelecityGroup acquisition. The divestiture of these data centers was completed on July 5, 2016. The Company recognized a gain on the sale of LD2 datacenter of $27.9 million in gains on asset sales in the consolidated statements of operations for the year ended December 31, 2016. During the years endedDecember 31, 2016 and 2015, the LD2 data center generated revenue of $6.1 million and $17.6 million, respectively, and net income of $2.3 million and$7.2 million, respectively. The results of operations for the TelecityGroup data centers that were divested, as well as the gain on divestiture, were classified asdiscontinued operations from January 15, 2016, the date the acquisition closed, through July 5, 2016 (see Note 5).During the fourth quarter of 2015, the Company entered into an agreement to sell a parcel of land in San Jose, California. The sale was completed inFebruary 2016 and the Company recognized a gain on sale of $5.2 million.5. Discontinued OperationsIn order to obtain the approval of the European Commission for the acquisition of TelecityGroup, the Company and TelecityGroup agreed to divestcertain data centers of TelecityGroup in the United Kingdom, Netherlands and Germany. These TelecityGroup data centers were classified as held for sale onthe acquisition date and were reported as discontinued operations.On July 5, 2016, the Company completed the sale of these data centers and related assets to Digital Realty for approximately €304.6 million and £376.2million, or approximately total of $827.3 million at the exchange rates in effect on July 5, 2016. The Company recognized a gain on sale of theTelecityGroup data centers in discontinued operations of $2.4 million. The results of operations for these data centers that were divested, as well as the gainon divestiture, have been reported as net income from discontinued operations, net of tax, from January 15, 2016, the date of the acquisition, to July 5, 2016in the Company's consolidated statements of operations. As of the date of acquisition, depreciation and amortization of discontinued operations ceased.Capital expenditures from the date of acquisition through the date of sale were $31.5 million.F-29Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)The following table presents the financial results of the Company's discontinued operations for the year ended December 31, 2016 (in thousands). TheCompany did not record income from discontinued operations, net of tax for the years ended December 31, 2017 and 2015. 2016Revenues$48,782Costs and operating expenses: Cost of revenues24,795Sales and marketing1,030General and administrative7,026Total costs and operating expenses32,851Income from operations of discontinued operations15,931Interest expense and other, net(1,286)Income from discontinued operations before income taxes14,645Income tax expense(4,604)Gain on sale of discontinued operations, net of tax2,351Net income from discontinued operations, net of tax$12,3926. Balance Sheet ComponentsCash, Cash Equivalents and Short-Term and Long-Term InvestmentsCash, cash equivalents and short-term and long-term investments consisted of the following as of December 31 (in thousands): 2017 2016Cash and cash equivalents: Cash (1)$985,382 $345,119Cash equivalents: Money market funds427,135 400,388Certificate of deposit— 2,969Total cash and cash equivalents1,412,517 748,476Short-term and long-term investments: Certificates of deposit31,351 6,988Publicly traded equity securities6,163 6,463Total short-term and long-term investments37,514 13,451Total cash, cash equivalents and short-term and long-term investments$1,450,031 $761,927_________________________(1)Excludes restricted cash.As of December 31, 2017 and 2016, cash and cash equivalents included investments which were readily convertible to cash and had original maturitydates of 90 days or less. The maturities of certificates of deposit classified as short-term investments were one year or less as of December 31, 2017 and 2016.The maturities of certificates of deposits classified as long-term investments were greater than one year and less than three years as of December 31, 2017 and2016. The balance of certificates of deposits, by contractual maturity, as of December 31 (in thousands): 2017 2016Due within one year$28,271 $3,409Due after one year through three years3,080 3,579Total$31,351 $6,988F-30Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)The net unrealized gains (losses) on its investments as of December 31 were comprised of the following (in thousands): 2017 2016 AmortizedCost GrossUnrealizedGains GrossUnrealizedLosses Fair Value AmortizedCost GrossUnrealizedGains GrossUnrealizedLosses Fair ValueCertificate of deposit$31,351 $— $— $31,351 $6,988 $— $— $6,988Publicly traded equitysecurities3,716 2,447 — 6,163 4,850 1,613 — 6,463Total$35,067 $2,447 $— $37,514 $11,838 $1,613 $— $13,451Accounts ReceivableAccounts receivable, net, consisted of the following as of December 31 (in thousands): 2017 2016Accounts receivable$594,541 $411,920Allowance for doubtful accounts(18,228) (15,675)Accounts receivable, net$576,313 $396,245Trade accounts receivable are recorded at the invoiced amount and generally do not bear interest.The following table summarizes the activity of the Company’s allowance for doubtful accounts (in thousands):Balance as of December 31, 2014$9,466Provision for allowance for doubtful accounts5,037Net write-offs(3,438)Impact of foreign currency exchange(713)Balance as of December 31, 201510,352Provision for allowance for doubtful accounts8,260Net write-offs(2,521)Impact of foreign currency exchange(416)Balance as of December 31, 201615,675Provision for allowance for doubtful accounts5,627Net write-offs(4,546)Impact of foreign currency exchange1,472Balance as of December 31, 2017$18,228Other Current AssetsOther current assets consisted of the following as of December 31 (in thousands): 2017 2016Prepaid expenses$64,832 $79,258Taxes receivable110,961 102,002Restricted cash, current26,919 15,065Other receivables7,797 46,809Derivative instruments4,175 54,072Other current assets17,343 22,190Total other current assets$232,027 $319,396F-31Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)Property, Plant and Equipment, NetProperty, plant and equipment, net consisted of the following as of December 31 (in thousands): 2017 2016Core systems$6,334,702 $4,760,868Buildings3,906,686 2,785,799Leasehold improvements1,850,351 1,599,424Construction in progress425,428 645,388Personal property798,133 622,069Land423,539 237,349 13,738,839 10,650,897Less accumulated depreciation(4,344,237) (3,451,687)Property, plant and equipment, net$9,394,602 $7,199,210Core systems, buildings, leasehold improvements, personal property and construction in progress recorded under capital leases aggregated to $760.4million and $715.3 million as of December 31, 2017 and 2016, respectively. As of December 31, 2017 and 2016, the Company recorded accumulateddepreciation for assets under capital leases of $199.2 million and $161.4 million, respectively.Goodwill and Other IntangiblesThe following table presents goodwill and other intangible assets, net, for the years ended December 31, 2017 and 2016 (in thousands): 2017 2016Goodwill: Americas$1,561,512 $469,438EMEA2,610,899 2,281,306Asia-Pacific239,351 235,320 $4,411,762 $2,986,064Intangible assets, net: Intangible assets - customer relationships$2,682,656 $839,593Intangible assets - trade names73,295 69,519Intangible assets - favorable leases39,470 38,139Intangible assets - licenses9,696 9,697Intangible assets - others— 19 2,805,117 956,967Accumulated amortization - customer relationships(334,985) (183,270)Accumulated amortization - trade names(71,728) (43,830)Accumulated amortization - favorable leases(10,196) (8,027)Accumulated amortization - licenses(3,236) (2,591)Accumulated amortization - others— (18) (420,145) (237,736)Total intangible assets, net$2,384,972 $719,231F-32Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)Changes in the carrying amount of goodwill by geographic regions are as follows (in thousands): Americas EMEA Asia-Pacific TotalBalance as of December 31, 2015$460,203 $374,070 $228,927 $1,063,200Purchase accounting adjustments - TelecityGroup— 2,215,567 — 2,215,567Purchase accounting adjustments - Paris IBX Data Center Acquisition— 48,835 — 48,835Asset held for sale adjustments— 1,605 — 1,605Impact of foreign currency exchange9,235 (358,771) 6,393 (343,143)Balance as of December 31, 2016469,438 2,281,306 235,320 2,986,064Purchase accounting adjustments - Verizon Data Center Acquisition1,095,262 — 1,095,262Purchase accounting adjustments - Other 2017 acquisitions— 163,993 — 163,993Impact of foreign currency exchange(3,188) 165,600 4,031 166,443Balance as of December 31, 2017$1,561,512 $2,610,899 $239,351 $4,411,762Changes in the net book value of intangible assets by geographic regions are as follows (in thousands): Americas EMEA Asia-Pacific TotalBalance as of December 31, 2014$62,954 $62,185 $22,388 $147,527Nimbo acquisition1,089 — — 1,089Bit-isle acquisition— — 111,374 111,374Asset held for sale adjustments— (784) — (784)Write-off of intangible asset— (357) — (357)Amortization of intangibles(11,432) (11,675) (4,339) (27,446)Impact of foreign currency exchange(1,968) (5,014) 144 (6,838)Balance as of December 31, 201550,643 44,355 129,567 224,565TelecityGroup acquisition— 694,243 — 694,243Paris IBX Data Center Acquisition— 11,758 — 11,758Sale of Terra Power— — (2,460) (2,460)Write-off of intangible asset(573) — — (573)Amortization of intangibles(11,348) (97,715) (13,799) (122,862)Impact of foreign currency exchange1,395 (90,280) 3,445 (85,440)Balance as of December 31, 201640,117 562,361 116,753 719,231Verizon Data Center Acquisition1,693,900 — — 1,693,900Other 2017 acquisitions— 112,645 — 112,645Write-off of intangible asset— (725) — (725)Amortization of intangibles(84,749) (79,105) (13,154) (177,008)Impact of foreign currency exchange(2,895) 36,043 3,781 36,929Balance as of December 31, 2017$1,646,373 $631,219 $107,380 $2,384,972The Company’s goodwill and intangible assets in EMEA, denominated in Euros, British Pounds, Turkish Lira, and the United Arab Emirates Dirham,goodwill and intangible assets in Asia-Pacific, denominated in Singapore Dollars, Hong Kong Dollars, Japanese Yen and Chinese Yuan and certain goodwilland intangibles in Americas, denominated in Canadian Dollars, Brazilian Reals and Colombian Pesos, are subject to foreign currency fluctuations. TheCompany’s foreign currency translation gains and losses, including goodwill and intangibles, are a component of other comprehensive income and loss.F-33Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)Estimated future amortization expense related to these intangibles is as follows (in thousands):Years ending: 2018$196,4692019191,2982020184,6022021176,7402022172,547Thereafter1,463,316Total$2,384,972Other AssetsOther assets consisted of the following as of December 31 (in thousands): 2017 2016Deferred tax assets, net$66,031 $62,308Prepaid expenses89,784 80,888Debt issuance costs, net10,670 6,611Deposits48,296 40,893Restricted cash11,265 9,706Derivative instruments4,110 15,907Other assets11,594 9,985Total other assets$241,750 $226,298Accounts Payable and Accrued ExpensesAccounts payable and accrued expenses consisted of the following as of December 31 (in thousands): 2017 2016Accounts payable$101,744 $60,211Accrued compensation and benefits214,585 172,808Accrued interest100,347 95,832Accrued taxes(1)130,272 133,562Accrued utilities and security68,916 44,202Accrued professional fees13,830 14,071Accrued repairs and maintenance11,232 5,430Accrued other78,331 55,623Total accounts payable and accrued expenses$719,257 $581,739__________________________(1)Includes income taxes payable of $56.4 million and $44.0 million, respectively, as of December 31, 2017 and 2016.F-34Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)Other Current LiabilitiesOther current liabilities consisted of the following as of December 31 (in thousands): 2017 2016Deferred installation revenue$74,452 $61,399Customer deposits16,598 13,894Derivative instruments34,466 10,819Deferred recurring revenue12,848 18,704Deferred rent6,546 4,158Dividends payable11,181 11,999Asset retirement obligations1,716 10,036Other current liabilities2,107 2,131Total other current liabilities$159,914 $133,140Other LiabilitiesOther liabilities consisted of the following as of December 31 (in thousands): 2017 2016Asset retirement obligations$96,823 $92,979Deferred tax liabilities, net252,287 274,341Deferred installation revenue117,021 96,744Deferred rent97,782 76,566Accrued taxes64,378 56,208Dividends payable6,669 8,495Customer deposits10,849 4,773Deferred recurring revenue4,236 2,681Derivative instruments6,381 140Other liabilities5,284 10,321Total other liabilities$661,710 $623,248F-35Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)The following table summarizes the activities of the Company’s asset retirement obligation ("ARO") (in thousands):Asset retirement obligations as of December 31, 2014$64,858Additions17,337Adjustments (1)(4,676)Accretion expense3,349Impact of foreign currency exchange(2,386)Asset retirement obligations as of December 31, 201578,482Additions22,955Adjustments (1)(2,366)Accretion expense6,685Impact of foreign currency exchange(2,741)Asset retirement obligations as of December 31, 2016103,015Additions17,736Adjustments (1)(34,576)Accretion expense7,335Impact of foreign currency exchange5,029Asset retirement obligations as of December 31, 2017$98,539__________________________(1) The ARO adjustments are primarily due to lease amendments, acquisition of real estate assets and other adjustments.7. Derivatives and Hedging InstrumentsDerivatives Designated as Hedging InstrumentsNet Investment Hedges. The Company is exposed to the impact of foreign exchange rate fluctuations on its investments in foreign subsidiaries whosefunctional currencies are other than the U.S. dollar. In order to mitigate the impact of foreign currency exchange rates, the Company has entered into variousforeign currency loans which are designated as hedges against the Company's net investment in foreign subsidiaries. As of December 31, 2017 and 2016, thetotal principal amount of foreign currency loans, which were designated as net investment hedges, was $3,149.5 million and $646.2 million, respectively. InMarch 2016, the Company began using foreign exchange forward contracts to hedge against the effect of foreign exchange rate fluctuations on a portion ofits net investment in the foreign subsidiaries. For a net investment hedge, changes in the fair value of the hedging instrument designated as a net investmenthedge, except the ineffective portion and forward points, are recorded as a component of other comprehensive income in the consolidated balance sheet.The Company recorded net foreign exchange losses of $235.3 million and net foreign exchanges gains of $85.5 million in other comprehensive income(loss) for the years ended December 31, 2017 and 2016, respectively. For the year ended December 31, 2016, the Company reclassified net foreign exchangegains of $40.0 million to gain on sale of discontinued operations. The Company recorded no ineffectiveness from its net investment hedges for the yearsended December 31, 2017 and 2016.Cash Flow Hedges. The Company hedges its foreign currency translation exposure for forecasted revenues and expenses in its EMEA region between theU.S. dollar and the British Pound, Euro, Swedish Krona and Swiss Franc. The foreign currency forward and option contracts that the Company uses from timeto time to hedge this exposure are designated as cash flow hedges under the accounting standard for derivatives and hedging. The Company also usespurchased collar options to manage a portion of its exposure to foreign currency exchange rate fluctuations, where the Company writes a foreign currencycall option and purchases a foreign currency put option. When two or more derivative instruments in combination are jointly designated as a cash flowhedging instrument, they are treated as a single instrument.Effective January 1, 2015, the Company began to enter into intercompany hedging instruments ("intercompany derivatives") with a wholly-ownedsubsidiary of the Company in order to hedge certain forecasted revenues and expenses denominated in currencies other than the U.S. dollar. Simultaneously,the Company enters into derivative contracts with unrelated third parties to externally hedge the net exposure created by such intercompany derivatives.F-36Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)The following disclosure is prepared on a consolidated basis. Assets and liabilities resulting from intercompany derivatives have been eliminated inconsolidation. As of December 31, 2017, the Company's cash flow hedge instruments had maturity dates ranging from January 2018 to October 2019 asfollows (in thousands): Notional Amount Fair Value (1) Accumulated OtherComprehensive Income(Loss) (2)(3)Derivative assets$72,262 $2,379 $2,055Derivative liabilities440,637 (29,777) (34,311) $512,899 $(27,398) $(32,256)__________________________(1)All derivative assets related to cash flow hedges are included in the consolidated balance sheets within other current assets, other assets, other current liabilities and otherliabilities.(2)Included in the consolidated balance sheets within accumulated other comprehensive income (loss).(3)The Company recorded a net loss of $26.7 million within accumulated other comprehensive income (loss) relating to cash flow hedges that will be reclassified to revenueand expenses as they mature over the next 12 months.As of December 31, 2016, the Company's cash flow hedge instruments had maturity dates ranging from January 2017 to November 2018 as follows (inthousands): Notional Amount Fair Value (1) Accumulated OtherComprehensive Income(Loss) (2)(3)Derivative assets$545,638 $44,570 $42,634Derivative liabilities42,207 (1,815) (1,453) $587,845 $42,755 $41,181__________________________(1)All derivative assets related to cash flow hedges are included in the consolidated balance sheets within other current assets, other assets, other current liabilities and otherliabilities.(2)Included in the consolidated balance sheets within accumulated other comprehensive income (loss).(3)The Company recorded a net gain of $31.9 million within accumulated other comprehensive income (loss) relating to cash flow hedges that will be reclassified to revenueand expenses as they mature over the next 12 months.During the year ended December 31, 2017, the amount of net gains from the ineffective and excluded portions of cash flow hedges recognized in otherincome (expense) was $3.8 million. During the year ended December 31, 2016, the amount of net gains from the ineffective and excluded portions of cashflow hedges recognized in other income (expense) were not significant. During the year ended December 31, 2017, the amount of net gains reclassified fromaccumulated other comprehensive income (loss) to revenues was $20.8 million and the amount of net losses reclassified from accumulated othercomprehensive income (loss) to operating expenses were $11.2 million. During the year ended December 31, 2016, the amount of net gains reclassified fromaccumulated other comprehensive income (loss) to revenues was $38.4 million and the amount of net losses reclassified from accumulated othercomprehensive income (loss) to operating expenses was $19.9 million. During the year ended December 31, 2015, the amount of net gains reclassified fromaccumulated other comprehensive income (loss) to revenues was $28.0 million and the amount of net losses reclassified from accumulated othercomprehensive income (loss) to operating expenses was $6.3 million.Derivatives Not Designated as Hedging InstrumentsEmbedded Derivatives. The Company is deemed to have foreign currency forward contracts embedded in certain of the Company’s customer agreementsthat are priced in currencies different from the functional or local currencies of the parties involved. These embedded derivatives are separated from their hostcontracts and carried on the Company’s balance sheet at their fair value. The majority of these embedded derivatives arise as a result of the Company’sforeign subsidiaries pricing their customer contracts in the U.S. dollar. Gains and losses on these embedded derivatives are included within revenues in theCompany’s consolidated statements of operations. The company recognized a net loss of $6.8 million during the year ended December 31, 2017. During theyears ended December 31, 2016 and 2015, the gain or loss associated with these embedded derivatives was not significant.F-37Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)Economic Hedges of Embedded Derivatives. The Company uses foreign currency forward contracts to help manage the foreign exchange risk associatedwith the Company’s customer agreements that are priced in currencies different from the functional or local currencies of the parties involved ("economichedges of embedded derivatives"). Foreign currency forward contracts represent agreements to exchange the currency of one country for the currency ofanother country at an agreed-upon price on an agreed-upon settlement date. Gains and losses on these contracts are included in revenues along with gainsand losses of the related embedded derivatives. The Company entered into various economic hedges of embedded derivatives during the years endedDecember 31, 2017, 2016 and 2015. During the year ended December 31, 2017, the gain or loss associated with these economic hedges of embeddedderivatives was not significant. The Company recognized a net gain of $2.9 million and a net loss of $2.3 million during the years ended December 31, 2016and 2015, respectively.Foreign Currency Forward and Option Contracts. The Company also uses foreign currency forward and option contracts to manage the foreignexchange risk associated with certain foreign currency-denominated assets and liabilities. As a result of foreign currency fluctuations, the U.S. dollarequivalent values of its foreign currency-denominated assets and liabilities change. Gains and losses on these contracts are included in other income(expense), on a net basis, along with the foreign currency gains and losses of the related foreign currency-denominated assets and liabilities associated withthese foreign currency forward contracts. The Company entered into various foreign currency forward and option contracts during the years endedDecember 31, 2017, 2016 and 2015. The Company recognized a net loss of $69.0 million during the year ended December 31, 2017, a net gain of $74.2million during the year ended December 31, 2016 and a net loss of $24.3 million during the year ended December 31, 2015.Offsetting Derivative Assets and LiabilitiesThe following table presents the fair value of derivative instruments recognized in the Company’s consolidated balance sheets as of December 31, 2017(in thousands): GrossAmounts Gross Amounts Offsetin the ConsolidatedBalance Sheet Net ConsolidatedBalance SheetAmounts(1) Gross Amountsnot Offset in theConsolidatedBalance Sheet (2) NetAssets: Designated as hedging instruments: Foreign currency forward contracts designated as cashflow hedges$2,379 $— $2,379 $(2,379) $—Not designated as hedging instruments: Embedded derivatives5,076 — 5,076 — 5,076Economic hedges of embedded derivatives325 — 325 — 325Foreign currency forward contracts505 — 505 (340) 165 5,906 — 5,906 (340) 5,566Additional netting benefit— — — (490) (490) $8,285 $— $8,285 $(3,209) $5,076Liabilities: Designated as hedging instruments: Foreign currency forward contracts designated as cashflow hedges$29,777 $— $29,777 $(2,379) $27,398Not designated as hedging instruments: Embedded derivatives3,503 — 3,503 — 3,503Economic hedges of embedded derivatives20 — 20 — 20Foreign currency forward contracts7,547 — 7,547 (340) 7,207 11,070 — 11,070 (340) 10,730Additional netting benefit— — — (490) (490) $40,847 $— $40,847 $(3,209) $37,638_______________________F-38Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)(1)As presented in the Company’s consolidated balance sheets within other current assets, other assets, other current liabilities and other liabilities.(2)The Company enters into master netting agreements with its counterparties for transactions other than embedded derivatives to mitigate credit risk exposure to any singlecounterparty. Master netting agreements allow for individual derivative contracts with a single counterparty to offset in the event of default. For presentation on theconsolidated balance sheets, the Company does not offset fair value amounts recognized for derivative instruments under master netting arrangements.The following table presents the fair value of derivative instruments recognized in the Company’s consolidated balance sheets as of December 31, 2016(in thousands): GrossAmounts Gross Amounts Offsetin the ConsolidatedBalance Sheet Net ConsolidatedBalance SheetAmounts(1) Gross Amounts notOffset in theConsolidatedBalance Sheet (2) NetAssets: Designated as hedging instruments: Cash flow hedges Foreign currency forward and option contracts$44,570 $— $44,570 $(1,815) $42,755Net investment hedges Foreign currency forward contracts6,930 — 6,930 (3,310) 3,620 51,500 — 51,500 (5,125) 46,375 Not designated as hedging instruments: Embedded derivatives9,745 — 9,745 — 9,745Foreign currency forward contracts8,734 — 8,734 (1,873) 6,861 18,479 — 18,479 (1,873) 16,606Additional netting benefit— — — (2,436) (2,436) $69,979 $— $69,979 $(9,434) $60,545 Liabilities: Designated as hedging instruments: Cash flow hedges Foreign currency forward and option contracts$1,815 $— $1,815 $(1,815) $—Net investment hedges Foreign currency forward contracts3,525 — 3,525 (3,310) 215 5,340 — 5,340 (5,125) 215 Not designated as hedging instruments: Embedded derivatives1,525 — 1,525 — 1,525Economic hedges of embedded derivatives866 — 866 — 866Foreign currency forward contracts3,228 — 3,228 (1,873) 1,355 5,619 — 5,619 (1,873) 3,746Additional netting benefit— — — (2,436) (2,436) $10,959 $— $10,959 $(9,434) $1,525_________________________(1)As presented in the Company’s consolidated balance sheets within other current assets, other assets, other current liabilities and other liabilities.(2)The Company enters into master netting agreements with its counterparties for transactions other than embedded derivatives to mitigate credit risk exposure to any singlecounterparty. Master netting agreements allow for individual derivative contracts with a singleF-39Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)counterparty to offset in the event of default. For presentation on the consolidated balance sheets, the Company does not offset fair value amounts recognized forderivative instruments under master netting arrangements.8. Fair Value MeasurementsValuation MethodsFair value estimates are made as of a specific point in time based on methods using the market approach valuation method which uses prices and otherrelevant information generated by market transactions involving identical or comparable assets or liabilities or other valuation techniques. These techniquesinvolve uncertainties and are affected by the assumptions used and the judgments made regarding risk characteristics of various financial instruments,discount rates, estimates of future cash flows, future expected loss experience and other factors.Cash, Cash Equivalents and Investments. The fair value of the Company's investments in money market funds approximates their face value. Suchinstruments are included in cash equivalents. The Company’s money market funds and publicly traded equity securities are classified within Level 1 of thefair value hierarchy because they are valued using quoted prices for identical instruments in active markets. The fair value of the Company's otherinvestments, including certificates of deposit, approximates their face value. The fair value of these investments is priced based on the quoted market pricefor similar instruments or nonbinding market prices that are corroborated by observable market data. Such instruments are classified within Level 2 of the fairvalue hierarchy. The Company determines the fair values of its Level 2 investments by using inputs such as actual trade data, benchmark yields,broker/dealer quotes, and other similar data, which are obtained from quoted market prices, custody bank, third-party pricing vendors, or other sources. TheCompany uses such pricing data as the primary input to make its assessments and determinations as to the ultimate valuation of its investment portfolio andhas not made, during the periods presented, any material adjustments to such inputs. The Company is responsible for its consolidated financial statementsand underlying estimates.The Company uses the specific identification method in computing realized gains and losses. Realized gains and losses on the investments are includedwithin other income (expense) in the Company’s consolidated statements of operations. Short-term and long-term investments are classified as available-for-sale and are carried at fair value with unrealized gains and losses reported in stockholders’ equity as a component of other comprehensive income or loss, netof any related tax effect. The Company reviews its investment portfolio quarterly to determine if any securities may be other-than-temporarily impaired dueto increased credit risk, changes in industry or sector of a certain instrument over an extended period of time.Derivative Assets and Liabilities. For derivatives, the Company uses forward contract and option models employing market observable inputs, such asspot currency rates and forward points with adjustments made to these values utilizing published credit default swap rates of its foreign exchange tradingcounterparties and other comparable companies. The Company has determined that the inputs used to value its derivatives fall within Level 2 of the fairvalue hierarchy, therefore the derivatives are categorized as Level 2.During the years ended December 31, 2017 and 2016, the Company did not have any nonfinancial assets or liabilities measured at fair value on arecurring basis.The Company’s financial assets and liabilities measured at fair value on a recurring basis as of December 31, 2017 were as follows (in thousands): Fair Value atDecember 31, Fair ValueMeasurement Using 2017 Level 1 Level 2Assets: Cash$985,382 $985,382 $—Money market and deposit accounts427,135 427,135 —Publicly traded equity securities6,163 6,163 —Certificates of deposit31,351 — 31,351Derivative instruments (1)8,285 — 8,285 $1,458,316 $1,418,680 $39,636Liabilities: Derivative instruments (1)$40,847 $— $40,847F-40Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)_________________________(1)Includes both foreign currency embedded derivatives and foreign currency forward and option contracts. Amounts are included within other current assets, other assets,other current liabilities and other liabilities in the Company’s consolidated balance sheet.The Company’s financial assets and liabilities measured at fair value on a recurring basis at December 31, 2016 were as follows (in thousands): Fair Value atDecember 31, Fair ValueMeasurement Using 2016 Level 1 Level 2Assets: Cash$345,119 $345,119 $—Money market and deposit accounts400,388 400,388 —Publicly traded equity securities6,463 6,463 —Certificates of deposit9,957 — 9,957Derivative instruments (1)69,979 — 69,979 $831,906 $751,970 $79,936Liabilities: Derivative instruments (1)$10,959 $— $10,959_________________________(1)Includes embedded derivatives, foreign currency embedded derivatives and foreign currency forward contracts. Amounts are included within other current assets, otherassets, other current liabilities and other liabilities in the Company’s consolidated balance sheet.The Company did not have any Level 3 financial assets or financial liabilities during the years ended December 31, 2017 and 2016.9. LeasesCapital Lease and Other Financing ObligationsThe Company’s capital lease and other financing obligations expire at various dates ranging from 2018 to 2053. The weighted average effective interestrate of the Company’s capital lease and other financing obligations was 7.86% as of December 31, 2017.The Company’s capital lease and other financing obligations are summarized as follows as of December 31, 2017 (in thousands): Capital LeaseObligations Other FinancingObligations Total2018$100,815 $101,095 $201,910201994,234 88,028 182,262202094,327 87,758 182,085202192,455 89,595 182,050202292,309 90,070 182,379Thereafter801,237 886,277 1,687,514Total minimum lease payments1,275,377 1,342,823 2,618,200Plus amount representing residual property value— 545,656 545,656Less amount representing interest(531,820) (933,075) (1,464,895)Present value of net minimum lease payments743,557 955,404 1,698,961Less current portion(41,117) (37,588) (78,705) $702,440 $917,816 $1,620,256F-41Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)Amsterdam 5 ("AM5") Data CenterIn May 2017, the Company acquired the land and building for the AM5 IBX data center for cash consideration of €26.7 million or $30.4 million at theexchange rate in effect on June 30, 2017. The Company had previously accounted for the construction and related agreements as a build-to-suit arrangement.As a result of the purchase, the prior arrangement was effectively terminated and the financing obligation was settled in full. The Company settled thefinancing obligation of the AM5 data center for €20.0 million or approximately $22.8 million and recognized a loss on debt extinguishment of €7.2million or approximately $8.2 million. The fair value allocated to the ground lease was €6.7 million or $7.6 million, which was recorded as other assets andwill be amortized through December 2054.Hong Kong 5 ("HK5") Data CenterIn January 2017, the Company entered into an agreement for certain elements of the construction of the HK5 Data Center. The terms of the constructionagreement triggered the Company to be, in substance, the owner of the asset during the construction phase. The Company has accounted for the constructionand related agreements as a build-to-suit arrangement. As of December 31, 2017, the Company recorded a financing obligation totaling approximately 577.4million Hong Kong dollars, or $73.9 million at the exchange rate in effect as of December 31, 2017.Operating LeasesThe Company also leases its IBX data centers and certain equipment under noncancelable operating lease agreements. The majority of the Company’soperating leases for its land and IBX data centers expire at various dates through 2065 with renewal options available to the Company. The lease agreementstypically provide for base rental rates that increase at defined intervals during the term of the lease. In addition, the Company has negotiated some rentexpense abatement periods for certain leases to better match the phased build out of its IBX data centers. The Company accounts for such abatements andincreasing base rentals using the straight-line method over the life of the lease. The difference between the straight-line expense and the cash payment isrecorded as deferred rent (see Note 6, "Other Current Liabilities" and "Other Liabilities").Minimum future operating lease payments as of December 31, 2017 are summarized as follows (in thousands):Years ending: 2018$176,7892019164,7112020154,3292021144,7062022140,451Thereafter1,132,964Total$1,913,950Total rent expense was approximately $157.9 million, $140.6 million and $101.5 million for the years ended December 31, 2017, 2016 and 2015,respectively.F-42Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)10. Debt FacilitiesMortgage and Loans PayableThe Company’s mortgage and loans payable consisted of the following as of December 31 (in thousands): 2017 2016Term loans$1,417,352 $1,413,582Mortgage payable and other loans payable48,872 44,382 1,466,224 1,457,964Less the amount representing debt discount and debt issuance cost(10,666) (22,811)Add the amount representing mortgage premium2,051 1,862 1,457,609 1,437,015Less current portion(64,491) (67,928) $1,393,118 $1,369,087Senior Credit FacilityOn December 12, 2017, the Company entered into a credit agreement with a group of lenders for a $3,000.0 million credit facility ("Senior CreditFacility"), comprised of a $2,000.0 million senior unsecured multicurrency revolving credit facility ("Revolving Facility") and an approximately $1,000.0million senior unsecured multicurrency term loan facility ("Term Loan Facility"). The Senior Credit Facility contains customary covenants, includingfinancial covenants which require the Company to maintain certain financial coverage and leverage ratios, as well as customary events of default, and isguaranteed by certain of the Company’s domestic subsidiaries. The Senior Credit Facility has a five-year term, maturing on December 12, 2022.The Company borrowed £500.0 million and SEK 2,800.0 million under the Term Loan Facility on December 12, 2017, or approximately $997.1 millionat the exchange rates in effect on that date. The Company is required to repay the Term Loan Facility at the rate of 5% of the original principle amount perannum with the remaining balance to be repaid in full at the maturity of the Senior Credit Facility. The Term Loan Facility bears interest at a rate based onLIBOR plus a margin that can vary from 1.00% to 1.70%.The Revolving Credit Facility allows the Company to borrow, repay and reborrow over its term. The Revolving Credit Facility provides a sublimit forthe issuance of letters of credit of up to $250.0 million at any one time. Borrowings under the Revolving Credit Facility bear interest at a rate based onLIBOR plus a margin that can vary from 0.85% to 1.40% or, at the Company’s option, the base rate, which is defined as the highest of (a) the Federal FundsRate plus 0.5%, (b) the Bank of America prime rate and (c) one-month LIBOR plus 1% plus a margin that can vary from 0.0% to 0.4%. The Company isrequired to pay a quarterly letter of credit fee on the face amount of each letter of credit, which fee is based on the same margin that applies from time to timeto LIBOR-indexed borrowings under the revolving credit line. The Company is also required to pay a quarterly facility fee ranging from 0.15% to 0.30% perannum based on the total revolving credit facility amount.Outstanding BorrowingsAs of December 31, 2017, the Company had £500.0 million and SEK2,800.0 million, or approximately $1,017.8 million in U.S dollars at exchange ratesin effect as of December 31, 2017, outstanding under the Term Loan Facility with a weighted average effective interest rate of 1.85% per annum. Debtissuance costs related to the Term Loan Facility, net of amortization, were $3.2 million as of December 31, 2017.2014 Senior Credit FacilityOn December 17, 2014, the Company entered into a credit agreement with a group of lenders for a $1,500.0 million credit facility ("2014 Senior CreditFacility"), comprised of a $1,000.0 million multicurrency revolving credit facility ("2014 Revolving Credit Facility") and a $500.0 million multicurrencyterm loan facility ("2014 Term Loan A Facility").The 2014 Revolving Credit Facility allowed the Company to borrow, repay and reborrow over the term. The 2014 Revolving Credit Facility provided asublimit for the issuance of letters of credit of up to $150.0 million at any one time. Borrowings under the 2014 Revolving Credit Facility bore interest at arate based on LIBOR plus a margin that could vary from 1.0% to 1.4%. The Company paid a quarterly letter of credit fee on the face amount of each letter ofcredit, which fee was based on the same marginF-43Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)that applies from time to time to LIBOR-indexed borrowings under the revolving credit line. The Company also paid a quarterly facility fee ranging from0.25% to 0.35% per annum of the revolving credit facility, regardless of the amount utilized.First AmendmentOn April 30, 2015, the Company entered into the first amendment (the "First Amendment") to the 2014 Senior Credit Facility. The First Amendmentprovided for the conversion of the outstanding U.S. dollar-denominated borrowings under the 2014 Term Loan A Facility into an approximately equivalentamount denominated in four foreign currencies. In connection with the execution of the First Amendment, on April 30, 2015 the Company repaid the U.S.dollar-denominated $490.0 million remaining principal balance of the Term Loan A Facility and immediately reborrowed under the 2014 Term Loan AFacility in the aggregate principal amounts of CHF 47.8 million, €184.9 million, £92.6 million and ¥11,924.0 million, or approximately $490.0 million inU.S. dollars at exchange rates in effect on April 30, 2015. The Company accounted for this transaction as a debt modification.The Company repaid the foreign-currency denominated borrowings under the 2014 Term Loan A Facility in equal quarterly installments on the lastbusiness day of each March, June, September and December, commencing on June 30, 2015, equal to the amount of 2.00% of the result of the respective2014 Term Loan A Facility on April 30, 2015 divided by 0.98 with the remaining principal amount to be paid on the maturity date of the Term Loan AFacility.Second AmendmentOn December 8, 2015, the Company entered into the second amendment (the "Second Amendment") to the 2014 Senior Credit Facility. Pursuant to theSecond Amendment, the 2014 Revolving Credit Facility was increased from $1,000.0 million to $1,500.0 million and the Company received commitmentsfrom the lenders for a $250.0 million seven year term loan (the "USD Term Loan B Commitment") and for a £300.0 million, or approximately $442.0 millionin U.S. dollars at the exchange rate in effect on December 31, 2015, seven year term loan (the "Sterling Term Loan B Commitment", and collectively, the"Term Loan B Commitments"). On January 8, 2016, the Company borrowed the full amount of the $250.0 million and £300.0 million under the Term Loan BCommitment.Funding of the Term Loan B was net of the original issue discounts of 0.25% of the principal of the USD Term Loan B and 0.50% of the principal of theSterling Term Loan B. Loans made under the Term Loan B Commitments (the "Term Loan B") were repaid in equal quarterly installments of 0.25% of theoriginal principal, with the remaining amount outstanding to be repaid in full on the seventh anniversary of the funding date of the Term Loan B. The USDTerm Loan B bore interest at a rate based on LIBOR plus a margin of 3.25% and the Sterling Term Loan B bore interest at a rate based on LIBOR plus amargin of 3.75%.Third AmendmentOn December 22, 2016, the Company, entered into the third amendment (the "Third Amendment") to the 2014 Senior Credit Facility. Pursuant to theThird Amendment, (i) the Company may borrow up to €1,000.0 million in additional term B loan (the "Term B-2 Loan"), (ii) the interest rate marginapplicable to the existing Term Loan B (the "Term Loan B Facility") in US Dollars was reduced from 3.25% to 2.50% and the LIBOR floor applicable to suchloans were reduced from 0.75% to zero and (iii) the interest rate margin applicable to the loans borrowed under the Term Loan B Facility in Pounds Sterlingwas reduced from 3.75% to 3.00%, with no change to the existing LIBOR floor of 0.75% applicable to such loans. The Company accounted for thistransaction as a debt modification.On January 6, 2017, the Company borrowed the full amount of the Term B-2 Loan for €1,000.0 million, or approximately $1,059.8 million in U.S dollarsat the exchange rate in effect on January 6, 2017. The Term B-2 Loan bore interest at an index rate based on LIBOR plus a margin of 3.25%. No original issuediscount is applicable to the Term B-2 Loan. The Term B-2 Loan was repaid in equal quarterly installments of 0.25% of the original principal amount startingin the second quarter of 2017, with the remaining amount outstanding to be repaid in full on the seventh anniversary of the funding date of the Term B-2Loan.Fourth AmendmentOn August 15, 2017, the Company entered into the fourth amendment (the "Fourth Amendment") to the 2014 Senior Credit Facility. Pursuant to theFourth Amendment, (a) the interest rate margin applicable to loans borrowed under the Term Loan B Facility in US Dollars (the "USD Term Loan B Loans")was reduced from 2.50% to 2.00%, (b) the LIBOR floor applicable to loans borrowed under the Term Loan B Facility in Pounds Sterling (the "GBP TermLoan B Loans") was reduced from 0.75% to zero and (c) the interest rate margin applicable to loans borrowed under the Term Loan B Facility in Euro wasreduced from 3.25% to 2.50%.F-44Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)On December 12, 2017, using the proceeds from the sale of 2.875% Euro Senior Notes due 2026 and amounts borrowed under the Term Loan Facility,the Company repaid in full amounts outstanding under the 2014 Term Loan A Facility, the Term B Loans and the Term B-2 Loan, and terminated the 2014Senior Credit Facility.Bridge Term LoanIn connection with its acquisition of Bit-isle, on September 30, 2015, the Company entered into a term loan agreement (the “Bridge Term LoanAgreement”) with the Bank of Tokyo-Mitsubishi UFJ, Ltd. (“BTMU”). Pursuant to the Bridge Term Loan Agreement, BTMU has committed to provide asenior bridge loan facility (the “Bridge Term Loan”) in the amount of up to ¥47,500.0 million, or approximately $395.2 million in U.S dollars at theexchange rate in effect on December 31, 2015. Proceeds from the Bridge Term Loan were used exclusively for the acquisition of Bit-isle, the repayment ofBit-isle’s existing debt and transaction costs incurred in connection with the closing of the Bridge Term Loan and the acquisition of Bit-isle. Borrowingsunder the Bridge Term Loan bore interest at the Tokyo Interbank Offered Rate for Japanese Yen, plus a margin of 0.4% per annum for the first tenmonths following the first draw down. Thereafter, the margin increased to 1.75% per annum. The Company repaid the Bridge Term Loan in full at the end ofits term on October 31, 2016.Japanese Yen Term LoanOn September 30, 2016, the Company entered into a five year term loan agreement (the "Japanese Yen Term Loan") with BTMU for ¥47,500.0 million, orapproximately $468.4 million at the exchange rate in effect on September 30, 2016. Loans made under the Japanese Yen Term Loan must be repaid in equalquarterly installments of ¥625.0 million, with the remaining balance of ¥35,625.0 million to be repaid in full on October 29, 2021. Borrowings under theJapanese Yen Term Loan bear interest at the Tokyo Interbank Offered Rate for Japanese Yen, plus a margin of 1.5% per annum.In October 2016, the Company drew down the full amount of the Japanese Yen Term Loan of ¥47,500.0 million, or approximately $453.2 million at theexchange rate in effect on October 31, 2016, and repaid the one-year Bridge Term Loan agreement which was used to facilitate the acquisition of Bit-isle.Total outstanding borrowings under the Japanese Yen Term Loan were ¥45,000.0 million, or approximately $399.6 million in U.S dollars at the exchangerate in effect as of December 31, 2017. As of December 31, 2017, debt issuance cost, net of amortization, related to the Japanese Yen Term Loan was ¥843.6million, or approximately $7.5 million in U.S. dollars at the exchange rate in effect on December 31, 2017.Brazil FinancingsIn June 2016, the Company prepaid and terminated its 2012 and 2013 Brazil financings. In connection with this prepayment, the Company paid 90.7million Brazilian Reals, including principal, accrued interest and termination fees, or approximately $28.3 million at the exchange rate in effect as of June30, 2016.Mortgage PayableIn October 2013, as a result of the Frankfurt Kleyer 90 Carrier Hotel Acquisition, the Company assumed a mortgage payable of $42.9 million with aneffective interest rate of 4.25%. The mortgage payable has monthly principal and interest payments and has an expiration date of August 2022.Convertible Debt4.75% Convertible Subordinated NotesIn June 2009, the Company issued $373.8 million aggregate principal amount of 4.75% Convertible Subordinated Notes due June 15, 2016 (the "4.75%Convertible Subordinated Notes"). Interest was payable semi-annually on June 15 and December 15 of each year and commenced on December 15, 2009. InMay and June 2014, certain holders of the 4.75% Convertible Subordinated Notes elected to convert a total of $215.8 million of the principal amount of thenotes for 2,411,851 shares of the Company’s common stock and $51.7 million in cash, comprised of accrued interest, premium and cash paid in lieu ofissuing shares for certain note holders’ principal amount.In December 2015, certain holders of the 4.75% Convertible Subordinated Notes elected to convert a total of $7.8 million of the principal amount of thenotes for 101,947 shares of the Company's common stock and approximately $1,000 in cash for residual shares in connection with the conversions.In April and June 2016, holders of the 4.75% convertible subordinated notes converted or redeemed a total of $150.1 million of the principal amount ofthe notes for 1,981,662 shares of the Company’s common stock and $3.6 million in cash, comprised ofF-45Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)accrued interest, cash paid in lieu of fractional shares and principal redemption. In the Company’s consolidated statement of cash flows for the year endedDecember 31, 2016, the principal redemption and cash paid in lieu of issuing fractional shares to settle a portion of the principal amount were includedwithin net cash provided by (used in) financing activities and the accrued interest paid was included within net cash provided by operating activities.The following table sets forth total interest expense recognized related to the 4.75% Convertible Subordinated Notes for the years ended December 31(in thousands): 2016Contractual interest expense$3,267Amortization of debt issuance costs186Amortization of debt discount3,775 $7,228Effective interest rate of the liability component10.48%To minimize the impact of potential dilution upon conversion of the 4.75% Convertible Subordinated Notes, the Company entered into capped calltransactions (the "Capped Call") separate from the issuance of the 4.75% Convertible Subordinated Notes and paid a premium of $49.7 million for theCapped Call in 2009. The Capped Call covers a total of approximately 4,432,638 shares of the Company’s common stock, subject to adjustment.Upon maturity of the 4.75% Convertible Subordinated Notes on June 15, 2016, the Company settled the capped call transaction and received 380,779shares of common stock, which were placed in treasury and resulted in a credit of $141.7 million to additional paid in capital at the market price of $372.10on June 15, 2016.Senior NotesThe Company’s senior notes consisted of the following as of December 31 (in thousands): 2017 2016 Amount Effective Rate Amount Effective Rate4.875% Senior Notes due 2020$— — $500,000 5.07%5.375% Senior Notes due 2022750,000 5.56% 750,000 5.56%5.375% Senior Notes due 20231,000,000 5.51% 1,000,000 5.51%5.75% Senior Notes due 2025500,000 5.88% 500,000 5.88%2.875% Euro Senior Notes due 20251,201,000 3.04% — —5.875% Senior Notes due 20261,100,000 6.03% 1,100,000 6.03%2.875% Euro Senior Notes due 20261,201,000 3.04% — —5.375% Senior Notes due 20271,250,000 5.51% — — 7,002,000 3,850,000 Less amount representing debt issuance cost(78,151) (39,230) $6,923,849 $3,810,770 2026 Euro Senior NotesIn December 2017, the Company issued €1,000.0 million aggregate principal amount of 2.875% senior notes due February 1, 2026, which are referred toas the "2026 Euro Senior Notes". Interest on the notes is payable semi-annually in arrears on February 1 and August 1 of each year, commencing on August 1,2018. Debt issuance costs related to the 2026 Euro Senior Notes were $15.7 million. As of December 31, 2017, debt issuance costs related to the 2026 EuroSenior Notes, net of amortization, were $15.9 million at the exchange rate in effect on that date.2025 Euro Senior NotesIn September 2017, the Company issued €1,000.0 million aggregate principal amount of 2.875% senior notes due October 1, 2025, which are referred toas the "2025 Euro Senior Notes". Interest on the notes is payable semi-annually in arrears on April 1F-46Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)and October 1 of each year, commencing on April 1, 2018. Debt issuance costs related to the 2025 Euro Senior Notes were $16.3 million. Debt issuance costsrelated to the 2025 Euro Senior Notes, net of amortization, were $15.7 million as of December 31, 2017.2027 Senior NotesIn March 2017, the Company issued $1,250.0 million aggregate principal amount of 5.375% senior notes due May 15, 2027, which are referred to as the"2027 Senior Notes". Interest on the notes is payable semi-annually in arrears on May 15 and November 15 of each year, and commenced on May 15, 2017.Debt issuance costs related to the 2027 Senior Notes were $16.8 million. Debt issuance costs related to the 2027 Senior Notes, net of amortization, were $15.6million as of December 31, 2017.2026 Senior NotesIn December 2015, the Company issued $1,100.0 million aggregate principal amount of 5.875% senior notes due January 15, 2026, which are referred toas the "2026 Senior Notes". Interest on the notes is payable semi-annually in arrears on January 15 and July 15 of each year, and commenced on July 15,2016. As of December 31, 2017 and 2016, debt issuance costs related to the 2026 Senior Notes, net of amortization, were $13.4 million and $15.1 million,respectively.2022 Senior Notes and 2025 Senior NotesIn November 2014, the Company issued $750.0 million aggregate principal amount of 5.375% senior notes due January 1, 2022, and $500.0 millionaggregate principal amount of 5.750% senior notes due January 1, 2025, which are referred to as the "2022 Senior Notes" and "2025 Senior Notes",respectively, and collectively, as the "2022 and 2025 Senior Notes". Interest on each series of the notes is payable semi-annually in arrears on January 1 andJuly 1 of each year, and commenced on July 1, 2015. As of December 31, 2017 and 2016, debt issuance costs related to the 2022 and 2025 Senior Notes, netof amortization, were $10.4 million and $12.5 million, respectively.2020 Senior Notes and 2023 Senior NotesIn March 2013, the Company issued $1,500.0 million aggregate principal amount of senior notes, which consist of $500.0 million aggregate principalamount of 4.875% senior notes due April 1, 2020 (the "2020 Senior Notes") and $1,000.0 million aggregate principal amount of 5.375% senior notes dueApril 1, 2023 (the "2023 Senior Notes"). Interest on both the 2020 Senior Notes and the 2023 Senior Notes is payable semi-annually on April 1 and October 1of each year and commenced on October 1, 2013. On September 28, 2017, the Company redeemed the entire $500.0 million principal amount of the 2020Senior Notes. Debt issuance costs related to the 2023 Senior Notes, net of amortization, were $7.1 million as of December 31, 2017. Debt issuance costsrelated to the 2020 Senior Notes and 2023 Senior Notes, net of amortization, were $11.6 million as of December 31, 2016.All senior notes are unsecured and rank equal in right of payment to the Company’s existing or future senior indebtedness and senior in right of paymentto the Company’s existing and future subordinated indebtedness. The senior notes are effectively subordinated to all of the existing and future secured debt,including debt outstanding under any bank facility or secured by any mortgage, to the extent of the assets securing such debt. They are also structurallysubordinated to any existing and future indebtedness and other liabilities (including trade payables) of any of the Company’s subsidiaries.Each series of senior notes is governed by a supplemental indenture between the Company and U.S. Bank National Association, as trustee. Thesesupplemental indentures contain covenants that limit the Company’s ability and the ability of its subsidiaries to, among other things(1):•incur additional debt;•pay dividends or make other restricted payments;•purchase, redeem or retire capital stock or subordinated debt;•make asset sales;•enter into transactions with affiliates;•incur liens(2);•enter into sale-leaseback transactions(2);•provide subsidiary guarantees;•make investments; and•merge or consolidate with any other person(2). (1) If the senior notes are rated investment grade at any time by two or more of Standard & Poor’s, Moody’s and Fitch, most of the restrictive covenants contained in thesupplemental indentures will be suspended.F-47Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)(2) The supplemental indenture for the 2.875% Euro Senior Notes due 2026 only contains these covenants footnoted with (2).Subject to compliance with the limitations described above, the Company may issue an unlimited principal amount of additional notes at later datesunder the same indenture as the senior notes. Any additional notes the Company issues under the indenture will be identical in all respects to the terms of the2.875% Euro Senior Notes due 2026, except that the additional notes will have different issuance dates and may have different issuance prices.The Company is not required to make any mandatory redemption with respect to the senior notes; however, upon the event of a change in control, theCompany may be required to offer to purchase the senior notes.Optional Redemption ScheduleSenior Note DescriptionEarly EquityRedemption PriceFirst ScheduledRedemption DateFirst ScheduledRedemption PriceSecond YearRedemption PriceThird YearRedemption PriceFourth Year(if scheduled)Redemption Price5.375% due 2022105.375%January 1, 2018104.031%102.688%101.344%100.000%5.375% due 2023105.375%April 1, 2018102.688%101.792%100.896%100.000%5.75% due 2025105.750%January 1, 2020102.875%101.917%100.958%100.000%2.875% Euro due 2025102.875%October 1, 2020101.438%100.719%100.000% 5.875% due 2026105.875%January 15, 2021102.938%101.958%100.979%100.000%2.875% Euro due 2026102.875%February 1, 2021101.438%100.719%100.000% 5.375% due 2027105.375%May 15, 2022102.688%101.792%100.896%100.000%Each series of senior notes provides for optional redemption. Within 90 days of the closing of one or more equity offerings and at any time prior to thefirst scheduled redemption date listed in the Optional Redemption Schedule, the Company may redeem up to 35% of the aggregate principal amount of anyseries of senior notes outstanding, at the respective early equity redemption price listed in the Optional Redemption Schedule, plus accrued and unpaidinterest to the redemption date, provided that at least 65% of the aggregate principal amount of the senior notes issued in such series remains outstandingimmediately after such redemption(s).On or after the first scheduled redemption date listed in the Optional Redemption Schedule, the Company may redeem all or a part of a series of seniornotes, on one or more occasions, at the redemption prices (expressed as percentages of principal amount) set forth in the Optional Redemption Schedule, plusaccrued and unpaid interest thereon, if any, if redeemed during the twelve-month periods beginning on the first scheduled redemption date and at reducedscheduled redemption prices during the twelve-month periods beginning on the anniversaries of the first scheduled redemption date.In addition, at any time prior to the first scheduled redemption date, the Company may redeem all or a part of any series of senior notes at a redemptionprice equal to 100% of the principal amount of such senior notes redeemed plus the applicable premium (the "Applicable Premium") and accrued and unpaidinterest, subject to the rights of the holders of record of such senior notes on the relevant record date to receive interest due on the relevant interest paymentdate. The Applicable Premium means the greater of:(1)1.0% of the principal amount of the senior notes;(2)the excess of:(a)the present value at such redemption date of (i) the first scheduled redemption price of the senior notes at the first scheduled redemptiondate, plus (ii) all required interest payments due on the senior notes through the first scheduled redemption date computed using a discount rateequal to the treasury rate as of such redemption date plus 50 basis points; over(b)the principal amount of the senior notes.Loss on Debt ExtinguishmentDuring the year ended December 31, 2017, the Company recorded $65.8 million of loss on debt extinguishment comprised of (i) $14.6 million of loss ondebt extinguishment from the redemption of the 2020 Senior Notes, which included the $12.2 million redemption premium that was paid in cash and $2.4million related to the write-off of unamortized debt issuance costs, (ii) $13.2F-48Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)million of loss on debt extinguishment from the redemption of the Term B-2 Loan, (iii) $9.3 million of loss on debt extinguishment as a result of theredemption of the Term B Loans, (iv) $16.7 million loss on debt extinguishment as a result of amendments to leases and financing obligations and (v) $12.0million of loss on debt extinguishment as a result of the settlement of financing obligations for properties purchased.During the year ended December 31, 2016, the Company recorded $12.3 million of loss on debt extinguishment as a result of (i) the settlement of thefinancing obligations for Paris 3 IBX data center, (ii) a portion of the lender fees associated with the Japanese Yen Term Loan and (iii) the prepayment andterminations of the 2012 and 2013 Brazil financings.During the year ended December 31, 2015, the Company recorded $0.3 million of loss on debt extinguishment as a result of the conversions of the4.75% Convertible Subordinated Notes.Maturities of Debt FacilitiesThe following table sets forth maturities of the Company’s debt, including mortgage, loans payable, and senior notes, gross of debt issuance costs anddebt discounts, as of December 31, 2017 (in thousands):Years ending: 2018$64,472201977,309202077,2372021387,76220221,607,402Thereafter6,256,093 $8,470,275Fair Value of Debt FacilitiesThe following table sets forth the estimated fair values of the Company’s mortgage and loans payable and senior notes, including current maturities, as ofDecember 31 (in thousands): 2017 2016Mortgage and loans payable$1,464,877 $1,461,954Senior notes7,288,673 4,033,985The fair value of the mortgage and loans payable, which were not publicly traded, was estimated by considering the Company’s credit rating, currentrates available to the Company for debt of the same remaining maturities and terms of the debt (level 2). The fair value of the senior notes, which were tradedin the public debt market, was based on quoted market prices (level 1).Interest ChargesThe following table sets forth total interest costs incurred and total interest costs capitalized for the years ended December 31 (in thousands): 2017 2016 2015Interest expense$478,698 $392,156 $299,055Interest capitalized22,625 13,338 10,943Interest charges incurred$501,323 $405,494 $309,998Total interest paid, net of capitalized interest, during the years ended December 31, 2017, 2016 and 2015 was $422.2 million, $336.7 million and $226.5million, respectively.F-49Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)11. Stockholders’ EquityThe Company’s authorized share capital is 300,000,000 shares of common stock and 100,000,000 shares of preferred stock, of which 25,000,000 isdesignated Series A, 25,000,000 is designated as Series A-1 and 50,000,000 is undesignated. As of December 31, 2017 and 2016, the Company had nopreferred stock issued and outstanding.Common StockIn August 2017, the Company entered into an equity distribution agreement with RBC Capital Market, LLC, Merrill Lynch, Pierce, Fenner & SmithIncorporated, Citigroup Global Markets Inc. and J.P. Morgan Securities LLC, establishing an "at the market" equity offering program, under which theCompany may offer and sell from time to time up to an aggregate of $750.0 million of its common stock in "at the market" transactions (the "ATM Program").For the year ended December 31, 2017, the Company sold 763,201 shares under the ATM Program, for approximately $355.1 million, net of payment ofcommissions to the sales agents and estimated equity offering costs.In March 2017, the Company issued and sold 6,069,444 shares of its common stock in a public offering pursuant to a registration statement and a relatedprospectus and prospectus supplement, in each case filed with the Securities and Exchange Commission ("SEC"). The shares issued and sold included the fullexercise of the underwriters' option to purchase 791,666 additional shares. The Company received net proceeds of approximately $2,126.3 million, afterdeducting underwriting discounts and commissions and offering expenses of $58.7 million.In April and June 2016, upon the maturity of the Company's 4.75% Convertible Subordinated Notes, holders of the Company's 4.75% ConvertibleSubordinated Notes converted $150.1 million principal amount of the notes into 1,981,662 shares of the Company's common stock. In June 2016, theCompany also settled the capped call transaction and received 380,779 shares of common stock, which were placed in treasury and resulted in a credit of$141.7 million to additional paid in capital at the market price of $372.10 on June 15, 2016. See convertible debt in Note 10 for additional information.In December 2015, certain holders of the Company's 4.75% Convertible Subordinated Notes elected to convert a portion of the notes into 101,947 sharesof the Company's common stock. See convertible debt in Note 10 for additional information.In November 2015, the Company issued and sold 2,994,792 shares of its common stock in a public offering pursuant to a registration statement and arelated prospectus and prospectus supplement, in each case filed with the SEC. The shares issued and sold included the full exercise of the underwriters’option to purchase 390,625 additional shares. The Company received net proceeds of approximately $829.5 million, after deducting underwriting discountsand commissions of $32.3 million and offering expenses of $0.7 million.As of December 31, 2017, the Company had reserved the following shares of authorized but unissued shares of common stock for future issuances:Common stock options and restricted stock units4,499,389Common stock employee purchase plans3,265,791Total7,765,180F-50Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)Accumulated Other Comprehensive LossThe components of the Company’s accumulated other comprehensive loss (OCI) consisted of the following as of December 31, 2017, 2016 and 2015 (inthousands): December 31,2014 NetChange December 31,2015 NetChange December 31,2016 NetChange December 31,2017Foreign currency translation adjustment("CTA") loss$(336,946) $(186,763) $(523,709) $(507,420) $(1,031,129) $454,269 $(576,860)Unrealized gain (loss) on cash flowhedges(1)6,603 4,550 11,153 19,551 30,704 (54,895) (24,191)Net investment hedge CTA gain (loss)(1)— 4,484 4,484 45,505 49,989 (235,292) (185,303)Unrealized gain (loss) on available forsale securities(2)(99) (40) (139) 2,249 2,110 14 2,124Net actuarial loss on defined benefitplans(3)(2,001) 1,153 (848) 32 (816) (143) (959) $(332,443) $(176,616) $(509,059) $(440,083) $(949,142) $163,953 $(785,189)__________________________(1)Refer to Note 7 for a discussion of the amounts reclassified from accumulated other comprehensive loss to net income (loss).(2)The realized gains and losses reclassified from accumulated other comprehensive loss to net income (loss) as a result of sale of available for sale securities were notsignificant for the years ended December 31, 2017, 2016 and 2015.(3)The Company has a defined benefit pension plan covering all employees in one country where such plans are mandated by law. The Company does not have any definedbenefit plans in any other countries. The unamortized gain (loss) on defined benefit plans includes gains or losses resulting from a change in the value of either theprojected benefit obligation or the plan assets resulting from a change in an actuarial assumption, net of amortization.Changes in foreign currencies can have a significant impact to the Company’s consolidated balance sheets (as evidenced above in the Company’sforeign currency translation gain or loss), as well as its consolidated results of operations, as amounts in foreign currencies are generally translating into moreU.S. dollars when the U.S. dollar weakens or less U.S. dollars when the U.S. dollar strengthens. At December 31, 2017, the U.S. dollar was generally weakerrelative to certain of the currencies of the foreign countries in which the Company operates. This overall weakening of the U.S. dollar had an overall positiveimpact on the Company’s consolidated financial position because the foreign denominations translated into more U.S. dollars as evidenced by the decreasein foreign currency translation loss for the year ended December 31, 2017 compared to the year ended December 31, 2016 as reflected in the above table. Infuture periods, the volatility of the U.S. dollar as compared to the other currencies in which the Company does business could have a significant impact on itsconsolidated financial position and results of operations including the amount of revenue that the Company reports in future periods.Treasury StockDuring the year ended December 31, 2017, the Company re-issued 6,073 shares of its treasury stock with a total value of $2.6 million related to thesettlement of restricted stock units. During the year ended December 31, 2016, the Company re-issued 7,099 shares of its treasury stock with a total value of$2.4 million related to the settlement of restricted stock units. During the year ended December 31, 2015, the Company re-issued 7,348 shares of its treasurystock with a total value of $1.8 million related to the settlement of restricted stock units and 11,784 shares of its treasury stock with a total value of $3.5million related to the exchange and conversion of the 4.75% Convertible Subordinated Notes (see Note 10).Special DistributionsIn September 2015, the Company’s Board of Directors declared a special distribution of $627.0 million, or approximately $10.95 per share (the "2015Special Distribution"), to its common stockholders. The 2015 Special Distribution represents an amount that includes the sum of: (1) foreign earnings andprofits repatriated as dividend income in 2015; (2) taxable income in 2015 from depreciation recapture in respect of accounting method changes commencedin the Company’s pre-REIT period; and (3) certain other items of taxable income.The 2015 Special Distribution was paid on November 10, 2015 to the Company’s common stockholders of record as of the close of business onOctober 8, 2015. Common stockholders had the option to elect to receive payment of the 2015 Special Distribution in the form of stock or cash. The numberof shares distributed was determined based upon common stockholderF-51Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)elections and the average closing price of the Company’s common stock on the three trading days commencing on November 3, 2015 or $297.03 per share.As such, the Company issued 1,688,411 shares of its common stock and paid $125.5 million in connection with the 2015 Special Distribution.Shares issued in connection with the 2015 Special Distribution impact weighted average shares outstanding from the date of issuance, thus impacting theCompany’s earnings per share data prospectively from the distribution date.DividendsDuring the year ended December 31, 2017, the Company's Board of Directors declared quarterly cash dividends of $2.00 per share on November 1,August 2, April 26, and February 15, 2017, to stockholders of record on November 15, August 23, May 24, and February 27, 2017, respectively, and paymentdates of December 13, September 20, June 21, and March 22, 2017, respectively. The Company paid a total of $612.1 million in cash dividends during theyear ended December 31, 2017.During the year ended December 31, 2016, the Company's Board of Directors declared quarterly cash dividends of $1.75 per share on November 2,August 3, May 4, and February 18, 2016, to stockholders of record on November 16, August 24, May 25, and March 9, 2016, respectively, and payment datesof December 14, September 14, June 15, and March 23, 2016, respectively. The Company paid a total of $492.4 million in cash dividends during the yearended December 31, 2016.During the year ended December 31, 2015, the Company's Board of Directors declared quarterly cash dividends of $1.69 per share on October 28, July29, May 7 and February 19, 2015, to stockholders of record on December 9, August 26, May 27 and March 11, 2015, respectively, and payment dates ofDecember 16, September 16, June 17 and March 25, 2015, respectively. The Company paid a total of $393.6 million in cash dividends during the year endedDecember 31, 2015.In addition, as of December 31, 2017, for dividends and special distributions attributed to the restricted stock units, the Company recorded a short termdividend payable of $11.2 million and a long term dividend payable of $6.7 million for the restricted stock units that have not yet vested. Asof December 31, 2016, for dividends and special distributions attributed to the RSU awards, the Company recorded a short term dividend payable of $12.0million and a long term dividend payable of $8.5 million for the restricted stock units that have not yet vested.For federal income tax purposes, distributions to stockholders are treated as ordinary income, capital gains, return of capital or a combination thereof. Forthe years ended December 31, 2017 and 2016, the quarterly dividends were classified as follows:Record Date Payment Date Total Distribution NonqualifiedOrdinary Dividend Qualified OrdinaryDividend Return of Capital (per share)Fiscal 2017 2/27/2017 3/22/2017 $2.000000 $2.000000 $— $—5/24/2017 6/21/2017 2.000000 2.000000 — —8/23/2017 9/20/2017 2.000000 2.000000 — —11/15/2017 12/13/2017 2.000000 2.000000 — —Total $8.000000 $8.000000 $— $— Fiscal 2016 3/9/2016 3/23/2016 $1.750000 $1.231334 $0.518666 $—5/25/2016 6/15/2016 1.750000 1.231334 0.518666 —8/24/2016 9/14/2016 1.750000 1.231334 0.518666 —11/16/2016 12/14/2016 1.750000 1.231334 0.518666 —Total $7.000000 $4.925336 $2.074664 $—F-52Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)12. Stock-Based CompensationEquinix Equity AwardsEquity Compensation PlansIn May 2000, the Company’s stockholders approved the adoption of the 2000 Equity Incentive Plan as the successor plan to the 1998 Stock Plan.Beginning in August 2000, the Company no longer issued additional grants under the 1998 Stock Plan, and unexercised options under the 1998 Stock Planthat are canceled due to an optionee’s termination may be reissued under the successor 2000 Equity Incentive Plan. Under the 2000 Equity Incentive Plan,nonstatutory stock options, restricted shares, restricted stock units, and stock appreciation rights may be granted to employees, outside directors andconsultants at not less than 85% of the fair value on the date of grant, and incentive stock options may be granted to employees at not less than 100% of thefair value on the date of grant. Options granted prior to October 1, 2005 generally expire 10 years from the grant date, and equity awards granted toemployees and consultants on or after October 1, 2005 will generally expire 7 years from the grant date, subject to continuous service of the optionee. Equityawards granted under the 2000 Equity Incentive Plan generally vest over 4 years. The Company had reserved a total of 16,636,172 shares for issuance underthe 2000 Equity Incentive Plan of which 2,423,051 shares were still available for grant as of December 31, 2017. The 2000 Equity Incentive Plan isadministered by the Compensation Committee of the Board of Directors (the "Compensation Committee"), and the Compensation Committee may terminateor amend the plan, with approval of the stockholders as may be required by applicable law, at any time.In May 2000, the Company’s stockholders approved the adoption of the 2000 Director Option Plan, which was amended and restated effective January 1,2003. Under the 2000 Director Option Plan, each non-employee board member who was not previously an employee of the Company will receive anautomatic initial nonstatutory stock option grant, which vests in four annual installments. In addition, each non-employee board member will receive anannual non-statutory stock option grant on the date of the Company’s regular Annual Meeting of Stockholders, provided the board member will continue toserve as a director thereafter. Such annual option grants shall vest in full on the earlier of a) the first anniversary of the grant, or b) the date of the regularAnnual Meeting of Stockholders held in the year following the grant date. A new director who receives an initial option will not receive an annual option inthe same calendar year. Options granted under the 2000 Director Option Plan will have an option price not less than 100% of the fair value on the date ofgrant and will have a 10-year contractual term, subject to continuous service of the board member. On December 18, 2008, the Company’s Board of Directorspassed resolutions eliminating all automatic stock option grant mechanisms under the 2000 Director Option Plan, and replaced them with an automaticrestricted stock unit grant mechanism under the 2000 Equity Incentive Plan. The Company had reserved 594,403 shares for issuance under the 2000 DirectorOption Plan of which 505,646 shares were still available for grant as of December 31, 2017. The 2000 Director Option Plan is administered by theCompensation Committee and the Compensation Committee may terminate or amend the plan, with approval of the stockholders as may be required byapplicable law, at any time.In September 2001, the Company adopted the 2001 Supplemental Stock Plan, under which non-statutory stock options and restricted shares/restrictedstock units may be granted to consultants and employees who are not executive officers or board members, at not less than 85% of the fair value on the dateof grant. Options granted prior to October 1, 2005 generally expire 10 years from the grant date, and options granted on or after October 1, 2005 willgenerally expire 7 years from the grant date, subject to continuous service of the optionee. Current stock options granted under the 2001 Supplemental StockPlan generally vest over four years. The Company had reserved a total of 1,494,275 shares for issuance under the 2001 Supplemental Stock Plan, of which260,498 shares were still available for grant as of December 31, 2017. The 2001 Supplemental Stock Plan is administered by the Compensation Committee,and the plan will continue in effect indefinitely unless the Compensation Committee decides to terminate it earlier.The 1998 Stock Plan, 2000 Equity Incentive Plan, 2000 Director Option Plan and 2001 Supplemental Stock Plan are collectively referred to as the"Equity Compensation Plans."F-53Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)Stock OptionsStock option activity under the Equity Compensation Plans is summarized as follows:Number of SharesOutstandingWeighted AverageExercise Price perShareWeighted AverageRemainingContractual Life(Years)AggregateIntrinsicValue (1) (Dollars inThousands)Stock options outstanding at December 31, 201477,934$73.84Stock options exercised(41,889)64.18Additional shares granted due to special distribution1,454—Stock options expired(250)41.12Stock options outstanding at December 31, 201537,24982.06Stock options exercised(18,183)80.10Stock options outstanding at December 31, 201619,06682.01Stock options exercised(12,763)83.51Stock options outstanding at December 31, 20176,303$78.970.57$2,359Stock options vested and exercisable at December 31, 20176,303$78.970.57$2,359__________________________(1)The aggregate intrinsic value is calculated as the difference between the market value of the stock as of December 31, 2017 and the exercise price of the option.The following table summarizes information about outstanding stock options as of December 31, 2017: OutstandingExercisableRange of exercise pricesNumber of SharesWeighted AverageRemainingContractual Life(Years)Weighted AverageExercise PriceNumber of Shares Weighted AverageExercise Price$28.56 to $28.561,0071.18$28.561,007 $28.56$88.56 to $88.565,2960.4588.565,296 88.566,3030.57$78.976,303 $78.97The Company provides the following additional disclosures for stock options as of December 31 (in thousands):2017 2016 2015Total aggregate intrinsic value of stock options exercised (1)$3,818 $4,712 $7,198_________________________(1)The intrinsic value is calculated as the difference between the market value of the stock on the date of exercise and the exercise price of the option.F-54Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)Restricted Stock UnitsSince 2008, the Company primarily grants restricted stock units to its employees, including executives and non-employee directors, in lieu of stockoptions. The Company generally grants restricted stock units that have a service condition only or have both a service and performance condition. Eachrestricted stock unit is not considered issued and outstanding and does not have voting rights until it is converted into one share of the Company’s commonstock upon vesting. Restricted stock unit activity is summarized as follows: Number of SharesOutstandingWeighted AverageGrant Date FairValue per ShareWeighted AverageRemainingContractual Life(Years)Aggregate IntrinsicValue (1) (Dollars inThousands)Restricted stock units outstanding, December 31, 20141,403,974$114.56Restricted stock units granted711,990236.89Additional shares granted due to special distribution51,432297.03Restricted stock units released, vested(623,554)173.79Special distribution shares released(19,966)227.99Restricted stock units canceled(103,922)198.67Special distribution shares canceled(3,516)235.43Restricted stock units outstanding, December 31, 20151,416,438148.53Restricted stock units granted720,601309.18Additional shares granted due to special distribution37297.03Restricted stock units released, vested(655,584)213.72Special distribution shares released(35,354)269.94Restricted stock units canceled(93,940)242.41Special distribution shares canceled(4,319)272.84Restricted stock units outstanding, December 31, 20161,347,879192.59Restricted stock units granted658,196389.60Restricted stock units released, vested(606,064)260.75Special distribution shares released(15,667)243.06Restricted stock units canceled(79,451)313.83Special distribution shares canceled(1,002)282.49Restricted stock units outstanding, December 31, 20171,303,891$252.301.22$590,950__________________________(1)The intrinsic value is calculated based on the market value of the stock as of December 31, 2017.The total fair value of restricted stock units vested and released during the years ended December 31, 2017, 2016 and 2015 was $259.1 million, $227.4million and $157.6 million, respectively.Employee Stock Purchase PlanIn June 2004, the Company’s stockholders approved the adoption of the 2004 Employee Stock Purchase Plan (the "2004 Purchase Plan") as a successorplan to a previous plan that ceased activity in 2005. A total of 500,000 shares have been reserved for issuance under the 2004 Purchase Plan, and the numberof shares available for issuance under the 2004 Purchase Plan automatically increased on January 1 each year, beginning in 2005 and ending in 2014 by thelesser of 2% of the shares of common stock then outstanding or 500,000 shares. Effective November 25, 2014, 3,197 shares were added to the 2004 PurchasePlan, representing an anti-dilutive adjustment pursuant to the 2014 Special Distribution. Effective November 10, 2015, 9,020 shares were added to the 2004Purchase Plan, representing an anti-dilutive adjustment pursuant to the 2015 Special Distribution. As of December 31, 2017, a total of 3,265,791 sharesremained available for purchase under the 2004 Purchase Plan. The 2004 Purchase Plan permits eligible employees to purchase common stock on favorableterms via payroll deductions of up to 15% of the employee’s cash compensation, subject to certain share and statutory dollar limits. Two overlapping offeringperiods commence during eachF-55Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)calendar year, on each February 15 and August 15 or such other periods or dates as determined by the Compensation Committee from time to time, and theoffering periods last up to 24 months with a purchase date every six months. The price of each share purchased is 85% of the lower of a) the fair value pershare of common stock on the last trading day before the commencement of the applicable offering period or b) the fair value per share of common stock onthe purchase date. The 2004 Purchase Plan is administered by the Compensation Committee of the Board of Directors, and such plan will terminateautomatically in June 2024 unless a) the 2004 Purchase Plan is extended by the Board of Directors and b) the extension is approved within 12 months by theCompany’s stockholders.The Company provides the following disclosures for the 2004 Purchase Plan as of December 31 (dollars, except shares): 2017 2016 2015Weighted-average purchase price per share$250.65 $217.91 $150.13Weighted average grant-date fair value per share of shares purchased$72.21 $60.49 $57.63Number of shares purchased162,076 150,044 182,175The Company uses the Black-Scholes option-pricing model to determine the fair value of shares under the 2004 Purchase Plan with the followingassumptions during the years ended December 31: 2017 2016 2015Range of dividend yield2.10 - 2.31% 2.38 - 2.53% 2.65 - 2.81%Range of risk-free interest rate0.70 - 1.35% 0.48 - 0.76% 0.08 - 0.77%Range of expected volatility16.42 - 24.27% 18.80 - 30.94% 19.96 - 25.78%Weighted-average expected volatility20.30% 25.01% 21.72%Weighted average expected life (in years)1.52 1.41 1.59Stock-Based Compensation Recognized in the Consolidated Statement of OperationsThe Company generally recognizes stock-based compensation expense on a straight-line basis over the requisite service period of the awards. However,for awards with market conditions or performance conditions, stock-based compensation expense is recognized on a straight-line basis over the requisiteservice period for each vesting tranche of the award.In October 2014, the Compensation Committee approved amendments to the terms of all outstanding restricted stock units ("RSUs") granted prior toJanuary 1, 2014 to provide for dividend equivalent rights ("DERs") in the event of future dividends paid on the Company’s common stock. TheCompensation Committee also approved an adjustment to outstanding stock options, including those under the Company’s Employee Stock Purchase Plan("ESPP"), to ensure that the cash portion of the 2014 Special Distribution would not negatively impact the intrinsic value of the options. Pursuant to theaccounting standard for stock compensation, these actions affecting the terms of the awards are considered modifications for accounting purposes thatresulted in incremental stock-based compensation expenses and will be recognized over the requisite service period for each vesting tranche of the award.The total charges associated with this modification are not significant to the financial statements.As of December 31, 2017, the total stock-based compensation cost related to unvested equity awards not yet recognized, net of estimated forfeitures,totaled $296.7 million which is expected to be recognized over a weighted-average period of 2.08 years.The following table presents, by operating expense, the Company’s stock-based compensation expense recognized in the Company’s consolidatedstatement of operations for the years ended December 31 (in thousands): 2017 2016 2015Cost of revenues$13,621 $13,086 $9,878Sales and marketing50,094 43,030 36,847General and administrative111,785 100,032 86,908Total$175,500 $156,148 $133,633F-56Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)The Company’s stock-based compensation recognized in the consolidated statement of operations was comprised of the following types of equityawards for the years ended December 31 (in thousands): 2017 2016 2015Stock options$— $— $1,679Restricted stock units164,321 145,769 124,512Employee stock purchase plan11,179 10,379 7,442Total$175,500 $156,148 $133,633During the years ended December 31, 2017, 2016 and 2015, the Company capitalized $6.2 million, $4.2 million and $3.0 million, respectively, of stock-based compensation expense as construction in progress in property, plant and equipment.13. Income TaxesIncome (loss) before income taxes is attributable to the following geographic locations for the years ended December 31, (in thousands): 2017 2016 2015Domestic$148,500 $215,010 $123,153Foreign138,332 (55,151) 87,845Income from continuing operations before income taxes$286,832 $159,859 $210,998The tax benefit (expenses) for income taxes consisted of the following components for the years ended December 31, (in thousands): 2017 2016 2015Current: Federal$9,346 $(16,365) $(85,352)State and local(849) (2,147) (3,984)Foreign(109,032) (62,278) (27,090)Subtotal(100,535) (80,790) (116,426)Deferred: Federal9,684 (11,184) 87,801State and local2,018 (3,328) 4,600Foreign34,983 49,851 801Subtotal46,685 35,339 93,202Provision for income taxes$(53,850) $(45,451) $(23,224)State and foreign taxes not based on income are included in general and administrative expenses and the aggregate amounts were not significant for theyears ended December 31, 2017, 2016 and 2015.F-57Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)The fiscal 2017, 2016 and 2015 income tax expense differed from the amounts computed by applying the U.S. federal income tax rate of 35% to pre-taxincome as a result of the following for the years ended December 31 (in thousands): 2017 2016 2015Federal tax at statutory rate$(100,391) $(55,951) $(73,849)State and local tax (expense) benefit1,000 (4,895) 945Deferred tax assets generated in current year not benefited(7,643) (6,246) (4,916)Foreign income tax rate differential26,151 22,016 30,387Non-deductible expenses(2,629) (15,828) (14,252)Stock-based compensation expense(616) (5,890) (3,922)Change in valuation allowance(716) 11,995 710Foreign financing activities1,319 (26,708) 2,592Loss on debt extinguishment(1,604) (8,288) —Gain on divestments— 8,828 —Uncertain tax positions reserve(66) (9,371) (3,191)Tax adjustments related to REIT41,973 45,060 45,823Enactment of the US tax reform(6,513) — —Other, net(4,115) (173) (3,551)Total income tax expense$(53,850) $(45,451) $(23,224)Legislation commonly referred to as the Tax Cuts and Jobs Act ("TCJA"), which was signed into law on December 22, 2017, contains many significantchanges to the existing U.S. federal income tax laws. Among other things, the TCJA reduces the U.S. corporate income tax rate from 35% to 21% effectiveJanuary 1, 2018, limits the tax deductibility of interest expense, accelerates expensing of certain business assets and transitions the U.S. internationaltaxation from a worldwide tax system to a territorial tax system by imposing a one-time mandatory repatriation of undistributed foreign earnings. As a resultof the reduced corporate tax rate, the Company recognized an income tax expense of $6.5 million during the fourth quarter of 2017 as a provisional amountdue to the remeasurement of the net deferred tax assets in the U.S. TRS. The Company is still analyzing the new tax legislation and assessing the impact. TheCompany will be able to conclude whether any adjustments are required to its net deferred tax asset balance in the U.S. when it files its 2017 U.S. federal taxreturn in the fourth quarter of 2018. Any adjustments to these provisional amounts will be reported as a component of tax expense (benefit) in the reportingperiod when such adjustments are determined.The TCJA mandates a one-time deemed repatriation of undistributed foreign earnings, which will increase the Company’s 2017 taxable income, as wellas its required REIT distribution. Based on the interpretation and guidance of the new tax legislation, the Company estimated a provisional amount of $195million as the one-time mandatory repatriation of its cumulative foreign earnings that was not previously included in the U.S. taxable income. The Companyhas an option of including the entire amount in its 2017 taxable income or spreading the amount over 8 years in its taxable income. The Company hastentatively determined to include the entire amount in its 2017 taxable income. However, the final decision will be made upon the filing of its 2017 taxreturn in the fourth quarter of 2018. The Company believes the mandatory repatriation will result in no financial statement impact provided the Companysatisfies its REIT distribution requirement.As a result of the Company’s conversion to a REIT effective January 1, 2015, it is no longer the Company’s intent to indefinitely reinvest undistributedforeign earnings. However, no deferred tax liability has been recognized to account for this change because the expected recovery of the basis difference willnot result in U.S. taxes in the post-REIT conversion periods due to the fact that none of its foreign subsidiaries is owned by a U.S. taxable REIT subsidiaryand the withholding tax effect would be immaterial. As it continues to qualify as a REIT, the Company will not incur U.S. tax liability on the futurerepatriation of the foreign earnings and profits due to the zero tax rate that will apply provided the Company distributes 100% of its taxable income. Duringthe fourth quarter of 2016, the Company repatriated approximately $63.7 million of foreign earnings from Singapore, which increased the taxable income for2016 and was included in the REIT distribution for the year. There was no foreign withholding tax triggered by the repatriation. The Company continues toassess the foreign withholding tax impact of its current policy and does not believe the distribution of its foreign earnings would trigger any significantforeign withholding taxes, as a majority of the foreign jurisdictions where the Company operates does not impose withholding taxes on dividenddistributions to a corporate U.S. parent.F-58Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)The types of temporary differences that give rise to significant portions of the Company’s deferred tax assets and liabilities are set out below as ofDecember 31 (in thousands): 2017 2016Deferred tax assets: Reserves and accruals$27,673 $11,276Stock-based compensation expense1,960 1,752Unrealized losses10,768 —Operating loss carryforwards95,864 37,594Others, net— 5Gross deferred tax assets136,265 50,627Valuation allowance(84,573) (29,167)Total deferred tax assets, net51,692 21,460Deferred tax liabilities: Property, plant and equipment(65,825) (57,006)Unrealized gains— (7,832)Intangible assets(172,123) (168,655)Total deferred tax liabilities(237,948) (233,493)Net deferred tax liabilities$(186,256) $(212,033)The tax basis of REIT assets, excluding investments in TRSs, is greater than the amounts reported for such assets in the accompanying consolidatedbalance sheet by approximately $1,390.1 million at December 31, 2017. The Company's accounting for deferred taxes involves weighing positive and negative evidence concerning the realizability of the Company's deferredtax assets in each tax jurisdiction. After considering such evidence as the nature, frequency and severity of current and cumulative financial reporting losses,and the sources of future taxable income and tax planning strategies, management concluded that valuation allowances were required in certain foreignjurisdictions. A valuation allowance continues to be provided for the deferred tax assets, net of deferred tax liabilities, associated with the Company'soperations in Brazil, Canada, and certain jurisdictions located in the Company’s EMEA and Asia-Pacific regions. The operations in these jurisdictions have ahistory of significant losses as of December 31, 2017. As such, management does not believe these operations have established a sustained history ofprofitability and that a valuation allowance is, therefore, necessary.Changes in the valuation allowance for deferred tax assets for the years ended December 31, 2017, 2016 and 2015 are as follows (in thousands): 2017 2016 2015Beginning balance$29,167 $29,894 $27,181Amounts from acquisitions25,283 5,053 —Amounts recognized into income716 (11,995) (710)Current increase28,431 6,557 4,513Impact of foreign currency exchange976 (342) (1,090)Ending balance$84,573 $29,167 $29,894Federal and state tax laws, including California tax laws, impose substantial restrictions on the utilization of NOL and credit carryforwards in the event ofan "ownership change" for tax purposes, as defined in Section 382 of the Internal Revenue Code. In 2003, the Company conducted an analysis to determinewhether an ownership change had occurred due to significant stock transactions in each of the reporting years disclosed at that time. The analysis indicatedthat an ownership change occurred during fiscal year 2002, which resulted in an annual limitation of approximately $0.8 million for NOL carryforwardsgenerated prior to 2003. Therefore, the Company substantially reduced its federal and state NOL carryforwards for the periods prior to 2003 to approximately$16.4 million.F-59Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)The Company’s NOL carryforwards for federal, state and foreign tax purposes which expire, if not utilized, at various intervals from 2018, are outlinedbelow (in thousands):Expiration Date Federal (1) State (1) Foreign Total2018 $— $— $11,730 $11,7302019 to 2021 190,125 474 16,638 207,2372022 to 2024 46,827 — 4,294 51,1212025 to 2027 13,005 — 9,425 22,4302031 to 2033 — 767 — 767Thereafter 61,375 18,909 242,382 322,666 $311,332 $20,150 $284,469 $615,951__________________________(1)The total amount of NOL carryforwards that will not be available to offset the Company’s future taxable income after dividend paid deduction due to Section 382limitations was $242.0 million, comprising $241.8 million of federal and $0.2 million of state.The beginning and ending balances of the Company's unrecognized tax benefits are reconciled below for the years ended December 31 (in thousands): 2017 2016 2015Beginning balance$72,187 $30,845 $36,138Gross increases related to prior year tax positions6,095 570 —Gross decreases related to prior year tax positions— — (8,645)Gross increases related to current year tax positions19,832 41,972 4,802Decreases resulting from expiration of statute of limitation(15,410) (826) (1,450)Decreases resulting from settlements(314) (374) —Ending balance$82,390 $72,187 $30,845The Company recognizes interest and penalties related to unrecognized tax benefits within income tax benefit (expense) in the consolidated statementsof operations. The Company has accrued $2.9 million and $4.4 million for interest and penalties as of December 31, 2017 and 2016, respectively.The unrecognized tax benefits of $82.4 million as of December 31, 2017, if subsequently recognized, will affect the Company's effective tax ratefavorably at the time when such a benefit is recognized.Due to various tax years open for examination, it is reasonably possible that the balance of unrecognized tax benefits could significantly increase ordecrease over the next 12 months as the Company may be subject to either examination by tax authorities or a lapse in statute of limitations. The Company iscurrently unable to estimate the range of possible adjustments to the balance of unrecognized tax benefits.The Company's income tax returns for the years from 2014 through current remain open to examination by federal and state taxing authorities. Inaddition, the Company's tax years of 2005 through 2017 remain open and subject to examination by local tax authorities in certain foreign jurisdictions inwhich the Company has major operations.14. Commitments and ContingenciesPurchase CommitmentsPrimarily as a result of the Company’s various IBX expansion projects, as of December 31, 2017, the Company was contractually committed for $508.2million of unaccrued capital expenditures, primarily for IBX equipment not yet delivered and labor not yet provided, in connection with the work necessaryto open these IBX data centers and make them available to customers for installation. In addition, the Company had numerous other, non-capital purchasecommitments in place as of December 31, 2017, such as commitments to purchase power in select locations, primarily in select locations through 2018 andthereafter, andF-60Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)other open purchase orders for goods or services to be delivered or provided during 2018 and thereafter. Such other miscellaneous purchase commitmentstotaled $643.6 million as of December 31, 2017.Contingent LiabilitiesThe Company estimates exposure on certain liabilities, such as indirect and property taxes, based on the best information available at the time ofdetermination. With respect to real and personal property taxes, the Company records what it can reasonably estimate based on prior payment history, currentlandlord estimates or estimates based on current or changing fixed asset values in each specific municipality, as applicable. However, there are circumstancesbeyond the Company’s control whereby the underlying value of the property or basis for which the tax is calculated on the property may change, such as alandlord selling the underlying property of one of the Company’s IBX data center leases or a municipality changing the assessment value in a jurisdictionand, as a result, the Company’s property tax obligations may vary from period to period. Based upon the most current facts and circumstances, the Companymakes the necessary property tax accruals for each of its reporting periods. However, revisions in the Company’s estimates of the potential or actual liabilitycould materially impact the financial position, results of operations or cash flows of the Company.The Company's indirect and property tax filings in various jurisdictions are subject to examination by local tax authorities. The outcome of anyexaminations cannot be predicted with certainty. The Company regularly assesses the likelihood of adverse outcomes resulting from these examinations thatwould affect the adequacy of its tax accruals for each of the reporting periods. If any issues arising from the tax examinations are resolved in a mannerinconsistent with the Company’s expectations, the revision of the estimates of the potential or actual liabilities could materially impact the financialposition, results of operations, or cash flows of the Company.From time to time, the Company may have certain contingent liabilities that arise in the ordinary course of its business activities. The Company accruescontingent liabilities when it is probable that future expenditures will be made and such expenditures can be reasonably estimated. In the opinion ofmanagement, there are no pending claims for which the outcome is expected to result in a material adverse effect in the financial position, results ofoperations or cash flows of the Company.Employment AgreementsThe Company has entered into a severance agreement with each of its executive officers that provides for a severance payment equal to the executiveofficer’s annual base salary and maximum bonus in the event his or her employment is terminated for any reason other than cause or he or she voluntarilyresigns under certain circumstances as described in the agreement. In addition, under the agreement, the executive officer is entitled to the payment of his orher monthly health care premiums under the Consolidated Omnibus Budget Reconciliation Act for up to 12 months. For certain executive officers, thesebenefits are only triggered after a change-in-control of the Company.Indemnification and Guarantor ArrangementsAs permitted under Delaware law, the Company has agreements whereby the Company indemnifies its officers and directors for certain events oroccurrences while the officer or director is, or was serving, at the Company’s request in such capacity. The term of the indemnification period is for theofficer's or director's lifetime. The maximum potential amount of future payments the Company could be required to make under these indemnificationagreements is unlimited; however, the Company has a director and officer insurance policy that limits the Company’s exposure and enables the Company torecover a portion of any future amounts paid. As a result of the Company’s insurance policy coverage, the Company believes the estimated fair value of theseindemnification agreements is minimal. The Company has no liabilities recorded for these agreements as of December 31, 2017.The Company enters into standard indemnification agreements in the ordinary course of business. Pursuant to these agreements, the Companyindemnifies, holds harmless, and agrees to reimburse the indemnified party for losses suffered or incurred by the indemnified party, generally the Company’sbusiness partners or customers, in connection with any U.S. patent, or any copyright or other intellectual property infringement claim by any third party withrespect to the Company’s offerings. The term of these indemnification agreements is generally perpetual any time after execution of the agreement. Themaximum potential amount of future payments the Company could be required to make under these indemnification agreements is unlimited; however, theCompany has never incurred costs to defend lawsuits or settle claims related to these indemnification agreements. As a result, the Company believes theestimated fair value of these agreements is minimal. The Company has no liabilities recorded for these agreements as of December 31, 2017.F-61Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)The Company enters into arrangements with its business partners, whereby the business partner agrees to provide services as a subcontractor for theCompany’s installations. Accordingly, the Company enters into standard indemnification agreements with its customers, whereby the Company indemnifiesthem for other acts, such as personal property damage, of its subcontractors. The maximum potential amount of future payments the Company could berequired to make under these indemnification agreements is unlimited; however, the Company has general and umbrella insurance policies that enable theCompany to recover a portion of any amounts paid. The Company has never incurred costs to defend lawsuits or settle claims related to these indemnificationagreements. As a result, the Company believes the estimated fair value of these agreements is minimal. The Company has no liabilities recorded for theseagreements as of December 31, 2017.The Company has service level commitment obligations to certain of its customers. As a result, service interruptions or significant equipment damage inthe Company’s IBX data centers, whether or not within the Company’s control, could result in service level commitments to these customers. The Company’sliability insurance may not be adequate to cover those expenses. In addition, any loss of services, equipment damage or inability to meet the Company’sservice level commitment obligations could reduce the confidence of the Company’s customers and could consequently impair the Company’s ability toobtain and retain customers, which would adversely affect both the Company’s ability to generate revenues and the Company’s operating results. TheCompany generally has the ability to determine such service level credits prior to the associated revenue being recognized. The Company has no significantliabilities in connection with service level credits as of December 31, 2017.15. Related Party TransactionsThe Company has several significant stockholders and other related parties that are also customers and/or vendors. The Company’s activity of relatedparty transactions was as follows (in thousands): Years ended December 31, 2017 2016 2015Revenues$13,726 $11,822 $10,745Costs and services11,211 14,574 10,808 As of December 31, 2017 2016Accounts receivable$1,321 $1,109Accounts payable744 1,720On February 10, 2016, the Company entered into a purchase and sale agreement to acquire land and a building from Prologis, L.P., with which it shares acommon board member, for approximately $6.3 million. This transaction is considered a related party transaction but is not reflected in the related party datapresented above.16. Segment InformationWhile the Company has a single line of business, which is the design, build-out and operation of IBX data centers, it has determined that it has threereportable segments comprised of its Americas, EMEA and Asia-Pacific geographic regions. The Company’s chief operating decision-maker evaluatesperformance, makes operating decisions and allocates resources based on the Company’s revenues and adjusted EBITDA performance both on a consolidatedbasis and these three reportable segments. The Company defines adjusted EBITDA as income or loss from operations plus depreciation, amortization,accretion, stock-based compensation expense, restructuring charges, impairment charges, acquisition costs, and gain on asset sales as presented below for theyears ended December 31 (in thousands):F-62Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) 2017 2016 2015Adjusted EBITDA: Americas$1,034,694 $787,311 $698,604EMEA582,697 494,263 318,561Asia-Pacific434,650 375,900 254,462Total adjusted EBITDA2,052,041 1,657,474 1,271,627Depreciation, amortization and accretion expense(1,028,892) (843,510) (528,929)Stock-based compensation expense(175,500) (156,148) (133,633)Acquisitions costs(38,635) (64,195) (41,723)Impairment charges— (7,698) —Gain on asset sales— 32,816 —Income from operations$809,014 $618,739 $567,342The Company provides the following segment disclosures related to its continuing operations as follows for the years ended December 31 (inthousands): 2017 2016 2015Total revenues: Americas(1)$2,172,760 $1,679,549 $1,512,535EMEA1,346,256 1,171,339 698,807Asia-Pacific849,412 761,101 514,525 $4,368,428 $3,611,989 $2,725,867 Total depreciation and amortization: Americas$515,726 $319,202 $278,216EMEA316,250 313,291 117,655Asia-Pacific210,504 204,714 129,709 $1,042,480 $837,207 $525,580 Capital expenditures: Americas$621,158 $503,855 $401,685EMEA555,346 400,642 202,322Asia-Pacific202,221 208,868 264,113 $1,378,725 $1,113,365 $868,120__________________________(1)Includes revenues of $2.0 billion, $1.5 billion and $1.4 billion, respectively, attributed to the U.S. for the years ended December 31, 2017, 2016 and 2015.The Company’s long-lived assets are located in the following geographic areas as of December 31 (in thousands): 2017 2016Americas (1)$4,425,077 $3,339,518EMEA3,265,088 2,355,943Asia-Pacific1,704,437 1,503,749 $9,394,602 $7,199,210_________________________(1)Includes $4.0 billion and $3.0 billion, respectively, of long-lived assets attributed to the U.S. as of December 31, 2017 and 2016.F-63Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)The following table presents revenue information on a service basis for the year ended December 31, 2017, 2016 and 2015 (in thousands): 2017 2016 2015Colocation$3,178,145 $2,647,094 $2,019,875Interconnection681,173 543,045 441,749Managed infrastructure245,169 210,292 96,836Rental15,633 16,943 10,681Recurring revenues4,120,120 3,417,374 2,569,141Non-recurring revenues248,308 194,615 156,726 $4,368,428 $3,611,989 $2,725,86717. Subsequent EventsOn February 14, 2018, the Company's Board of Directors declared a quarterly cash dividend of $2.28 per share, which is payable on March 21, 2018 tothe Company’s common stockholders of record as of the close of business on February 26, 2018.On February 11, 2018, the Company entered into an agreement to acquire the Infomart Dallas, including its operations and tenants, from ASB Real EstateInvestments. At the closing, the Company will deliver $31.0 million in cash, subject to customary adjustments, and will issue $750.0 million aggregateprincipal amount of 5.000% senior unsecured notes. The transaction is expected to close in mid-2018, subject to satisfaction of closing conditions. TheCompany will account for this transaction as a business combination using the acquisition method of accounting.18. Quarterly Financial Information (Unaudited)The Company believes that period-to-period comparisons of its financial results should not be relied upon as an indication of future performance. TheCompany’s revenues and results of operations have been subject to significant fluctuations, particularly on a quarterly basis, and the Company’s revenuesand results of operations could fluctuate significantly quarter-to-quarter and year-to-year. Significant quarterly fluctuations in revenues will causefluctuations in the Company’s cash flows and the cash and cash equivalents and accounts receivable accounts on the Company’s consolidated balance sheet.Causes of such fluctuations may include the volume and timing of new orders and renewals, the timing of the opening of new IBX data centers, the salescycle for the Company’s offerings, the introduction of new offerings, changes in prices and pricing models, trends in the internet infrastructure industry,general economic conditions, extraordinary events such as acquisitions or litigation and the occurrence of unexpected events.The unaudited quarterly financial information presented below has been prepared by the Company and reflects all adjustments, consisting only ofnormal recurring adjustments, which in the opinion of management are necessary to present fairly the financial position and results of operations for theinterim periods presented.F-64Table of ContentsEQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)The following tables present selected quarterly information (in thousands, except per share data): 2017 Quarters Ended March 31 June 30 September 30 December 31Revenues$949,525 $1,066,421 $1,152,261 $1,200,221Gross profit480,564 544,218 569,901 580,596Net income42,062 45,805 79,900 65,215EPS Basic EPS0.58 0.59 1.02 0.83Diluted EPS0.57 0.58 1.02 0.82 2016 Quarters Ended March 31 June 30 September 30 December 31Revenues$844,156 $900,510 $924,676 $942,647Gross profit416,476 443,543 454,374 476,726Net income (loss)(31,111) 44,711 51,450 61,750EPS Basic EPS(0.46) 0.64 0.73 0.86Diluted EPS(0.46) 0.64 0.72 0.86F-65Table of ContentsEQUINIX INC.SCHEDULE III- SCHEDULE OF REAL ESTATE AND ACCUMULATED DEPRECIATIONDECEMBER 31, 2017(Dollars in Thousands) Initial Costs to Company (1) Costs CapitalizedSubsequent to Acquisitionor Lease Total Costs Encumbrances Land Buildings andImprovements(2) Land Buildings andImprovements (2) Land Buildings andImprovements(2) AccumulatedDepreciation (3) Date ofConstruction Date ofAcquisitionor Lease (4)Americas: AT1 ATLANTA (METRO)— — — — 123,655 — 123,655 (42,278) N/A 2010AT2 ATLANTA (METRO)— — — — 42,574 — 42,574 (20,048) N/A 2010AT3 ATLANTA (METRO)— — — — 4,095 — 4,095 (1,678) N/A 2010AT4 ATLANTA (METRO)— 5,400 20,209 — 1,823 5,400 22,032 (2,955) 2017 2017AT5 ATLANTA (METRO)— — 5,011 — 1,552 — 6,563 (1,029) 2017 2017BG1 BOGOTÁ (METRO),COLOMBIA— — 8,779 — 409 — 9,188 (769) 2017 2017BO1 BOSTON (METRO)— — — — 11,185 — 11,185 (6,713) N/A 2010BO2 BOSTON (METRO)— 2,500 30,383 — 214 2,500 30,597 (2,917) 2017 2017CH1 CHICAGO (METRO)— — — — 161,324 — 161,324 (103,562) 2001 1999CH2 CHICAGO (METRO)— — — — 108,257 — 108,257 (53,744) 2005 2005CH3 CHICAGO (METRO)— 9,759 — 351 279,869 10,110 279,869 (99,791) 2007 2006CH4 CHICAGO (METRO)— — — — 21,976 — 21,976 (9,792) 2010 2009CH7 CHICAGO (METRO)— 670 10,564 — 88 670 10,652 (1,046) 2017 2017CU1 CULPEPER (METRO)— 1,019 37,581 — 311 1,019 37,892 (2,788) 2017 2017CU2 CULPEPER (METRO)— 1,244 48,000 — 367 1,244 48,367 (3,254) 2017 2017CU3 CULPEPER (METRO)— 1,088 37,387 — 54 1,088 37,441 (2,437) 2017 2017CU4 CULPEPER (METRO)— 1,372 27,832 — 1,963 1,372 29,795 (1,285) 2017 2017DA1 DALLAS (METRO)— — — — 74,900 — 74,900 (48,583) 2000 2000DA2 DALLAS (METRO)— — — — 78,659 — 78,659 (21,955) 2011 2010DA3 DALLAS (METRO)— — — — 92,408 — 92,408 (30,450) N/A 2010DA4 DALLAS (METRO)— — — — 18,010 — 18,010 (8,616) N/A 2010DA6 DALLAS (METRO)— — 20,522 — 110,282 — 130,804 (16,735) 2013 2012DA7 DALLAS (METRO)— — — — 26,888 — 26,888 (4,964) 2015 2015DA9 DALLAS (METRO)— 610 15,398 — 89 610 15,487 (1,191) 2017 2017DA10 DALLAS (METRO)— — 117 — 4,535 — 4,652 (349) 2017 2017DC1 WASHINGTON, DC(METRO)— — — — 2,435 — 2,435 (574) 2007 1999DC2 WASHINGTON, DC(METRO)— — — 5,047 158,709 5,047 158,709 (128,668) 1999 1999F-66Table of Contents Initial Costs to Company (1) Costs CapitalizedSubsequent to Acquisitionor Lease Total Costs Encumbrances Land Buildings andImprovements(2) Land Buildings andImprovements (2) Land Buildings andImprovements(2) AccumulatedDepreciation (3) Date ofConstruction Date ofAcquisitionor Lease (4)DC3 WASHINGTON, DC(METRO)— — 37,451 — 53,210 — 90,661 (49,386) 2004 2004DC4 WASHINGTON, DC(METRO)— 1,906 7,272 — 72,961 1,906 80,233 (49,250) 2007 2005DC5 WASHINGTON, DC(METRO)— 1,429 4,983 — 89,024 1,429 94,007 (57,411) 2008 2005DC6 WASHINGTON, DC(METRO)— 1,429 5,082 — 87,709 1,429 92,791 (39,873) 2010 2005DC7 WASHINGTON, DC(METRO)— — — — 20,851 — 20,851 (11,503) N/A 2010DC8 WASHINGTON, DC(METRO)— — — — 5,185 — 5,185 (4,739) N/A 2010DC10 WASHINGTON, DC(METRO)— — 44,601 — 71,706 — 116,307 (41,225) 2012 2011DC11 WASHINGTON, DC(METRO)— 1,429 5,082 — 175,361 1,429 180,443 (30,071) 2013 2005DC12 WASHINGTON, DC(METRO)— — 101,783 — 19,101 — 120,884 (1,869) 2017 2017DC13 WASHINGTON, DC(METRO)— 5,500 25,423 — 364 5,500 25,787 (3,015) 2017 2017DC14 WASHINGTON, DC(METRO)— 2,560 33,511 — 206 2,560 33,717 (2,330) 2017 2017DC97 WASHINGTON, DC(METRO)— — 2,021 — 141 — 2,162 (259) 2017 2017DE1 DENVER (METRO)— — — — 10,260 — 10,260 (7,172) N/A 2010DE2 DENVER (METRO)— 5,240 23,053 — 14,764 5,240 37,817 (3,814) 2017 2017HO1 HOUSTON (METRO)— 1,440 23,780 — 3,996 1,440 27,776 (2,679) 2017 2017LA1 LOS ANGELES(METRO)— — — — 112,209 — 112,209 (64,914) 2000 1999LA2 LOS ANGELES(METRO)— — — — 11,066 — 11,066 (8,887) 2001 2000LA3 LOS ANGELES(METRO)— — 34,727 3,959 24,296 3,959 59,023 (45,521) 2005 2005LA4 LOS ANGELES(METRO)— 19,333 137,630 — 29,032 19,333 166,662 (68,944) 2009 2009LA7 LOS ANGELES(METRO)— 7,800 33,621 — 124 7,800 33,745 (2,544) 2017 2017MI1 MIAMI (METRO)— 18,920 127,194 — 31,502 18,920 158,696 (11,253) 2017 2017MI2 MIAMI (METRO)— — — — 25,776 — 25,776 (11,815) N/A 2010MI3 MIAMI (METRO)— — — — 31,148 — 31,148 (10,329) 2012 2012MI6 MIAMI (METRO)— 4,750 23,017 — 1,538 4,750 24,555 (2,231) 2017 2017NY1 NEW YORK(METRO)— — — — 80,528 — 80,528 (45,712) 1999 1999NY2 NEW YORK(METRO)— — — 17,859 199,508 17,859 199,508 (125,823) 2002 2000NY4 NEW YORK(METRO)— — — — 338,384 — 338,384 (167,338) 2007 2006NY5 NEW YORK(METRO)— — — — 254,899 — 254,899 (50,791) 2012 2010NY6 NEW YORK(METRO)— — — — 73,350 — 73,350 (8,658) 2015 2010NY7 NEW YORK(METRO)— — 24,660 — 146,688 — 171,348 (101,925) N/A 2010NY8 NEW YORK(METRO)— — — — 12,188 — 12,188 (7,195) N/A 2010F-67Table of Contents Initial Costs to Company (1) Costs CapitalizedSubsequent to Acquisitionor Lease Total Costs Encumbrances Land Buildings andImprovements(2) Land Buildings andImprovements(2) Land Buildings andImprovements(2) AccumulatedDepreciation (3) Date ofConstruction Date ofAcquisitionor Lease (4)NY9 NEW YORK(METRO)— — — — 54,514 — 54,514 (31,583) N/A 2010NY11 NEW YORK(METRO)— 2,050 58,717 — 3,086 2,050 61,803 (4,707) 2017 2017NY12 NEW YORK(METRO)— 3,460 10,380 — 1,571 3,460 11,951 (942) 2017 2017NY13 NEW YORK(METRO)— — 31,603 — 1,527 — 33,130 (2,829) 2017 2017PH1 PHILADELPHIA(METRO)— — — — 43,862 — 43,862 (12,765) N/A 2010RJ1 RIO DE JANEIRO(METRO), BRAZIL— — — — 23,297 — 23,297 (16,898) 2011 2011RJ2 RIO DE JANEIRO(METRO), BRAZIL— — 2,012 1,986 53,635 1,986 55,647 (13,460) 2013 2012SE2 SEATTLE (METRO)— — — — 30,282 — 30,282 (23,003) N/A 2010SE3 SEATTLE (METRO)— — 1,760 — 95,706 — 97,466 (28,649) 2013 2011SE4 SEATTLE (METRO)— 4,000 12,903 — (112) 4,000 12,791 (1,669) 2017 2017SP1 SÃO PAULO(METRO), BRAZIL— — 10,188 — 24,862 — 35,050 (21,485) 2011 2011SP2 SÃO PAULO(METRO), BRAZIL— — — — 85,948 — 85,948 (46,937) 2011 2011SP3 SÃO PAULO(METRO), BRAZIL— 12,148 72,997 — 8,208 12,148 81,205 (5,011) 2017 2017SP4 SÃO PAULO(METRO), BRAZIL— — 24,633 — 1,572 — 26,205 (2,810) 2017 2017SV1 SILICON VALLEY(METRO)— — — 15,545 162,162 15,545 162,162 (108,646) 1999 1999SV2 SILICON VALLEY(METRO)— — — — 150,653 — 150,653 (76,489) 2003 2003SV3 SILICON VALLEY(METRO)— — — — 45,592 — 45,592 (40,301) 2004 1999SV4 SILICON VALLEY(METRO)— — — — 27,184 — 27,184 (20,935) 2005 2005SV5 SILICON VALLEY(METRO)— 6,238 98,991 — 90,853 6,238 189,844 (53,708) 2010 2010SV6 SILICON VALLEY(METRO)— — 15,585 — 22,785 — 38,370 (25,454) N/A 2010SV8 SILICON VALLEY(METRO)— — — — 50,520 — 50,520 (26,134) N/A 2010SV10 SILICON VALLEY(METRO)— 12,646 123,594 — 6,939 12,646 130,533 (2,816) 2017 2017SV12 SILICON VALLEY(METRO)— 20,313 — — 2,340 20,313 2,340 — 2015 2015SV13 SILICON VALLEY(METRO)— — 3,828 — 52 — 3,880 (635) 2017 2017SV14 SILICON VALLEY(METRO)— 3,638 5,503 — 181 3,638 5,684 (361) 2017 2017SV15 SILICON VALLEY(METRO)— 7,651 23,060 — 72 7,651 23,132 (1,605) 2017 2017SV16 SILICON VALLEY(METRO)— 4,271 15,018 — 274 4,271 15,292 (1,201) 2017 2017SV17 SILICON VALLEY(METRO)— — 17,493 — 526 — 18,019 (2,906) 2017 2017TR1 TORONTO (METRO),CANADA— — — — 96,425 — 96,425 (25,161) N/A 2010TR2 TORONTO (METRO),CANADA— — 21,113 — 101,996 — 123,109 (12,821) 2015 2015OTHERS (5)— 70,803 19,365 — 8,408 70,803 27,773 (4,085) Various VariousF-68Table of Contents Initial Costs to Company (1) Costs CapitalizedSubsequent to Acquisitionor Lease Total Costs Encumbrances Land Buildings andImprovements(2) Land Buildings andImprovements(2) Land Buildings andImprovements(2) AccumulatedDepreciation (3) Date ofConstruction Date ofAcquisitionor Lease (4) EMEA: AD1 ABU DHABI(METRO), UNITED ARABEMIRATES— — — — 387 — 387 (45) N/A 2017AM1 AMSTERDAM(METRO), THENETHERLANDS— — — — 88,460 — 88,460 (33,378) 2008 2008AM2 AMSTERDAM(METRO), THENETHERLANDS— — — — 75,488 — 75,488 (24,556) 2010 2008AM3 AMSTERDAM(METRO), THENETHERLANDS— — 27,099 — 124,113 — 151,212 (36,011) 2012 2011AM4 AMSTERDAM(METRO), THENETHERLANDS— — — — 119,113 — 119,113 (1,087) 2016 2016AM5 AMSTERDAM(METRO), THENETHERLANDS— — 92,199 — 17,650 — 109,849 (13,629) N/A 2016AM6 AMSTERDAM(METRO), THENETHERLANDS— 6,616 50,876 933 59,412 7,549 110,288 (6,985) N/A 2016AM7 AMSTERDAM(METRO), THENETHERLANDS— — 7,397 — 8,528 — 15,925 (1,699) N/A 2016AM8 AMSTERDAM(METRO), THENETHERLANDS— — — — 10,657 — 10,657 (2,670) N/A 2016BA1 BARCELONA(METRO), SPAIN— — 9,443 — 290 — 9,733 (256) N/A 2017DB1 DUBLIN (METRO),IRELAND— — — — 3,080 — 3,080 (731) N/A 2016DB2 DUBLIN (METRO),IRELAND— — 12,460 — 3,032 — 15,492 (3,543) N/A 2016DB3 DUBLIN (METRO),IRELAND— 3,334 54,387 470 18,163 3,804 72,550 (7,754) N/A 2016DB4 DUBLIN (METRO),IRELAND— — 26,875 — 17,297 — 44,172 (3,307) N/A 2016DU1 DÜSSELDORF(METRO), GERMANY— — — 8,644 33,567 8,644 33,567 (21,137) 2001 2000DX1 DUBAI (METRO),UNITED ARABEMIRATES— — — — 84,493 — 84,493 (8,695) 2012 2008DX2 DUBAI (METRO),UNITED ARABEMIRATES— — — — 2,594 — 2,594 (11) N/A 2017EN1 ENSCHEDE(METRO), THENETHERLANDS— — — — 29,382 — 29,382 (17,764) 2008 2008FR1 FRANKFURT(METRO), GERMANY— — — — 7,615 — 7,615 (7,371) N/A 2007FR2 FRANKFURT(METRO), GERMANY— — — 13,132 335,573 13,132 335,573 (99,648) N/A 2007FR3 FRANKFURT(METRO), GERMANY— — — — 1,172 — 1,172 (1,157) N/A 2007FR4 FRANKFURT(METRO), GERMANY— 11,578 9,307 1,633 74,071 13,211 83,378 (21,689) 2009 2009F-69Table of Contents Initial Costs to Company (1) Costs CapitalizedSubsequent to Acquisitionor Lease Total Costs Encumbrances Land Buildings andImprovements(2) Land Buildings andImprovements (2) Land Buildings andImprovements(2) AccumulatedDepreciation (3) Date ofConstruction Date ofAcquisitionor Lease (4)FR5 FRANKFURT(METRO), GERMANY30,310 — — 4,240 148,382 4,240 148,382 (30,480) 2012 2012FR6 FRANKFURT(METRO), GERMANY— — — — 106,231 — 106,231 (2,336) 2016 2016FR7 FRANKFURT(METRO), GERMANY— — 43,634 — 12,865 — 56,499 (8,816) N/A 2016GV1 GENEVA (METRO),SWITZERLAND— — — — 7,493 — 7,493 (4,625) 2004 2004GV2 GENEVA (METRO),SWITZERLAND— — — — 23,250 — 23,250 (17,044) 2010 2009HE1 HELSINKI (METRO),FINLAND— — — — 3,626 — 3,626 (1,362) N/A 2016HE2 HELSINKI (METRO),FINLAND— — — — 1,638 — 1,638 (1,023) N/A 2016HE3 HELSINKI (METRO),FINLAND— — — — 11,758 — 11,758 (4,971) N/A 2016HE4 HELSINKI (METRO),FINLAND— — 29,092 — 8,007 — 37,099 (6,697) N/A 2016HE5 HELSINKI (METRO),FINLAND— — 7,564 — 1,233 — 8,797 (2,358) N/A 2016HE6 HELSINKI (METRO),FINLAND— — 17,204 1,791 25,836 1,791 43,040 (2,717) N/A 2016IS1 ISTANBUL (METRO),TURKEY— — — — 8,166 — 8,166 (4,042) N/A 2016IS2 ISTANBUL (METRO),TURKEY— 14,460 39,289 — 1,332 14,460 40,621 (298) N/A 2017LD3 LONDON (METRO),UNITED KINGDOM— — — — 16,526 — 16,526 (11,886) 2005 2000LD4 LONDON (METRO),UNITED KINGDOM— — 23,044 — 69,365 — 92,409 (39,185) 2007 2007LD5 LONDON (METRO),UNITED KINGDOM— — 16,412 — 183,250 — 199,662 (68,682) 2010 2010LD6 LONDON (METRO),UNITED KINGDOM— — — — 121,069 — 121,069 (12,525) 2015 2013LD8 LONDON (METRO),UNITED KINGDOM— — 107,544 — 18,577 — 126,121 (15,891) N/A 2016LD9 LONDON (METRO),UNITED KINGDOM— — 181,431 — 32,756 — 214,187 (26,163) N/A 2016LD10 LONDON (METRO),UNITED KINGDOM— — 40,251 — 63,905 — 104,156 (2,203) N/A 2017LS1 LISBON (METRO),PORTUGAL— — 7,374 2,789 820 2,789 8,194 (193) 2017 2017MA1 MANCHESTER(METRO), UNITEDKINGDOM— — — — 6,453 — 6,453 (1,765) N/A 2016MA2 MANCHESTER(METRO), UNITEDKINGDOM— — — — 10,439 — 10,439 (2,586) N/A 2016MA3 MANCHESTER(METRO), UNITEDKINGDOM— — 44,931 — 6,813 — 51,744 (9,862) N/A 2016MA4 MANCHESTER(METRO), UNITEDKINGDOM— — 6,697 — 1,957 — 8,654 (3,245) N/A 2016F-70Table of Contents Initial Costs to Company (1) Costs CapitalizedSubsequent to Acquisitionor Lease Total Costs Encumbrances Land Buildings andImprovements(2) Land Buildings andImprovements (2) Land Buildings andImprovements(2) AccumulatedDepreciation (3) Date ofConstruction Date ofAcquisitionor Lease (4)MD1 MADRID (METRO),SPAIN— — 8,120 — 250 — 8,370 (165) N/A 2017MD2 MADRID (METRO),SPAIN— — 40,952 — 2,733 — 43,685 (1,083) N/A 2017ML1 MILAN (METRO),ITALY— — — — 134 — 134 (1) 2011 2011ML2 MILAN (METRO),ITALY— — — — 7,967 — 7,967 (5,026) N/A 2016ML3 MILAN (METRO),ITALY— — — 3,344 33,566 3,344 33,566 (8,620) N/A 2016ML4 MLAN (METRO),ITALY— — — — 8,424 — 8,424 (2,667) N/A 2016MU1 MUNICH (METRO),GERMANY— — — — 19,124 — 19,124 (14,244) N/A 2007MU3 MUNICH (METRO),GERMANY— — — — 2,431 — 2,431 (1,088) 2010 2010PA1 PARIS (METRO),FRANCE— — — — 25,484 — 25,484 (19,996) N/A 2007PA2 & PA3 PARIS(METRO), FRANCE— — 29,615 27,071 292,453 27,071 322,068 (101,473) 2010 2007PA4 PARIS (METRO),FRANCE— 1,701 9,503 239 228,289 1,940 237,792 (40,718) 2012 2011PA5 PARIS (METRO),FRANCE— — 16,554 — 3,072 — 19,626 (3,263) N/A 2016PA6 PARIS (METRO),FRANCE— — — — 66,000 — 66,000 (13,605) N/A 2016PA7 PARIS (METRO),FRANCE— — — — 16,137 — 16,137 (3,976) N/A 2016SA1 SEVILLE (METRO),SPAIN— — 1,594 — 49 — 1,643 (75) N/A 2017SK1 STOCKHOLM,(METRO), SWEDEN— — 15,495 — 6,758 — 22,253 (4,131) N/A 2016SK2 STOCKHOLM,(METRO), SWEDEN— — 80,148 — 14,171 — 94,319 (10,539) N/A 2016SK3 STOCKHOLM,(METRO), SWEDEN— — — — 15,255 — 15,255 (2,005) N/A 2016SO1 SOFIA (METRO),BULGARIA— — 5,236 2,984 1,654 2,984 6,890 (860) N/A 2016WA1 WARSAW (METRO),POLAND— — 5,950 — 5,356 — 11,306 (2,402) N/A 2016WA2 WARSAW (METRO),POLAND— — 4,709 3,038 8,278 3,038 12,987 (1,649) N/A 2016ZH1 ZURICH (METRO),SWITZERLAND— — — — 4,919 — 4,919 (4,376) N/A 2007ZH2 ZURICH (METRO),SWITZERLAND— — — — 5,025 — 5,025 (3,502) 2003 2002ZH4 ZURICH (METRO),SWITZERLAND— — 11,284 — 29,805 — 41,089 (21,868) 2010 2009ZH5 ZURICH (METRO),SWITZERLAND— — — 7,987 59,474 7,987 59,474 (15,119) 2013 2009ZW1 ZWOLLE (METRO),THE NETHERLANDS— — — — 9,453 — 9,453 (5,416) 2008 2008OTHERS (5)— 3,184 1,293 395 22,490 3,579 23,783 (914) Various Various F-71Table of Contents Initial Costs to Company (1) Costs CapitalizedSubsequent to Acquisitionor Lease Total Costs Encumbrances Land Buildings andImprovements(2) Land Buildings andImprovements (2) Land Buildings andImprovements(2) AccumulatedDepreciation (3) Date ofConstruction Date ofAcquisitionor Lease (4)Asia-Pacific: HK1 HONG KONG(METRO), CHINA— — — — 148,027 — 148,027 (76,233) N/A 2003HK2 HONG KONG(METRO), CHINA— — — — 241,480 — 241,480 (74,971) 2011 2010HK3 HONG KONG(METRO), CHINA— — — — 133,673 — 133,673 (52,731) N/A 2012HK4 HONG KONG(METRO), CHINA— — — — 6,913 — 6,913 (4,882) N/A 2012HK5 HONG KONG(METRO), CHINA— — 70,002 — 31,781 — 101,783 (548) 2017 2017ME1 MELBOURNE(METRO), AUSTRALIA— 15,341 — 1,269 73,238 16,610 73,238 (10,711) 2013 2013OS1 OSAKA (METRO),JAPAN— — 14,876 — 53,015 — 67,891 (12,946) 2013 2013SG1 SINGAPORE(METRO)— — — — 178,617 — 178,617 (116,756) N/A 2003SG2 SINGAPORE(METRO)— — — — 322,842 — 322,842 (135,587) 2008 2008SG3 SINGAPORE(METRO)— — 34,844 — 110,842 — 145,686 (20,324) 2013 2013SH2 SHANGHAI(METRO), CHINA— — — — 3,921 — 3,921 (1,369) 2012 2012SH3 SHANGHAI(METRO), CHINA— — 7,066 — 9,650 — 16,716 (4,595) 2012 2012SH4 SHANGHAI(METRO), CHINA— — — — 1,707 — 1,707 (1,875) 2012 2012SH5 SHANGHAI(METRO), CHINA— — 11,284 — 21,513 — 32,797 (8,463) 2012 2012SH6 SHANGHAI(METRO), CHINA— — 16,545 — 1,893 — 18,438 — N/A 2017SY1 SYDNEY (METRO),AUSTRALIA— — — — 26,684 — 26,684 (14,867) N/A 2003SY2 SYDNEY (METRO),AUSTRALIA— — 3,080 — 35,042 — 38,122 (21,647) 2008 2008SY3 SYDNEY (METRO),AUSTRALIA— — 8,712 — 148,640 — 157,352 (56,626) 2010 2010SY4 SYDNEY (METRO),AUSTRALIA— — — — 145,683 — 145,683 (9,490) 2015 2014TY1 TOKYO (METRO),JAPAN— — — — 19,426 — 19,426 (10,395) 2000 2000TY2 TOKYO (METRO),JAPAN— — — — 85,617 — 85,617 (60,135) 2007 2006TY3 TOKYO (METRO),JAPAN— — — — 73,526 — 73,526 (29,924) 2010 2010TY4 TOKYO (METRO),JAPAN— — — — 53,000 — 53,000 (15,975) 2012 2012TY5 TOKYO (METRO),JAPAN— — 102 — 52,606 — 52,708 (5,060) 2014 2014TY6 TOKYO (METRO),JAPAN— — 37,941 — 11,646 — 49,587 (12,113) N/A 2015TY7 TOKYO (METRO),JAPAN— — 13,175 — 4,669 — 17,844 (5,597) N/A 2015TY8 TOKYO (METRO),JAPAN— — 53,848 — 5,505 — 59,353 (10,006) N/A 2015TY9 TOKYO (METRO),JAPAN— — 106,710 — 6,877 — 113,587 (24,123) N/A 2015TY10 TOKYO (METRO),JAPAN— — 69,881 — 11,665 — 81,546 (10,751) N/A 2015OTHERS (5)— — — — 32,794 — 32,794 (15,986) Various VariousF-72Table of Contents Initial Costs to Company (1) Costs CapitalizedSubsequent to Acquisitionor Lease Total Costs Encumbrances Land Buildings andImprovements(2) Land Buildings andImprovements(2) Land Buildings andImprovements(2) AccumulatedDepreciation (3) Date ofConstruction Date ofAcquisitionor Lease (4)TOTAL LOCATIONS$30,310 $298,830 $3,058,446 $124,706 $9,465,753 $423,536 $12,524,199 $(3,980,198) __________________________(1)The initial cost was $0 if the lease of the respective IBX was classified as an operating lease.(2)Building and improvements include all fixed assets except for land.(3)Buildings and improvements are depreciated on a straight line basis over estimated useful live as described under described in Note 1 of Notes toCondensed Consolidated Financial Statements in Item 8 of this Annual Report on Form 10-K(4)Date of lease or acquisition represents the date the Company leased the facility or acquired the facility through purchase or acquisition.(5)Includes various IBXs that are under initial development and costs incurred at certain central locations supporting various IBX functions.The aggregate gross cost of the Company's properties for federal income tax purpose approximated $17,901.9 million (unaudited) as of December 31,2017.The following table reconciles the historical cost of the Company’s properties for financial reporting purposes for each of the years in the three-yearperiod ended December 31, 2017 (in thousands).Gross Fixed Assets: 2017 2016 2015Balance, beginning of period$9,855,811 $7,871,890 $7,006,695Additions (including acquisitions and improvements)2,508,333 2,187,306 1,172,855Disposals(78,886) (78,607) (9,295)Foreign currency transaction adjustments and others662,477 (124,778) (298,365)Balance, end of year$12,947,735 $9,855,811 $7,871,890Accumulated Depreciation: 2017 2016 2015Balance, beginning of period$(3,175,972) $(2,595,648) $(2,242,345)Additions (depreciation expense)(748,942) (618,970) (440,002)Disposals65,922 9,401 7,396Foreign currency transaction adjustments and others(121,206) 29,245 79,303Balance, end of year$(3,980,198) $(3,175,972) $(2,595,648)F-73EXHIBIT 10.40EXECUTION VERSIONPublished CUSIP Number: 29446BAW6CREDIT AGREEMENTDated as of December 12, 2017amongEQUINIX, INC.,as Borrower,The Guarantors Party Hereto,BANK OF AMERICA, N.A., as Administrative Agent, Lender and L/C Issuer,BARCLAYS BANK PLC, GOLDMAN SACHS BANK USA, HSBC SECURITIES (USA) INC., ING CAPITAL LLC, TDSECURITIES (USA) LLC, and WELLS FARGO BANK, NATIONAL ASSOCIATION,as Co-Documentation AgentsThe Other Lenders Party HeretoandBANK OF AMERICA, N.A., CITIBANK, N.A., JPMORGAN CHASE BANK, N.A., MUFG, and RBC CAPITALMARKETS,as Joint Lead Arrangers and Joint Book Runners,TABLE OF CONTENTS PageARTICLE I.DEFINITIONS AND ACCOUNTING TERMS 11.01.Defined Terms 11.02.Other Interpretive Provisions 431.03.Accounting Terms 431.04.Rounding 441.05.Exchange Rates; Currency Equivalents 441.06.Additional Alternative Currencies 451.07.Change of Currency 451.08.Times of Day 461.09.Letter of Credit Amounts 46ARTICLE II.THE COMMITMENTS AND CREDIT EXTENSIONS 462.01.Loans 462.02.Borrowings, Conversions and Continuations of Loans 472.03.Letters of Credit 492.04.Prepayments 592.05.Termination or Reduction of Commitments 622.06.Repayment of Loans 632.07.Interest 632.08.Fees 642.09.Computation of Interest and Fees; Retroactive Adjustments of ApplicableMargin 652.10.Evidence of Debt 652.11.Payments Generally; Administrative Agent’s Clawback 662.12.Sharing of Payments by Lenders 682.13.Increase in Commitments 682.14.Cash Collateral 702.15.Defaulting Lenders 722.16.Extension of Maturity Date in Respect of Revolving Facility and TermFacility 732.17.Credit Agreement Refinancing Facilities 78ARTICLE III.TAXES, YIELD PROTECTION AND ILLEGALITY 80-i-TABLE OF CONTENTS(continued) Page3.01.Taxes 803.02.Illegality 853.03.Inability to Determine Rates 863.04.Increased Costs; Reserves on Eurocurrency Rate Loans 873.05.Compensation for Losses 893.06.Mitigation Obligations; Replacement of Lenders 893.07.Survival 90ARTICLE IV.CONDITIONS PRECEDENT TO CREDIT EXTENSIONS 904.01.Conditions of Initial Credit Extension 904.02.Conditions to All Credit Extensions 92ARTICLE V.REPRESENTATIONS AND WARRANTIES 935.01.Existence, Qualification and Power 935.02.Authorization; No Contravention 935.03.Governmental Authorization; Other Consents 935.04.Binding Effect 935.05.Financial Statements; No Material Adverse Effect 945.06.Litigation 945.07.No Default 945.08.Ownership of Property; Liens 945.09.Environmental Compliance 955.10.Insurance 955.11.Taxes 955.12.ERISA Compliance 955.13.Subsidiaries; Equity Interests 975.14.Margin Regulations; Investment Company Act 985.15.Disclosure 985.16.Compliance with Laws 985.17.Taxpayer Identification Number 985.18.REIT Status 995.19.OFAC and Sanctions 99-ii-TABLE OF CONTENTS(continued) Page5.20.Anti-Corruption Laws 995.21.EEA Financial Institutions 99ARTICLE VI.AFFIRMATIVE COVENANTS 996.01.Financial Statements 996.02.Certificates; Other Information 1006.03.Notices 1016.04.Payment of Obligations 1026.05.Preservation of Existence, Etc 1026.06.Maintenance of Properties 1026.07.Maintenance of Insurance 1036.08.Compliance with Laws 1036.09.Books and Records 1036.10.Inspection Rights 1036.11.Use of Proceeds 1036.12.ERISA Plans 1036.13.Additional Subsidiary Guarantors; Automatic Release of Guarantors 1036.14.Designation of Unrestricted Subsidiaries 1046.15.Maintenance of REIT Status 1056.16.Anti-Corruption Laws and Sanctions Laws 105ARTICLE VII.NEGATIVE COVENANTS 1057.01.Liens 1057.02.Investments 1077.03.Indebtedness 1087.04.Fundamental Changes 1097.05.Maintenance of Assets; Dispositions 1107.06.Restricted Payments 1117.07.Change in Nature of Business 1127.08.Transactions with Affiliates 1127.09.Burdensome Agreements 1127.10.Use of Proceeds 113-iii-TABLE OF CONTENTS(continued) Page7.11.Financial Covenants 1137.12.Prepayments of Certain Indebtedness 1147.13.Sanctions 1147.14.Anti-Corruption Laws 1147.15.Foreign Subsidiary Holdcos 114ARTICLE VIII.EVENTS OF DEFAULT AND REMEDIES 1148.01.Events of Default 1148.02.Remedies Upon Event of Default 1168.03.Application of Funds 117ARTICLE IX.ADMINISTRATIVE AGENT 1189.01.Appointment and Authority 1189.02.Rights as a Lender 1199.03.Exculpatory Provisions 1199.04.Reliance by Administrative Agent 1209.05.Delegation of Duties 1209.06.Resignation of Administrative Agent 1209.07.Non-Reliance on Administrative Agent and Other Lenders 1219.08.No Other Rights or Duties, Etc 1229.09.Administrative Agent May File Proofs of Claim; Credit Bidding 1229.10.Multiparty Guaranty Matters 1239.11.Guaranteed Cash Management Agreements and Guaranteed Hedge Agreements 1239.12.Lender ERISA Non-Fiduciary Representations and Covenants 123ARTICLE X.MISCELLANEOUS 12510.01.Amendments, Etc 12510.02.Notices; Effectiveness; Electronic Communication 12810.03.No Waiver; Cumulative Remedies; Enforcement 13010.04.Expenses; Indemnity; Damage Waiver 13110.05.Payments Set Aside 13310.06.Successors and Assigns 133-iv-TABLE OF CONTENTS(continued) Page10.07.Treatment of Certain Information; Confidentiality 13810.08.Right of Setoff 13810.09.Interest Rate Limitation 13910.10.Counterparts; Integration; Effectiveness 13910.11.Survival of Representations and Warranties 14010.12.Severability 14010.13.Replacement of Lenders 14010.14.Governing Law; Jurisdiction; Etc 14110.15.Waiver of Jury Trial 14210.16.No Advisory or Fiduciary Responsibility 14210.17.Electronic Execution of Assignments and Certain Other Documents 14310.18.USA PATRIOT Act 14310.19.Multiparty Guaranty 14410.20.Designation as Senior Debt 14710.21.Judgment Currency 14710.22.Subordination 14710.23.Waiver of Certain Notices Under the Existing Credit Agreement 14810.24.Acknowledgement and Consent to Bail-In of EEA Financial Institutions 14810.25.ERISA Non-Fiduciary Provisions 14810.26.Hedge Banks’ and Cash Management Banks’ Acknowledgment of Release of Collateral and Automatic GuarantyRelease 149-v-SCHEDULES1.01Existing Letters of Credit2.01Commitments and Applicable Percentages5.13Subsidiaries; Other Equity Investments6.14Unrestricted Subsidiaries7.01Existing Liens7.03Existing Indebtedness10.02Administrative Agent’s Office; Certain Addresses for NoticesEXHIBITSForm ofALoan NoticeBRevolving NoteC-1SEK Term NoteC-2Sterling Term NoteDCompliance CertificateEJoinder AgreementF-1Assignment and AssumptionF-2Administrative QuestionnaireGGuaranteed Party Designation NoticeHLetter of Credit ReportI-1-4Tax Compliance CertificatesCREDIT AGREEMENTThis CREDIT AGREEMENT (“Agreement”) is entered into as of December 12, 2017, among EQUINIX, INC., aDelaware corporation (“Equinix” or the “Borrower”), EQUINIX LLC, a Delaware limited liability company and direct wholly-owned Subsidiary of Equinix (“OpCo”), SWITCH & DATA LLC, a Delaware limited liability company and indirect wholly-ownedSubsidiary of Equinix (“S&D”), EQUINIX (US) ENTERPRISES, INC., a Delaware corporation and indirect wholly-ownedSubsidiary of Equinix (“Equinix US”), and any other Person that executes a Joinder Agreement pursuant to Section 6.13 in order tobecome a Guarantor hereunder for purposes of Section 10.19 (together with OpCo, S&D and Equinix US, collectively, the“Guarantors” and individually, a “Guarantor”), each lender from time to time party hereto (collectively, the “Lenders” and individually,a “Lender”), BANK OF AMERICA, N.A., as Administrative Agent, Lender and L/C Issuer, BARCLAYS BANK PLC,GOLDMAN SACHS BANK USA, HSBC SECURITIES (USA) INC., ING CAPITAL LLC, TD SECURITIES (USA) LLC,and WELLS FARGO BANK, NATIONAL ASSOCIATION, as Co-Documentation Agents, BANK OF AMERICA, N.A.,CITIBANK, N.A., JPMORGAN CHASE BANK, N.A., MUFG, and RBC CAPITAL MARKETS, in their capacities as JointLead Arrangers and Joint Book Runners, with reference to the following facts:RECITALSWHEREAS, the Borrower has requested that the Lenders provide a multi-currency revolving credit and term loan facility, andthe Lenders are willing to do so on the terms and conditions set forth herein.NOW, THEREFORE, in consideration of the mutual covenants, agreements and provisions contained herein, the partieshereto covenant and agree as follows:ARTICLE I.DEFINITIONS AND ACCOUNTING TERMS1.01. Defined Terms. As used in this Agreement, the following terms shall have the meanings set forth below:“2.875% Senior Notes Due 2026” means those certain 2.875% senior notes due February 2026, issued by Equinix inDecember 2017, in an initial aggregate principal amount of €1,000,000,000, in favor of the holders thereof pursuant to the Indenturedated as of December 12, 2017, between the Borrower, as issuer, and U.S. Bank National Association, as trustee, as supplemented bya First Supplemental Indenture dated as of December 12, 2017.“2.875% Senior Notes Due 2025” means those certain 2.875% senior notes due October 2025, issued by Equinix in September2017, in an initial aggregate principal amount of €1,000,000,000, in favor of the holders thereof pursuant to the Base Indenture, assupplemented by a Fifth Supplemental Indenture dated as of September 20, 2017.“4.75% Convertible Subordinated Notes Due 2016” means those certain 4.75% convertible subordinated notes due June 2016,issued by Equinix in June 2009, in an initial aggregate principalamount of $373,750,000, in favor of the holders thereof pursuant to an indenture dated as of June 12, 2009, between Equinix, asissuer, and U.S. Bank National Association, as trustee.“5.375% Senior Notes Due 2022” means those certain 5.375% senior notes due January 2022, issued by Equinix in November2014, in an initial aggregate principal amount of $750,000,000, in favor of the holders thereof pursuant to the Base Indenture, assupplemented by a First Supplemental Indenture dated as of November 20, 2014.“5.375% Senior Notes Due 2023” means those certain 5.375% senior notes due April 2023, issued by Equinix in March 2013,in an initial aggregate principal amount of $1,000,000,000, in favor of the holders thereof pursuant to an indenture dated as of March 5,2013, between Equinix, as issuer, and U.S. Bank National Association, as trustee.“5.375% Senior Notes Due 2027” means those certain 5.375% senior notes due May 2027, issued by Equinix in March 2017,in an initial aggregate principal amount of $1,250,000,000, in favor of the holders thereof pursuant to the Base Indenture, assupplemented by a Fourth Supplemental Indenture dated as of March 22, 2017.“5.750% Senior Notes Due 2025” means those certain 5.750% senior notes due January 2025, issued by Equinix in November2014, in an initial aggregate principal amount of $500,000,000, in favor of the holders thereof pursuant to the Base Indenture, assupplemented by a Second Supplemental Indenture dated as of November 20, 2014.“5.875% Senior Notes Due 2026” means those certain 5.875% senior notes due January 2026, issued by Equinix in December2015, in an initial aggregate principal amount of $1,100,000,000, in favor of the holders thereof pursuant to the Base Indenture, assupplemented by a Third Supplemental Indenture dated as of December 4, 2015.“Acquired Indebtedness” means Indebtedness (including Guarantees) of any Person existing at the time such Person becomes aRestricted Subsidiary in a transaction permitted hereunder (or of any Person not previously a Subsidiary that is merged or consolidatedwith or into a Restricted Subsidiary in a transaction permitted hereunder) after the Closing Date, or Indebtedness of any Person that isassumed by any Restricted Subsidiary in connection with an acquisition of assets by such Restricted Subsidiary in an acquisitionpermitted hereunder; provided that such Indebtedness exists at the time such Person becomes a Restricted Subsidiary (or is so mergedor consolidated) or such assets are acquired and such Indebtedness is not created in contemplation of such Person becoming aRestricted Subsidiary (or such merger or consolidation) or such assets being acquired.“Acquisition” means a purchase or other acquisition, direct or indirect, by any Person of all or substantially all of the assets orall or substantially all of the business of any other Person or of a line of business of any other Person (whether by acquisition of EquityInterests, assets, permitted merger or any combination thereof).“Additional Revolving Commitment Lender” has the meaning set forth in Section 2.16(d).“Additional Term Commitment Lender” has the meaning set forth in Section 2.16(d).-2-“Additional Lender” means, at any time, any Person that is not an existing Lender and that agrees to provide any portion of anyCredit Agreement Refinancing Facilities pursuant to a Refinancing Amendment in accordance with Section 2.17; provided that suchAdditional Lender shall be an Eligible Assignee.“Adjusted Consolidated Total Assets” means, as of any date of determination, Equinix’s consolidated total assets as shown onthe consolidated balance sheet of Equinix and its Subsidiaries as of the end of the immediately preceding fiscal year delivered to theAdministrative Agent and the Lenders under Section 6.01(a); provided that if, during the fiscal year in which such date ofdetermination occurs, any Permitted Acquisition was consummated, “Adjusted Consolidated Total Assets” shall also include the resultof (a) the aggregate book value of the total assets acquired by Equinix or its Subsidiaries pursuant to such Permitted Acquisition as ofthe date of such consummation minus (b) the aggregate book value of all assets sold or required to be sold as a result of such PermittedAcquisition, in each case solely to the extent that the foregoing were not included in Equinix’s consolidated total assets as of the end ofthe immediately preceding fiscal year.“Administrative Agent” means (a) Bank of America in its capacity as administrative agent under any of the Loan Documents,(b) any Person appointed as administrative agent with respect to a new term loan tranche advanced pursuant to Section 2.13 and inaccordance with clause (4) of the proviso set forth in Section 2.13(e), and (c) any successor of any of the foregoing.“Administrative Agent’s Office” means, with respect to any currency, the Administrative Agent’s address and, as appropriate,account as set forth on Schedule 10.02 with respect to such currency, or such other address or account with respect to such currency asthe Administrative Agent may from time to time notify to the Borrower and the Lenders.“Administrative Questionnaire” means an Administrative Questionnaire in substantially the form of Exhibit F-2 or any otherform approved by the Administrative Agent.“Affiliate” means, with respect to any Person, another Person that directly, or indirectly through one or more intermediaries,Controls or is Controlled by or is under common Control with the Person specified.“Aggregate Commitments” means the Commitments of all the Lenders.“Aggregate Revolving Commitments” means the Revolving Commitments of all the Revolving Lenders.“Agreement” means this Credit Agreement.“Alternative Currency” means each of Euro, Sterling, Yen, Canadian Dollars, Australian Dollars, Hong Kong Dollars,Singapore Dollars, Swiss Francs, Swedish Krona and each other currency (other than Dollars) that is approved in accordance withSection 1.06.“Alternative Currency Equivalent” means, at any time, with respect to any amount denominated in Dollars, the equivalentamount thereof in the applicable Alternative Currency as determined by the-3-Administrative Agent or the L/C Issuer, as the case may be, at such time on the basis of the Spot Rate (determined in respect of themost recent Revaluation Date) for the purchase of such Alternative Currency with Dollars.“Anti-Corruption Laws” means the United States Foreign Corrupt Practices Act of 1977, the UK Bribery Act 2010, and othersimilar and applicable legislation in other jurisdictions.“Applicable Margin” means the following percentages per annum, based upon the lower of (a) the Pricing Level correspondingto the then applicable Consolidated Net Lease Adjusted Leverage Ratio and (b) the Pricing Level corresponding to the higher of thethen applicable Debt Rating issued by Moody’s and the then applicable Debt Rating issued by S&P, as set forth below: Pricing Level Based on Most Favorable Of: Pricing LevelConsolidated NetLease AdjustedLeverage RatioDebt Rating(Moody’s/S&P)ApplicableMargin forEurocurrencyRate RevolvingLoans/Letter ofCredit FeesApplicableMargin forEurocurrencyRate TermLoansApplicableMargin for BaseRate RevolvingLoansFacility Fee4> 4.50:1Ba2/BB or lower140.0170.040.030.03< 4.50:1 but > 3.25:1Ba1/BB+120.0145.020.025.02< 3.25:1 but > 2.50:1Baa3/BBB-100.0120.0020.01< 2.50:1Baa2/BBB or higher85.0100.0015.0Commencing on the Closing Date, the Applicable Margin shall be determined based upon Pricing Level 3. Thereafter, eachchange in the Applicable Margin (i) resulting from a change in the Debt Rating shall be effective during the period commencing on thedate of such change and ending on the date immediately preceding the effective date of the next such change and (ii) resulting from achange in the Consolidated Net Lease Adjusted Leverage Ratio shall become effective two Business Days after the date that theAdministrative Agent receives a duly completed Compliance Certificate pursuant to Section 6.02(a) evidencing such change.“Applicable Percentage” means with respect to any Appropriate Lender at any time, with respect to any Facility, the percentage(carried out to the ninth decimal place) of the Aggregate Commitments with respect to such Facility represented by such Lender’sCommitment with respect to such Facility at such time, subject to adjustment as provided in Section 2.15. If the commitment of eachRevolving Lender to make Revolving Loans and the obligation of the L/C Issuer to make L/C Credit Extensions have been terminatedpursuant to Section 8.02 or if the Aggregate Revolving Commitments have expired, then the Applicable Percentage of each RevolvingLender with respect to the Revolving Facility shall be determined based on the Applicable Percentage of such Lender most recently ineffect, giving effect to any subsequent assignments. After the Term Loans have been advanced, the Applicable Percentage of anyLender with respect to such Term Loans shall be determined based on the percentage-4-(carried out to the ninth decimal place) of the Outstanding Amount of such Lender’s Term Loans at such time. The initial ApplicablePercentage of each Appropriate Lender with respect to each applicable Facility is set forth opposite the name of such Lender onSchedule 2.01 or in the Assignment and Assumption pursuant to which such Lender becomes a party hereto, as applicable.“Applicable Time” means, with respect to any borrowings and payments in any Alternative Currency, the local time in theplace of settlement for such Alternative Currency as may be determined by the Administrative Agent or the L/C Issuer, as the case maybe, to be necessary for timely settlement on the relevant date in accordance with normal banking procedures in the place of payment.“Appropriate Lender” means, at any time, (a) with respect to any Facility, a Lender that has a Commitment with respect to suchFacility, or holds a Term Loan or a Revolving Loan with respect to such Facility at such time and (b) with respect to the Letter ofCredit Sublimit, (i) the L/C Issuer and (ii) if any Letters of Credit have been issued pursuant to Section 2.03(a), the Revolving Lenders.“Approved Fund” means any Fund that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entityor an Affiliate of an entity that administers or manages a Lender.“Asset Sale” means any Transfer of property of the Borrower or any of its Subsidiaries other than (a) Transfers permitted underSection 7.05(a) through (i), (k) or (l) or (b) a transaction or series of related transactions for which the Borrower or its Subsidiariesreceive aggregate consideration of less than $50,000,000.“Assignee Group” means two or more Eligible Assignees that are Affiliates of one another or two or more Approved Fundsmanaged by the same investment advisor.“Assignment and Assumption” means an assignment and assumption entered into by a Lender and an assignee (with theconsent of any party whose consent is required by Section 10.06(b)), and accepted by the Administrative Agent, in substantially theform of Exhibit F-1 or any other form (including electronic documentation generated by use of an electronic platform) approved by theAdministrative Agent.“Attributable A/R Share” means, with respect to any Subsidiary, an amount equal to the product of (a) the percentage of theEquity Interests of such Subsidiary owned directly or indirectly by Equinix multiplied by (b) the net accounts receivable of suchSubsidiary.“Attributable Asset Share” means, with respect to any Subsidiary, an amount equal to the product of (a) the percentage of theEquity Interests of such Subsidiary owned directly or indirectly by Equinix multiplied by (b) the total assets of such Subsidiary.“Attributable Indebtedness” means, on any date, (a) in respect of any Capital Lease of any Person, the capitalized amountthereof that would appear on a balance sheet of such Person prepared as of such date in accordance with GAAP, and (b) in respect ofany Synthetic Lease Obligation, the capitalized amount of the remaining lease payments under the relevant lease that would appear ona balance sheet of such Person prepared as of such date in accordance with GAAP if such lease were accounted for as a Capital Lease.-5-“Audited Financial Statements” means the audited consolidated balance sheet of Equinix and its Subsidiaries for the fiscal yearended December 31, 2016, and the related consolidated statements of income or operations, shareholders’ equity and cash flows forsuch fiscal year of Equinix and its Subsidiaries, including the notes thereto.“Australian Dollars” or “AUD” means the lawful currency of the Commonwealth of Australia.“Automatic Guaranty Release” has the meaning specified in Section 6.13(b)(i).“Availability Period” means, in respect of the Revolving Facility, the period from and including the Closing Date to the earliestof (a) the Revolving Maturity Date, (b) the date of termination of the Aggregate Revolving Commitments pursuant to Section 2.05, and(c) the date of termination of the commitment of each Lender to make Revolving Loans and of the obligation of the L/C Issuer to makeL/C Credit Extensions pursuant to Section 8.02.“Bail-In Action” means the exercise of any Write-Down and Conversion Powers by the applicable EEA Resolution Authorityin respect of any liability of an EEA Financial Institution.“Bail-In Legislation” means, with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU ofthe European Parliament and of the Council of the European Union, the implementing law for such EEA Member Country from timeto time which is described in the EU Bail-In Legislation Schedule.“Bank of America” means Bank of America, N.A. and its successors.“Base Indenture” means that certain Indenture dated as of November 20, 2014, between Equinix, as issuer, and U.S. BankNational Association, as trustee.“Base Rate” means for any day a fluctuating rate per annum equal to the highest of (a) the Federal Funds Rate plus 1/2 of 1%,(b) the rate of interest in effect for such day as publicly announced from time to time by Bank of America as its “prime rate,” and (c)the Eurocurrency Rate plus 1.00%. The “prime rate” is a rate set by Bank of America based upon various factors including Bank ofAmerica’s costs and desired return, general economic conditions and other factors, and is used as a reference point for pricing someloans, which may be priced at, above, or below such announced rate. Any change in such prime rate announced by Bank of Americashall take effect at the opening of business on the day specified in the public announcement of such change.“Base Rate Loan” means a Loan that bears interest based on the Base Rate. All Base Rate Loans shall be denominated inDollars.“Base Rate Revolving Loan” means a Revolving Loan that is a Base Rate Loan.-6-“Benefit Plan” means any of (a) an “employee benefit plan” (as defined in ERISA) that is subject to Title I of ERISA, (b) a“plan” as defined in Section 4975 of the Code or (c) any Person whose assets include (for purposes of ERISA Section 3(42) orotherwise for purposes of Title I of ERISA or Section 4975 of the Code) the assets of any such “employee benefit plan” or “plan”.“Borrower” has the meaning specified in the introductory paragraph hereto.“Borrower Materials” has the meaning specified in Section 6.02.“Borrowing” means a Revolving Borrowing or a Term Borrowing, as the context may require.“Business Day” means any day other than a Saturday, Sunday or other day on which commercial banks are authorized to closein New York City or under the Laws of, or are in fact closed in, the state where the Administrative Agent’s Office with respect toObligations denominated in Dollars is located and:(a) if such day relates to any interest rate settings as to a Eurocurrency Rate Loan denominated in Dollars, any fundings,disbursements, settlements and payments in Dollars in respect of any such Eurocurrency Rate Loan, or any other dealings in Dollars tobe carried out pursuant to this Agreement in respect of any such Eurocurrency Rate Loan, means any such day that is also a LondonBanking Day;(b) if such day relates to any interest rate settings as to a Eurocurrency Rate Loan denominated in Euro, any fundings,disbursements, settlements and payments in Euro in respect of any such Eurocurrency Rate Loan, or any other dealings in Euro to becarried out pursuant to this Agreement in respect of any such Eurocurrency Rate Loan, means a TARGET Day;(c) if such day relates to any interest rate settings as to a Eurocurrency Rate Loan denominated in a currency other thanDollars or Euro, means any such day on which dealings in deposits in the relevant currency are conducted by and between banks inthe London or other applicable offshore interbank market for such currency; and(d) if such day relates to any fundings, disbursements, settlements and payments in a currency other than Dollars or Euro inrespect of a Eurocurrency Rate Loan denominated in a currency other than Dollars or Euro, or any other dealings in any currency otherthan Dollars or Euro to be carried out pursuant to this Agreement in respect of any such Eurocurrency Rate Loan (other than anyinterest rate settings), means any such day on which banks are open for foreign exchange business in the principal financial center ofthe country of such currency.“Canadian Dollars”, “CAD” or “Cdn. $” means the lawful currency of Canada.“Capital Lease” means, as to any Person, the obligations of such Person under a lease that are required to be classified andaccounted for as capital lease obligations under GAAP.-7-“Cash Collateralize” means to pledge and deposit with or deliver to the Administrative Agent, for the benefit of theAdministrative Agent, L/C Issuer and the Revolving Lenders, as collateral for L/C Obligations, or obligations of the RevolvingLenders to fund participations in respect thereof (as the context may require), cash or deposit account balances or, if the L/C Issuerbenefitting from such collateral shall agree in its sole discretion, other credit support, in each case pursuant to documentation in formand substance reasonably satisfactory to (a) the Administrative Agent and (b) the L/C Issuer. “Cash Collateral” shall have a meaningcorrelative to the foregoing and shall include the proceeds of such cash collateral and other credit support.“Cash Management Agreement” means any agreement that is not prohibited by the terms hereof to provide treasury or cashmanagement services, including deposit accounts, overnight draft, credit cards, debit cards, p-cards (including purchasing cards andcommercial cards), funds transfer, automated clearinghouse, zero balance accounts, returned check, concentration, controlleddisbursement, lockbox, account reconciliation and reporting and trade finance services and other cash management services.“Cash Management Bank” means any Person in its capacity as a party to a Cash Management Agreement that, (a) at the time itenters into a Cash Management Agreement with a Loan Party, is a Lender or an Affiliate of a Lender, or (b) at the time it (or itsAffiliate) becomes a Lender, is a party to a Cash Management Agreement with a Loan Party, in each case in its capacity as a party tosuch Cash Management Agreement (even if such Person ceases to be a Lender or such Person’s Affiliate ceases to be a Lender);provided, however, that for any of the foregoing to be included as a “Guaranteed Cash Management Agreement” on any date ofdetermination by the Administrative Agent, the applicable Cash Management Bank (other than the Administrative Agent or anAffiliate of the Administrative Agent) must have delivered a Guaranteed Party Designation Notice to the Administrative Agent prior tosuch date of determination.“Change in Law” means the occurrence, after the date of this Agreement, of any of the following: (a) the adoption or takingeffect of any law, rule, regulation or treaty, (b) any change in any law, rule, regulation or treaty or in the administration, interpretation,implementation or application thereof by any Governmental Authority or (c) the making or issuance of any request, rule, guideline ordirective (whether or not having the force of law) by any Governmental Authority; provided that notwithstanding anything herein tothe contrary, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directivesthereunder or issued in connection therewith and (y) all requests, rules, guidelines or directives promulgated by the Bank forInternational Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States orforeign regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to be a “Change in Law”, regardless ofthe date enacted, adopted or issued.“Change of Control” means an event or series of events by which:(a) any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, butexcluding any employee benefit plan of such person or its subsidiaries, and any person or entity acting in its capacity as trustee, agentor other fiduciary or administrator of any such plan (a “Group”)) becomes the “beneficial owner” (as defined in Rules 13d-3 and 13d-5under the Securities Exchange Act of 1934, except that a person or group shall be deemed to have “beneficial ownership” of allsecurities that such person or group has the right to acquire,-8-whether such right is exercisable immediately or only after the passage of time (such right, an “option right”)), directly or indirectly, ofgreater than 50% of the equity securities of Equinix entitled to vote for members of the board of directors or equivalent governing bodyof Equinix on a fully-diluted basis (and taking into account all such securities that such person or group has the right to acquirepursuant to any option right);(b) any sale, lease, exchange or other transfer occurs (in one transaction or a series of related transactions) of all orsubstantially all of the assets of Equinix to any Person or Group, together with any Affiliates thereof (whether or not otherwise incompliance with the provisions of this Agreement); or(c) the holders of Equity Interests of Equinix approve any plan or proposal for the liquidation or dissolution of Equinix(whether or not otherwise in compliance with the provisions of this Agreement).“Class” when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising suchBorrowing, are Revolving Loans, SEK Term Loans or Sterling Term Loans, and, when used in reference to any Commitment, refersto whether such Commitment is a Revolving Commitment or Term Commitment.“Closing Date” means the first date all of the conditions precedent in Section 4.01 are satisfied or waived in accordance withSection 10.01.“Code” means the United States Internal Revenue Code of 1986, as amended.“Commitment” means a Revolving Commitment or a Term Commitment, as the context requires.“Commodity Exchange Act” means the Commodity Exchange Act (7 U.S.C. § 1 et seq.), as amended from time to time, andany successor statute.“Compliance Certificate” means a certificate substantially in the form of Exhibit D.“Connection Income Taxes” means Other Connection Taxes that are imposed on or measured by net income (howeverdenominated) or that are franchise Taxes or branch profits Taxes.“Consolidated EBITDA” means, as of any date of determination, for Equinix and its Subsidiaries on a consolidated basis, anamount equal to Consolidated Net Income for the Measurement Period most recently ended plus the sum of the following expenses (tothe extent deducted in calculating such Consolidated Net Income) for such Measurement Period: (i) interest expense, (ii) income taxexpense, (iii) depreciation expense, (iv) amortization expense and (v) non-cash stock-based compensation expense. For purposes ofcalculating Consolidated EBITDA, Consolidated Net Income shall be determined without deduction for any of the following items: (a)noncash expenses, charges and losses (including the write-down of any unamortized transaction costs, fees, original issue orunderwriting discounts and expenses as a result of the redemption, refinancing, refunding, prepayment or exchange of, or modificationto the terms of, any Indebtedness, to the extent not prohibited by this Agreement) not to exceed 10% of Consolidated EBITDA(calculated before giving effect to this clause (a)) in the aggregate for the Measurement Period, (b) one-time costs, fees, original issue orunderwriting discounts,-9-premiums, expenses, charges and losses incurred in connection with any actual or proposed (1) issuance of Indebtedness or EquitySecurities, (2) redemptions, refinancings, refundings, prepayments or exchanges of, or modifications to the terms of, any Indebtedness,(3) restructurings of or modifications to any operating leases, including in connection with the purchase of leased assets, (4)Acquisitions, (5) Investments or (6) Dispositions, in each case to the extent not prohibited by this Agreement (including, for theavoidance of doubt, the issuance by Equinix of any Senior Unsecured Notes and the entry by Equinix into this Agreement and theother Loan Documents), (c) ongoing expenses relating to the maintenance of Equinix’s status as a REIT and compliance with REITrules and regulations, (d) any net loss from disposed, abandoned or discontinued operations or product lines but only to the extent suchlosses do not exceed five percent (5%) of Consolidated EBITDA (calculated before giving effect to this clause (d)) in the aggregate forthe Measurement Period and (e) costs and expenses of Equinix and its Subsidiaries associated with the conversion of Equinix to aREIT (including, without limitation, planning and advisory costs related to the foregoing) but only to the extent such costs andexpenses do not exceed $200,000,000 in the aggregate whether incurred prior to or after the Closing Date. For purposes of calculatingConsolidated EBITDA for any period in which a Permitted Acquisition has been consummated, Consolidated EBITDA shall beadjusted to include, without duplication, (A) the historical EBITDA of the Person acquired in such Permitted Acquisition for theapplicable Measurement Period on a pro forma basis as if such Permitted Acquisition had been consummated on the first day of theapplicable Measurement Period, as the EBITDA of such acquired Person is reflected in its historical audited financial statements for themost recently ended fiscal year, and management prepared unaudited statements for any periods following the end of such fiscal yearand (B) expected cost savings (without duplication of actual cost savings or other charges or expenses that are otherwise added back incalculating Consolidated EBITDA) and synergies to the extent (x) such cost savings and synergies would be permitted to be reflectedin pro forma financial information complying with the requirements of GAAP and Article 11 of Regulation S-X under the SecuritiesAct of 1933, and as certified by a Responsible Officer of the Borrower or (y) such cost savings or synergies are factually supportableand have been realized or are reasonably expected to be realized within 365 days following such Permitted Acquisition; provided thatthe aggregate amount of cost savings and synergies added pursuant to this clause (B) shall not exceed fifteen percent (15%) ofConsolidated EBITDA (calculated before giving effect to this clause (B)) in the aggregate for the Measurement Period; provided,further, that for addbacks to cost savings and synergies under clause (y), the Borrower shall have delivered to the Administrative Agenta certificate of a Responsible Officer of the Borrower, in form and substance reasonably satisfactory to the Administrative Agent,certifying that such cost savings and synergies meet the requirements set forth in clause (y), together with reasonably detailed evidencein support thereof. In the event that there are only unaudited financial statements or no financial statements available for such acquiredPerson, then the pro forma adjustments described in clause (A) above shall be made based on such unaudited financial statements orreasonable estimates as may be agreed between the Borrower and the Administrative Agent.“Consolidated EBITDAR” means, as of any date of determination, for Equinix and its Subsidiaries on a consolidated basis, anamount equal to the sum of Consolidated EBITDA plus rent expense for the Measurement Period most recently ended. For purposesof calculating Consolidated EBITDAR for any period in which a Permitted Acquisition has been consummated, ConsolidatedEBITDAR shall be adjusted to include, without duplication, (A) the historical EBITDAR of the Person acquired in such PermittedAcquisition for the applicable Measurement Period on a pro forma basis as-10-if such Permitted Acquisition had been consummated on the first day of the applicable Measurement Period, as the EBITDAR of suchacquired Person is reflected in its historical audited financial statements for the most recently ended fiscal year, and managementprepared unaudited statements for any periods following the end of such fiscal year and (B) expected cost savings (without duplicationof actual cost savings or other charges or expenses that are otherwise added back in calculating Consolidated EBITDAR) andsynergies to the extent (x) such cost savings and synergies would be permitted to be reflected in pro forma financial informationcomplying with the requirements of GAAP and Article 11 of Regulation S-X under the Securities Act of 1933, and as certified by aResponsible Officer of the Borrower or (y) such cost savings or synergies are factually supportable and have been realized or arereasonably expected to be realized within 365 days following such Permitted Acquisition; provided that the aggregate amount of costsavings and synergies added pursuant to this clause (B) shall not exceed fifteen percent (15%) of Consolidated EBITDAR (calculatedbefore giving effect to this clause (B)) in the aggregate for the Measurement Period; provided, further, that for addbacks to cost savingsand synergies under clause (y), the Borrower shall have delivered to the Administrative Agent a certificate of a Responsible Officer ofthe Borrower, in form and substance reasonably satisfactory to the Administrative Agent, certifying that such cost savings andsynergies meet the requirements set forth in clause (y), together with reasonably detailed evidence in support thereof. In the event thatthere are only unaudited financial statements or no financial statements available for such acquired Person, then the pro formaadjustments described in clause (A) above shall be made based on such unaudited financial statements or reasonable estimates as maybe agreed between the Borrower and the Administrative Agent.“Consolidated Fixed Charges” means, as of any date of determination, for Equinix and its Subsidiaries on a consolidated basis,the sum of, without duplication, (a) the current maturities of long-term debt for the next twelve months (but excluding (i) anyConvertible Subordinated Notes, (ii) the current portion of the Revolving Facility, (iii) the final installment of the Term Loans, and (iv)the final installment of any Senior Unsecured Notes), (b) the principal portion of the current maturity of Capital Lease obligations andbuild-to-suit lease obligations for the next twelve months, (c) interest expense for the Measurement Period most recently ended, and (d)rent expense for the Measurement Period most recently ended.“Consolidated Fixed Charge Coverage Ratio” means, as of any date of determination, the ratio of (a) Consolidated EBITDARfor the Measurement Period ending on such date to (b) Consolidated Fixed Charges.“Consolidated Funded Indebtedness” means, as of any date of determination, for Equinix and its Subsidiaries on a consolidatedbasis, the sum, without duplication, of (a) the outstanding principal amount of all obligations, whether current or long-term, forborrowed money (including Obligations hereunder) and all obligations evidenced by bonds, debentures, notes, loan agreements orother similar instruments, (b) all direct obligations arising under letters of credit (including standby and commercial) and bankguaranties (but excluding any of the foregoing to the extent secured by cash collateral), (c) Attributable Indebtedness in respect ofCapital Leases and Synthetic Lease Obligations, (d) obligations in respect of build-to-suit leases, (e) all Guarantees with respect tooutstanding Indebtedness of the types specified in clauses (a) through (d) above of Persons other than Equinix or any Subsidiarythereof, and (f) all Indebtedness of the types referred to in clauses (a) through (e) above of any partnership or-11-joint venture (other than a joint venture that is itself a corporation or limited liability company) in which Equinix or a Subsidiary thereofis a general partner or joint venturer, except to the extent such Indebtedness is expressly made non-recourse to Equinix or suchSubsidiary. Notwithstanding the foregoing, as of any date of determination, for purposes of calculating the Consolidated Net LeaseAdjusted Leverage Ratio or the Consolidated Lease Adjusted Secured Leverage Ratio, “Consolidated Funded Indebtedness” shall notinclude the outstanding principal amount of any debt securities issued by Equinix to the extent that (i) as of such date, Equinix shallhave delivered (or the indenture trustee under the applicable indenture shall have delivered on Equinix’s behalf) to the holders of suchdebt securities an irrevocable notice of redemption with respect to all of such debt securities and shall have deposited funds with theindenture trustee or into an escrow account in an amount required to effect such redemption, unless any portion of such debt securitiesshall not in fact be redeemed within 35 days of such notice of redemption and deposit of funds or (ii) the proceeds of such debtsecurities are held by the trustee of the related indenture and have not been released to Equinix or are deposited into an escrow accountpending the closing of an acquisition or the redemption of other debt securities solely until such proceeds are released, it beingunderstood that any such proceeds shall not be included in the calculation of clause (iii) of the definition of Consolidated Net LeaseAdjusted Indebtedness.“Consolidated Lease Adjusted Secured Indebtedness” means as of any date of determination, with respect to Equinix and itsSubsidiaries, the sum, without duplication, of (a) Consolidated Funded Indebtedness as of such date that is secured by a Lien, plus (b)Attributable Indebtedness in respect of Capital Leases and in respect of Synthetic Lease Obligations as of such date, plus (c)obligations in respect of build-to-suit leases as of such date, plus (d) rent expense for the Measurement Period ending on such datemultiplied by six (6).“Consolidated Lease Adjusted Secured Leverage Ratio” means, as of any date of determination, the ratio of (a) ConsolidatedLease Adjusted Secured Indebtedness as of such date of determination to (b) Consolidated EBITDAR for the Measurement Periodending on such date.“Consolidated Net Income” means, for any period, for Equinix and its Subsidiaries on a consolidated basis, the net income ofEquinix and its Subsidiaries (excluding extraordinary gains and extraordinary losses) for that period.“Consolidated Net Lease Adjusted Indebtedness” means as of any date of determination, with respect to Equinix and itsSubsidiaries, the result, without duplication, of (a) Consolidated Funded Indebtedness as of such date, plus (b) rent expense for theMeasurement Period ending on such date multiplied by six (6), minus (c) the amount of unencumbered (other than by Liens permittedunder clauses (a), (c) and (g) of Section 7.01) and unrestricted cash, cash equivalents, freely tradable and liquid short term investments,and freely tradable and liquid long term investments of Equinix and its Subsidiaries as of such date.-12-“Consolidated Net Lease Adjusted Leverage Ratio” means, as of any date of determination, the ratio of (a) Consolidated NetLease Adjusted Indebtedness as of such date of determination to (b) Consolidated EBITDAR for the Measurement Period ending onsuch date.“Contractual Obligation” means, as to any Person, any provision of any security issued by such Person or of any agreement,instrument or other undertaking to which such Person is a party or by which it or any of its property is bound.“Control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management orpolicies of a Person, whether through the ability to exercise voting power, by contract or otherwise. “Controlling” and “Controlled”have meanings correlative thereto.“Convertible Subordinated Notes” means any convertible subordinated notes or debentures issued by the Borrower after thedate hereof, which are subordinated to the Obligations on terms no less favorable to the Lenders, in any material respect, than the4.75% Convertible Subordinated Notes Due 2016 (as those terms were in effect and applied to the 4.75% Convertible SubordinatedNotes Due 2016 prior to the repayment thereof in full on June 15, 2016).“Credit Agreement Refinancing Facility” means (a) with respect to any Class of Revolving Commitments or Revolving Loans,Replacement Revolving Commitments or Replacement Revolving Loans and (b) with respect to any Class of Term Loans,Refinancing Term Loans.“Credit Agreement Refinancing Facility Lenders” means the Lenders with a Replacement Revolving Commitment oroutstanding Refinancing Term Loans.“Credit Extension” means each of the following: (a) a Borrowing and (b) an L/C Credit Extension.“Debt Rating” means, as of any date of determination, the rating as determined by either S&P or Moody’s of the Borrower’scorporate credit rating, in the case of S&P, or the Borrower’s corporate family rating, in the case of Moody’s.“Debtor Relief Laws” means the Bankruptcy Code of the United States, and all other liquidation, conservatorship, bankruptcy,assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor reliefLaws of the United States or other applicable jurisdictions from time to time in effect and affecting the rights of creditors generally.“Default” means any event or condition that constitutes an Event of Default or that, with the giving of any notice, the passageof time, or both, would be an Event of Default.“Default Rate” means (a) when used with respect to Obligations other than Letter of Credit Fees, an interest rate equal to (i) theBase Rate plus (ii) the Applicable Margin applicable to Base Rate Loans plus (iii) 2% per annum; provided, however, that with respectto a Eurocurrency Rate Loan, the Default Rate shall be an interest rate equal to the interest rate (including any Applicable Margin)otherwise applicable to such Loan plus 2% per annum, and (b) when used with respect to Letter of Credit Fees, a rate equal to theApplicable Margin plus 2% per annum.-13-“Defaulting Lender” means, subject to Section 2.15(b), any Lender that, as determined by the Administrative Agent, (a) hasfailed to (i) fund all or any portion of its funding obligations hereunder, including in respect of its Loans or participations in respect ofLetters of Credit, within two Business Days of the date required to be funded by it hereunder, unless such Lender notifies theAdministrative Agent and the Borrower in writing that such failure is the result of such Lender’s good faith determination that one ormore conditions precedent to funding (each of which conditions precedent, together with any applicable default, shall be specificallyidentified in such writing) has not been satisfied, or (ii) pay to the Administrative Agent, any L/C Issuer or any Lender any otheramount required to be paid by it hereunder (including in respect of its participation in Letters of Credit) within two Business Days ofthe date when due, (b) has notified the Borrower, the Administrative Agent or any L/C Issuer or Lender that it does not intend tocomply with its funding obligations, or has made a public statement to that effect with respect to its funding obligations hereunder orgenerally under other agreements in which it commits to extend credit (unless such writing or public statement relates to such Lender’sobligation to fund a Loan hereunder and states that such position is based on such Lender’s good faith determination that a conditionprecedent to funding (which condition precedent, together with any applicable default, shall be specifically identified in such writing orpublic statement) cannot be satisfied), (c) has failed, within three Business Days after written request by the Administrative Agent, toconfirm in a manner satisfactory to the Administrative Agent that it will comply with its funding obligations (provided that such Lendershall cease to be a Defaulting Lender pursuant to this clause (c) upon receipt of such written confirmation by the AdministrativeAgent), or (d) has, or has a direct or indirect parent company that has, (i) become the subject of a proceeding under any Debtor ReliefLaw, (ii) had a receiver, conservator, trustee, administrator, assignee for the benefit of creditors or similar Person charged withreorganization or liquidation of its business or assets (including the Federal Deposit Insurance Corporation or any other state or federalregulatory authority acting in such a capacity) or a custodian appointed for it, or (iii) become the subject of a Bail-In Action; providedthat a Lender shall not be a Defaulting Lender solely by virtue of the ownership or acquisition of any equity interest in that Lender orany direct or indirect parent company thereof by a Governmental Authority so long as such ownership interest does not result in orprovide such Lender with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments orwrits of attachment on its assets or permit such Lender (or such Governmental Authority) to reject, repudiate, disavow or disaffirm anycontracts or agreements made with such Lender. Any determination by the Administrative Agent that a Lender is a Defaulting Lenderunder any one or more of clauses (a) through (d) above, and of the effective date of such status, shall be conclusive and binding absentmanifest error, and such Lender shall be deemed to be a Defaulting Lender (subject to Section 2.15(b)) as of the date establishedtherefor by the Administrative Agent in a written notice of such determination, which shall be delivered by the Administrative Agent tothe Borrower, L/C Issuer and each other Lender promptly following such determination.“Designated Jurisdiction” means any country or territory to the extent that such country or territory itself is the subject of anySanction.-14-“Disposition” or “Dispose” means the sale, transfer, license, lease or other disposition (including any sale and leasebacktransaction) of any property by any Person, including any sale, assignment, transfer or other disposal, with or without recourse, of anynotes or accounts receivable or any rights and claims associated therewith.“Dollar” and “$” mean lawful money of the United States.“Dollar Equivalent” means, at any time, (a) with respect to any amount denominated in Dollars, such amount, and (b) withrespect to any amount denominated in any Alternative Currency, the equivalent amount thereof in Dollars as determined by theAdministrative Agent or the L/C Issuer, as the case may be, at such time on the basis of the Spot Rate (determined in respect of themost recent Revaluation Date) for the purchase of Dollars with such Alternative Currency.“Domestic Subsidiary” means a Subsidiary of Equinix formed under the laws of the United States or any state thereof.“EEA Financial Institution” means (a) any credit institution or investment firm established in any EEA Member Country whichis subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parentof an institution described in clause (a) of this definition, or (c) any financial institution established in an EEA Member Country whichis a Subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with itsparent.“EEA Member Country” means any of the member states of the European Union, Iceland, Liechtenstein, and Norway.“EEA Resolution Authority” means any public administrative authority or any Person entrusted with public administrativeauthority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA FinancialInstitution.“Eligible Assignee” means any Person that meets the requirements to be an assignee under Section 10.06(b)(iii), and (v)(subject to such consents, if any, as may be required under Section 10.06(b)(iii)).“EMU Legislation” means the legislative measures of the European Council for the introduction of, changeover to or operationof a single or unified European currency.“Environmental Laws” means any and all Federal, state, local, and foreign statutes, laws, regulations, ordinances, rules,judgments, orders, decrees, permits, concessions, grants, franchises, licenses, agreements or governmental restrictions relating topollution and the protection of the environment or the release of any materials into the environment, including those related tohazardous substances or wastes, air emissions and discharges to waste or public systems.“Environmental Liability” means any liability, contingent or otherwise (including any liability for damages, costs ofenvironmental remediation, fines, penalties or indemnities), of the Borrower, any other Loan Party or any of their respectiveSubsidiaries directly or indirectly resulting from or based-15-upon (a) violation of any Environmental Law, (b) the generation, use, handling, transportation, storage, treatment or disposal of anyHazardous Materials, (c) exposure to any Hazardous Materials, (d) the release or threatened release of any Hazardous Materials intothe environment or (e) any contract, agreement or other consensual arrangement pursuant to which liability is assumed or imposed withrespect to any of the foregoing.“Equinix” has the meaning specified in the introductory paragraph hereto.“Equity Interests” means, with respect to any Person, all of the shares of capital stock of (or other ownership or profit interestsin) such Person, all of the warrants, options or other rights for the purchase or acquisition from such Person of shares of capital stock of(or other ownership or profit interests in) such Person, all of the securities convertible into or exchangeable for shares of capital stock of(or other ownership or profit interests in) such Person or warrants, rights or options for the purchase or acquisition from such Person ofsuch shares (or such other interests), and all of the other ownership or profit interests in such Person (including partnership, member ortrust interests therein), whether voting or nonvoting, and whether or not such shares, warrants, options, rights or other interests areoutstanding on any date of determination.“ERISA” means the Employee Retirement Income Security Act of 1974 and the rules and regulations promulgated thereunder.“ERISA Affiliate” means any trade or business (whether or not incorporated) under common control with Equinix or anySubsidiary thereof within the meaning of Section 414(b) or (c) of the Code (and Sections 414(m) and (o) of the Code for purposes ofprovisions relating to Section 412 of the Code).“ERISA Event” means (a) a Reportable Event with respect to a Pension Plan; (b) the withdrawal of the Borrower or anyERISA Affiliate from a Pension Plan subject to Section 4063 of ERISA during a plan year in which such entity was a “substantialemployer” as defined in Section 4001(a)(2) of ERISA or a cessation of operations that is treated as such a withdrawal under Section4062(e) of ERISA; (c) a complete or partial withdrawal by the Borrower or any ERISA Affiliate from a Multiemployer Plan ornotification that a Multiemployer Plan is in reorganization; (d) the filing of a notice of intent to terminate, the treatment of a PensionPlan amendment as a termination under Section 4041 or 4041A of ERISA; (e) the institution by the PBGC of proceedings to terminatea Pension Plan; (f) any event or condition which constitutes grounds under Section 4042 of ERISA for the termination of, or theappointment of a trustee to administer, any Pension Plan; (g) the determination that any Pension Plan is considered an at-risk plan or aplan in endangered or critical status within the meaning of Sections 430, 431 and 432 of the Code or Sections 303, 304 and 305 ofERISA; or (h) the imposition of any liability under Title IV of ERISA, other than for PBGC premiums due but not delinquent underSection 4007 of ERISA, upon the Borrower or any ERISA Affiliate.“EU Bail-In Legislation Schedule” means the EU Bail-In Legislation Schedule published by the Loan Market Association (orany successor person), as in effect from time to time.“Euro”, “EUR” and “€” mean the lawful currency of the Participating Member States introduced in accordance with the EMULegislation.-16-“Eurocurrency Rate” means:(a) for any Interest Period with respect to a Eurocurrency Rate Loan:(i) in the case of a Eurocurrency Rate Loan denominated in a LIBOR Quoted Currency, the rate per annum equal tothe London Interbank Offered Rate (“LIBOR”) or a comparable or successor rate which rate is approved by the Administrative Agent,as published on the applicable Bloomberg screen page (or such other commercially available source providing quotations of LIBOR asmay be designated by the Administrative Agent from time to time) at approximately 11:00 a.m., London time, two Business Days priorto the commencement of such Interest Period, for deposits in the relevant currency (for delivery on the first day of such Interest Period)with a term equivalent to such Interest Period;(ii) in the case of a Eurocurrency Rate Loan denominated in Canadian Dollars, the rate per annum equal to theCanadian Dealer Offered Rate, or a comparable or successor rate which rate is approved by the Administrative Agent, as published onthe applicable Bloomberg screen page (or such other commercially available source providing such quotations as may be designated bythe Administrative Agent from time to time) at or about 10:00 a.m. (Toronto, Ontario time) on the Rate Determination Date with a termequivalent to such Interest Period;(iii) in the case of a Eurocurrency Rate Loan denominated in Australian Dollars, the rate per annum equal to the BankBill Swap Reference Bid Rate or a comparable or successor rate, which rate is approved by the Administrative Agent, as published onthe applicable Bloomberg screen page (or such other commercially available source providing such quotations as may be designated bythe Administrative Agent from time to time) at or about 10:30 a.m. (Melbourne, Australia time) on the Rate Determination Date with aterm equivalent to such Interest Period; and(iv) in the case of a Eurocurrency Rate Loan denominated in Swedish Krona, the rate per annum equal to theStockholm Interbank Offered Rate, or a comparable or successor rate which rate is approved by the Administrative Agent, aspublished on the applicable Bloomberg screen page (or such other commercially available source providing such quotations as may bedesignated by the Administrative Agent from time to time) at or about 11:00 a.m. (Stockholm, Sweden time) on the RateDetermination Date with a term equivalent to such Interest Period;(v) in the case of a Eurocurrency Rate Loan denominated in Hong Kong Dollars, the rate per annum equal to theHong Kong Interbank Offered Rate, or a comparable or successor rate which rate is approved by the Administrative Agent, aspublished on the applicable Bloomberg screen page (or such other commercially available source providing such quotations as may bedesignated by the Administrative Agent from time to time) at or about 11:00 a.m. (Hong Kong time) on the Rate Determination Datewith a term equivalent to such Interest Period;(vi) in the case of any other Eurocurrency Rate Loan denominated in a Non-LIBOR Quoted Currency, the ratedesignated with respect to such Alternative Currency at the time such Alternative Currency is approved by the Administrative Agentand the Appropriate Lenders pursuant to Section 1.06(a); and-17-(b) for any interest calculation with respect to a Base Rate Loan on any date, the rate per annum equal to LIBOR, atapproximately 11:00 a.m., London time determined two Business Days prior to such date for Dollar deposits being delivered in theLondon interbank market for a term of one month commencing that day;provided that, (x) if the Eurocurrency Rate (including any LIBOR Successor Rate or alternative rate of interest under Section 3.03(b))shall be less than zero, such rate shall be deemed zero for purposes of this Agreement; (y) to the extent a comparable or successor rateis approved by the Administrative Agent in connection with any rate set forth in this definition, the approved rate shall be applied in amanner consistent with market practice; and (z) to the extent such market practice is not administratively feasible for the AdministrativeAgent, such approved rate shall be applied in a manner as otherwise reasonably determined by the Administrative Agent.Notwithstanding anything to the contrary in this Agreement or any other Loan Document, if the Administrative Agentdetermines (which determination shall be conclusive absent manifest error), or the Borrower or Required Lenders notify theAdministrative Agent (with, in the case of a notice from the Required Lenders, a copy to Borrower) that the Borrower or RequiredLenders (as applicable) have determined, that:(A)adequate and reasonable means do not exist for ascertaining LIBOR for any requested Interest Period, including, withoutlimitation, because the LIBOR Screen Rate is not available or published on a current basis and such circumstances areunlikely to be temporary,(B)the administrator of the LIBOR Screen Rate or a Governmental Authority having jurisdiction over the AdministrativeAgent has made a public statement identifying a specific date after which LIBOR or the LIBOR Screen Rate shall nolonger be made available or used for determining the interest rate of loans (such specific date, the “Scheduled UnavailabilityDate”), or(C)syndicated credit facilities currently being executed, or that include language similar to that contained in this definition, arebeing executed or amended (as applicable) to incorporate or adopt a new benchmark interest rate to replace LIBOR,then, reasonably promptly after such determination by the Administrative Agent or receipt by the Administrative Agent of such notice,as applicable, the Administrative Agent and the Borrower may amend this Agreement to replace LIBOR with an alternate benchmarkrate (including any mathematical or other adjustments to the benchmark (if any) incorporated therein), giving due consideration to anyevolving or then existing convention for similar Dollar denominated syndicated credit facilities for such alternative benchmarks (anysuch proposed rate, a “LIBOR Successor Rate”), together with any proposed LIBOR Successor Rate Conforming Changes, and anysuch amendment shall become effective at 5:00 p.m. (New York time) on the fifth Business Day after the Administrative Agent shallhave posted such proposed amendment to all Lenders and the Borrower unless, prior to such time, Lenders comprising the RequiredLenders have delivered to the Administrative Agent written notice that such Required Lenders do not accept such amendment.-18-If no LIBOR Successor Rate has been determined and the circumstances under clause (A) above exist or the Scheduled UnavailabilityDate has occurred (as applicable), the Administrative Agent will promptly so notify the Borrower and each Lender and (1) theobligation of the Lenders to make or maintain Eurocurrency Rate Loans shall be suspended (to the extent of the affected EurocurrencyRate Loans or Interest Periods), and (2) the Eurocurrency Rate component shall no longer be utilized in determining the Base Rate.Upon receipt of such notice, (x) in the case of any affected Eurocurrency Rate Loans denominated in Dollars, the Borrower mayrevoke any pending request for a Borrowing of, conversion to or continuation of, such Eurocurrency Rate Loans (to the extent of theaffected Eurocurrency Rate Loans or Interest Periods) or, failing that, will be deemed to have converted such request into a request fora Borrowing of Base Rate Loans (subject to the foregoing clause (2)) in the amount specified therein or (y) in the case of any affectedEurocurrency Rate Loans denominated in Euro, Sterling, Yen or Swiss Franc, the provisions in Section 3.03(b) shall apply to suchEurocurrency Rate Loans.“Eurocurrency Rate Loan” means a Loan that bears interest at a rate based on clause (a) of the definition of “EurocurrencyRate.” Eurocurrency Rate Loans may be denominated in Dollars or in an Alternative Currency. All Loans denominated in anAlternative Currency must be Eurocurrency Rate Loans.“Eurocurrency Rate Revolving Loan” means a Revolving Loan that is a Eurocurrency Rate Loan.“Eurocurrency Rate Term Loan” means a Term Loan that is a Eurocurrency Rate Loan.“Event of Default” has the meaning specified in Section 8.01.“Excluded Swap Obligation” means, with respect to any Guarantor, any Swap Obligation if, and to the extent that, all or aportion of the Multiparty Guaranty of such Guarantor of, or the grant by such Guarantor of a security interest to secure, such SwapObligation (or any Guarantee thereof) is or becomes illegal under the Commodity Exchange Act or any rule, regulation or order of theCommodity Futures Trading Commission (or the application or official interpretation of any thereof) by virtue of such Guarantor’sfailure for any reason to constitute an “eligible contract participant” as defined in the Commodity Exchange Act (determined aftergiving effect to Section 10.19(k) and any other “keepwell, support or other agreement” for the benefit of such Guarantor and any andall guarantees of such Guarantor’s Swap Obligations by other Loan Parties) at the time the Multiparty Guaranty of such Guarantor, ora grant by such Guarantor of a security interest, becomes effective with respect to such Swap Obligation. If a Swap Obligation arisesunder a master agreement governing more than one swap, such exclusion shall apply only to the portion of such Swap Obligation thatis attributable to swaps for which such Multiparty Guaranty or security interest is or becomes excluded in accordance with the firstsentence of this definition.“Excluded Taxes” means any of the following Taxes imposed on or with respect to any Recipient or required to be withheld ordeducted from a payment to a Recipient, (a) Taxes imposed on or measured by net income (however denominated), franchise Taxes,and branch profits Taxes, in each case, (i) imposed as a result of such Recipient being organized under the laws of, or having itsprincipal office or, in the case of any Lender, its Lending Office located in, the jurisdiction imposing such Tax (or any-19-political subdivision thereof) or (ii) that are Other Connection Taxes, (b) in the case of a Lender, U.S. federal withholding Taxesimposed on amounts payable to or for the account of such Lender with respect to an applicable interest in a Loan or Commitmentpursuant to a law in effect on the date on which (i) such Lender acquires such interest in the Loan or Commitment (other than pursuantto an assignment request by the Borrower under Section 10.13) or (ii) such Lender changes its Lending Office, except in each case tothe extent that, pursuant to Section 3.01(a)(ii) or (c), amounts with respect to such Taxes were payable either to such Lender’s assignorimmediately before such Lender became a party hereto or to such Lender immediately before it changed its Lending Office, (c) Taxesattributable to such Recipient’s failure to comply with Section 3.01(e) and (d) any withholding Taxes imposed pursuant to FATCA.“Existing Administrative Agent” has the meaning specified in the definition of “Existing Credit Agreement”.“Existing Credit Agreement” means that certain Credit Agreement, dated as of December 17, 2014 (as amended) among theBorrower, the subsidiary guarantors party thereto, Bank of America, as administrative agent thereunder (in such capacity, the “ExistingAdministrative Agent”), the L/C Issuer thereunder, and the lenders party thereto.“Existing Japanese Yen Loan” means the term loan facility provided under that certain Term Loan Agreement dated as ofSeptember 30, 2016, by and among Equinix Japan K.K., as borrower, the lenders from time to time party thereto and The Bank ofTokyo-Mitsubishi UFJ, Ltd., as arranger and agent.“Existing Letters of Credit” means, collectively, the Letters of Credit identified on Schedule 1.01.“Existing Loan Documents” means the “Loan Documents”, as such term is defined in the Existing Credit Agreement.“Existing Revolving Commitments” has the meaning specified in Section 2.16(g)(ii).“Existing Revolving Loans” has the meaning specified in Section 2.16(g)(ii).“Existing Revolving Maturity Date” has the meaning set forth in Section 2.16(a).“Existing Term Loans” has the meaning set forth in Section 2.16(g)(i).“Existing Term Maturity Date” has the meaning set forth in Section 2.16(a).“Extended Revolving Commitments” has the meaning specified in Section 2.16(g)(ii).“Extended Revolving Loans” has the meaning specified in Section 2.16(g)(ii).-20-“Extended Term Loans” has the meaning specified in Section 2.16(g)(i).“Extending Lender” means an Extending Revolving Lender or an Extending Term Lender, as applicable.“Extending Revolving Lender” has the meaning specified in Section 2.16(e)(i).“Extending Term Lender” has the meaning specified in Section 2.16(e)(ii).“Extension Amendment” means an amendment to this Agreement pursuant to which the Revolving Maturity Date or the TermMaturity Date has been extended in accordance with Section 2.16, which shall be consistent with the applicable provisions of thisAgreement and otherwise satisfactory to the parties thereto. Each Extension Amendment shall be executed by the AdministrativeAgent, the L/C Issuer (to the extent Section 10.01 would require the consent of the L/C Issuer for the amendments effected in suchExtension Amendment), the Loan Parties and the applicable Extending Lenders. Any Extension Amendment may include conditionsfor delivery of opinions of counsel and other documentation consistent with the conditions in Sections 4.01 and/or 4.02 to the extentreasonably requested by the Administrative Agent or the applicable Extending Lenders.“Extension Date” means any date on which any Existing Term Loans or any Existing Revolving Commitments are modified toextend the related Maturity Date in accordance with Section 2.16 (with respect to Lenders under such Existing Term Loans or anyExisting Revolving Commitments that agree to such modification).“Extension Request Notice” has the meaning specified in Section 2.16(a).“Facility” means the Term Facility or the Revolving Facility, as the context may require.“Facility Fee” has the meaning specified in Section 2.08(a).“Facility Termination Date” means the date as of which all of the following shall have occurred: (a) the AggregateCommitments have terminated, (b) all Obligations have been paid in full in cash (other than contingent indemnification obligations),and (c) all Letters of Credit have terminated or expired (other than Letters of Credit as to which other arrangements with respect theretosatisfactory to the Administrative Agent and the L/C Issuer shall have been made).“FASB ASC” means the Accounting Standards Codification of the Financial Accounting Standards Board.“FATCA” means Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or successorversion that is substantively comparable and not materially more onerous to comply with), any current or future regulations or officialinterpretations thereof and any intergovernmental agreement, and any fiscal or regulatory legislation, rules or practices adoptedpursuant to any intergovernmental agreement, treaty or convention among governmental authorities and implementing subsections ofthe Code and any agreements entered into pursuant to Section 1471(b)(1) of the Code.-21-“Federal Funds Rate” means, for any day, the rate per annum equal to the weighted average of the rates on overnight Federalfunds transactions with members of the Federal Reserve System, as published by the Federal Reserve Bank of New York on theBusiness Day next succeeding such day; provided that (a) if such day is not a Business Day, the Federal Funds Rate for such day shallbe such rate on such transactions on the next preceding Business Day as so published on the next succeeding Business Day, (b) if nosuch rate is so published on such next succeeding Business Day, the Federal Funds Rate for such day shall be the average rate(rounded upward, if necessary, to a whole multiple of 1/100 of 1%) charged to Bank of America on such day on such transactions asdetermined by the Administrative Agent and (c) if the Federal Funds Rate shall be less than zero, such rate shall be deemed zero forpurposes of this Agreement.“Fee Letter” means that certain letter agreement, dated December 12, 2017, among the Borrower, the Administrative Agentand the Left Lead Arranger.“Foreign Asset Sale” has the meaning specified in Section 2.04(c)(v).“Foreign Lender” means, with respect to the Borrower, any Lender or L/C Issuer that is organized under the Laws of ajurisdiction other than that in which the Borrower is resident for tax purposes. For purposes of this definition, the United States, eachState thereof and the District of Columbia shall be deemed to constitute a single jurisdiction.“Foreign Subsidiary” means any Subsidiary that is organized under the laws of a jurisdiction other than the United States, aState thereof or the District of Columbia.“Foreign Subsidiary Holdco” means any Domestic Subsidiary substantially all of whose assets consist (or any DomesticSubsidiary that is formed for the purpose of holding assets that substantially consist) of Equity Interests or Indebtedness of (a) one ormore Foreign Subsidiaries or (b) other Foreign Subsidiary Holdcos described in clause (a).“FRB” means the Board of Governors of the Federal Reserve System of the United States.“Fronting Exposure” means, at any time there is a Defaulting Lender, with respect to the L/C Issuer, such Defaulting Lender’sApplicable Percentage of the Outstanding Amount of all L/C Obligations other than L/C Obligations as to which such DefaultingLender’s participation obligation has been reallocated to other Revolving Lenders or Cash Collateralized in accordance with the termshereof.“Fund” means any Person (other than a natural person) that is (or will be) engaged in making, purchasing, holding or otherwiseinvesting in commercial loans and similar extensions of credit in the ordinary course of its activities.“Funds From Operations” means, with respect to any fiscal period, an amount equal to the net income (or deficit) of Equinixand its Subsidiaries for that period computed on a consolidated basis in accordance with GAAP, excluding gains (or losses) from salesof property, plus depreciation and amortization and after adjustments for unconsolidated partnerships and joint ventures; provided thatFunds From Operations shall exclude one-time or non-recurring charges and impairment charges,-22-charges from the early extinguishment of indebtedness and other non-cash charges. Adjustments for unconsolidated partnerships andjoint ventures will be calculated to reflect Funds From Operations on the same basis. To the extent not inconsistent with the foregoing,Funds From Operations shall be reported in accordance with the NAREIT Policy Bulletin dated April 5, 2002, as amended, restated,supplemented or otherwise modified from time to time.“GAAP” means generally accepted accounting principles in the United States set forth in the opinions and pronouncements ofthe Accounting Principles Board and the American Institute of Certified Public Accountants and statements and pronouncements of theFinancial Accounting Standards Board or such other principles as may be approved by a significant segment of the accountingprofession in the United States, that are applicable to the circumstances as of the date of determination, consistently applied.“Governmental Authority” means the government of the United States or any other nation, or of any political subdivisionthereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entityexercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government(including any supra-national bodies such as the European Union or the European Central Bank).“Guarantee” means, as to any Person, (a) any obligation, contingent or otherwise, of such Person guaranteeing or having theeconomic effect of guaranteeing any Indebtedness or other obligation payable or performable by another Person (the “primaryobligor”) in any manner, whether directly or indirectly, and including any obligation of such Person, direct or indirect, (i) to purchaseor pay (or advance or supply funds for the purchase or payment of) such Indebtedness or other obligation, (ii) to purchase or leaseproperty, securities or services for the purpose of assuring the obligee in respect of such Indebtedness or other obligation of thepayment or performance of such Indebtedness or other obligation, (iii) to maintain working capital, equity capital or any other financialstatement condition or liquidity or level of income or cash flow of the primary obligor so as to enable the primary obligor to pay suchIndebtedness or other obligation, or (iv) entered into for the purpose of assuring in any other manner the obligee in respect of suchIndebtedness or other obligation of the payment or performance thereof or to protect such obligee against loss in respect thereof (inwhole or in part) and will include the Multiparty Guaranty set forth in Section 10.19, or (b) any Lien on any assets of such Personsecuring any Indebtedness or other obligation of any other Person, whether or not such Indebtedness or other obligation is assumed bysuch Person (or any right, contingent or otherwise, of any holder of such Indebtedness to obtain any such Lien). The amount of anyGuarantee shall be deemed to be an amount equal to the stated or determinable amount of the related primary obligation, or portionthereof, in respect of which such Guarantee is made or, if not stated or determinable, the maximum reasonably anticipated liability inrespect thereof as determined by the guaranteeing Person in good faith. The term “Guarantee” as a verb has a corresponding meaning.“Guaranteed Cash Management Agreement” means any Cash Management Agreement between any Loan Party and/or any ofits Subsidiaries and any Cash Management Bank.-23-“Guaranteed Hedge Agreement” means any interest rate, currency, foreign exchange, or commodity Swap Contract betweenany Loan Party and/or any of its Subsidiaries and any Hedge Bank.“Guaranteed Obligations” means (a) all Obligations, (b) all obligations arising under Guaranteed Cash ManagementAgreements and Guaranteed Hedge Agreements and (c) all costs and expenses incurred in connection with enforcement and collectionof the foregoing, including the fees, charges and disbursements of counsel, in each case whether direct or indirect (including thoseacquired by assumption), absolute or contingent, due or to become due, now existing or hereafter arising and including interest andfees that accrue after the commencement by or against any Loan Party or any Affiliate thereof of any proceeding under any DebtorRelief Laws naming such Person as the debtor in such proceeding, regardless of whether such interest and fees are allowed claims insuch proceeding; provided that the Guaranteed Obligations shall exclude any Excluded Swap Obligations.“Guaranteed Parties” means, collectively, the Administrative Agent, the Lenders, the L/C Issuer, the Hedge Banks, the CashManagement Banks, the Indemnitees, each co-agent or sub-agent appointed by the Administrative Agent from time to time pursuant toSection 9.05.“Guaranteed Party Designation Notice” means a notice from any Lender or an Affiliate of a Lender substantially in the form ofExhibit G.“Guarantors” has the meaning specified in the introductory paragraph hereto, and in addition, shall include, with respect to thepayment and performance by each Loan Party of its obligations under its Multiparty Guaranty with respect to all GuaranteedObligations, the Borrower.“Hazardous Materials” means all explosive or radioactive substances or wastes and all hazardous or toxic substances, wastes orother pollutants, including petroleum or petroleum distillates, asbestos or asbestos-containing materials, polychlorinated biphenyls,radon gas, infectious or medical wastes and all other substances or wastes of any nature regulated pursuant to any Environmental Law.“Hedge Bank” means any Person in its capacity as a party to a Swap Contract that, (a) at the time it enters into a Swap Contractis a Lender or an Affiliate of a Lender, or (b) at the time it (or its Affiliate) becomes a Lender, is a party to a Swap Contract (even ifsuch Person ceases to be a Lender or such Person’s Affiliate ceased to be a Lender); provided, in the case of a Guaranteed HedgeAgreement with a Person who is no longer a Lender (or an Affiliate of a Lender), such Person shall be considered a Hedge Bank onlythrough the stated termination date (without extension or renewal) of such Guaranteed Hedge Agreement and provided further that forany of the foregoing to be included as a “Guaranteed Hedge Agreement” on any date of determination by the Administrative Agent,the applicable Hedge Bank (other than the Administrative Agent or an Affiliate of the Administrative Agent) must have delivered aGuaranteed Party Designation Notice to the Administrative Agent (it being understood that one notice with respect to a specified ISDAMaster Agreement may designate all transactions thereunder as being “Guaranteed Hedge Agreements”, without the need for separatenotices for each individual transaction thereunder).-24-“Hong Kong Dollars” or “HKD” means the lawful currency of the Hong Kong Special Administrative Region of the People’sRepublic of China.“Hostile Acquisition” means an Acquisition of all or substantially all of the Equity Interests of a Person through a tender offeror similar solicitation of the owners of such Equity Interests which has not been approved (prior to the consummation of suchAcquisition) by the board of directors (or any other applicable governing body) of such Person or by similar or other appropriate actionif such Person is not a corporation, or as to which, at the time of consummation of such Acquisition, any such prior approval has beenwithdrawn.“Increase Effective Date” has the meaning specified in Section 2.13(d).“Indebtedness” means, as to any Person at a particular time, without duplication, all of the following, whether or not includedas indebtedness or liabilities in accordance with GAAP:(a) all obligations of such Person for borrowed money and all obligations of such Person evidenced by bonds, debentures,notes, loan agreements or other similar instruments;(b) all direct or contingent obligations of such Person arising under letters of credit (including standby and commercial),bankers’ acceptances, bank guaranties, surety bonds and similar instruments;(c) net obligations of such Person under any Swap Contract;(d) all obligations of such Person to pay the deferred purchase price of property or services (other than (i) trade accountspayable in the ordinary course of business and (ii) post-closing purchase price adjustments or earnout obligations in connection withPermitted Acquisitions, in the case of this clause (ii), until such obligations become a liability on the balance sheet of such Person inaccordance with GAAP);(e) indebtedness (excluding prepaid interest thereon) secured by a Lien on property owned or being purchased by suchPerson (including indebtedness arising under conditional sales or other title retention agreements), whether or not such indebtednessshall have been assumed by such Person or is limited in recourse;(f) Capital Leases, obligations under build-to-suit leases and Synthetic Lease Obligations;(g) all obligations of such Person to purchase, redeem, retire, defease or otherwise make any payment in respect of anyEquity Interest in such Person or any other Person, valued, in the case of a redeemable preferred interest, at the greater of its voluntaryor involuntary liquidation preference plus accrued and unpaid dividends; and(h) all Guarantees of such Person in respect of any of the foregoing.For all purposes hereof, the Indebtedness of any Person shall include the Indebtedness of any partnership or joint venture (other than ajoint venture that is itself a corporation or limited liability company) in which such Person is a general partner or a joint venturer, exceptto the extent such Indebtedness is expressly made non-recourse to such Person. The amount of any net obligation under any SwapContract-25-on any date shall be deemed to be the Swap Termination Value thereof as of such date. The amount of any Capital Lease or SyntheticLease Obligation as of any date shall be deemed to be the amount of Attributable Indebtedness in respect thereof as of such date. Theamount of any build-to-suit lease obligation as of any date shall be deemed to be the amount required to be reflected as a liability on thebalance sheet of the tenant under such build-to-suit lease prepared in accordance with GAAP as of such date.“Indemnified Taxes” means (a) Taxes, other than Excluded Taxes, imposed on or with respect to any payment made by or onaccount of any obligation of any Loan Party under any Loan Document and (b) to the extent not otherwise described in clause (a),Other Taxes.“Indemnitees” has the meaning specified in Section 10.04(b).“Information” has the meaning specified in Section 10.07.“Intercompany Accounts” means those accounts receivable of each Loan Party where the account debtor or obligor is aSubsidiary or Affiliate of such Loan Party.“Interest Payment Date” means, (a) as to any Loan other than a Base Rate Loan, the last day of each Interest Period applicableto such Loan and the applicable Maturity Date; provided, however, that if any Interest Period for a Eurocurrency Rate Loan exceedsthree months, the respective dates that fall every three months after the beginning of such Interest Period shall also be Interest PaymentDates; and (b) as to any Base Rate Loan, the last Business Day of each March, June, September and December and the applicableMaturity Date.“Interest Period” means as to each Eurocurrency Rate Loan, the period commencing on the date such Eurocurrency Rate Loanis disbursed or converted to or continued as a Eurocurrency Rate Loan and ending on the date one, two, three or six months thereafter(or, if consented to by all Appropriate Lenders pursuant to the first proviso to Section 2.02(a), a shorter period, or nine or twelvemonths thereafter), as selected by the Borrower in its Loan Notice; provided that:(i) any Interest Period that would otherwise end on a day that is not a Business Day shall be extended to the nextsucceeding Business Day unless, in the case of a Eurocurrency Rate Loan, such Business Day falls in another calendar month,in which case such Interest Period shall end on the next preceding Business Day;(ii) any Interest Period pertaining to a Eurocurrency Rate Loan that begins on the last Business Day of a calendarmonth (or on a day for which there is no numerically corresponding day in the calendar month at the end of such InterestPeriod) shall end on the last Business Day of the calendar month at the end of such Interest Period; and(iii) no Interest Period pertaining to any Loan shall extend beyond the applicable Maturity Date for such Loan.“Investment” means, as to any Person, any direct or indirect acquisition or investment by such Person, whether by means of (a)the purchase or other acquisition of capital stock or other securities-26-of another Person, (b) a loan, advance or capital contribution to, Guarantee or assumption of debt of, or purchase or other acquisition ofany other debt or equity participation or interest in, another Person, including any partnership or joint venture interest in such otherPerson and any arrangement pursuant to which the investor Guarantees Indebtedness of such other Person, or (c) the purchase or otheracquisition (in one transaction or a series of transactions) of assets of another Person that constitute a business unit. For purposes ofcovenant compliance, the amount of any Investment shall be the amount actually invested, without adjustment for subsequent increasesor decreases in the value of such Investment.“IRS” means the United States Internal Revenue Service.“ISP” means, with respect to any Letter of Credit, the “International Standby Practices 1998” published by the Institute ofInternational Banking Law & Practice, Inc. (or such later version thereof as may be in effect at the time of issuance).“Issuer Documents” means with respect to any Letter of Credit, the Letter of Credit Application, and any other document,agreement and instrument entered into by the L/C Issuer and the Borrower (or any Subsidiary) or in favor of the L/C Issuer andrelating to such Letter of Credit.“Joinder Agreement” means a joinder agreement substantially in the form of Exhibit E executed and delivered in accordancewith the provisions of Section 6.13, or any other form approved by Administrative Agent.“Joint Lead Arrangers” means the Left Lead Arranger, MUFG, J. P. Morgan Securities LLC, and RBC Capital Markets intheir capacities as joint lead arrangers and joint bookrunners.“JV Entity” means a non-wholly-owned Subsidiary or joint venture in which Equinix or one or more of its Subsidiaries is ajoint venturer with another Person.“JV Interest” means an Equity Interest in a JV Entity.“Laws” means, collectively, all international, foreign, Federal, state and local statutes, treaties, rules, guidelines, regulations,ordinances, codes and administrative or judicial precedents or authorities, including the interpretation or administration thereof by anyGovernmental Authority charged with the enforcement, interpretation or administration thereof, and all applicable administrativeorders, directed duties, requests, licenses, authorizations and permits of, and agreements with, any Governmental Authority, in eachcase whether or not having the force of law.“L/C Advance” means, with respect to each Revolving Lender, such Revolving Lender’s funding of its participation in anyL/C Borrowing in accordance with its Applicable Percentage. All L/C Advances shall be denominated in Dollars.“L/C Borrowing” means an extension of credit resulting from a drawing under any Letter of Credit which has not beenreimbursed on the date when made or refinanced as a Revolving Borrowing. All L/C Borrowings shall be denominated in Dollars.-27-“L/C Credit Extension” means, with respect to any Letter of Credit, the issuance thereof or extension of the expiry date thereof,or the increase of the amount thereof.“L/C Issuer” means, individually and collectively, each of (a) Bank of America in its capacity as issuer of Letters of Credithereunder, (b) any other Revolving Lender appointed by the Borrower (with the consent of such appointed Lender) as an issuer ofLetters of Credit hereunder, or (c) any successor of any of the foregoing. At any time there is more than one L/C Issuer, any singularreferences to the L/C Issuer shall mean any L/C Issuer, either L/C Issuer, each L/C Issuer, the L/C Issuer that has issued the applicableLetter of Credit, or both (or all) L/C Issuers, as the context may require.“L/C Issuer Sublimit” means, (a) in the case of Bank of America, $250,000,000, less such amounts as may be designated toother L/C Issuers pursuant to the following clause (b) and (b) in the case of any other L/C Issuer, such amount as may be designated tosuch other L/C Issuer (with the consent of such L/C Issuer) (i) by the Administrative Agent in writing or (ii) at the request of theBorrower in a writing delivered to the Administrative Agent, less such amounts as may be designated to other L/C Issuers pursuant tothis clause (b), in each case, as such sublimits are set forth on Schedule 2.01 from time to time.“L/C Obligations” means, as at any date of determination, the aggregate amount available to be drawn under all outstandingLetters of Credit plus the aggregate of all Unreimbursed Amounts, including all L/C Borrowings. For purposes of computing theamount available to be drawn under any Letter of Credit, the amount of such Letter of Credit shall be determined in accordance withSection 1.09. For all purposes of this Agreement, if on any date of determination a Letter of Credit has expired by its terms but anyamount may still be drawn thereunder by reason of the operation of Rule 3.14 of the ISP, such Letter of Credit shall be deemed to be“outstanding” in the amount so remaining available to be drawn.“Left Lead Arranger” means Bank of America (or any other registered broker-dealer wholly-owned by Bank of AmericaCorporation to which all or substantially all of Bank of America Corporation’s or any of its subsidiaries’ investment banking,commercial lending services or related businesses may be transferred following the date of this Agreement), in its capacity as left leadarranger and joint book runner.“Lender” has the meaning specified in the introductory paragraph hereto.“Lending Office” means, as to any Lender, the office or offices of such Lender described as such in such Lender’sAdministrative Questionnaire, or such other office or offices as a Lender may from time to time notify the Borrower and theAdministrative Agent which office may include any Affiliate of such Lender or any domestic or foreign branch of such Lender or suchAffiliate. Unless the context otherwise requires each reference to a Lender shall include its applicable Lending Office.“Letter of Credit” means any standby letter of credit issued hereunder and shall include the Existing Letters of Credit.“Letter of Credit Application” means an application and agreement for the issuance or amendment of a Letter of Credit in theform from time to time in use by the L/C Issuer.-28-“Letter of Credit Expiration Date” means the day that is seven days prior to the Revolving Maturity Date (or, if such day is nota Business Day, the next preceding Business Day).“Letter of Credit Fee” has the meaning specified in Section 2.03(h).“Letter of Credit Report” means a certificate substantially the form of Exhibit H or any other form approved by theAdministrative Agent.“Letter of Credit Sublimit” means an amount equal to $250,000,000. The Letter of Credit Sublimit is part of, and not inaddition to, the Aggregate Commitments.“LIBOR” has the meaning specified in the definition of Eurocurrency Rate.“LIBOR Quoted Currency” means each of the following currencies: Dollars; Euro; Sterling; Yen; and Swiss Franc; in eachcase as long as there is a published LIBOR rate with respect thereto.“LIBOR Screen Rate” means the LIBOR quote on the applicable screen page the Administrative Agent designates todetermine LIBOR (or such other commercially available source providing such quotations as may be designated by the AdministrativeAgent from time to time).“LIBOR Successor Rate” has the meaning specified in the definition of Eurocurrency Rate.“LIBOR Successor Rate Conforming Changes” means, with respect to any proposed LIBOR Successor Rate, any conformingchanges to the definitions of “Base Rate” or “Interest Period”, the timing and frequency of determining rates and making payments ofinterest and other administrative matters as may be appropriate, in the discretion of the Administrative Agent, to reflect the adoption ofsuch LIBOR Successor Rate and to permit the administration thereof by the Administrative Agent in a manner substantially consistentwith market practice (or, if the Administrative Agent determines that adoption of any portion of such market practice is notadministratively feasible or that no market practice for the administration of such LIBOR Successor Rate exists, in such other mannerof administration as the Administrative Agent determines in consultation with the Borrower).“Lien” means any mortgage, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other),charge, or preference, priority or other security interest or preferential arrangement in the nature of a security interest of any kind ornature whatsoever (including any conditional sale or other title retention agreement, any easement, right of way or other encumbranceon title to real property, and any financing lease having substantially the same economic effect as any of the foregoing).“Loan” means an extension of credit by a Lender to the Borrower under Article II in the form of a Revolving Loan or a TermLoan.-29-“Loan Documents” means this Agreement, each Note, each Issuer Document, any agreement creating or perfecting rights inCash Collateral pursuant to the provisions of Section 2.14 of this Agreement, the Fee Letter, each Request for Credit Extension, anyguaranty of the Obligations by a Guarantor (including the Multiparty Guaranty), each Joinder Agreement, any other joinder agreementexecuted by any Loan Party in favor of the Administrative Agent, any Lender or any Guaranteed Party with respect to any of the otherLoan Documents, and any and all other agreements, documents and instruments executed and/or delivered by or on behalf of or insupport of any Loan Party to Administrative Agent, any Lender or any Guaranteed Party or their respective authorized designeeevidencing or otherwise relating to any of the Credit Extensions hereunder (but specifically excluding any Guaranteed HedgeAgreement or any Guaranteed Cash Management Agreement).“Loan Notice” means a notice of (a) a Borrowing, (b) a conversion of Loans from one Type to the other, or (c) a continuationof Eurocurrency Rate Loans, pursuant to Section 2.02(a), which, if in writing, shall be substantially in the form of Exhibit A or suchother form as may be approved by the Administrative Agent (including any form on an electronic platform or electronic transmissionsystem as shall be approved by the Administrative Agent), appropriately completed and signed by a Responsible Officer of theBorrower.“Loan Parties” means, (a) at all times prior to the Automatic Guaranty Release, collectively, the Borrower and each Guarantorand (b) at all times thereafter, the Borrower.“London Banking Day” means any day on which dealings in Dollar deposits are conducted by and between banks in theLondon interbank eurodollar market.“Material Adverse Effect” means (a) a material adverse change in, or a material adverse effect upon, the operations, business,assets, properties, liabilities (actual or contingent) or condition (financial or otherwise) of the Borrower and its Subsidiaries, taken as awhole; (b) a material impairment of the rights and remedies of the Administrative Agent or any Lender under any Loan Document, orof the ability of any Loan Party to perform its obligations under any Loan Document to which it is a party; or (c) a material adverseeffect upon the legality, validity, binding effect or enforceability against any Loan Party of any Loan Document to which it is a party.“Material Domestic Subsidiary” means, as at any date of determination (determined in accordance with GAAP), any DomesticSubsidiary or group of Domestic Subsidiaries (other than Loan Parties or joint ventures) whose net accounts receivable (afterintercompany eliminations and excluding Real Property Lease Accounts), individually or collectively (as the case may be), equal orexceed 10.0% of all net accounts receivable of Equinix and its Domestic Subsidiaries (after intercompany eliminations and excludingReal Property Lease Accounts) as of the end of the most recently completed fiscal quarter of Equinix.“Material Subsidiary” means, as at any date of determination (determined in accordance with GAAP), any Subsidiary or groupof Subsidiaries of Equinix (other than Loan Parties) (a) whose total assets, individually or collectively (as the case may be), equal orexceed 20.0% of the consolidated total assets (after intercompany eliminations) of Equinix and its Subsidiaries as of the end of the mostrecently completed fiscal quarter of Equinix, or (b) whose revenue, individually or collectively (as the case may-30-be), for the Measurement Period most recently ended equals or exceeds 10.0% of the consolidated revenue (after intercompanyeliminations) of Equinix and its Subsidiaries for such Measurement Period.“Maturity Date” means the Revolving Maturity Date or the Term Maturity Date, as the context requires.“Maximum Incremental Facilities Amount” means the sum of:(a) the Alternative Currency Equivalent of $400,000,000 in Yen, solely for purposes of refinancing the Existing JapaneseYen Loan, plus(b) $1,000,000,000, plus(c) the result of (i) any voluntary prepayments of the Loans (in the case of any prepayment of Revolving Loans, solely to theextent such prepayment is accompanied by a permanent reduction in the Aggregate Revolving Commitments in an amount equal tosuch prepayment) made on or prior to such date (it being understood that any such voluntary prepayment financed with the proceeds ofincurrences of Indebtedness shall not be included in the calculation of the amount under this clause (c)(i)), minus (ii) the aggregateprincipal amount of all increases to the Aggregate Commitments outstanding as of such date and (without duplication) the aggregateprincipal amount of all Loans outstanding as of such date made pursuant to an increase in the Aggregate Commitments. For purposesof the foregoing, increases in the Aggregate Commitments (other than pursuant to clause (a)) shall first be incurred under clause (c) andthen under clause (b).“Measurement Period” means, at any date of determination, the rolling two most recently completed fiscal quarters of Equinix,annualized.“Moody’s” means Moody’s Investors Service, Inc. and any successor thereto.“Multiemployer Plan” means any employee benefit plan of the type described in Section 4001(a)(3) of ERISA, to which theBorrower or any ERISA Affiliate makes or is obligated to make contributions, or during the preceding five plan years, has made orbeen obligated to make contributions.“Multiparty Guaranty” means, collectively, the guaranty made by the Guarantors in favor of the Guaranteed Parties underSection 10.19.“Multiple Employer Plan” means a Plan which has two or more contributing sponsors (including the Borrower or any ERISAAffiliate) at least two of whom are not under common control, as such a plan is described in Section 4064 of ERISA.“Net Cash Proceeds” means (a) with respect to any Asset Sale by the Borrower or any of its Subsidiaries, the excess, if any, of(i) the sum of cash and cash equivalents received in connection with such transaction (including any cash or cash equivalents receivedby way of deferred payment pursuant to, or by monetization of, a note receivable or otherwise, but only as and when so received) over(ii) the sum of (A) the principal amount of any Indebtedness that is secured by the applicable asset and that is required to be repaid inconnection with such transaction (other than Indebtedness under the Loan Documents), (B) the reasonable and customary out-of-pocket expenses incurred by the Borrower or-31-such Subsidiary in connection with such transaction, (C) transfer and similar taxes incurred by the Borrower or such Subsidiary inconnection with such transaction and income taxes reasonably estimated to be actually payable within two years of the date of therelevant transaction as a result of any gain recognized in connection therewith; provided that, if the amount of any estimated taxespursuant to subclause (C) exceeds the amount of taxes actually required to be paid in cash in respect of such Disposition, the aggregateamount of such excess shall constitute Net Cash Proceeds, (D) amounts provided as a reserve, in accordance with GAAP, against anyliabilities under any indemnification obligations or purchase price adjustment associated with such Asset Sale (provided that, to theextent and at the time any such amounts are released from such reserve, such amounts shall constitute Net Cash Proceeds of such AssetSale) and (E) in the case of any Asset Sale by a Subsidiary that is not directly or indirectly wholly-owned (other than directorsqualifying shares) by the Borrower, the pro rata portion of the Net Cash Proceeds thereof (calculated without regard to this subclause(E)) attributable to minority interests and not available for distribution as a result thereof to or for the account of the Borrower or by aRestricted Subsidiary that is directly or indirectly wholly-owned (other than directors qualifying shares) by the Borrower; and (b) withrespect to the incurrence or issuance of any Indebtedness by the Borrower or any of its Restricted Subsidiaries, the excess of (i) thesum of the cash and cash equivalents received in connection with such transaction over (ii) the underwriting discounts andcommissions, original issue discounts, fees and other reasonable and customary out-of-pocket expenses, incurred by the Borrower orsuch Restricted Subsidiary in connection therewith and not netted out of cash and cash equivalents received as described in clause (i).“Non-Defaulting Lender” means, at any time, each Lender that is not a Defaulting Lender at such time.“Non-Extending Lender” has the meaning set forth in Section 2.16(b).“Non-LIBOR Quoted Currency” means any currency other than a LIBOR Quoted Currency.“Note” means a Term Note or a Revolving Note, as the context may require.“Notice Date” has the meaning set forth in Section 2.16(b).“Obligations” means all advances to, and debts, liabilities, obligations, covenants and duties of, any Loan Party arising underany Loan Document or otherwise with respect to any Loan or Letter of Credit, whether direct or indirect (including those acquired byassumption), absolute or contingent, due or to become due, now existing or hereafter arising and including interest and fees that accrueafter the commencement by or against any Loan Party or any Affiliate thereof of any proceeding under any Debtor Relief Lawsnaming such Person as the debtor in such proceeding, regardless of whether such interest and fees are allowed claims in suchproceeding; provided that Obligations of a Loan Party shall exclude any Excluded Swap Obligations with respect to such Loan Party.-32-“OFAC” means the Office of Foreign Assets Control of the United States Department of the Treasury.“Optional Prepayment Notice” has the meaning specified in Section 2.04(a).“Optional Termination/Reduction Notice” has the meaning specified in Section 2.05(a).“Organization Documents” means, (a) with respect to any corporation, the certificate or articles of incorporation and the bylaws(or equivalent or comparable constitutive documents with respect to any non-U.S. jurisdiction); (b) with respect to any limited liabilitycompany, the certificate or articles of formation or organization and operating agreement; and (c) with respect to any partnership, jointventure, trust or other form of business entity, the partnership, joint venture or other applicable agreement of formation or organizationand any agreement, instrument, filing or notice with respect thereto filed in connection with its formation or organization with theapplicable Governmental Authority in the jurisdiction of its formation or organization and, if applicable, any certificate or articles offormation or organization of such entity.“Other Connection Taxes” means, with respect to any Recipient, Taxes imposed as a result of a present or former connectionbetween such Recipient and the jurisdiction imposing such Tax (other than connections arising from such Recipient having executed,delivered, become a party to, performed its obligations under, received payments under, received or perfected a security interest under,engaged in any other transaction pursuant to or enforced any Loan Document, or sold or assigned an interest in any Loan or LoanDocument).“Other Taxes” means all present or future stamp, court, documentary, intangible, recording, filing or similar Taxes that arisefrom any payment made under, from the execution, delivery, performance, enforcement or registration of, from the receipt or perfectionof a security interest under, or otherwise with respect to, any Loan Document, except any such Taxes that are Other Connection Taxesimposed with respect to an assignment (other than an assignment made pursuant to Section 3.06).“Outstanding Amount” means (a) with respect to any Loans on any date, the Dollar Equivalent amount of the aggregateoutstanding principal amount thereof after giving effect to any borrowings and prepayments or repayments of such Loans occurring onsuch date; and (b) with respect to any L/C Obligations on any date, the Dollar Equivalent amount of the aggregate outstanding amountof such L/C Obligations on such date after giving effect to any L/C Credit Extension occurring on such date and any other changes inthe aggregate amount of the L/C Obligations as of such date, including as a result of any reimbursements by the Borrower ofUnreimbursed Amounts.“Overnight Rate” means, for any day, (a) with respect to any amount denominated in Dollars, the greater of (i) the FederalFunds Rate and (ii) an overnight rate determined by the Administrative Agent or the L/C Issuer, as the case may be, in accordance withbanking industry rules on interbank compensation, and (b) with respect to any amount denominated in an Alternative Currency, therate of interest per annum at which overnight deposits in the applicable Alternative Currency, in an amount approximately equal to theamount with respect to which such rate is being determined, would be offered for such day by a branch or Affiliate of Bank ofAmerica in the applicable offshore interbank market for such currency to major banks in such interbank market.-33-“Participant” has the meaning specified in Section 10.06(d).“Participant Register” has the meaning specified in Section 10.06(d).“Participating Member State” means any member state of the European Union that has the Euro as its lawful currency inaccordance with legislation of the European Union relating to Economic and Monetary Union.“PBGC” means the Pension Benefit Guaranty Corporation.“Pension Act” means the Pension Protection Act of 2006.“Pension Funding Rules” means the rules of the Code and ERISA regarding minimum required contributions (including anyinstallment payment thereof) to Pension Plans and set forth in, with respect to plan years ending prior to the effective date of thePension Act, Section 412 of the Code and Section 302 of ERISA, each as in effect prior to the Pension Act and, thereafter, Section412, 430, 431, 432 and 436 of the Code and Sections 302, 303, 304 and 305 of ERISA.“Pension Plan” means any employee pension benefit plan (including a Multiple Employer Plan or a Multiemployer Plan) that ismaintained or is contributed to by the Borrower and any ERISA Affiliate and is either covered by Title IV of ERISA or is subject tothe minimum funding standards under Section 412 of the Code.“Permitted Acquisition” means any Acquisition by Equinix or any of its Subsidiaries, provided that: (a) such Investment is nota Hostile Acquisition; and (b) after giving pro forma effect to the consummation of such Acquisition, (i) the Loan Parties shall be incompliance with each of the financial covenants set forth in Section 7.11, and (ii) no Default or Event of Default shall have occurredand be continuing or would result therefrom.“Person” means any natural person, corporation, limited liability company, trust, joint venture, association, company,partnership, Governmental Authority or other entity.“Plan” means any employee benefit plan within the meaning of Section 3(3) of ERISA (including a Pension Plan), maintainedfor employees of the Borrower or any ERISA Affiliate or any such Plan to which the Borrower or any ERISA Affiliate is required tocontribute on behalf of any of its employees.“Platform” has the meaning specified in Section 6.02.“PTE” means a prohibited transaction class exemption issued by the U.S. Department of Labor, as any such exemption may beamended from time to time.“Public Lender” has the meaning specified in Section 6.02.-34-“Qualified ECP Guarantor” shall mean, in respect of any Swap Obligation, at the time the Multiparty Guaranty or grant of therelevant security interest becomes effective with respect to such Swap Obligation, each Loan Party with total assets exceeding$10,000,000 or that qualifies at such time as an “eligible contract participant” under the Commodity Exchange Act and can causeanother person to qualify as an “eligible contract participant” at such time under §1a(18)(A)(v)(II) of the Commodity Exchange Act.“Rate Determination Date” means, with respect to any Interest Period, two (2) Business Days prior to the commencement ofsuch Interest Period (or such other day as is generally treated as the rate fixing day by market practice in the relevant interbank market,as determined by the Administrative Agent; provided that to the extent such market practice is not administratively feasible for theAdministrative Agent, such other day as otherwise reasonably determined by the Administrative Agent).“Ratings Agency” means each of S&P or Moody’s.“Real Property Lease Accounts” means those accounts receivable of each Loan Party arising from the lease or rental of realproperty by such Loan Party to the extent such accounts receivable comprise collateral for a third party real property lender.“Recipient” means the Administrative Agent, any Lender, the L/C Issuer or any other recipient of any payment to be made byor on account of any obligation of any Loan Party hereunder.“Refinanced Term Loans” has the meaning specified in Section 2.17(a).“Refinancing Amendment” means an amendment to this Agreement pursuant to which any Refinancing Term Loans and/orReplacement Revolving Commitments have been provided for in accordance with Section 2.17, which shall be consistent with theapplicable provisions of this Agreement and otherwise satisfactory to the parties thereto. Each Refinancing Amendment shall beexecuted by the Administrative Agent, the L/C Issuer (to the extent Section 10.01 would require the consent of the L/C Issuer for theamendments effected in such Refinancing Amendment), the Loan Parties and the applicable Credit Agreement Refinancing FacilityLenders. Any Refinancing Amendment may include conditions for delivery of opinions of counsel and other documentation consistentwith the conditions in Sections 4.01 and/or 4.02 to the extent reasonably requested by the Administrative Agent or the applicableCredit Agreement Refinancing Facility Lenders.“Refinancing Term Loans” means one or more new Classes of Term Loans that result from a Refinancing Amendment inaccordance with Section 2.17.“Register” has the meaning specified in Section 10.06(c).“REIT” means a Person that is qualified to be treated for tax purposes as a real estate investment trust under Sections 856-860of the Code.-35-“Related Parties” means, with respect to any Person, such Person’s Affiliates and the partners, directors, officers, employees,agents, trustees, administrators, managers, advisors and representatives of such Person and of such Person’s Affiliates.“Replaced Revolving Commitments” has the meaning specified in Section 2.17(a).“Replacement Revolving Commitments” means one or more new Classes of Revolving Commitments established pursuant to aRefinancing Amendment in accordance with Section 2.17.“Replacement Revolving Lender” means a Revolving Lender with a Replacement Revolving Commitment or an outstandingReplacement Revolving Loan.“Replacement Revolving Loans” means Revolving Loans made pursuant to Replacement Revolving Commitments.“Reportable Event” means any of the events set forth in Section 4043(c) of ERISA, other than events for which the 30 daynotice period has been waived.“Request for Credit Extension” means (a) with respect to a Borrowing, conversion or continuation of Loans, a Loan Noticeand (b) with respect to an L/C Credit Extension, a Letter of Credit Application.“Required Lenders” means, as of any date of determination, at least two Lenders holding more than 50.00% of the sum of theAggregate Commitments under the Revolving Facility and the Outstanding Amount of all Term Loans or, if the commitment of eachLender to make Loans and the obligation of the L/C Issuer to make L/C Credit Extensions have been terminated pursuant to Section8.02, at least two Lenders holding in the aggregate more than 50.00% of the Total Outstandings (with the aggregate amount of eachRevolving Lender’s risk participation and funded participation in L/C Obligations being deemed “held” by such Lender for purposesof this definition). The Total Credit Exposure of any Defaulting Lender shall be disregarded in determining Required Lenders at anytime; provided that the amount of any Unreimbursed Amounts that such Defaulting Lender has failed to fund that have not beenreallocated to and funded by another Lender shall be deemed to be held by the Lender that is the L/C Issuer in making suchdetermination.“Required Revolving Lenders” means, as of any date of determination, at least two Revolving Lenders holding more than50.00% of the sum of the (a) Total Revolving Outstandings (with the aggregate amount of each Revolving Lender’s risk participationand funded participation in L/C Obligations being deemed “held” by such Revolving Lender for purposes of this definition) and(b) aggregate unused Revolving Commitments; provided that the unused Revolving Commitment of, and the portion of the TotalRevolving Outstandings held or deemed held by, any Defaulting Lender shall be excluded for purposes of making a determination ofRequired Revolving Lenders.“Required Term Lenders” means, as of any date of determination, at least two Term Lenders holding more than 50.00% of theOutstanding Amount of the Term Loans; provided that the Term Loans held by any Defaulting Lender shall be excluded for purposesof making a determination of Required Term Lenders.-36-“Responsible Officer” means the chief executive officer, chief financial officer, treasurer or vice president-tax and treasury of aLoan Party, and solely for purposes of the delivery of incumbency certificates pursuant to Section 4.01, the secretary or any assistantsecretary of a Loan Party and, solely for purposes of notices given pursuant to Article II, any other officer of the applicable Loan Partyso designated by any of the foregoing officers in a notice to the Administrative Agent or any other officer or employee of theapplicable Loan Party designated in or pursuant to an agreement between the applicable Loan Party and the Administrative Agent.Any document delivered hereunder that is signed by a Responsible Officer of a Loan Party shall be conclusively presumed to havebeen authorized by all necessary corporate, partnership and/or other action on the part of such Loan Party and such ResponsibleOfficer shall be conclusively presumed to have acted on behalf of such Loan Party.“Restricted Payment” means any dividend or other distribution (whether in cash, securities or other property) with respect toany capital stock or other Equity Interest of the Borrower or any Subsidiary, or any payment (whether in cash, securities or otherproperty), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation ortermination of any such capital stock or other Equity Interest, or on account of any return of capital to the Borrower’s stockholders,partners or members (or the equivalent Person thereof).“Restricted Subsidiary” means any Subsidiary of the Borrower that is not an Unrestricted Subsidiary.“Revaluation Date” means (a) with respect to any Eurocurrency Rate Loan, each of the following: (i) each date of a Borrowingof such Eurocurrency Rate Loan denominated in an Alternative Currency, (ii) each date of a continuation of such Eurocurrency RateLoan denominated in an Alternative Currency pursuant to Section 2.02, and (iii) such additional dates as the Administrative Agentshall determine or the Required Lenders shall reasonably require; and (b) with respect to any Letter of Credit, each of the following: (i)each date of issuance of a Letter of Credit denominated in an Alternative Currency, (ii) each date of an amendment of any such Letterof Credit having the effect of increasing the amount thereof (solely with respect to the increased amount), (iii) each date of anypayment by the L/C Issuer under any Letter of Credit denominated in an Alternative Currency and (iv) such additional dates as theAdministrative Agent or the L/C Issuer shall determine or the Required Lenders shall reasonably require (including, without limitation,any date of determination of the Total Outstandings and the Outstanding Amount of L/C Obligations).“Revolving Borrowing” means a borrowing consisting of simultaneous Revolving Loans of the same Type, in the samecurrency and, in the case of Eurocurrency Rate Revolving Loans, having the same Interest Period made by each of the RevolvingLenders pursuant to Section 2.01.“Revolving Commitment” means, as to each Revolving Lender, its obligation to (a) make Revolving Loans to the Borrowerpursuant to Section 2.01, and (b) purchase participations in L/C Obligations, in an aggregate principal amount at any one timeoutstanding not to exceed the Dollar amount set forth opposite such Lender’s name on Schedule 2.01 or in the Assignment andAssumption pursuant to which such Lender becomes a party hereto, as applicable, as such amount may be adjusted from time to timein accordance with this Agreement.-37-“Revolving Credit Exposure” means, as to any Revolving Lender at any time, the aggregate Outstanding Amount at such timeof its Revolving Loans and the aggregate Outstanding Amount of such Lender’s participation in L/C Obligations at such time.“Revolving Facility” means the credit facility consisting of the Revolving Commitments and outstanding Revolving Loans andL/C Obligations.“Revolving Lender” means, at any time, any Lender that has a Revolving Commitment at such time.“Revolving Loan” has the meaning specified in Section 2.01.“Revolving Maturity Date” means (a) December 12, 2022 and (b) if such maturity date is extended pursuant to Section 2.16,solely as to each Revolving Lender agreeing to extend such maturity date, such extended maturity date as determined pursuant to suchSection; provided, however, that if such date is not a Business Day, the Revolving Maturity Date shall be the immediately precedingBusiness Day.“Revolving Note” means a promissory note made by the Borrower in favor of a Revolving Lender evidencing RevolvingLoans made by such Revolving Lender, substantially in the form of Exhibit B.“Sale-Leaseback Transaction” means, with respect to any Person, the sale of property owned by such Person (the “S-L Seller”)to another Person (the “S-L Buyer”), together with the substantially concurrent leasing of such property by the S-L Buyer to the S-LSeller.“Same Day Funds” means (a) with respect to disbursements and payments in Dollars, immediately available funds, and (b)with respect to disbursements and payments in an Alternative Currency, same day or other funds as may be determined by theAdministrative Agent or the L/C Issuer, as the case may be, to be customary in the place of disbursement or payment for the settlementof international banking transactions in the relevant Alternative Currency.“Sanction(s)” means any sanction or embargo imposed, administered or enforced by the United States Government (includingwithout limitation, OFAC), the European Union or Her Majesty’s Treasury.“SEC” means the Securities and Exchange Commission, or any Governmental Authority succeeding to any of its principalfunctions.“SEK Term Borrowing” means a borrowing consisting of simultaneous SEK Term Loans of the same Type, in SwedishKrona, and having the same Interest Period made by each of the applicable Term Lenders on the Closing Date.-38-“SEK Term Commitment” means, as to each applicable Term Lender, its obligation to make SEK Term Loans to the Borrowerpursuant to Section 2.01, in an aggregate principal amount at any one time outstanding not to exceed the Swedish Krona amount setforth opposite such Lender’s name on Schedule 2.01 or in the Assignment and Assumption pursuant to which such Lender becomes aparty hereto, as applicable, as such amount may be adjusted from time to time in accordance with this Agreement.“SEK Term Loan” means the term loans advanced by the applicable Term Lenders to the Borrower in Swedish Krona on theClosing Date in the aggregate amount of SEK 2,800,000,000.“SEK Term Note” means a promissory note made by the Borrower in favor of a Term Lender evidencing the SEK Term Loanmade by such Term Lender, substantially in the form of Exhibit C-1.“Senior Notes Indentures” means, collectively, the Indentures (together with any Supplemental Indentures thereto) entered intoby Equinix in connection with the Senior Unsecured Notes.“Senior Unsecured Notes” means, collectively, (a) the 5.375% Senior Notes Due 2022, (b) the 5.375% Senior Notes Due2023, (c) the 5.750% Senior Notes Due 2025, (d) the 2.875% Senior Notes Due 2025, (e) the 5.875% Senior Notes Due 2026, (f) the5.375% Senior Notes due 2027, (g) the 2.875% Senior Notes due 2026, (h) any other senior unsecured notes issued by Equinix andnot otherwise prohibited hereunder, and (i) any refinancings or replacements thereof.“Singapore Dollars” or “SGD” means the lawful currency of the Republic of Singapore.“Special Notice Currency” means at any time an Alternative Currency, other than the currency of a country that is a member ofthe Organization for Economic Cooperation and Development at such time located in North America or Europe.“Specified Loan Party” means any Loan Party that is not an “eligible contract participant” under the Commodity Exchange Act(determined prior to giving effect to Section 10.19(k)).“Spot Rate” for a currency means the rate determined by the Administrative Agent or the L/C Issuer, as applicable, to be therate quoted by the Person acting in such capacity as the spot rate for the purchase by such Person of such currency with anothercurrency through its principal foreign exchange trading office at approximately 11:00 a.m. on the date two Business Days prior to thedate as of which the foreign exchange computation is made; provided that the Administrative Agent or the L/C Issuer may obtain suchspot rate from another financial institution designated by the Administrative Agent or the L/C Issuer if the Person acting in suchcapacity does not have as of the date of determination a spot buying rate for any such currency; and provided further that the L/CIssuer may use such spot rate quoted on the date as of which the foreign exchange computation is made in the case of any Letter ofCredit denominated in an Alternative Currency.-39-“S&P” means S&P Global Ratings, a division of S&P Global, Inc. and any successor thereto.“Sterling”, “GBP” and “£” mean the lawful currency of the United Kingdom.“Sterling Term Borrowing” means a borrowing consisting of simultaneous Sterling Term Loans of the same Type, in Sterling,and having the same Interest Period made by each of the applicable Term Lenders on the Closing Date.“Sterling Term Commitment” means, as to each applicable Term Lender, its obligation to make Sterling Term Loans to theBorrower pursuant to Section 2.01, in an aggregate principal amount at any one time outstanding not to exceed the Sterling amount setforth opposite such Lender’s name on Schedule 2.01 or in the Assignment and Assumption pursuant to which such Lender becomes aparty hereto, as applicable, as such amount may be adjusted from time to time in accordance with this Agreement.“Sterling Term Loan” means the term loans advanced by the applicable Term Lenders to the Borrower in Sterling on theClosing Date in the aggregate amount of £500,000,000.“Sterling Term Note” means a promissory note made by the Borrower in favor of a Term Lender evidencing the Sterling TermLoan made by such Term Lender, substantially in the form of Exhibit C-2.“Subsidiary” of a Person means a corporation, partnership, joint venture, limited liability company or other business entity ofwhich a majority of the shares of securities or other interests having ordinary voting power for the election of directors or othergoverning body (other than securities or interests having such power only by reason of the happening of a contingency) are at the timebeneficially owned, or the management of which is otherwise controlled, directly, or indirectly through one or more intermediaries, orboth, by such Person. Unless otherwise specified, all references herein to a “Subsidiary” or to “Subsidiaries” shall refer to a Subsidiaryor Subsidiaries of Equinix.“Swap Contract” means (a) any and all rate swap transactions, basis swaps, credit derivative transactions, forward ratetransactions, commodity swaps, commodity options, forward commodity contracts, equity or equity index swaps or options, bond orbond price or bond index swaps or options or forward bond or forward bond price or forward bond index transactions, interest rateoptions, forward foreign exchange transactions, cap transactions, floor transactions, collar transactions, currency swap transactions,cross-currency rate swap transactions, currency options, spot contracts, or any other similar transactions or any combination of any ofthe foregoing (including any options to enter into any of the foregoing), whether or not any such transaction is governed by or subjectto any master agreement, and (b) any and all transactions of any kind, and the related confirmations, which are subject to the terms andconditions of, or governed by, any form of master agreement published by the International Swaps and Derivatives Association, Inc.,any International Foreign Exchange Master Agreement, or any other master agreement (any such master agreement, together with anyrelated schedules, a “Master Agreement”), including any such obligations or liabilities under any Master Agreement.-40-“Swap Obligations” means with respect to any Guarantor any obligation to pay or perform under any agreement, contract ortransaction that constitutes a “swap” within the meaning of Section 1a(47) of the Commodity Exchange Act.“Swap Termination Value” means, in respect of any one or more Swap Contracts, after taking into account the effect of anylegally enforceable netting agreement relating to such Swap Contracts, (a) for any date on or after the date such Swap Contracts havebeen closed out and termination value(s) determined in accordance therewith, such termination value(s), and (b) for any date prior tothe date referenced in clause (a), the amount(s) determined as the mark-to-market value(s) for such Swap Contracts, as determinedbased upon one or more mid-market or other readily available quotations provided by any recognized dealer in such Swap Contracts(which may include a Lender or any Affiliate of a Lender).“Swedish Krona” or “SEK” means the lawful currency of the Kingdom of Sweden.“Swiss Francs” or “CHF” means the lawful currency of the Swiss Confederation.“Synthetic Lease Obligation” means the monetary obligation of a Person under (a) a so-called synthetic, off-balance sheet ortax retention lease, or (b) an agreement for the use or possession of property creating obligations that do not appear on the balancesheet of such Person but which, upon the insolvency or bankruptcy of such Person, would be characterized as the indebtedness of suchPerson (without regard to accounting treatment).“TARGET2” means the Trans-European Automated Real-time Gross Settlement Express Transfer payment system, whichutilizes a single shared platform and which was launched on November 19, 2007.“TARGET Day” means any day on which TARGET2 (or, if such payment system ceases to be operative, such other paymentsystem, if any, determined by the Administrative Agent to be a suitable replacement) is open for the settlement of payments in Euro.“Taxes” means all present or future taxes, levies, imposts, duties, deductions, withholdings (including backup withholding),and other similar assessments, fees or other charges imposed by any Governmental Authority, including any interest, additions to tax orpenalties applicable thereto.“Term Borrowing” means a SEK Term Borrowing or a Sterling Term Borrowing, as applicable.“Term Commitments” means the SEK Term Commitments and the Sterling Term Commitments.“Term Facility” means, at any time, the aggregate principal amount of the Term Loans of all Term Lenders outstanding at suchtime.“Term Lender” means any Lender that holds Term Loans.“Term Loan” means a SEK Term Loan or a Sterling Term Loan, as applicable.-41-“Term Maturity Date” means (a) December 12, 2022 and (b) if such maturity date is extended pursuant to Section 2.16, solelyas to each Term Lender agreeing to extend such maturity date, such extended maturity date as determined pursuant to such Section;provided, however, that if such date is not a Business Day, the Term Maturity Date shall be the immediately preceding Business Day.“Term Note” means a SEK Term Note or a Sterling Term Note, as applicable.“Total Credit Exposure” means, as to any Lender at any time, the sum of the unused Commitments, the outstanding TermLoans and Revolving Credit Exposure of such Lender at such time.“Total Outstandings” means the aggregate Outstanding Amount of all Loans and all L/C Obligations.“Total Revolving Outstandings” means the aggregate Outstanding Amount of all Revolving Loans and L/C Obligations.“Transfer” has the meaning specified in Section 7.05.“Type” means with respect to a Loan, its character as a Base Rate Loan or a Eurocurrency Rate Loan.“United States” and “U.S.” mean the United States of America.“Unreimbursed Amount” has the meaning specified in Section 2.03(c)(i).“Unrestricted Subsidiary” means any Subsidiary of the Borrower designated as such on Schedule 6.14 hereto as of the ClosingDate, or after the Closing Date pursuant to Section 6.14.“U.S. Person” means any Person that is a “United States Person” as defined in Section 7701(a)(30) of the Code.“U.S. Tax Compliance Certificate” has the meaning specified in Section 3.01(e)(ii)(B)(III).“Weighted Average Life to Maturity” means, on any date and with respect to the aggregate amount of the applicable TermLoans, an amount equal to (a) the scheduled repayments of such Term Loans to be made after such date, multiplied by the number ofdays from such date to the respective dates of such scheduled repayments divided by (b) the aggregate principal amount of such TermLoans.“wholly-owned” means, with respect to a Subsidiary of a Person, a Subsidiary of such Person all of the outstanding EquityInterests of which (other than (a) director’s qualifying shares and (b) shares issued to foreign nationals to the extent required byapplicable Law) are owned by such Person and/or by one or more wholly-owned Subsidiaries of such Person.“Withholding Agent” means any Loan Party and the Administrative Agent.-42-“Write-Down and Conversion Powers” means, with respect to any EEA Resolution Authority, the write-down and conversionpowers of such EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member Country,which write-down and conversion powers are described in the EU Bail-In Legislation Schedule.“Yen” and “¥” mean the lawful currency of Japan.1.02. Other Interpretive Provisions. With reference to this Agreement and each other Loan Document, unless otherwisespecified herein or in such other Loan Document:(a) The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined. Whenever thecontext may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The words “include,”“includes” and “including” shall be deemed to be followed by the phrase “without limitation.” The word “will” shall be construed tohave the same meaning and effect as the word “shall.” Unless the context requires otherwise, (i) any definition of or reference to anyagreement, instrument or other document (including any Organization Document) shall be construed as referring to such agreement,instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on suchamendments, supplements or modifications set forth herein or in any other Loan Document), (ii) any reference herein to any Personshall be construed to include such Person’s successors and assigns, (iii) the words “hereto,” “herein,” “hereof” and “hereunder,” andwords of similar import when used in any Loan Document, shall be construed to refer to such Loan Document in its entirety and not toany particular provision thereof, (iv) all references in a Loan Document to Articles, Sections, Exhibits and Schedules shall be construedto refer to Articles and Sections of, and Exhibits and Schedules to, the Loan Document in which such references appear, (v) anyreference to any law shall include all statutory and regulatory provisions consolidating, amending, replacing or interpreting such lawand any reference to any law or regulation shall, unless otherwise specified, refer to such law or regulation as amended, modified orsupplemented from time to time, and (vi) the words “asset” and “property” shall be construed to have the same meaning and effect andto refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights.(b) In the computation of periods of time from a specified date to a later specified date, the word “from” means “from andincluding;” the words “to” and “until” each mean “to but excluding;” and the word “through” means “to and including.”Section headings herein and in the other Loan Documents are included for convenience of reference only and shall not affect theinterpretation of this Agreement or any other Loan Document.1.03. Accounting Terms.(a) Generally. All accounting terms not specifically or completely defined herein shall be construed in conformity with, and allfinancial data (including financial statements, financial ratios and other financial calculations) required to be submitted pursuant to thisAgreement shall be prepared in conformity with, GAAP applied on a consistent basis, as in effect from time to time, applied in amanner consistent with that used in preparing the Audited Financial Statements, except as otherwise specifically prescribed herein.Notwithstanding the foregoing, for purposes of determining compliance with any-43-covenant (including the computation of any financial covenant) contained herein, Indebtedness of the Borrower and its Subsidiariesshall be deemed to be carried at 100% of the outstanding principal amount thereof, and the effects of FASB ASC 825 on financialliabilities shall be disregarded.(b) Changes in GAAP. If at any time any change in GAAP would affect the computation of any financial ratio or requirementset forth in any Loan Document, and either the Borrower or the Required Lenders shall so request, the Administrative Agent, theLenders and the Borrower shall negotiate in good faith to amend such ratio or requirement to preserve the original intent thereof in lightof such change in GAAP (subject to the approval of the Required Lenders); provided that, until so amended, (i) such ratio orrequirement shall continue to be computed in accordance with GAAP prior to such change therein and (ii) the Borrower shall provideto the Administrative Agent and the Lenders financial statements and other documents required under this Agreement or as reasonablyrequested hereunder setting forth a reconciliation between calculations of such ratio or requirement made before and after giving effectto such change in GAAP.1.04. Rounding. Any financial ratios required to be maintained by the Borrower, their Subsidiaries or any Loan Partypursuant to this Agreement shall be calculated by dividing the appropriate component by the other component, carrying the result toone place more than the number of places by which such ratio is expressed herein and rounding the result up or down to the nearestnumber (with a rounding-up if there is no nearest number).1.05. Exchange Rates; Currency Equivalents. (1) The Administrative Agent or the L/C Issuer, as applicable, shalldetermine the Spot Rates as of each Revaluation Date to be used for calculating Dollar Equivalent amounts of Credit Extensions andL/C Obligations denominated in Alternative Currencies. Such Spot Rates shall become effective as of such Revaluation Date and shallbe the Spot Rates employed in converting any amounts between the applicable currencies until the next Revaluation Date to occur.Except for purposes of financial statements delivered by Loan Parties hereunder or calculating financial covenants hereunder or exceptas otherwise provided herein, the applicable amount of any currency (other than Dollars) for purposes of the Loan Documents shall besuch Dollar Equivalent amount as so determined by the Administrative Agent or the L/C Issuer, as applicable.(a) Wherever in this Agreement in connection with a Borrowing, conversion, continuation or prepayment of a EurocurrencyRate Loan or the issuance, amendment or extension of a Letter of Credit, an amount, such as a Commitment or a required minimum ormultiple amount, is expressed in Dollars, but such Borrowing, Eurocurrency Rate Loan or Letter of Credit is denominated in anAlternative Currency, such amount shall be the relevant Alternative Currency Equivalent of such Dollar amount (rounded to thenearest unit of such Alternative Currency, with 0.5 of a unit being rounded upward), as determined by the Administrative Agent or theL/C Issuer, as the case may be.(b) The Administrative Agent does not warrant, nor accept responsibility, nor shall the Administrative Agent have any liabilitywith respect to the administration, submission or any other matter related to the rates in the definition of “Eurocurrency Rate” or withrespect to any comparable or successor rate thereto.-44-1.06. Additional Alternative Currencies.(a) The Borrower may from time to time request that Eurocurrency Rate Revolving Loans be made and/or Letters of Credit beissued in a currency other than those specifically listed in the definition of “Alternative Currency;” provided that such requestedcurrency is a lawful currency (other than Dollars) that is readily available and freely transferable and convertible into Dollars. In thecase of any such request with respect to the making of Eurocurrency Rate Revolving Loans, such request shall be subject to theapproval of the Administrative Agent and the Revolving Lenders; and in the case of any such request with respect to the issuance ofLetters of Credit, such request shall be subject to the approval of the Administrative Agent and the L/C Issuer.(b) Any such request shall be made to the Administrative Agent not later than 11:00 a.m., 10 Business Days prior to the dateof the desired Credit Extension (or such other time or date as may be agreed by the Administrative Agent and, in the case of any suchrequest pertaining to Letters of Credit, the L/C Issuer, in its or their sole discretion). In the case of any such request pertaining toEurocurrency Rate Revolving Loans, the Administrative Agent shall promptly notify each Revolving Lender thereof; and in the caseof any such request pertaining to Letters of Credit, the Administrative Agent shall promptly notify the L/C Issuer thereof. EachRevolving Lender (in the case of any such request pertaining to Eurocurrency Rate Revolving Loans) or the L/C Issuer (in the case ofa request pertaining to Letters of Credit) shall notify the Administrative Agent, not later than 11:00 a.m., five Business Days afterreceipt of such request whether it consents, in its sole discretion, to the making of Eurocurrency Rate Revolving Loans or the issuanceof Letters of Credit, as the case may be, in such requested currency.(c) Any failure by a Revolving Lender or the L/C Issuer, as the case may be, to respond to such request within the time periodspecified in the preceding sentence shall be deemed to be a refusal by such Lender or the L/C Issuer, as the case may be, to permitEurocurrency Rate Revolving Loans to be made or Letters of Credit to be issued in such requested currency. If the AdministrativeAgent and all the Revolving Lenders consent to making Eurocurrency Rate Revolving Loans in such requested currency, theAdministrative Agent shall so notify the Borrower and such currency shall thereupon be deemed for all purposes to be an AlternativeCurrency hereunder for purposes of any Borrowings of Eurocurrency Rate Revolving Loans; and if the Administrative Agent and theL/C Issuer consent to the issuance of Letters of Credit in such requested currency, the Administrative Agent shall so notify theBorrower and such currency shall thereupon be deemed for all purposes to be an Alternative Currency hereunder for purposes of anyLetter of Credit issuances. If the Administrative Agent shall fail to obtain consent to any request for an additional currency under thisSection 1.06, the Administrative Agent shall promptly so notify the Borrower.1.07. Change of Currency.(a) Each obligation of the Borrower to make a payment denominated in the national currency unit of any member state of theEuropean Union that adopts the Euro as its lawful currency after the date hereof shall be redenominated into Euro at the time of suchadoption (in accordance with the EMU Legislation). If, in relation to the currency of any such member state, the basis of accrual ofinterest expressed in this Agreement in respect of that currency shall be inconsistent with any convention or practice in the Londoninterbank market for the basis of accrual of interest in respect of the Euro, such-45-expressed basis shall be replaced by such convention or practice with effect from the date on which such member state adopts the Euroas its lawful currency; provided that if any Borrowing in the currency of such member state is outstanding immediately prior to suchdate, such replacement shall take effect, with respect to such Borrowing, at the end of the then current Interest Period.(b) Each provision of this Agreement shall be subject to such reasonable changes of construction as the Administrative Agentmay from time to time specify to be appropriate to reflect the adoption of the Euro by any member state of the European Union andany relevant market conventions or practices relating to the Euro.(c) Each provision of this Agreement also shall be subject to such reasonable changes of construction as the AdministrativeAgent may from time to time specify to be appropriate to reflect a change in currency of any other country and any relevant marketconventions or practices relating to the change in currency.1.08. Times of Day. Unless otherwise specified, all references herein to times of day shall be references to Pacific time(daylight or standard, as applicable).1.09. Letter of Credit Amounts. Unless otherwise specified herein, the amount of a Letter of Credit at any time shall bedeemed to be the Dollar Equivalent of the stated amount of such Letter of Credit in effect at such time; provided, however, that withrespect to any Letter of Credit that, by its terms or the terms of any Issuer Document related thereto, provides for one or more automaticincreases in the stated amount thereof, the amount of such Letter of Credit shall be deemed to be the Dollar Equivalent of the maximumstated amount of such Letter of Credit after giving effect to all such increases, whether or not such maximum stated amount is in effectat such time.ARTICLE II.THE COMMITMENTS AND CREDIT EXTENSIONS2.01. Loans.(a) The Term Loans.(i) Subject to the terms and conditions set forth herein, each Term Lender with a SEK Term Commitment severallyagrees to make a SEK Term Loan to the Borrower, in Swedish Krona, on the Closing Date, in an amount not to exceed suchTerm Lender’s Applicable Percentage of the aggregate amount of the SEK Term Commitments at such time. The SEK TermBorrowing shall consist of SEK Term Loans made simultaneously by the applicable Term Lenders in accordance with theirrespective Applicable Percentages of the aggregate amount of the SEK Term Commitments at such time. Amounts borrowedunder this Section 2.01(a)(i) and repaid or prepaid may not be reborrowed. All SEK Term Loans shall be Eurocurrency RateLoans, as further provided herein.-46-(ii) Subject to the terms and conditions set forth herein, each Term Lender with a Sterling Term Commitment severallyagrees to make a Sterling Term Loan to the Borrower, in Sterling, on the Closing Date, in an amount not to exceed such TermLender’s Applicable Percentage of the aggregate amount of the Sterling Term Commitments at such time. The Sterling TermBorrowing shall consist of Sterling Term Loans made simultaneously by the applicable Term Lenders in accordance with theirrespective Applicable Percentages of the aggregate amount of the Sterling Term Commitments at such time. Amountsborrowed under this Section 2.01(a)(ii) and repaid or prepaid may not be reborrowed. All Sterling Term Loans shall beEurocurrency Rate Loans, as further provided herein.(b) The Revolving Borrowings. Subject to the terms and conditions set forth herein, each Revolving Lender severally agreesto make revolving loans (each such loan, a “Revolving Loan”) to the Borrower in Dollars or in one or more Alternative Currenciesfrom time to time, on any Business Day during the Availability Period, in an aggregate amount not to exceed at any time outstandingthe amount of such Lender’s Revolving Commitment; provided, however, that after giving effect to any Revolving Borrowing, (i) theTotal Revolving Outstandings shall not exceed the Aggregate Revolving Commitments, and (ii) the Outstanding Amount of theRevolving Loans of any Lender, plus such Lender’s Applicable Percentage of the Outstanding Amount of all L/C Obligations shallnot exceed such Lender’s Commitment. Within the limits of each Revolving Lender’s Revolving Commitment, and subject to the otherterms and conditions hereof, the Borrower may borrow under this Section 2.01(b), prepay under Section 2.04, and reborrow under thisSection 2.01(b). Revolving Loans may be Base Rate Loans or Eurocurrency Rate Loans, as further provided herein.2.02. Borrowings, Conversions and Continuations of Loans.(a) Each Borrowing, each conversion of Loans from one Type to the other, and each continuation of Eurocurrency RateLoans shall be made upon the Borrower’s irrevocable notice to the Administrative Agent, which may be given by (A) telephone or (B)a Loan Notice; provided that any telephonic notice must be confirmed immediately by delivery to the Administrative Agent of a LoanNotice. Each such notice must be received by the Administrative Agent not later than 11:00 a.m. (or in the case of clause (iii) below,not later than 10:00 a.m.): (i) three Business Days prior to the requested date of any Borrowing of, conversion to or continuation ofEurocurrency Rate Loans denominated in Dollars or of any conversion of Eurocurrency Rate Loans denominated in Dollars to BaseRate Loans, (ii) four Business Days (or five Business Days in the case of a Special Notice Currency) prior to the requested date of anyBorrowing or continuation of Eurocurrency Rate Loans denominated in Alternative Currencies, (iii) on the requested date of anyBorrowing of Base Rate Loans; provided, however, that if the Borrower wishes to request Eurocurrency Rate Loans having an InterestPeriod other than one, two, three or six months in duration as provided in the definition of “Interest Period,” the applicable notice mustbe received by the Administrative Agent not later than 11:00 a.m. (x) four Business Days prior to the requested date of suchBorrowing, conversion or continuation of Eurocurrency Rate Loans denominated in Dollars, or (y) five Business Days (or sixBusiness days in the case of a Special Notice Currency) prior to the requested date of such Borrowing, conversion or continuation ofEurocurrency Rate Loans denominated in Alternative Currencies, whereupon the Administrative Agent shall give prompt notice to theAppropriate Lenders of such request and determine whether the requested Interest Period is acceptable to all of them. In the case of arequest for an Interest-47-Period other than one, two, three or six months in duration, not later than 11:00 a.m. (A) three Business Days before the requested dateof such Borrowing, conversion or continuation of Eurocurrency Rate Loans denominated in Dollars, or (B) four Business Days (orfive Business days in the case of a Special Notice Currency) prior to the requested date of such Borrowing, conversion or continuationof Eurocurrency Rate Loans denominated in Alternative Currencies, the Administrative Agent shall notify the Borrower (which noticemay be by telephone) whether or not the requested Interest Period has been consented to by all the Appropriate Lenders (and, if any ofthe Lenders objects to the requested duration of such Interest Period, the duration of the Interest Period for such Borrowing shall beone, two, three or six months, as specified by the Borrower in the applicable Loan Notice as the desired alternative to the requestedduration of such Interest Period (or one month, if no desired alternative is specified by the Borrower in the applicable Loan Notice)).Each Borrowing of, conversion to or continuation of Eurocurrency Rate Loans shall be in a principal amount of $5,000,000 or a wholemultiple of $1,000,000 in excess thereof. Except as provided in Section 2.03(c), each Borrowing of or conversion to Base Rate Loansshall be in a principal amount of $500,000 or a whole multiple of $100,000 in excess thereof. Each Loan Notice (whether telephonicor written) shall specify (1) the applicable Facility, (2) whether the Borrower is requesting a Borrowing, a conversion of Loans fromone Type to the other, or a continuation of Eurocurrency Rate Loans, (3) the requested date of the Borrowing, conversion orcontinuation, as the case may be (which shall be a Business Day), (4) the principal amount of Loans to be borrowed, converted orcontinued, (5) the Type of Loans to be borrowed or to which existing Loans are to be converted, (6) if applicable, the duration of theInterest Period with respect thereto and (7) the currency of such Loans to be borrowed. If the Borrower fails to specify a currency in aLoan Notice requesting a Borrowing, then the Loans so requested shall be made in Dollars. If the Borrower fails to specify a Type ofLoan in a Loan Notice, then the applicable Loans shall be made as Base Rate Loans in Dollars. If the Borrower fails to give a timelyLoan Notice requesting a continuation or conversion of Eurocurrency Rate Loans, such Eurocurrency Rate Loans shall beautomatically continued for an Interest Period of one month. If the Borrower requests a Borrowing of, conversion to, or continuation ofEurocurrency Rate Loans in any such Loan Notice, but fails to specify an Interest Period, it will be deemed to have specified anInterest Period of one month. No Loan may be converted into or continued as a Loan denominated in a different currency, but insteadmust be prepaid or repaid in the original currency of such Loan, and, in the case of Revolving Loans only, may thereafter bereborrowed in the other currency.(b) Following receipt of a Loan Notice for a Facility, the Administrative Agent shall promptly notify each Appropriate Lenderof the amount (and currency) of its Applicable Percentage of the applicable Term Loan or Revolving Loans, and if no timely LoanNotice of a continuation of Eurocurrency Rate Loans is provided by the Borrower, the Administrative Agent shall notify eachAppropriate Lender of the details of any automatic continuation of such Eurocurrency Rate Loans, in each case as described in thepreceding subsection. In the case of a Borrowing, each Appropriate Lender shall make the amount of its applicable Loan available tothe Administrative Agent in Same Day Funds at the Administrative Agent’s Office for the applicable currency not later than 1:00 p.m.,in the case of any Loan denominated in Dollars, and not later than the Applicable Time specified by the Administrative Agent in thecase of any Loan denominated in an Alternative Currency, in each case on the Business Day specified in the applicable Loan Notice.Upon satisfaction of the applicable conditions set forth in Section 4.02 (and, if such Borrowing is the initial Credit Extension, Section4.01), the Administrative Agent shall make all funds so received available to the Borrower in like funds as received by the-48-Administrative Agent either by (i) crediting the account of the Borrower on the books of Bank of America with the amount of suchfunds or (ii) wire transfer of such funds, in each case in accordance with instructions provided to (and reasonably acceptable to) theAdministrative Agent by the Borrower; provided, however, that if, on the date a Loan Notice with respect to a Revolving Borrowingdenominated in Dollars is given by the Borrower, there are L/C Borrowings outstanding, then the proceeds of such Borrowing, first,shall be applied to the payment in full of any such L/C Borrowings, and second, shall be made available to the Borrower as providedabove.(c) Except as otherwise provided herein, a Eurocurrency Rate Loan may be continued or converted only on the last day of anInterest Period for such Eurocurrency Rate Loan. During the existence of a Default, no Loans may be requested as, or (i) in the case ofLoans in Dollars, converted to or continued as Eurocurrency Rate Loans without the consent of the Required Lenders or (ii) in the caseof Loans in Alternative Currencies, converted or continued as Eurocurrency Rate Loans with an Interest Period of more than onemonth if the Required Lenders so notify the Borrower. During the existence of a Default, any Loans that are continued or converted toEurocurrency Rate Loans as provided in this clause (c), unless the Required Lenders shall otherwise consent, shall have a one monthInterest Period.(d) The Administrative Agent shall promptly notify the Borrower and the Appropriate Lenders of the interest rate applicableto any Interest Period for Eurocurrency Rate Loans upon determination of such interest rate. At any time that Base Rate Loans areoutstanding, the Administrative Agent shall notify the Borrower and the Appropriate Lenders of any change in Bank of America’sprime rate used in determining the Base Rate promptly following the public announcement of such change.(e) After giving effect to all Term Borrowings, all conversions of Term Loans from one Type to the other, and allcontinuations of Term Loans as the same Type, there shall not be more than ten Interest Periods in effect in respect of the TermFacility. After giving effect to all Revolving Borrowings, all conversions of Revolving Loans from one Type to the other, and allcontinuations of Revolving Loans as the same Type, there shall not be more than ten Interest Periods in effect in respect of theRevolving Facility.2.03. Letters of Credit.(a) The Letter of Credit Commitment.(i) Subject to the terms and conditions set forth herein, (A) the L/C Issuer agrees, in reliance upon the agreements ofthe Revolving Lenders set forth in this Section 2.03, (1) from time to time on any Business Day during the period from theClosing Date until the Letter of Credit Expiration Date, to issue Letters of Credit denominated in Dollars or in one or moreAlternative Currencies for the account of the Borrower or its Subsidiaries, and to amend or extend Letters of Credit previouslyissued by it, in accordance with Section 2.03(b) below, and (2) to honor drawings under the Letters of Credit; and (B) theRevolving Lenders severally agree to participate in Letters of Credit issued for the account of the Borrower or its Subsidiariesand any drawings thereunder; provided that after giving effect to any L/C Credit Extension with respect to any Letter of Credit,(w) the Total Revolving Outstandings shall not exceed the Aggregate Revolving Commitments, (x) the Outstanding Amount ofthe Revolving Loans of-49-any Revolving Lender, plus such Revolving Lender’s Applicable Percentage of the Outstanding Amount of all L/CObligations, shall not exceed such Revolving Lender’s Revolving Commitment, and (y) the Outstanding Amount of the L/CObligations shall not exceed the Letter of Credit Sublimit. Each request by the Borrower for the issuance or amendment of aLetter of Credit shall be deemed to be a representation by the Borrower that the L/C Credit Extension so requested complieswith the conditions set forth in the proviso to the preceding sentence. Notwithstanding the foregoing or anything to the contrarycontained herein, no L/C Issuer shall be obligated to issue, amend or extend any Letter of Credit if, immediately after givingeffect thereto, the outstanding L/C Obligations in respect of all Letters of Credit issued by such L/C Issuer would exceed suchPerson’s L/C Issuer Sublimit. Within the foregoing limits, and subject to the terms and conditions hereof, the Borrower’s abilityto obtain Letters of Credit shall be fully revolving, and accordingly the Borrower may, during the foregoing period, obtainLetters of Credit to replace Letters of Credit that have expired or that have been drawn upon and reimbursed. All ExistingLetters of Credit shall be deemed to have been issued pursuant hereto, and from and after the Closing Date shall be subject toand governed by the terms and conditions hereof.(ii) The L/C Issuer shall not issue any Letter of Credit, if:(A) subject to Section 2.03(b)(iii), the expiry date of the requested Letter of Credit would occur more thantwelve months after the date of issuance or last extension, unless the Required Revolving Lenders have approved suchexpiry date; or(B) the expiry date of the requested Letter of Credit would occur after the Letter of Credit Expiration Date,unless all the Revolving Lenders have approved such expiry date.(iii) The L/C Issuer shall not be under any obligation to issue any Letter of Credit if:(A) any order, judgment or decree of any Governmental Authority or arbitrator shall by its terms purport toenjoin or restrain the L/C Issuer from issuing the Letter of Credit, or any Law applicable to the L/C Issuer or anyrequest or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction overthe L/C Issuer shall prohibit, or request that the L/C Issuer refrain from, the issuance of letters of credit generally or theLetter of Credit in particular or shall impose upon the L/C Issuer with respect to the Letter of Credit any restriction,reserve or capital requirement (for which the L/C Issuer is not otherwise compensated hereunder) not in effect on theClosing Date, or shall impose upon the L/C Issuer any unreimbursed loss, cost or expense which was not applicable onthe Closing Date and which the L/C Issuer in good faith deems material to it;-50-(B) the issuance of the Letter of Credit would violate one or more policies of the L/C Issuer applicable toletters of credit generally;(C) except as otherwise agreed by the Administrative Agent and the L/C Issuer, the Letter of Credit is in aninitial stated amount less than $25,000, in the case of a standby Letter of Credit;(D) except as otherwise agreed by the Administrative Agent and the L/C Issuer, the Letter of Credit is to bedenominated in a currency other than Dollars or an Alternative Currency;(E) any Revolving Lender is at that time a Defaulting Lender, unless the L/C Issuer has entered intoarrangements, including the delivery of Cash Collateral, satisfactory to the L/C Issuer (in its sole discretion) with theBorrower or such Lender to eliminate the L/C Issuer’s actual or potential Fronting Exposure (after giving effect toSection 2.15(a)(iv)) with respect to the Defaulting Lender arising from either the Letter of Credit then proposed to beissued or that Letter of Credit and all other L/C Obligations as to which the L/C Issuer has actual or potential FrontingExposure, as it may elect in its sole discretion; or(F) the Letter of Credit contains any provisions for automatic reinstatement of the stated amount after anydrawing thereunder.(iv) The L/C Issuer shall not amend any Letter of Credit if the L/C Issuer would not be permitted at such time to issuethe Letter of Credit in its amended form under the terms hereof.(v) The L/C Issuer shall be under no obligation to amend any Letter of Credit if (A) the L/C Issuer would have noobligation at such time to issue the Letter of Credit in its amended form under the terms hereof, or (B) the beneficiary of theLetter of Credit does not accept the proposed amendment to the Letter of Credit.(vi) The L/C Issuer shall act on behalf of the Revolving Lenders with respect to any Letters of Credit issued by it andthe documents associated therewith, and the L/C Issuer shall have all of the benefits and immunities (A) provided to theAdministrative Agent in Article IX with respect to any acts taken or omissions suffered by the L/C Issuer in connection withLetters of Credit issued by it or proposed to be issued by it and Issuer Documents pertaining to such Letters of Credit as fully asif the term “Administrative Agent” as used in Article IX included the L/C Issuer with respect to such acts or omissions, and (B)as additionally provided herein with respect to the L/C Issuer.-51-(b) Procedures for Issuance and Amendment of Letters of Credit; Auto-Extension Letters of Credit.(i) Each Letter of Credit shall be issued or amended, as the case may be, upon the request of the Borrower delivered tothe L/C Issuer (with a copy to the Administrative Agent) in the form of a Letter of Credit Application, appropriately completedand signed by a Responsible Officer of the Borrower. Such Letter of Credit Application may be sent by facsimile, by UnitedStates mail, by overnight courier, by electronic transmission using the system provided by the L/C Issuer, by personal deliveryor by any other means acceptable to the L/C Issuer. Such Letter of Credit Application must be received by the L/C Issuer andthe Administrative Agent not later than 11:00 a.m. at least two Business Days (or such later date and time as the AdministrativeAgent and the L/C Issuer may agree in a particular instance in their sole discretion) prior to the proposed issuance date or dateof amendment, as the case may be. In the case of a request for an initial issuance of a Letter of Credit, such Letter of CreditApplication shall specify in form and detail satisfactory to the L/C Issuer: (A) the proposed issuance date of the requested Letterof Credit (which shall be a Business Day); (B) the amount and currency thereof; (C) the expiry date thereof; (D) the name andaddress of the beneficiary thereof; (E) the documents to be presented by such beneficiary in case of any drawing thereunder;(F) the full text of any certificate to be presented by such beneficiary in case of any drawing thereunder; (G) the purpose andnature of the requested Letter of Credit; and (H) such other matters as the L/C Issuer may require. In the case of a request for anamendment of any outstanding Letter of Credit, such Letter of Credit Application shall specify in form and detail satisfactory tothe L/C Issuer (A) the Letter of Credit to be amended; (B) the proposed date of amendment thereof (which shall be a BusinessDay); (C) the nature of the proposed amendment; and (D) such other matters as the L/C Issuer may require. Additionally, theBorrower shall furnish to the L/C Issuer and the Administrative Agent such other documents and information pertaining to suchrequested Letter of Credit issuance or amendment, including any Issuer Documents, as the L/C Issuer or the AdministrativeAgent may require.(ii) Promptly after receipt of any Letter of Credit Application, the L/C Issuer will confirm with the AdministrativeAgent (by telephone or in writing) that the Administrative Agent has received a copy of such Letter of Credit Application fromthe Borrower and, if not, the L/C Issuer will provide the Administrative Agent with a copy thereof. Unless the L/C Issuer hasreceived written notice from any Revolving Lender, the Administrative Agent or any Loan Party, at least one Business Dayprior to the requested date of issuance or amendment of the applicable Letter of Credit, that one or more applicable conditionscontained in Article IV shall not then be satisfied, then, subject to the terms and conditions hereof, the L/C Issuer shall, on therequested date, issue a Letter of Credit for the account of the Borrower or its applicable Subsidiary, as the case may be, or enterinto the applicable amendment, as the case may be, in each case in accordance with the L/C Issuer’s usual and customarybusiness practices. Immediately upon the issuance of each Letter of Credit, each Revolving Lender shall be deemed to, andhereby irrevocably and unconditionally agrees to, purchase from the L/C Issuer a risk participation in such Letter of Credit inan amount equal to the product of such Lender’s Applicable Percentage times the amount of such Letter of Credit.-52-(iii) If the Borrower so requests in any applicable Letter of Credit Application, the L/C Issuer may, in its solediscretion, agree to issue a Letter of Credit that has automatic extension provisions (each, an “Auto-Extension Letter ofCredit”); provided that any such Auto-Extension Letter of Credit must permit the L/C Issuer to prevent any such extension atleast once in each twelve-month period (commencing with the date of issuance of such Letter of Credit) by giving prior noticeto the beneficiary thereof not later than a day (the “Non-Extension Notice Date”) in each such twelve-month period to beagreed upon at the time such Letter of Credit is issued. Unless otherwise directed by the L/C Issuer, the Borrower shall not berequired to make a specific request to the L/C Issuer for any such extension. Once an Auto-Extension Letter of Credit has beenissued, the Revolving Lenders shall be deemed to have authorized (but may not require) the L/C Issuer to permit the extensionof such Letter of Credit at any time; provided, however, that the L/C Issuer shall not permit any such extension if (A) the L/CIssuer has determined that it would not be permitted, or would have no obligation, at such time to issue such Letter of Credit inits revised form (as extended) under the terms hereof (by reason of the provisions of clause (ii) or (iii) of Section 2.03(a) orotherwise), (B) it has received notice (which may be by telephone or in writing) on or before the day that is seven BusinessDays before the Non-Extension Notice Date (1) from the Administrative Agent that the Required Revolving Lenders haveelected not to permit such extension or (2) from the Administrative Agent, any Revolving Lender, or the Borrower that one ormore of the applicable conditions specified in Section 4.02 is not then satisfied, and in each such case directing the L/C Issuernot to permit such extension or (C) the expiry date of such extended Letter of Credit would be later than the Letter of CreditExpiration Date, and the Borrower has not Cash Collateralized the Outstanding Amount of the L/C Obligations as of suchextension date in respect of such Letter of Credit.(iv) Promptly after its delivery of any Letter of Credit or any amendment to a Letter of Credit to an advising bank withrespect thereto or to the beneficiary thereof, the L/C Issuer will also deliver to the Borrower and the Administrative Agent atrue and complete copy of such Letter of Credit or amendment.(c) Drawings and Reimbursements; Funding of Participations.(i) Upon receipt from the beneficiary of any Letter of Credit of any notice of a drawing under such Letter of Credit,the L/C Issuer shall notify the Borrower and the Administrative Agent thereof. Not later than 11:00 a.m. on the date of anypayment by the L/C Issuer under a Letter of Credit (each such date, an “Honor Date”), the Borrower shall reimburse the L/CIssuer through the Administrative Agent in an amount equal to the amount of such drawing; provided, however, that in the caseof a Letter of Credit denominated in an Alternative Currency, the Borrower shall reimburse the L/C Issuer in Dollars, and theL/C Issuer shall notify the Borrower of the Dollar Equivalent of the amount of the drawing promptly following thedetermination thereof. If the Borrower fails to so reimburse the L/C Issuer by such time, the Administrative Agent shallpromptly notify each Revolving Lender of the Honor Date, the amount of the unreimbursed drawing (expressed in Dollars inthe amount of the Dollar Equivalent thereof in the case of a Letter of Credit denominated in an Alternative Currency) (the“Unreimbursed Amount”), and the amount of such Lender’s Applicable Percentage thereof. In such event, the Borrower shallbe deemed to have requested a Revolving Borrowing of Base-53-Rate Loans to be disbursed on the Honor Date in an amount equal to the Unreimbursed Amount, without regard to theminimum and multiples specified in Section 2.02 for the principal amount of Base Rate Loans, but subject to the amount of theunutilized portion of the Aggregate Commitments and the conditions set forth in Section 4.02 (other than the delivery of aRevolving Loan Notice). Any notice given by the L/C Issuer or the Administrative Agent pursuant to this Section 2.03(c)(i)may be given by telephone if immediately confirmed in writing; provided that the lack of such an immediate confirmation shallnot affect the conclusiveness or binding effect of such notice.(ii) Each Revolving Lender shall upon any notice pursuant to Section 2.03(c)(i) make funds available (and theAdministrative Agent may apply Cash Collateral provided for this purpose) for the account of the L/C Issuer, in Dollars, at theAdministrative Agent’s Office for Dollar-denominated payments in an amount equal to its Applicable Percentage of theUnreimbursed Amount not later than 1:00 p.m. on the Business Day specified in such notice by the Administrative Agent,whereupon, subject to the provisions of Section 2.03(c)(iii), each Lender that so makes funds available shall be deemed to havemade a Base Rate Revolving Loan to the Borrower in such amount. The Administrative Agent shall remit the funds soreceived to the L/C Issuer.(iii) With respect to any Unreimbursed Amount that is not fully refinanced by a Revolving Borrowing of Base RateLoans because the conditions set forth in Section 4.02 cannot be satisfied or for any other reason, the Borrower shall bedeemed to have incurred from the L/C Issuer an L/C Borrowing in the amount of the Unreimbursed Amount that is not sorefinanced, which L/C Borrowing shall be due and payable on demand (together with interest) and shall bear interest at theDefault Rate. In such event, each Revolving Lender’s payment to the Administrative Agent for the account of the L/C Issuerpursuant to Section 2.03(c)(ii) shall be deemed payment in respect of its participation in such L/C Borrowing and shallconstitute an L/C Advance from such Lender in satisfaction of its participation obligation under this Section 2.03.(iv) Until each Revolving Lender funds its Revolving Loan or L/C Advance pursuant to this Section 2.03(c) toreimburse the L/C Issuer for any amount drawn under any Letter of Credit, interest in respect of such Revolving Lender’sApplicable Percentage of such amount shall be solely for the account of the L/C Issuer.(v) Each Revolving Lender’s obligation to make Revolving Loans or L/C Advances to reimburse the L/C Issuer foramounts drawn under Letters of Credit, as contemplated by this Section 2.03(c), shall be absolute and unconditional and shallnot be affected by any circumstance, including (A) any setoff, counterclaim, recoupment, defense or other right which suchRevolving Lender may have against the L/C Issuer, the Borrower or any other Person for any reason whatsoever; (B) theoccurrence or continuance of a Default, or (C) any other occurrence, event or condition, whether or not similar to any of theforegoing; provided, however, that each Revolving Lender’s obligation to make Revolving Loans pursuant to this Section2.03(c) is subject to the conditions set forth in Section 4.02 (other than delivery by the Borrower of a Revolving Loan Notice).No such making of an L/C Advance shall relieve or otherwise-54-impair the obligation of the Borrower to reimburse the L/C Issuer for the amount of any payment made by the L/C Issuer underany Letter of Credit, together with interest as provided herein.(vi) If any Revolving Lender fails to make available to the Administrative Agent for the account of the L/C Issuer anyamount required to be paid by such Lender pursuant to the foregoing provisions of this Section 2.03(c) by the time specified inSection 2.03(c)(ii), then, without limiting the other provisions of this Agreement, the L/C Issuer shall be entitled to recover fromsuch Lender (acting through the Administrative Agent), on demand, such amount with interest thereon for the period from thedate such payment is required to the date on which such payment is immediately available to the L/C Issuer at a rate per annumequal to the applicable Overnight Rate from time to time in effect, plus any administrative, processing or similar feescustomarily charged by the L/C Issuer in connection with the foregoing. If such Lender pays such amount (with interest andfees as aforesaid), the amount so paid shall constitute such Lender’s Revolving Loan included in the relevant RevolvingBorrowing or L/C Advance in respect of the relevant L/C Borrowing, as the case may be. A certificate of the L/C Issuersubmitted to any Revolving Lender (through the Administrative Agent) with respect to any amounts owing under this clause(vi) shall be conclusive absent manifest error.(d) Repayment of Participations.(i) At any time after the L/C Issuer has made a payment under any Letter of Credit and has received from anyRevolving Lender such Lender’s L/C Advance in respect of such payment in accordance with Section 2.03(c), if theAdministrative Agent receives for the account of the L/C Issuer any payment in respect of the related Unreimbursed Amount orinterest thereon (whether directly from the Borrower or otherwise, including proceeds of Cash Collateral applied thereto by theAdministrative Agent), the Administrative Agent will distribute to such Lender its Applicable Percentage thereof in Dollars andin the same funds as those received by the Administrative Agent.(ii) If any payment received by the Administrative Agent for the account of the L/C Issuer pursuant to Section 2.03(c)(i) is required to be returned under any of the circumstances described in Section 10.05 (including pursuant to any settlemententered into by the L/C Issuer in its discretion), each Revolving Lender shall pay to the Administrative Agent for the account ofthe L/C Issuer its Applicable Percentage thereof on demand of the Administrative Agent, plus interest thereon from the date ofsuch demand to the date such amount is returned by such Lender, at a rate per annum equal to the applicable Overnight Ratefrom time to time in effect. The obligations of the Revolving Lenders under this clause shall survive the payment in full of theObligations and the termination of this Agreement.(e) Obligations Absolute. The obligation of the Borrower to reimburse the L/C Issuer for each drawing under each Letter ofCredit and to repay each L/C Borrowing shall be absolute, unconditional and irrevocable, and shall be paid strictly in accordance withthe terms of this Agreement under all circumstances, including the following:-55-(i) any lack of validity or enforceability of such Letter of Credit, this Agreement, or any other Loan Document;(ii) the existence of any claim, counterclaim, setoff, defense or other right that the Borrower or any Subsidiary thereofmay have at any time against any beneficiary or any transferee of such Letter of Credit (or any Person for whom any suchbeneficiary or any such transferee may be acting), the L/C Issuer or any other Person, whether in connection with thisAgreement, the transactions contemplated hereby or by such Letter of Credit or any agreement or instrument relating thereto, orany unrelated transaction;(iii) any draft, demand, certificate or other document presented under such Letter of Credit proving to be forged,fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect; or any lossor delay in the transmission or otherwise of any document required in order to make a drawing under such Letter of Credit;(iv) waiver by the L/C Issuer of any requirement that exists for the L/C Issuer’s protection and not the protection of theBorrower or any waiver by the L/C Issuer which does not in fact materially prejudice the Borrower;(v) honor of a demand for payment presented electronically even if such Letter of Credit requires that demand be inthe form of a draft;(vi) any payment made by the L/C Issuer in respect of an otherwise complying item presented after the date specifiedas the expiration date of, or the date by which documents must be received under, such Letter of Credit if presentation aftersuch date is authorized by the UCC or the ISP, as applicable;(vii) any payment by the L/C Issuer under such Letter of Credit against presentation of a draft or certificate that doesnot strictly comply with the terms of such Letter of Credit; or any payment made by the L/C Issuer under such Letter of Creditto any Person purporting to be a trustee in bankruptcy, debtor-in-possession, assignee for the benefit of creditors, liquidator,receiver or other representative of or successor to any beneficiary or any transferee of such Letter of Credit, including anyarising in connection with any proceeding under any Debtor Relief Law; or(viii) any other circumstance or happening whatsoever, whether or not similar to any of the foregoing, including anyother circumstance that might otherwise constitute a defense available to, or a discharge of, the Borrower or any Subsidiarythereof.The Borrower shall promptly examine a copy of each Letter of Credit and each amendment thereto that is delivered to it and, inthe event of any claim of noncompliance with the Borrower’s instructions or other irregularity, the Borrower will immediately notifythe L/C Issuer. The Borrower shall be conclusively deemed to have waived any such claim against the L/C Issuer and itscorrespondents unless such notice is given as aforesaid.-56-(f) Role of L/C Issuer. Each Revolving Lender and the Borrower agree that, in paying any drawing under a Letter of Credit,the L/C Issuer shall not have any responsibility to obtain any document (other than any sight draft, certificates and documents expresslyrequired by the Letter of Credit) or to ascertain or inquire as to the validity or accuracy of any such document or the authority of thePerson executing or delivering any such document. None of the L/C Issuer, the Administrative Agent, any of their respective RelatedParties nor any correspondent, participant or assignee of the L/C Issuer shall be liable to any Lender for (i) any action taken or omittedin connection herewith at the request or with the approval of the Revolving Lenders or the Required Revolving Lenders, as applicable;(ii) any action taken or omitted in the absence of gross negligence or willful misconduct; or (iii) the due execution, effectiveness,validity or enforceability of any document or instrument related to any Letter of Credit or Issuer Document. The Borrower herebyassumes all risks of the acts or omissions of any beneficiary or transferee with respect to its use of any Letter of Credit; provided,however, that this assumption is not intended to, and shall not, preclude the Borrower pursuing such rights and remedies as it may haveagainst the beneficiary or transferee at law or under any other agreement. None of the L/C Issuer, the Administrative Agent, any oftheir respective Related Parties nor any correspondent, participant or assignee of the L/C Issuer shall be liable or responsible for any ofthe matters described in clauses (i) through (viii) of Section 2.03(e); provided, however, that anything in such clauses to the contrarynotwithstanding, the Borrower may have a claim against the L/C Issuer, and the L/C Issuer may be liable to the Borrower, to theextent, but only to the extent, of any direct, as opposed to consequential or exemplary, damages suffered by the Borrower which theBorrower proves were caused by the L/C Issuer’s willful misconduct or gross negligence or the L/C Issuer’s willful failure to payunder any Letter of Credit after the presentation to it by the beneficiary of a sight draft and certificate(s) strictly complying with theterms and conditions of a Letter of Credit. In furtherance and not in limitation of the foregoing, the L/C Issuer may accept documentsthat appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to thecontrary, and the L/C Issuer shall not be responsible for the validity or sufficiency of any instrument transferring or assigning orpurporting to transfer or assign a Letter of Credit or the rights or benefits thereunder or proceeds thereof, in whole or in part, whichmay prove to be invalid or ineffective for any reason. The L/C Issuer may send a Letter of Credit or conduct any communication to orfrom the beneficiary via the Society for Worldwide Interbank Financial Telecommunication (“SWIFT”) message or overnight courier,or any other commercially reasonable means of communicating with a beneficiary.(g) Applicability of ISP. Unless otherwise expressly agreed by the L/C Issuer and the Borrower when a Letter of Credit isissued (including any such agreement applicable to an Existing Letter of Credit), the rules of the ISP shall apply to each standby Letterof Credit. Notwithstanding the foregoing, the L/C Issuer shall not be responsible to the Borrower for, and the L/C Issuer’s rights andremedies against the Borrower shall not be impaired by, any action or inaction of the L/C Issuer required or permitted under any law,order, or practice that is required or permitted to be applied to any Letter of Credit or this Agreement, including the Law or any orderof a jurisdiction where the L/C Issuer or the beneficiary is located, the practice stated in the ISP, or in the decisions, opinions, practicestatements, or official commentary of the ICC Banking Commission, the Bankers Association for Finance and Trade - InternationalFinancial Services Association (BAFT-IFSA), or the Institute of International Banking Law & Practice, whether or not any Letter ofCredit chooses such law or practice.-57-(h) Letter of Credit Fees. The Borrower shall pay to the Administrative Agent for the account of each Revolving Lender inaccordance with its Applicable Percentage a Letter of Credit fee in Dollars (the “Letter of Credit Fee”) for each Letter of Credit equalto the Applicable Margin times the daily amount available to be drawn under such Letter of Credit; provided, however, any Letter ofCredit Fees otherwise payable for the account of a Defaulting Lender with respect to any Letter of Credit as to which such DefaultingLender has not provided Cash Collateral satisfactory to the L/C Issuer pursuant to this Section 2.03 shall be payable, to the maximumextent permitted by applicable Law, to the other Revolving Lenders in accordance with the upward adjustments in their respectiveApplicable Percentages allocable to such Letter of Credit pursuant to Section 2.15(a)(iv), with the balance of such fee, if any, payableto the L/C Issuer for its own account. For purposes of computing the daily amount available to be drawn under any Letter of Credit,the amount of such Letter of Credit shall be determined in accordance with Section 1.09. Letter of Credit Fees shall be (i) due andpayable on the last Business Day of each March, June, September and December, commencing with the first such date to occur afterthe issuance of such Letter of Credit, on the Letter of Credit Expiration Date and thereafter on demand and (ii) computed on a quarterlybasis in arrears. If there is any change in the Applicable Margin during any quarter, the daily amount available to be drawn under eachLetter of Credit shall be computed and multiplied by the Applicable Margin separately for each period during such quarter that suchApplicable Margin was in effect. Notwithstanding anything to the contrary contained herein, upon the request of the RequiredRevolving Lenders, while any Event of Default exists, all Letter of Credit Fees shall accrue at the Default Rate.(i) Fronting Fee and Documentary and Processing Charges Payable to L/C Issuer. The Borrower shall pay directly to the L/CIssuer for its own account a fronting fee in Dollars with respect to each Letter of Credit, at the rate per annum specified in the FeeLetter or in any other agreement between the Borrower and the L/C Issuer, computed on the Dollar Equivalent of the daily amountavailable to be drawn under such Letter of Credit on a quarterly basis in arrears. Such fronting fee shall be due and payable on the lastBusiness Day of each March, June, September and December in respect of the most recently-ended quarterly period (or portionthereof, in the case of the first payment), commencing with the first such date to occur after the issuance of such Letter of Credit, on theLetter of Credit Expiration Date and thereafter on demand. For purposes of computing the daily amount available to be drawn underany Letter of Credit, the amount of such Letter of Credit shall be determined in accordance with Section 1.09. In addition, theBorrower shall pay directly to the L/C Issuer for its own account, in Dollars, the customary issuance, presentation, amendment andother processing fees, and other standard costs and charges, of the L/C Issuer relating to letters of credit as from time to time in effect.Such customary fees and standard costs and charges are due and payable on demand and are nonrefundable.(j) Conflict with Issuer Documents. In the event of any conflict between the terms hereof and the terms of any IssuerDocument, the terms hereof shall control.(k) Letters of Credit Issued for Subsidiaries. Notwithstanding that a Letter of Credit issued or outstanding hereunder is insupport of any obligations of, or is for the account of, a Subsidiary, the Borrower shall be obligated to reimburse the L/C Issuerhereunder for any and all drawings under such Letter of Credit. The Borrower hereby acknowledges that the issuance of Letters ofCredit for the-58-account of Subsidiaries inures to the benefit of the Borrower, and that the Borrower’s business derives substantial benefits from thebusinesses of such Subsidiaries.(l) L/C Issuer Reports to the Administrative Agent. Unless otherwise agreed by the Administrative Agent, each L/C Issuer(other than Bank of America) shall, in addition to its notification obligations set forth elsewhere in this Section, provide theAdministrative Agent a Letter of Credit Report, as set forth below:(i) on any Business Day, such other information as the Administrative Agent shall reasonably request as to the Lettersof Credit issued by such L/C Issuer; and(ii) for so long as any Letter of Credit issued by an L/C Issuer is outstanding, such L/C Issuer shall deliver to theAdministrative Agent (A) on the last Business Day of each calendar month, (B) at all other times a Letter of Credit Report isrequired to be delivered pursuant to this Agreement, and (C) on each date that (1) an L/C Credit Extension occurs or (2) there isany expiration, cancellation and/or disbursement, in each case, with respect to any such Letter of Credit, a Letter of CreditReport appropriately completed with the information for every outstanding Letter of Credit issued by such L/C Issuer.2.04. Prepayments.(a) Optional Prepayments of Revolving Loans. The Borrower may, upon written notice (or telephonic notice promptlyconfirmed in writing) (together with any prepayment notice given with respect to Term Loans under Section 2.04(b), each, an“Optional Prepayment Notice”) to the Administrative Agent, at any time or from time to time voluntarily prepay Revolving Loans inwhole or in part without premium or penalty; provided that (i) such Optional Prepayment Notice must be in a form acceptable to theAdministrative Agent and be received by the Administrative Agent not later than 11:00 a.m. (A) three Business Days prior to any dateof prepayment of Eurocurrency Rate Revolving Loans and (B) on the date of prepayment of Base Rate Revolving Loans; (ii) anyprepayment of Eurocurrency Rate Revolving Loans shall be in a principal amount of $5,000,000 or a whole multiple of $1,000,000 inexcess thereof; and (iii) any prepayment of Base Rate Revolving Loans shall be in a principal amount of $500,000 or a whole multipleof $100,000 in excess thereof or, in each case, if less, the entire principal amount thereof then outstanding. Each such OptionalPrepayment Notice shall specify the date and amount of such prepayment and the Type(s) of Revolving Loans to be prepaid and, ifEurocurrency Rate Revolving Loans are to be prepaid, the Interest Period(s) of such Loans. The Administrative Agent will promptlynotify each Revolving Lender of its receipt of each such notice, and of the amount of such Lender’s Applicable Percentage of suchprepayment. Each Optional Prepayment Notice given under this Section 2.04(a) shall be irrevocable; provided, however, that any suchOptional Prepayment Notice may state that such Optional Prepayment Notice is conditioned upon the effectiveness of other creditfacilities or acquisitions or the receipt of net proceeds from the issuance of Equity Interests or incurrence of Indebtedness by theBorrower, in which case, such Optional Prepayment Notice may be revoked by the Borrower giving written notice (or telephonicnotice promptly confirmed in writing) to the Administrative Agent on or prior to the date for prepayment specified in such OptionalPrepayment Notice if such condition is not satisfied (and for the avoidance of doubt, the Borrower shall remain obligated pursuant tothe terms of this Agreement for any cost, expense or loss (including those arising under Sections 3.05 and 10.04) incurred by theAdministrative Agent, any-59-Lender, L/C Issuer or other Person in connection with any Optional Prepayment Notice or revocation thereof). If an OptionalPrepayment Notice is given and has not been revoked by the Borrower in accordance with the proviso to the immediately precedingsentence, the Borrower shall make such prepayment and the payment amount specified in such notice shall be due and payable on thedate specified therein. Any prepayment of a Eurocurrency Rate Loan shall be accompanied by all accrued interest on the amountprepaid, together with any additional amounts required pursuant to Section 3.05. Subject to Section 2.15, each such prepayment shallbe applied to the Revolving Loans of the Lenders in accordance with their respective Applicable Percentages.(b) Optional Prepayments of Term Loans. The Borrower shall have the right at any time to prepay the Term Loans on orbefore the applicable Maturity Date as a whole, or in part, by providing an Optional Prepayment Notice not less than three (3) BusinessDays prior written notice to the Administrative Agent, without premium or penalty, provided that, subject to compliance with Section3.05, (a) each partial prepayment shall be in principal amount of $5,000,000 or a whole multiple of $1,000,000 in excess thereof, and(b) each partial prepayment shall be allocated among the Appropriate Lenders in accordance with such Lender’s ApplicablePercentage of the applicable Term Loans. Each such Optional Prepayment Notice shall specify the date and amount of suchprepayment and the Type(s) of Term Loans to be prepaid and, if Eurocurrency Rate Term Loans are to be prepaid, the InterestPeriod(s) of such Loans. The Administrative Agent will promptly notify each Appropriate Lender of its receipt of each such notice,and of the amount of such Lender’s Applicable Percentage of such prepayment. Each Optional Prepayment Notice given under thisSection 2.04(b) shall be irrevocable; provided, however, that any such Optional Prepayment Notice may state that such OptionalPrepayment Notice is conditioned upon the effectiveness of other credit facilities or acquisitions or the receipt of net proceeds from theissuance of Equity Interests or incurrence of Indebtedness by the Borrower, in which case, such Optional Prepayment Notice may berevoked by the Borrower giving written notice (or telephonic notice promptly confirmed in writing) to the Administrative Agent on orprior to the date for prepayment specified in such Optional Prepayment Notice if such condition is not satisfied (and for the avoidanceof doubt, the Borrower shall remain obligated pursuant to the terms of this Agreement for any cost, expense or loss (including thosearising under Sections 3.05 and 10.04) incurred by the Administrative Agent, any Lender or other Person in connection with anyOptional Prepayment Notice or revocation thereof). If an Optional Prepayment Notice is given and has not been revoked by theBorrower in accordance with the proviso to the immediately preceding sentence, the Borrower shall make such prepayment and thepayment amount specified in such notice shall be due and payable on the date specified therein. Any prepayment of principal of theTerm Loans hereunder shall include all interest accrued to the date of prepayment and shall be applied against the scheduledinstallments of principal due on the applicable Term Loans as directed by the Borrower in the Optional Prepayment Notice. No amountrepaid with respect to the Term Loans may be reborrowed.(c) Mandatory Prepayments.(i) If for any reason the (A) Total Revolving Outstandings at any time exceed the Aggregate Revolving Commitmentsthen in effect or (B) the L/C Obligations at any time exceed any applicable L/C Issuer Sublimit then in effect or the Letter ofCredit Sublimit then in effect (as applicable), the Borrower shall immediately prepay Revolving Loans and/or CashCollateralize the L/C Obligations in an aggregate amount equal to such excess; provided,-60-however, that the Borrower shall not be required to Cash Collateralize the L/C Obligations pursuant to this Section 2.04(c)(i)unless after the prepayment in full of the Revolving Loans the Total Revolving Outstandings exceeds the Aggregate RevolvingCommitments then in effect.(ii) Upon the consummation of any Asset Sale that results in the realization by such the Borrower or any of itsSubsidiaries of Net Cash Proceeds in excess of $100,000,000 in any fiscal year, the Borrower shall prepay an aggregateprincipal amount of Term Loans equal to 100% of such excess Net Cash Proceeds immediately upon receipt thereof by suchPerson (such prepayments to be applied as set forth in clause (iv) below); provided however, that, with respect to any Net CashProceeds realized pursuant to an Asset Sale, at the election of the Borrower (as notified by the Borrower to the AdministrativeAgent on or prior to the date of such Asset Sale), and so long as no Default shall have occurred and be continuing, in lieu ofthe Borrower prepaying the Term Loans, the Borrower or any Subsidiary (or any Restricted Subsidiary, if the assets soldpursuant to such Asset Sale were assets of the Borrower or a Restricted Subsidiary) may reinvest an amount equal to all or anyportion of such excess Net Cash Proceeds in properties and assets (including Equity Interests) that replace the properties andassets that were the subject of such Asset Sale or in properties and assets that will be used in the business of the Borrower andits Subsidiaries in compliance with Section 7.07 so long as within 360 days after the receipt of such excess Net Cash Proceedssuch reinvestment shall have been consummated or the Borrower or such Subsidiary shall have entered into a definitiveagreement for such reinvestment within such 360 day period and subsequently makes such reinvestment within 180 daysthereafter (in either case as certified by the Borrower in writing to the Administrative Agent); and provided further, however,that the amount of any such excess Net Cash Proceeds not subject to such definitive agreement or so reinvested shall beimmediately applied to the prepayment of the Term Loans as set forth in this Section 2.04(c)(ii).(iii) Upon the incurrence or issuance by the Borrower or any of its Restricted Subsidiaries of any Indebtedness (otherthan Indebtedness expressly permitted to be incurred or issued pursuant to Section 7.03), the Borrower shall prepay anaggregate principal amount of the Term Loans equal to 100% of all Net Cash Proceeds received therefrom immediately uponreceipt thereof by the Borrower or such Restricted Subsidiary (such prepayments to be applied as set forth in clause (iv) below).(iv) Prepayments of the Term Loans made pursuant to Section 2.04(c)(ii) or (iii) above shall be applied to theremaining principal repayment installments thereof under Section 2.06(b) on a pro rata basis.(v) Notwithstanding any other provisions of this Section 2.04(c), (A) to the extent that the repatriation to the UnitedStates of any or all of the Net Cash Proceeds of any Asset Sale by a Foreign Subsidiary (“Foreign Asset Sale”) would be (x)prohibited or delayed by applicable local law or (y) restricted by applicable material Organization Documents, an amount equalto the Net Cash Proceeds that would be so affected were the Borrower to attempt to repatriate such cash will not be required tobe applied to repay Term Loans at the times provided in this Section 2.04(c) so long, but only so long, as the applicable locallaw or applicable material Organization Documents would not otherwise permit repatriation to the United States (and the-61-Borrower hereby agrees to use all commercially reasonable efforts to overcome or eliminate any such restrictions onrepatriation even if the Borrower does not intend to actually repatriate such cash, so that an amount equal to the full amount ofsuch Net Cash Proceeds will otherwise be subject to repayment under this Section 2.04(c)), and if within one (1) yearfollowing the date on which the respective prepayment would otherwise have been required such repatriation of any of suchaffected Net Cash Proceeds is permissible under the applicable local law or applicable material Organization Documents, evenif such cash is not actually repatriated at such time, an amount equal to the amount of the Net Cash Proceeds will be promptly(and in any event not later than five (5) Business Days) applied (net of an amount equal to the additional taxes of the Borrower,its Subsidiaries and the direct and indirect holders of Equity Interests in the Borrower that would be payable or reserved againstand any additional costs that would be incurred as a result of a repatriation, whether or not a repatriation actually occurs) by theBorrower to the repayment of the Term Loans pursuant to this Section 2.04(c) and (B) to the extent that the Borrower hasdetermined in good faith that repatriation of any of or all the Net Cash Proceeds of any Foreign Asset Sale would have materialadverse tax consequences with respect to such Net Cash Proceeds, an amount equal to such Net Cash Proceeds that would beso affected will not be subject to prepayment under this Section 2.04(c); provided that in the case of each of subclauses (A) and(B), nonpayment prior to the time such amounts must be repatriated shall not constitute an Event of Default (and such amountsshall be available (1) first, to repay local foreign indebtedness owing to third parties, if any, and (2) thereafter, for workingcapital purposes of the Borrower and its Subsidiaries, in each case, subject to the prepayment provisions in this Section2.04(c)).(vi) For the avoidance of doubt, nothing in this Section 2.04(c) shall require the Borrower to cause any amounts to berepatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount ofany mandatory prepayments hereunder).2.05. Termination or Reduction of Commitments.(a) Optional. The Borrower may, upon written notice (or telephonic notice promptly confirmed in writing) (an “OptionalTermination/Reduction Notice”) to the Administrative Agent, terminate the Aggregate Revolving Commitments, or from time to timepermanently reduce the Aggregate Revolving Commitments; provided that (i) any such Optional Termination/Reduction Notice shallbe received by the Administrative Agent not later than 11:00 a.m. five Business Days prior to the date of termination or reduction, (ii)any such partial reduction shall be in an aggregate amount of $5,000,000 or any whole multiple of $1,000,000 in excess thereof, (iii)the Borrower shall not terminate or reduce the Aggregate Revolving Commitments if, after giving effect thereto and to any concurrentprepayments hereunder, the Total Revolving Outstandings would exceed the Aggregate Revolving Commitments, and (iv) if, aftergiving effect to any reduction of the Aggregate Revolving Commitments, the Letter of Credit Sublimit exceeds the amount of theAggregate Revolving Commitments, such Letter of Credit Sublimit shall be automatically reduced by the amount of such excess. EachOptional Termination/Reduction Notice shall be irrevocable; provided, however, that any such Optional Termination/Reduction Noticemay state that such Optional Termination/Reduction Notice is conditioned upon the effectiveness of other credit facilities oracquisitions or the receipt of net proceeds-62-from the issuance of Equity Interests or incurrence of Indebtedness by the Borrower, in which case, such OptionalTermination/Reduction Notice may be revoked by the Borrower giving written notice (or telephonic notice promptly confirmed inwriting) to the Administrative Agent on or prior to the date for prepayment specified in such Optional Termination/Reduction Notice ifsuch condition is not satisfied (and for the avoidance of doubt, the Borrower shall remain obligated pursuant to the terms of thisAgreement for any cost, expense or loss (including those arising under Section 10.04) incurred by the Administrative Agent, anyLender, L/C Issuer or other Person in connection with any Optional Termination/Reduction Notice or revocation thereof). TheAdministrative Agent will promptly notify the Revolving Lenders of any such notice of termination or reduction of the AggregateRevolving Commitments. Any reduction of the Aggregate Revolving Commitments shall be applied to the Revolving Commitment ofeach Revolving Lender according to its Applicable Percentage. All fees accrued until the effective date of any termination of theAggregate Revolving Commitments shall be paid on the effective date of such termination.(b) Mandatory. The aggregate Term Commitments shall be automatically and permanently reduced to zero upon the makingof the Term Loans.2.06. Repayment of Loans.(a) The Borrower shall repay to the Revolving Lenders on the Revolving Maturity Date the aggregate principal amount ofRevolving Loans outstanding on such date.(b) The Borrower shall repay the Term Loans in equal quarterly installments, on the last Business Day of each March, June,September and December (commencing on June 30, 2018), each such installment in the amount of 1.25% of the respective TermBorrowing on the Closing Date (which amounts shall be reduced as a result of the application of prepayments in accordance with theorder set forth in Section 2.04(b) or 2.04(c), as applicable). The Borrower shall repay to the Term Lenders, on the Term Maturity Date,the remaining principal amount of Term Loans outstanding on such date.2.07. Interest.(a) Subject to the provisions of subsection (b) below, (i) each Eurocurrency Rate Revolving Loan shall bear interest on theoutstanding principal amount thereof for each Interest Period at a rate per annum equal to the Eurocurrency Rate for such InterestPeriod plus the Applicable Margin; (ii) each Base Rate Revolving Loan shall bear interest on the outstanding principal amount thereoffrom the applicable borrowing date at a rate per annum equal to the Base Rate plus the Applicable Margin; and (iii) each EurocurrencyRate Term Loan shall bear interest on the outstanding principal amount thereof for each Interest Period at a rate per annum equal to theEurocurrency Rate for such Interest Period plus the Applicable Margin.-63-(b) (1) If any amount of principal of any Loan is not paid when due (without regard to any applicable grace periods),whether at stated maturity, by acceleration or otherwise, such amount shall thereafter bear interest at a fluctuating interest rate perannum at all times equal to the Default Rate to the fullest extent permitted by applicable Laws.(i) If any amount (other than principal of any Loan) payable by the Borrower under any Loan Document is not paidwhen due (without regard to any applicable grace periods), whether at stated maturity, by acceleration or otherwise, then uponthe request of the Required Lenders, such amount shall thereafter bear interest at a fluctuating interest rate per annum at alltimes equal to the Default Rate to the fullest extent permitted by applicable Laws.(ii) Upon the request of the Required Lenders, while any Event of Default exists (other than as set forth in clauses (b)(i) and (b)(ii) above), the Borrower shall pay interest on the principal amount of all outstanding Obligations hereunder at afluctuating interest rate per annum at all times equal to the Default Rate to the fullest extent permitted by applicable Laws.(iii) Accrued and unpaid interest on past due amounts (including interest on past due interest) shall be due and payableupon demand.(c) Interest on each Loan shall be due and payable in arrears on each Interest Payment Date applicable thereto and at suchother times as may be specified herein. Interest hereunder shall be due and payable in accordance with the terms hereof before and afterjudgment, and before and after the commencement of any proceeding under any Debtor Relief Law.2.08. Fees. In addition to certain fees described in subsections (h) and (i) of Section 2.03:(a) Facility Fee. The Borrower shall pay to the Administrative Agent for the account of each Revolving Lender in accordancewith its Applicable Percentage, a facility fee (the “Facility Fee”) in Dollars equal to the Applicable Margin times the actual dailyamount of the Aggregate Revolving Commitments, regardless of usage (or, if the Aggregate Revolving Commitments have terminated,of the Total Revolving Outstandings). The Facility Fee shall accrue at all times until the Facility Termination Date, and shall be dueand payable quarterly (and at maturity) in arrears on the last Business Day of each March, June, September and December,commencing with the first such date to occur after the Closing Date. The Facility Fee shall be calculated quarterly in arrears, and ifthere is any change in the Applicable Margin during any quarter, the actual daily amount shall be computed and multiplied by theApplicable Margin separately for each period during such quarter that such Applicable Margin was in effect.(b) Lender Fees. The Borrower shall pay to the Lenders fees in the amounts and at the times specified in the Fee Letter. Suchfees shall be fully earned when paid and shall not be refundable for any reason whatsoever.(c) Other Fees. The Borrower shall pay to the Administrative Agent or the Left Lead Arranger, as applicable, for its ownaccount, fees in the amounts and at the times specified in the Fee Letter. Such fees shall be fully earned when paid and shall not berefundable for any reason whatsoever.-64-2.09. Computation of Interest and Fees; Retroactive Adjustments of Applicable Margin.(a) All computations of interest for Base Rate Loans (including Base Rate Loans determined by reference to the EurocurrencyRate) shall be made on the basis of a year of 365 or 366 days, as the case may be, and actual days elapsed. All other computations offees and interest shall be made on the basis of a 360-day year and actual days elapsed (which results in more fees or interest, asapplicable, being paid than if computed on the basis of a 365-day year) or, in the case of interest in respect of Loans denominated inAlternative Currencies as to which market practice differs from the foregoing, in accordance with such market practice. Interest shallaccrue on each Loan for the day on which the Loan is made, and shall not accrue on a Loan, or any portion thereof, for the day onwhich the Loan or such portion is paid, provided that any Loan that is repaid on the same day on which it is made shall, subject toSection 2.11(a), bear interest for one day. Each determination by the Administrative Agent of an interest rate or fee hereunder shall beconclusive and binding for all purposes, absent manifest error. With respect to all Non-LIBOR Quoted Currencies, the calculation ofthe applicable interest rate shall be determined in accordance with market practice.(b) If, as a result of any restatement of or other adjustment to the financial statements of the Borrower or for any other reason,the Borrower or the Lenders determine that (i) the Consolidated Net Lease Adjusted Leverage Ratio as calculated by the Borrower asof any applicable date was inaccurate and (ii) a proper calculation of the Consolidated Net Lease Adjusted Leverage Ratio would haveresulted in higher pricing for such period, the Borrower shall immediately and retroactively be obligated to pay to the AdministrativeAgent for the account of the applicable Lenders or the L/C Issuer, as the case may be, within three (3) Business Days of demand bythe Administrative Agent (or, after the occurrence of an actual or deemed entry of an order for relief with respect to the Borrowerunder the Bankruptcy Code of the United States, automatically and without further action by the Administrative Agent, any Lender orthe L/C Issuer), an amount equal to the excess of the amount of interest and fees that should have been paid for such period over theamount of interest and fees actually paid for such period. This subsection shall not limit the rights of the Administrative Agent, anyLender or the L/C Issuer, as the case may be, under Sections 2.03(c)(iii), 2.03(h) or 2.07(b) or under Article VIII. The Borrower’sobligations under this subsection shall survive the termination of the Aggregate Commitments and the repayment of all otherObligations hereunder.2.10. Evidence of Debt.(a) The Credit Extensions made by each Lender shall be evidenced by one or more accounts or records maintained by suchLender and by the Administrative Agent in the ordinary course of business. The accounts or records maintained by the AdministrativeAgent and each Lender shall be conclusive absent manifest error of the amount of the Credit Extensions made by the Lenders to theBorrower and the interest and payments thereon. Any failure to so record or any error in doing so shall not, however, limit or otherwiseaffect the obligation of the Borrower hereunder to pay any amount owing with respect to the Obligations. In the event of any conflictbetween the accounts and records maintained by any Lender and the accounts and records of the Administrative Agent in respect ofsuch matters, the accounts and records of the Administrative Agent shall control in the absence of manifest error. Upon the request ofany Lender made through the Administrative Agent, the Borrower shall execute and deliver to such Lender (through theAdministrative Agent) a Note, which shall evidence such Lender’s Loans in addition-65-to such accounts or records. Each Lender may attach schedules to its Note and endorse thereon the date, Type (if applicable), amount,currency and maturity of its Loans and payments with respect thereto.(b) In addition to the accounts and records referred to in subsection (a), each Revolving Lender and the Administrative Agentshall maintain in accordance with its usual practice accounts or records evidencing the purchases and sales by such Lender ofparticipations in Letters of Credit. In the event of any conflict between the accounts and records maintained by the AdministrativeAgent and the accounts and records of any Revolving Lender in respect of such matters, the accounts and records of theAdministrative Agent shall control in the absence of manifest error.2.11. Payments Generally; Administrative Agent’s Clawback.(a) General. All payments to be made by the Borrower shall be made without condition or deduction for any counterclaim,defense, recoupment or setoff. Except as otherwise expressly provided herein, all payments by the Borrower hereunder shall be madeto the Administrative Agent, for the account of the respective Lenders to which such payment is owed, at the Administrative Agent’sOffice in the currency in which such Loan was made and in Same Day Funds not later than 2:00 p.m. on the date specified herein. TheAdministrative Agent will promptly distribute to each Appropriate Lender its Applicable Percentage in respect of the relevant Facility(or other applicable share as provided herein) of such payment in like funds as received by wire transfer to such Lender’s LendingOffice. All payments received by the Administrative Agent after 2:00 p.m. shall be deemed received on the next succeeding BusinessDay and any applicable interest or fee shall continue to accrue. If any payment to be made by the Borrower shall come due on a dayother than a Business Day, payment shall be made on the next following Business Day, and such extension of time shall be reflected incomputing interest or fees, as the case may be.(b) (1) Funding by Lenders; Presumption by Administrative Agent. Unless the Administrative Agent shall have receivednotice from a Lender prior to the proposed date of any Borrowing of Eurocurrency Rate Loans (or, in the case of any Borrowing ofBase Rate Loans, prior to 12:00 noon on the date of such Borrowing) that such Lender will not make available to the AdministrativeAgent such Lender’s share of such Borrowing, the Administrative Agent may assume that such Lender has made such share availableon such date in accordance with Section 2.02 (or, in the case of a Borrowing of Base Rate Loans, that such Lender has made suchshare available in accordance with and at the time required by Section 2.02) and may, in reliance upon such assumption, makeavailable to the Borrower a corresponding amount. In such event, if a Lender has not in fact made its share of the applicableBorrowing available to the Administrative Agent, then the applicable Lender and the Borrower severally agree to pay to theAdministrative Agent forthwith on demand such corresponding amount in Same Day Funds with interest thereon, for each day fromand including the date such amount is made available to the Borrower to but excluding the date of payment to the AdministrativeAgent, at (A) in the case of a payment to be made by such Lender, the Overnight Rate, plus any administrative, processing or similarfees customarily charged by the Administrative Agent in connection with the foregoing, and (B) in the case of a payment to be madeby the Borrower, the interest rate applicable to Base Rate Loans. If the Borrower and such Lender shall pay such interest to theAdministrative Agent for the same or an overlapping period, the Administrative Agent shall promptly remit to the Borrower theamount of such interest paid by the Borrower for such period. If such Lender pays its share of the-66-applicable Borrowing to the Administrative Agent, then the amount so paid shall constitute such Lender’s Loan included in suchBorrowing. Any payment by the Borrower shall be without prejudice to any claim the Borrower may have against a Lender that shallhave failed to make such payment to the Administrative Agent.(i) Payments by Borrower; Presumptions by Administrative Agent. Unless the Administrative Agent shall havereceived notice from the Borrower prior to the date on which any payment is due to the Administrative Agent for the accountof the Lenders or the L/C Issuer hereunder that the Borrower will not make such payment, the Administrative Agent mayassume that the Borrower has made such payment on such date in accordance herewith and may, in reliance upon suchassumption, distribute to the Appropriate Lenders or the L/C Issuer, as the case may be, the amount due. In such event, if theBorrower has not in fact made such payment, then each of the Appropriate Lenders or the L/C Issuer, as the case may be,severally agrees to repay to the Administrative Agent forthwith on demand the amount so distributed to such Lender or the L/CIssuer, in Same Day Funds with interest thereon, for each day from and including the date such amount is distributed to it to butexcluding the date of payment to the Administrative Agent, at the Overnight Rate.A notice of the Administrative Agent to any Lender or the Borrower with respect to any amount owing under this subsection(b) shall be conclusive, absent manifest error.(c) Failure to Satisfy Conditions Precedent. If any Lender makes available to the Administrative Agent funds for any Loan tobe made by such Lender as provided in the foregoing provisions of this Article II, and such funds are not made available to theBorrower by the Administrative Agent because the conditions to the applicable Credit Extension set forth in Article IV are not satisfiedor waived in accordance with the terms hereof, the Administrative Agent shall return such funds (in like funds as received from suchLender) to such Lender, without interest.(d) Obligations of Lenders Several. The obligations of the Appropriate Lenders hereunder to make Term Loans andRevolving Loans, to fund participations in Letters of Credit and to make payments pursuant to Section 10.04(c), as applicable, areseveral and not joint. The failure of any Appropriate Lender to make any Term Loan or Revolving Loan, to fund any suchparticipation or to make any payment under Section 10.04(c) on any date required hereunder shall not relieve any other AppropriateLender of its corresponding obligation to do so on such date, and no Lender shall be responsible for the failure of any other Lender toso make its Term Loan or Revolving Loan, to purchase its participation or to make its payment under Section 10.04(c).-67-(e) Funding Source. Nothing herein shall be deemed to obligate any Lender to obtain the funds for any Loan in any particularplace or manner or to constitute a representation by any Lender that it has obtained or will obtain the funds for any Loan in anyparticular place or manner.2.12. Sharing of Payments by Lenders. If any Lender shall, by exercising any right of setoff or counterclaim or otherwise,obtain payment in respect of any principal of or interest on any of the Revolving Loans or Term Loans made by it, or the participationsin L/C Obligations held by it, resulting in such Lender’s receiving payment of a proportion of the aggregate amount of such RevolvingLoans, Term Loans, or participations and accrued interest thereon greater than its pro rata share thereof as provided herein, then theLender receiving such greater proportion shall (a) notify the Administrative Agent of such fact, and (b) purchase (for cash at facevalue) participations in the Revolving Loans and/or Term Loans and subparticipations in L/C Obligations of the other AppropriateLenders, or make such other adjustments as shall be equitable, so that the benefit of all such payments shall be shared by theAppropriate Lenders ratably in accordance with the aggregate amount of principal of and accrued interest on their respectiveRevolving Loans, Term Loans and other amounts owing them, provided that:(i) if any such participations or subparticipations are purchased and all or any portion of the payment giving risethereto is recovered, such participations or subparticipations shall be rescinded and the purchase price restored to the extent ofsuch recovery, without interest; and(ii) the provisions of this Section shall not be construed to apply to (x) any payment made by or on behalf of theBorrower pursuant to and in accordance with the express terms of this Agreement (including the application of funds arisingfrom the existence of a Defaulting Lender), (y) the application of Cash Collateral provided for in Section 2.14, or (z) anypayment obtained by a Lender as consideration for the assignment of or sale of a participation in any of its Revolving Loans orTerm Loans or subparticipations in L/C Obligations to any assignee or participant, other than an assignment to the Borrower orany Subsidiary thereof (as to which the provisions of this Section shall apply).The Borrower consents to the foregoing and agrees, to the extent it may effectively do so under applicable law, that any Lenderacquiring a participation pursuant to the foregoing arrangements may exercise against the Borrower rights of setoff and counterclaimwith respect to such participation as fully as if such Lender were a direct creditor of the Borrower in the amount of such participation.2.13. Increase in Commitments.(a) Request for Increase. Provided there exists no Default, except as provided in clause (e) below, upon notice to theAdministrative Agent (which shall promptly notify the Lenders), the Borrower may from time to time after the Closing Date request anincrease in the Aggregate Commitments (which increase may take the form of new revolving loan tranches or term loan tranches) byan amount (for all such requests) not exceeding, in the aggregate, the Maximum Incremental Facilities Amount; provided that (x) anysuch request for an increase shall be in a minimum amount of $100,000,000, and (y) no Lender shall be required to participate in anincrease in the applicable Commitments after such request. At the time of sending such notice, the Borrower (in consultation with theAdministrative-68-Agent) shall specify the time period within which each Lender is requested to respond (which shall in no event be less than tenBusiness Days from the date of delivery of such notice to the Appropriate Lenders).(b) Lender Elections to Increase. Each Appropriate Lender shall notify the Administrative Agent within such time periodwhether or not it agrees to increase its applicable Commitment and, if so, whether by an amount equal to, greater than, or less than itsApplicable Percentage of such requested increase. Any Lender not responding within such time period shall be deemed to havedeclined to increase its applicable Commitment.(c) Notification by Administrative Agent; Additional Lenders. The Administrative Agent shall notify the Borrower and eachAppropriate Lender of the Appropriate Lenders’ responses to each request made hereunder. To achieve the full amount of a requestedincrease and subject to the approval of the Administrative Agent and the L/C Issuer (which approvals shall not be unreasonablywithheld), the Borrower may also invite additional Eligible Assignees to become Lenders pursuant to a joinder agreement in form andsubstance reasonably satisfactory to the Administrative Agent and its counsel.(d) Effective Date and Allocations. If the Aggregate Commitments are increased in accordance with this Section, theAdministrative Agent and the Borrower shall determine the effective date (the “Increase Effective Date”) and the final allocation ofsuch increase. The Administrative Agent shall promptly notify the Borrower and the Lenders of the final allocation of such increaseand the Increase Effective Date.(e) Conditions to Effectiveness of Increase. As a condition precedent to such increase, (i) the Borrower shall deliver to theAdministrative Agent a certificate of each Loan Party dated as of the Increase Effective Date (in sufficient copies for each AppropriateLender) signed by a Responsible Officer of such Loan Party (x) certifying and attaching the resolutions adopted by such Loan Partyapproving or consenting to such increase, and (y) in the case of the Borrower, certifying that, before and after giving effect to suchincrease, (A) the representations and warranties of the Borrower and each other Loan Party contained in Article V or any other LoanDocument, or which are contained in any document furnished at any time under or in connection herewith or therewith, are true andcorrect in all material respects on and as of the Increase Effective Date, except (1) for representations and warranties which arequalified by the inclusion of a materiality standard, which representations and warranties are true and correct in all respects, and (2) tothe extent that such representations and warranties specifically refer to an earlier date, in which case they are true and correct in allmaterial respects as of such earlier date, and except that for purposes of this clause (i)(y)(A), the representations and warrantiescontained in clauses (a) and (b) of Section 5.05 shall be deemed to refer to the most recent statements furnished pursuant to clauses (a)and (b), respectively, of Section 6.01, and (B) no Default or Event of Default exists or would result therefrom; provided, that in theevent that the Loans incurred in connection with such increased Commitments are used to finance a Permitted Acquisition or permittedInvestment, the Persons providing such increased Commitments may agree to a customary “Limited Conditionality Provision”, (ii) tothe extent that the increase of the Aggregate Commitments shall take the form of a new revolving loan tranche, such RevolvingCommitments and Revolving Loans shall be on the same terms (as amended from time to time) (including interest rate margin andmaturity date, but excluding arrangement, structuring, upfront and underwriting fees with respect to such-69-Revolving Loans) as, and pursuant to documentation applicable to, the initial Revolving Commitments and Revolving Loans and anynew Lenders providing such additional Revolving Commitments shall consent to the provisions herein relating to the AutomaticGuaranty Release, and (iii) to the extent that the increase of the Aggregate Commitments shall take the form of a new term loantranche, this Agreement shall be amended, in form and substance satisfactory to the Administrative Agent, the Lenders providing suchterm loan, and the Borrower, to include such terms as are customary for a term loan commitment, including maturity, pricing and yield,amortization, voting, pro rata sharing and other terms and provisions; provided, however, that except as further set forth herein, suchterm loans shall be treated substantially the same as the Term Loans then outstanding (including with respect to mandatory andvoluntary prepayments); provided, further, that (1) the final maturity date of any such new term loan shall be determined by theLenders providing such term loan and the Borrower but shall in no event be earlier than the latest maturity date of the Term Loans thenoutstanding, (2) the Weighted Average Life to Maturity of any such term loan shall be determined by the Lenders providing such termloan and the Borrower but shall in no event be shorter than the Weighted Average Life to Maturity of any of the Term Loans thenoutstanding, (3) any such new term loan shall rank pari passu or junior in right of payment with the Revolving Loans and the TermLoans then outstanding and shall be subject to mandatory prepayment on a pari passu or less than pari passu basis with the Term Loansthen outstanding, (4) the Borrower may appoint a different administrative agent with respect to a new term loan tranche to refinance theExisting Japanese Yen Loan if such tranche is denominated in Yen, (5) any new Lenders providing such additional term loans shallconsent to the provisions herein relating to the Automatic Guaranty Release, and (6) the pricing (including interest rate margins, anyinterest rate floors, original issue discount and upfront fees) shall be determined by the Lenders providing such new term loan and theBorrower. To the extent necessary to keep the outstanding Revolving Loans ratable with any revised Applicable Percentages arisingfrom any nonratable increase in the Revolving Commitments under this Section, either (a) the Borrower shall prepay any RevolvingLoans outstanding on the Increase Effective Date or (b) the Revolving Lenders whose Applicable Percentages have decreased mayassign a portion of their Revolving Loans to other Revolving Lenders whose Applicable Percentages have increased; provided that ineach case the Borrower shall pay any additional amounts required pursuant to Section 3.05.(f) Conflicting Provisions. This Section shall supersede any provisions in Section 2.12 or 10.01 to the contrary.2.14. Cash Collateral.(a) Certain Credit Support Events. Upon the request of the Administrative Agent or the L/C Issuer (i) if the L/C Issuer hashonored any full or partial drawing request under any Letter of Credit and such drawing has resulted in an L/C Borrowing, or (ii) if, asof the Letter of Credit Expiration Date, any L/C Obligation for any reason remains outstanding, the Borrower shall, in each case,immediately Cash Collateralize the then Outstanding Amount of all L/C Obligations, or (iii) if the Outstanding Amount of the L/CObligations exceeds 110% of the Letter of Credit Sublimit, the Borrower shall Cash Collateralize the amount by which theOutstanding Amount of the L/C Obligations exceeds the Letter of Credit Sublimit. At any time that there shall exist a DefaultingLender, promptly upon the request of the Administrative Agent or the L/C Issuer, the Borrower shall deliver to the AdministrativeAgent-70-Cash Collateral in an amount sufficient to cover all Fronting Exposure (after giving effect to Section 2.15(a)(iv) and any CashCollateral provided by the Defaulting Lender).(b) Grant of Security Interest. The Borrower, and to the extent provided by any Defaulting Lender, such Defaulting Lender,hereby grants to (and subjects to the control of) the Administrative Agent, for the benefit of the Administrative Agent, the L/C Issuerand the Appropriate Lenders, and agrees to maintain, a first priority security interest in all such cash, deposit accounts and all balancestherein, and all other property so provided as collateral pursuant hereto, and in all proceeds of the foregoing, all as security for theobligations to which such Cash Collateral may be applied pursuant to Section 2.14(c). If at any time the Administrative Agentdetermines that Cash Collateral is subject to any right or claim of any Person other than the Administrative Agent as herein provided,or that the total amount of such Cash Collateral is less than the applicable Fronting Exposure and other obligations secured thereby, theBorrower or the relevant Defaulting Lender will, within one (1) Business Day of demand by the Administrative Agent, pay or provideto the Administrative Agent additional Cash Collateral in an amount sufficient to eliminate such deficiency. All Cash Collateral (otherthan credit support not constituting funds subject to deposit) shall be maintained in blocked, non-interest bearing deposit accounts atBank of America. The Borrower shall pay on demand therefor from time to time all customary account opening, activity and otheradministrative fees and charges in connection with the maintenance and disbursement of Cash Collateral.(c) Application. Notwithstanding anything to the contrary contained in this Agreement, Cash Collateral provided under any ofthis Section 2.14 or Sections 2.03, 2.04, 2.15 or 8.02 in respect of Letters of Credit shall be held and applied to the satisfaction of thespecific L/C Obligations, obligations to fund participations therein (including, as to Cash Collateral provided by a Defaulting Lender,any interest accrued on such obligation) and other obligations for which the Cash Collateral was so provided, prior to any otherapplication of such property as may be provided for herein.(d) Release. Cash Collateral (or the appropriate portion thereof) provided to reduce Fronting Exposure or other obligationsshall be released promptly following (i) the elimination of the applicable Fronting Exposure or other obligations giving rise thereto(including by the termination of Defaulting Lender status of the applicable Lender (or, as appropriate, its assignee followingcompliance with Section 10.06(b)(vi))) or (ii) the Administrative Agent’s good faith determination that there exists excess CashCollateral; provided, however, (x) that Cash Collateral furnished by or on behalf of a Loan Party shall not be released during thecontinuance of a Default or Event of Default (and following application as provided in this Section 2.14 may be otherwise applied inaccordance with Section 8.03), and (y) the Person providing Cash Collateral and the L/C Issuer may agree that Cash Collateral shallnot be released but instead held to support future anticipated Fronting Exposure or other obligations.-71-2.15. Defaulting Lenders.(a) Adjustments. Notwithstanding anything to the contrary contained in this Agreement, if any Lender becomes a DefaultingLender, then, until such time as that Lender is no longer a Defaulting Lender, to the extent permitted by applicable Law:(i) Waivers and Amendments. That Defaulting Lender’s right to approve or disapprove any amendment, waiver orconsent with respect to this Agreement shall be restricted as set forth in the definitions of “Required Lenders”, “RequiredRevolving Lenders”, “Required Term Lenders”, and Section 10.01.(ii) Defaulting Lender Waterfall. Any payment of principal, interest, fees or other amounts received by theAdministrative Agent for the account of such Defaulting Lender (whether voluntary or mandatory, at maturity, pursuant toArticle VIII or otherwise) or received by the Administrative Agent from a Defaulting Lender pursuant to Section 10.08 shall beapplied at such time or times as may be determined by the Administrative Agent as follows: first, to the payment of anyamounts owing by such Defaulting Lender to the Administrative Agent hereunder; second, to the payment on a pro rata basisof any amounts owing by such Defaulting Lender to the L/C Issuer hereunder; third, to Cash Collateralize the L/C Issuer’sFronting Exposure with respect to such Defaulting Lender in accordance with Section 2.14; fourth, as the Borrower mayrequest (so long as no Default exists), to the funding of any Loan in respect of which such Defaulting Lender has failed to fundits portion thereof as required by this Agreement, as determined by the Administrative Agent; fifth, if so determined by theAdministrative Agent and the Borrower, to be held in a deposit account and released pro rata in order to (x) satisfy suchDefaulting Lender’s potential future funding obligations with respect to Loans under this Agreement and (y) Cash Collateralizethe L/C Issuer’s future Fronting Exposure with respect to such Defaulting Lender with respect to future Letters of Credit issuedunder this Agreement, in accordance with Section 2.14; sixth, to the payment of any amounts owing to the Lenders or the L/CIssuer as a result of any judgment of a court of competent jurisdiction obtained by any Lender or the L/C Issuer against suchDefaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Agreement; seventh, so long asno Default exists, to the payment of any amounts owing to the Borrower as a result of any judgment of a court of competentjurisdiction obtained by the Borrower against such Defaulting Lender as a result of such Defaulting Lender’s breach of itsobligations under this Agreement; and eighth, to such Defaulting Lender or as otherwise directed by a court of competentjurisdiction; provided that if (x) such payment is a payment of the principal amount of any Loans or L/C Borrowings in respectof which such Defaulting Lender has not fully funded its appropriate share, and (y) such Loans were made or the relatedLetters of Credit were issued at a time when the conditions set forth in Section 4.02 were satisfied or waived, such paymentshall be applied solely to pay the Loans of, and L/C Obligations owed to, all Non-Defaulting Lenders on a pro rata basis priorto being applied to the payment of any Loans of, or L/C Obligations owed to, such Defaulting Lender until such time as allLoans and funded and-72-unfunded participations in L/C Obligations are held by the Lenders pro rata in accordance with the Commitments hereunderwithout giving effect to Section 2.15(a)(iv). Any payments, prepayments or other amounts paid or payable to a DefaultingLender that are applied (or held) to pay amounts owed by a Defaulting Lender or to post Cash Collateral pursuant to thisSection 2.15(a)(ii) shall be deemed paid to and redirected by such Defaulting Lender, and each Lender irrevocably consentshereto.(iii) Certain Fees. That Defaulting Lender (x) shall not be entitled to receive any Facility Fee pursuant to Section2.08(a) for any period during which that Lender is a Defaulting Lender (and the Borrower shall not be required to pay any suchfee that otherwise would have been required to have been paid to that Defaulting Lender for any period during which thatLender is a Defaulting Lender) and (y) shall be limited in its right to receive Letter of Credit Fees as provided in Section2.03(h).(iv) Reallocation of Applicable Percentages to Reduce Fronting Exposure. All or any part of such Defaulting Lender’sparticipation in L/C Obligations shall be reallocated among the Non-Defaulting Lenders in accordance with their respectiveApplicable Percentages in respect of the Revolving Facility (calculated without regard to such Defaulting Lender’s RevolvingCommitment) but only to the extent that such reallocation does not cause the aggregate Revolving Credit Exposure of anyNon-Defaulting Lender to exceed such Non-Defaulting Lender’s Revolving Commitment. No reallocation hereunder shallconstitute a waiver or release of any claim of any party hereunder against a Defaulting Lender arising from that Lender havingbecome a Defaulting Lender, including any claim of a Non-Defaulting Lender as a result of such Non-Defaulting Lender’sincreased exposure following such reallocation.(b) Defaulting Lender Cure. If the Borrower, the Administrative Agent and the L/C Issuer agree in writing in their solediscretion that a Defaulting Lender should no longer be deemed to be a Defaulting Lender, the Administrative Agent will so notify theparties hereto, whereupon as of the effective date specified in such notice and subject to any conditions set forth therein (which mayinclude arrangements with respect to any Cash Collateral), that Lender will, to the extent applicable, purchase that portion ofoutstanding Loans of the other Lenders or take such other actions as the Administrative Agent may determine to be necessary to causethe Loans and funded and unfunded participations in Letters of Credit to be held on a pro rata basis by the Lenders in accordance withtheir Applicable Percentages (without giving effect to Section 2.15(a)(iv)), whereupon that Lender will cease to be a DefaultingLender; provided that no adjustments will be made retroactively with respect to fees accrued or payments made by or on behalf of theBorrower while that Lender was a Defaulting Lender; and provided, further, that except to the extent otherwise expressly agreed bythe affected parties, no change hereunder from Defaulting Lender to Lender will constitute a waiver or release of any claim of anyparty hereunder arising from that Lender’s having been a Defaulting Lender.2.16. Extension of Maturity Date in Respect of Revolving Facility and Term Facility.(a) Requests for Extension. The Borrower may, from time to time by notice (an “Extension Request Notice”) to theAdministrative Agent (who shall promptly notify the Revolving Lenders or the Term Lenders, as applicable) not earlier than 45 daysand not later than 35 days prior to the then-existing Revolving Maturity Date or the then‑existing Term Maturity Date, respectively(with respect to the-73-Revolving Facility, the “Existing Revolving Maturity Date”, and with respect to the Term Facility, the “Existing Term MaturityDate”), request that each Applicable Lender extend such Lender’s Revolving Maturity Date, or Term Maturity Date, as applicable, foran additional 364 days from the Existing Revolving Maturity Date or the Existing Term Maturity Date, as applicable.(b) Lender Elections to Extend. Each Revolving Lender or Term Lender, as applicable, acting in its sole and individualdiscretion, shall, by notice to the Administrative Agent given not earlier than 30 days prior to the Existing Revolving Maturity Date orExisting Term Maturity Date, as applicable, and not later than the date (the “Notice Date”) that is 20 days prior to the ExistingRevolving Maturity Date or the Existing Term Maturity Date, as applicable, advise the Administrative Agent whether or not suchRevolving Lender or Term Lender, as applicable, agrees to such extension (and each Revolving Lender or Term Lender, as applicable,that determines not to so extend its Revolving Maturity Date or Term Maturity Date, respectively (a “Non-Extending Lender”)), shallnotify the Administrative Agent of such fact promptly after such determination (but in any event no later than the Notice Date) and anyRevolving Lender or Term Lender, as applicable, that does not so advise the Administrative Agent on or before the Notice Date shallbe deemed to be a Non-Extending Lender. The election of any Revolving Lender or Term Lender, as applicable, to agree to suchextension shall not obligate any other Revolving Lender or Term Lender, as applicable, to so agree.(c) Notification by Administrative Agent. The Administrative Agent shall notify the Borrower of each Revolving Lender’s orTerm Lender’s, as applicable, determination under this Section no later than the date 15 days prior to the Existing Revolving MaturityDate or the Existing Term Maturity Date, as applicable (or, if such date is not a Business Day, on the next preceding Business Day).(d) Additional Commitment Lenders. The Borrower shall have the right to replace each Non-Extending Lender effective as ofthe Existing Revolving Maturity Date or Existing Term Maturity Date, as applicable with, and add as “Revolving Lenders” or “TermLenders”, as applicable, under this Agreement in place thereof, one or more Eligible Assignees (each, an “Additional RevolvingCommitment Lender” or “Additional Term Commitment Lender”, as applicable) as provided in Section 10.13; provided that each ofsuch Additional Revolving Commitment Lenders shall enter into an Assignment and Assumption pursuant to which such AdditionalRevolving Commitment Lender shall, effective as of the Existing Revolving Maturity Date, undertake a Revolving Commitment (andif any such Additional Revolving Commitment Lender is already a Revolving Lender, its Revolving Commitment shall be in additionto any other Revolving Commitment of such Lender hereunder on such date).(e) Extension Requirement.(i) With respect to the Revolving Facility, if (and only if) the total of the Revolving Commitments of the RevolvingLenders that have agreed so to extend the Revolving Maturity Date (each, an “Extending Revolving Lender”) and theadditional Revolving Commitments of the Additional Revolving Commitment Lenders shall be more than 50.00% (or suchlesser percentage as may be acceptable to all of the Extending Revolving Lenders, the Administrative Agent and the Borrower;provided that if a lesser percentage agree to extend, the Administrative Agent, upon the request of the Borrower, shall providenotice of the percentage agreeing to-74-extend to the Extending Revolving Lenders and such extension shall not become effective unless all such Extending RevolvingLenders confirm their consent to such extension as provided in the original Extension Request Notice) of the aggregate amountof the Revolving Commitments in effect immediately prior to the Existing Revolving Maturity Date, then, effective as of theExisting Revolving Maturity Date, the Revolving Maturity Date of the Revolving Loans of the Extending Revolving Lendersand Additional Revolving Commitment Lenders shall be extended to the date falling 364 days after the Existing RevolvingMaturity Date (except that, if such date is not a Business Day, such Revolving Maturity Date as so extended shall be the nextpreceding Business Day) and each Additional Revolving Commitment Lender shall thereupon become a “Revolving Lender”for all purposes of this Agreement.(ii) With respect to the Term Facility, if (and only if) the total of the Outstanding Amount of Term Loans of the TermLenders that have agreed so to extend their Term Maturity Date (each, an “Extending Term Lender”) and the OutstandingAmount of Term Loans of the Additional Term Commitment Lenders shall be more than 50.00% (or such lesser percentage asmay be acceptable to all of the Extending Term Lenders, the Administrative Agent and the Borrower; provided that if a lesserpercentage agree to extend, the Administrative Agent, upon the request of the Borrower, shall provide notice of the percentageagreeing to extend to the Extending Term Lenders and such extension shall not become effective unless all such ExtendingTerm Lenders confirm their consent to such extension as provided in the original Extension Request Notice) of the aggregateOutstanding Amount of Term Loans immediately prior to the Existing Term Maturity Date, then, effective as of the ExistingTerm Maturity Date, the Term Maturity Date of the Term Loans of the Extending Term Lenders and Additional TermCommitment Lenders shall be extended to the date falling 364 days after the Existing Term Maturity Date (except that, if suchdate is not a Business Day, such Term Maturity Date as so extended shall be the next preceding Business Day) and eachAdditional Term Commitment Lender shall thereupon become a “Term Lender” for all purposes of this Agreement.(f) Conditions to Effectiveness of Extensions. As a condition precedent to such extension, the Borrower shall deliver to theAdministrative Agent a certificate of each Loan Party dated as of the Existing Revolving Maturity Date or Existing Term MaturityDate, as applicable (in sufficient copies for each Extending Revolving Lender or Extending Term Lender, as applicable, and eachAdditional Revolving Commitment Lender or Additional Term Lender, as applicable) signed by a Responsible Officer of such LoanParty (i) certifying and attaching the resolutions adopted by such Loan Party approving or consenting to such extension and (ii) in thecase of the Borrower, certifying that, before and after giving effect to such extension, (A) representations and warranties of theBorrower and each other Loan Party contained in Article V or any other Loan Document, or which are contained in any documentfurnished at any time under or in connection herewith or therewith, shall be true and correct in all material respects on and as of theExisting Revolving Maturity Date or Existing Term Maturity Date, as applicable, except (i) for representations and warranties whichare qualified by the inclusion of a materiality standard, which representations and warranties shall be true and correct in all respects,and (ii) to the extent that such representations and warranties specifically refer to an earlier date, in which case they shall be true andcorrect in all material respects as of such earlier date, and except that for purposes of this Section 2.16, the representations andwarranties contained in clauses (a) and (b) of Section 5.05 shall be deemed to refer to the most recent statements furnished pursuant toclauses (a)-75-and (b), respectively, of Section 6.01, and (B) no Default or Event of Default shall exist, or would result from such proposedextension. In addition, on the Revolving Maturity Date or the Term Maturity Date, as applicable, then in effect for each Non-Extending Lender, the Borrower shall prepay any Revolving Loans or Term Loans, as applicable, outstanding on such date (and payany additional amounts required pursuant to Section 3.05) to the extent necessary to keep outstanding Revolving Loans or TermLoans, as applicable, ratable with any revised Applicable Percentages of the respective Revolving Lenders or Term Lenders, asapplicable, effective as of such date.(g) Additional Terms of Extensions. The terms of the Extended Term Loans or Extended Revolving Commitments shall,subject to clauses (i) and (ii) below, be set forth in an Extension Amendment executed by the Borrower, the Administrative Agent, andthe Extending Term Lenders or the Extending Revolving Lenders, as applicable.(i) The terms of the Term Loans with a Maturity Date that has been extended pursuant to this Section 2.16 (the“Extended Term Loans”) shall be substantially similar to or no more favorable to the Extending Term Lenders than thoseapplicable to the non-extended Term Loans (the “Existing Term Loans”), except (1) the scheduled final maturity date shall beextended to the date requested in the applicable Extension Request Notice, (2) (A) the yield with respect to the applicableExtended Term Loans may be higher or lower than the yield for the Existing Term Loans, and/or (B) additional fees may bepayable to the Lenders providing such Extended Term Loans in addition to or in lieu of any increased yield contemplated bythe preceding clause (A), in each case, to the extent provided in the applicable Extension Amendment, (3) any Extended TermLoans may participate on a pro rata basis or a less than pro rata basis (but not greater than a pro rata basis) in any optional ormandatory prepayments or prepayment of Term Loans hereunder in each case as specified in the applicable ExtensionAmendment, (4) the amortization schedule set forth in Section 2.06 applicable to the Existing Term Loans shall be adjusted toreflect the scheduled final maturity date of the applicable Extended Term Loans and the amortization schedule (including theprincipal amounts payable pursuant thereto) in respect of such Extended Term Loans set forth in the applicable ExtensionAmendment; provided that no changes to scheduled amortization pursuant to the preceding clause (4) shall take effect prior tothe Existing Term Maturity Date and no changes shall result in a change to the percentage set forth in Section 2.06(b) or thecalculation of such scheduled amortization in respect of the Term Loans thereafter; provided further, that the Weighted AverageLife to Maturity of such Extended Term Loans shall be no shorter than the Weighted Average Life to Maturity of the ExistingTerm Loans and (5) the covenants set forth in Article VII may be modified in a manner acceptable to the Borrower, theAdministrative Agent and the Lenders party to the applicable Extension Amendment; provided that (x) such modificationsbecome effective only after the latest Maturity Date in effect immediately prior to giving effect to such Extension Amendmentor (y) this Agreement is amended in accordance with Section 10.01 (which amendment may be effected by the AdministrativeAgent and the Borrower to the extent permitted by clause (vi)(2) of the last paragraph in Section 10.01) so that such covenantsapply to all of the then-existing Facilities) (it being understood that each Lender providing Extended Term Loans, by executingan Extension Amendment, agrees to be bound by such provisions and waives any inconsistent provisions set forth in Section2.12 or Section 10.08). Each Lender holding Extended Term Loans shall be entitled to all the benefits afforded by thisAgreement (including, without-76-limitation, the provisions set forth in Section 2.04(c)(iv)) applicable to Term Loans (except to the extent otherwise set forth inthe applicable Extension Amendment) and the other Loan Documents, and shall, without limiting the foregoing, at all timesprior to the Automatic Guaranty Release, benefit equally and ratably from the Multiparty Guaranty. Any Extended Term Loanshall constitute a separate tranche of Term Loans from the Existing Term Loans from which they were modified.(ii) The terms of the Revolving Commitments with a Maturity Date that has been extended pursuant to this Section2.16 (the “Extended Revolving Commitments” and any related Revolving Loans, the “Extended Revolving Loans”) shall besubstantially similar to or no more favorable to the Extending Revolving Lenders, as applicable, than those applicable to thenon-extended Revolving Commitments (the “Existing Revolving Commitments” and any related Revolving Loans, the“Existing Revolving Loans”), except (1) the scheduled final maturity date shall be extended to the date requested in theapplicable Extension Request Notice, (2) (A) the yield with respect to the Extended Revolving Loans may be higher or lowerthan the yield for the Existing Revolving Loans, and/or (B) additional fees may be payable to the Lenders providing suchExtended Revolving Commitments in addition to or in lieu of any increased yield contemplated by the preceding clause (A), ineach case, to the extent provided in the applicable Extension Amendment, (3) the Applicable Margin with respect to theFacility Fee for the Extended Revolving Commitments may be higher or lower than the Applicable Margin with respect to theFacility Fee for the Existing Revolving Commitments, and (4) the covenants set forth in Article VII may be modified in amanner acceptable to the Borrower, the Administrative Agent and the Lenders party to the applicable Extension Amendment,provided that (x) such modifications become effective only after the latest Maturity Date in effect immediately prior to givingeffect to such Extension Amendment or (y) or this Agreement is amended in accordance with Section 10.01 (whichamendment may be effected by the Administrative Agent and the Borrower to the extent permitted by clause (v)(2) of the lastparagraph in Section 10.01) so that such covenants apply to all of the then-existing Facilities) (it being understood that eachLender providing Extended Revolving Commitments, by executing an Extension Amendment, agrees to be bound by suchprovisions and waives any inconsistent provisions set forth in Section 2.12 or Section 10.08). Each Lender holding ExtendedRevolving Commitments shall be entitled to all the benefits afforded by this Agreement and the other Loan Documents, andshall, without limiting the foregoing, at all times prior to the Automatic Guaranty Release, benefit equally and ratably from theMultiparty Guaranty. Any Extended Revolving Commitments and Extended Revolving Loans shall constitute a separatetranche of Revolving Commitments and Revolving Loans from the Existing Revolving Commitments or Existing RevolvingLoans from which they were modified. If, on any Extension Date, any Revolving Loans of any Extending Lender areoutstanding under the applicable Existing Revolving Commitments, such Revolving Loans (and any related participations)shall be deemed to be allocated as Extended Revolving Loans (and related participations) and Existing Revolving Loans (andrelated participations) in the same proportion as such Extending Lender’s Extended Revolving Commitments bear to itsremaining Revolving Commitments of the Existing Revolving Commitments. In addition, if the relevant Extension Amendmentprovides for the extension of the Letter of Credit Sublimit, and with the consent of the L/C Issuer, participations in Letters ofCredit expiring on or after the latest Revolving Maturity Date for-77-any Revolving Loans then in effect shall, on the Letter of Credit Expiration Date, be re-allocated from Lenders with ExistingRevolving Commitments to Lenders holding Extended Revolving Commitments in accordance with the terms of suchExtension Amendment; provided, that such participation interests shall, upon receipt thereof by the relevant Lenders holdingExtended Revolving Commitments, be deemed to be participation interests in respect of such Extended RevolvingCommitments and the terms of such participation interests (including, without limitation, the Letter of Credit Fees applicablethereto) shall be adjusted accordingly.(h) Conflicting Provisions. This Section shall supersede any provisions in Sections 2.12 or 10.01 to the contrary.2.17. Credit Agreement Refinancing Facilities.(a) The Borrower may, by written notice to the Administrative Agent from time to time, request (x) Replacement RevolvingCommitments to replace all of any existing Class of Revolving Commitments (the “Replaced Revolving Commitments”) in anaggregate amount not to exceed the aggregate amount of the Replaced Revolving Commitments plus any accrued interest, fees, costsand expenses related thereto and (y) Refinancing Term Loans to refinance all of any existing Class of Term Loans (the “RefinancedTerm Loans”) in an aggregate principal amount not to exceed the aggregate principal amount of the Refinanced Term Loans plus anyaccrued interest, fees, costs premiums (if any) and expenses related thereto (including any original issue discount or upfront fees). Suchnotice shall set forth (i) the amount of the applicable Credit Agreement Refinancing Facility, (ii) the date on which the applicableCredit Agreement Refinancing Facility is to become effective (which shall not be less than 10 Business Days nor more than 60 daysafter the date of such notice (or such longer or shorter periods as the Administrative Agent shall agree)) and (iii) whether such CreditAgreement Refinancing Facilities are Replacement Revolving Commitments or Refinancing Term Loans. The Borrower may seekCredit Agreement Refinancing Facilities from existing Lenders (each of which shall be entitled to agree or decline to participate in itssole discretion) or any Additional Lender.(b) It shall be a condition precedent to the effectiveness of any Credit Agreement Refinancing Facility and the incurrence ofany Refinancing Term Loans that (i) no Default or Event of Default shall have occurred and be continuing immediately prior to orimmediately after giving effect to such Credit Agreement Refinancing Facility or the incurrence of such Refinancing Term Loans, asapplicable, (ii) the representations and warranties set forth in Article V and in each other Loan Document shall be true and correct in allmaterial respects on and as of the date such Credit Agreement Refinancing Facility becomes effective and the Refinancing Term Loansare made, except (x) for representations and warranties which are qualified by the inclusion of a materiality standard, whichrepresentations and warranties shall be true and correct in all respects, and (y) to the extent that such representations and warrantiesspecifically refer to an earlier date, in which case they shall be true and correct in all material respects as of such earlier date, and exceptthat for purposes of this clause (ii)(y), the representations and warranties contained in clauses (a) and (b) of Section 5.05 shall bedeemed to refer to the most recent statements furnished pursuant to clauses (a) and (b), respectively, of Section 6.01; (iii) the terms ofthe Credit Agreement Refinancing Facility shall comply with Section 2.17(c) and (iv) (x) substantially concurrently with the incurrenceof any such Refinancing Term Loans, 100% of the proceeds thereof shall be applied to repay the Refinanced Term Loans (includingaccrued interest, fees, costs, premiums-78-(if any) and expenses related thereto (including any original issue discount or upfront fees) payable in connection therewith) and (y)substantially concurrently with the effectiveness of any such Replacement Revolving Commitments, all of the RevolvingCommitments in effect immediately prior to such effectiveness shall be terminated, and all of the Revolving Loans then outstanding,together with interest thereon and all other amounts accrued for the benefit of the Revolving Lenders, shall be repaid or paid.(c) The terms of any Credit Agreement Refinancing Facility shall be determined by the Borrower and the applicable CreditAgreement Refinancing Facility Lenders and set forth in a Refinancing Amendment; provided that (i) the final maturity date of anyRefinancing Term Loans or Replacement Revolving Commitments shall not be earlier than the maturity or termination date of theapplicable Refinanced Term Loans or Replaced Revolving Commitments, respectively, then in effect, (ii) (A) there shall be noscheduled amortization of the Replacement Revolving Commitments and (B) the Weighted Average Life to Maturity of theRefinancing Term Loans shall be no shorter than the remaining Weighted Average Life to Maturity of the Refinanced Term Loans,(iii) the Credit Agreement Refinancing Facilities will rank pari passu in right of payment with the Revolving Loans and the TermLoans and none of the obligors or guarantors with respect thereto shall be a Person that is not a Loan Party, (iv) the interest ratemargin, rate floors, fees, original issue discount and premiums applicable to the Credit Agreement Refinancing Facilities shall bedetermined by the Borrower and the applicable Credit Agreement Refinancing Facility Lenders, (v) any Refinancing Term Loans mayparticipate on a pro rata basis or a less than pro rata basis (but not greater than a pro rata basis) in any optional or mandatoryprepayments or prepayment of Term Loans hereunder in each case as specified in the applicable Refinancing Amendment, (vi) theterms in respect of the applicable Credit Agreement Refinancing Facility shall be substantially similar to and no more favorable to theapplicable Credit Agreement Refinancing Facility Lenders than the terms of the Replaced Revolving Commitments and RefinancedTerm Loans being replaced or refinanced, as applicable; provided that the covenants set forth in Article VII may be modified withrespect to such Credit Agreement Refinancing Facility in a manner acceptable to the Borrower, the Administrative Agent and theapplicable Credit Agreement Refinancing Facility Lenders; provided that (x) such modifications become effective only after the latestMaturity Date in effect immediately prior to giving effect to such Refinancing Amendment or (y) this Agreement is amended inaccordance with Section 10.01 (which amendment may be effected by the Administrative Agent and the Borrower to the extentpermitted by clause (vii)(2) of the last paragraph in Section 10.01) so that such covenants apply to all of the then-existing Facilities),and (vii) to the extent the terms of the Credit Agreement Refinancing Facilities are inconsistent with the terms set forth herein (exceptas set forth in clause (i) through (vi) above), such terms shall be reasonably satisfactory to the Administrative Agent.(d) In connection with any Credit Agreement Refinancing Facility pursuant to this Section 2.17, the Borrower, theAdministrative Agent and each applicable Credit Agreement Refinancing Facility Lender shall execute and deliver to theAdministrative Agent a Refinancing Amendment and such other documentation as the Administrative Agent shall reasonably specifyto evidence such Credit Agreement Refinancing Facilities. The Administrative Agent shall promptly notify each Lender as to theeffectiveness of each Refinancing Amendment. Any Refinancing Amendment may, without the consent of any other Lender, effectsuch amendments to this Agreement and the other Loan Documents as may be necessary or appropriate, in the reasonable opinion ofthe Administrative Agent and the Borrower, to effect the provisions of this Section 2.17, including any amendments necessary toestablish-79-the applicable Credit Agreement Refinancing Facility as a new Class or tranche of Term Loans or Revolving Commitments (asapplicable) and such other technical amendments as may be necessary or appropriate in the reasonable opinion of the AdministrativeAgent and the Borrower in connection with the establishment of such Classes or tranches (including to preserve the pro rata treatmentof the refinanced and non-refinanced tranches and to provide for the reallocation of participation in outstanding Letters of Credit uponthe expiration or termination of the commitments under any Class or tranche), in each case on terms consistent with this Section 2.17.Upon effectiveness of any Replacement Revolving Commitments pursuant to this Section 2.17, each Revolving Lender with aRevolving Commitment immediately prior to such effectiveness will automatically and without further act be deemed to have assignedto each Replacement Revolving Lender, and each such Replacement Revolving Lender will automatically and without further act bedeemed to have assumed, a portion of such existing Revolving Lender’s participations hereunder in outstanding Letters of Credit suchthat, after giving effect to each such deemed assignment and assumption of participations, the percentage of the aggregate outstandingparticipations hereunder in Letters of Credit held by each Revolving Lender (including each such Replacement Revolving Lender) willequal its Applicable Percentage. If, on the date of such effectiveness, there are any Revolving Loans outstanding, such RevolvingLoans shall upon the effectiveness of such Replacement Revolving Commitment be prepaid from the proceeds of additional RevolvingLoans made hereunder so that Revolving Loans are thereafter held by the Revolving Lenders (including each Replacement RevolvingLender) according to their Applicable Percentage, which prepayment shall be accompanied by accrued interest on the RevolvingLoans being prepaid and any costs incurred by any Revolving Lender in accordance with Section 3.05. The Administrative Agent andthe Lenders hereby agree that the minimum borrowing, pro rata borrowing and pro rata payment requirements contained elsewhere inthis Agreement shall not apply to the transactions effected pursuant to the immediately preceding sentence.ARTICLE III. TAXES, YIELD PROTECTION AND ILLEGALITY3.01. Taxes.(a) Payments Free of Taxes; Obligation to Withhold; Payments on Account of Taxes. (1) Any and all payments by or onaccount of any obligation of any Loan Party under any Loan Document shall be made without deduction or withholding for anyTaxes, except as required by applicable Laws. If any applicable Laws (as determined in the good faith discretion of an applicableWithholding Agent) require the deduction or withholding of any Tax from any such payment by a Withholding Agent, then theWithholding Agent shall be entitled to make such deduction or withholding.-80-(i) If any Withholding Agent shall be required by any applicable Laws to withhold or deduct any Taxes from anypayment, then (A) such Withholding Agent, as required by such Laws, shall withhold or make such deductions as aredetermined by it to be required, (B) such Withholding Agent, to the extent required by such Laws, shall timely pay the fullamount withheld or deducted to the relevant Governmental Authority in accordance with such Laws, and (C) to the extent thatthe withholding or deduction is made on account of Indemnified Taxes, the sum payable by the applicable Loan Party shall beincreased as necessary so that after any required withholding or the making of all required deductions (including deductionsapplicable to additional sums payable under this Section 3.01) the applicable Recipient receives an amount equal to the sum itwould have received had no such withholding or deduction been made.(b) Payment of Other Taxes by the Loan Parties. Without limiting the provisions of subsection (a) above, the Loan Partiesshall timely pay to the relevant Governmental Authority in accordance with applicable law, or at the option of the AdministrativeAgent timely reimburse it for the payment of, any Other Taxes.(c) Tax Indemnifications.(i) Each of the Loan Parties shall, and does hereby, jointly and severally indemnify each Recipient, and shall makepayment in respect thereof within 10 days after demand therefor, for the full amount of any Indemnified Taxes (includingIndemnified Taxes imposed or asserted on or attributable to amounts payable under this Section 3.01) payable or paid by suchRecipient or required to be withheld or deducted from a payment to such Recipient, and any reasonable expenses arisingtherefrom or with respect thereto, whether or not such Indemnified Taxes were correctly or legally imposed or asserted by therelevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to the Borrower by aLender or the L/C Issuer (with a copy to the Administrative Agent), or by the Administrative Agent on its own behalf or onbehalf of a Lender or the L/C Issuer, shall be conclusive absent manifest error.(ii) Each Lender and the L/C Issuer shall, and does hereby, severally indemnify, and shall make payment in respectthereof within 10 days after demand therefor, (x) the Administrative Agent against any Indemnified Taxes attributable to suchLender or the L/C Issuer (but only to the extent that any Loan Party has not already indemnified the Administrative Agent forsuch Indemnified Taxes and without limiting the obligation of the Loan Party to do so), (y) the Administrative Agent and theLoan Party, as applicable, against any Taxes attributable to such Lender’s failure to comply with the provisions ofSection 10.06(d) relating to the maintenance of a Participant Register and (z) the Administrative Agent and the Loan Party, asapplicable, against any Excluded Taxes attributable to such Lender or the L/C Issuer, in each case, that are payable or paid bythe Administrative Agent or a Loan Party in connection with any Loan Document, and any reasonable expenses arisingtherefrom or with respect thereto, whether or not such Taxes were correctly or legally imposed or asserted by the relevantGovernmental Authority. A certificate as to the amount of such payment or liability delivered to any Lender by theAdministrative Agent shall be conclusive absent manifest error. Each Lender and the L/C Issuer hereby authorizes theAdministrative Agent to set off and apply any and all amounts at any time owing to such Lender or the L/C Issuer, as the casemay be, under-81-this Agreement or any other Loan Document against any amount due to the Administrative Agent under this clause (ii).(d) Evidence of Payments. Upon request by the Borrower or the Administrative Agent, as the case may be, after any paymentof Taxes by any Loan Party or by the Administrative Agent to a Governmental Authority as provided in this Section 3.01, theBorrower shall deliver to the Administrative Agent or the Administrative Agent shall deliver to the Borrower, as the case may be, theoriginal or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of any return requiredby Laws to report such payment or other evidence of such payment reasonably satisfactory to the Borrower or the AdministrativeAgent, as the case may be.(e) Status of Lenders; Tax Documentation.(i) Any Lender that is entitled to an exemption from or reduction of withholding Tax with respect to payments madeunder any Loan Document shall deliver to the Borrower and the Administrative Agent, at the time or times reasonablyrequested by the Borrower or the Administrative Agent, such properly completed and executed documentation prescribed byapplicable law or the taxing authorities of a jurisdiction pursuant to such applicable law or reasonably requested by theBorrower or the Administrative Agent as will permit such payments to be made without withholding or at a reduced rate ofwithholding. In addition, any Lender, if reasonably requested by the Borrower or the Administrative Agent, shall deliver suchother documentation prescribed by applicable law or reasonably requested by the Borrower or the Administrative Agent as willenable the Borrower or the Administrative Agent to determine whether or not such Lender is subject to backup withholding orinformation reporting requirements. Notwithstanding anything to the contrary in the preceding two sentences, the completion,execution and submission of such documentation (other than such documentation either (A) set forth in Section 3.01(e)(ii)(A),(ii)(B) and (ii)(D) below or (B) required by applicable law other than the Code or the taxing authorities of the jurisdictionpursuant to such applicable law to comply with the requirements for exemption or reduction of withholding tax in thatjurisdiction) shall not be required if in the Lender’s reasonable judgment such completion, execution or submission wouldsubject such Lender to any material unreimbursed cost or expense or would materially prejudice the legal or commercialposition of such Lender.(ii) Without limiting the generality of the foregoing, in the event that the Borrower is a U.S. Person,(A) any Lender that is a U.S. Person shall deliver to the Borrower and the Administrative Agent on or prior tothe date on which such Lender becomes a Lender under this Agreement (and from time to time thereafter upon thereasonable request of the Borrower or the Administrative Agent), executed originals of IRS Form W‑9 certifying thatsuch Lender is exempt from U.S. federal backup withholding tax;-82-(B) any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to the Borrower and theAdministrative Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on whichsuch Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonablerequest of the Borrower or the Administrative Agent), whichever of the following is applicable:(I)in the case of a Foreign Lender claiming the benefits of an income tax treaty to which the United Statesis a party (x) with respect to payments of interest under any Loan Document, executed originals of IRSForm W-8BEN-E establishing an exemption from, or reduction of, U.S. federal withholding Taxpursuant to the “interest” article of such tax treaty and (y) with respect to any other applicable paymentsunder any Loan Document, IRS Form W‑8BEN-E establishing an exemption from, or reduction of,U.S. federal withholding Tax pursuant to the “business profits” or “other income” article of such taxtreaty;(II)executed originals of IRS Form W-8ECI;(III)in the case of a Foreign Lender claiming the benefits of the exemption for portfolio interest underSection 881(c) of the Code, (x) a certificate substantially in the form of Exhibit I-1 to the effect that suchForeign Lender is not a “bank” within the meaning of Section 881(c)(3)(A) of the Code, a “10 percentshareholder” of the Borrower within the meaning of Section 881(c)(3)(B) of the Code, or a “controlledforeign corporation” described in Section 881(c)(3)(C) of the Code (a “U.S. Tax ComplianceCertificate”) and (y) executed originals of IRS Form W-8BEN-E; or(IV)to the extent a Foreign Lender is not the beneficial owner, executed originals of IRS Form W-8IMY,accompanied by IRS Form W‑8ECI, IRS Form W-8BEN-E, a U.S. Tax Compliance Certificatesubstantially in the form of Exhibit I-2 or Exhibit I-3, IRS Form W-9, and/or other certificationdocuments from each beneficial owner, as applicable; provided that if the Foreign Lender is apartnership and one or more direct or indirect partners of such Foreign Lender are claiming the portfoliointerest exemption, such Foreign Lender may provide a U.S. Tax Compliance Certificate substantially inthe form of Exhibit I-4 on behalf of each such direct and indirect partner;(C) any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to the Borrower and theAdministrative Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on whichsuch Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonablerequest of the Borrower or the Administrative Agent), executed originals of any other form prescribed by applicablelaw as a basis for claiming exemption from or a reduction in U.S. federal withholding Tax, duly completed, togetherwith such-83-supplementary documentation as may be prescribed by applicable law to permit the Borrower or the AdministrativeAgent to determine the withholding or deduction required to be made; and(D) if a payment made to a Lender under any Loan Document would be subject to U.S. federal withholdingTax imposed by FATCA if such Lender were to fail to comply with the applicable reporting requirements of FATCA(including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender shall deliver to theBorrower and the Administrative Agent at the time or times prescribed by law and at such time or times reasonablyrequested by the Borrower or the Administrative Agent such documentation prescribed by applicable law (including asprescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by theBorrower or the Administrative Agent as may be necessary for the Borrower and the Administrative Agent to complywith their obligations under FATCA and to determine that such Lender has complied with such Lender’s obligationsunder FATCA or to determine the amount to deduct and withhold from such payment. Solely for purposes of thisclause (D), “FATCA” shall include any amendments made to FATCA after the date of this Agreement.(iii) Each Lender agrees that if any form or certification it previously delivered pursuant to this Section 3.01 expires orbecomes obsolete or inaccurate in any respect, it shall update such form or certification or promptly notify the Borrower and theAdministrative Agent in writing of its legal inability to do so.(f) Treatment of Certain Refunds, Etc. Unless required by applicable Laws, at no time shall the Administrative Agent haveany obligation to file for or otherwise pursue on behalf of a Lender or the L/C Issuer, or have any obligation to pay to any Lender orthe L/C Issuer, any refund of Taxes withheld or deducted from funds paid for the account of such Lender or the L/C Issuer, as the casemay be. If any Recipient determines, in its sole discretion exercised in good faith, that it has received a refund or credit in lieu of arefund of any Taxes as to which it has been indemnified by any Loan Party or with respect to which any Loan Party has paidadditional amounts pursuant to this Section 3.01, it shall pay to such Loan Party an amount equal to such refund (but only to the extentof indemnity payments made, or additional amounts paid, by a Loan Party under this Section 3.01 with respect to the Taxes giving riseto such refund), net of all out-of-pocket expenses (including Taxes) incurred by such Recipient, and without interest (other than anyinterest paid by the relevant Governmental Authority with respect to such refund), provided that each Loan Party, upon the request ofthe Recipient, agrees to repay the amount paid over to such Loan Party (plus any penalties, interest or other charges imposed by therelevant Governmental Authority) to the Recipient in the event the Recipient is required to repay such refund to such GovernmentalAuthority. Notwithstanding anything to the contrary in this subsection, in no event will the applicable Recipient be required to pay anyamount to such Loan Party pursuant to this subsection the payment of which would place the Recipient in a less favorable net after-Tax position than such Recipient would have been in if the Tax subject to indemnification and giving rise to such refund had not beendeducted, withheld or otherwise imposed and the indemnification payments or additional amounts with respect to such Tax had neverbeen paid. This subsection shall-84-not be construed to require any Recipient to make available its tax returns (or any other information relating to its taxes that it deemsconfidential) to the Borrower or any other Person.(g) Survival. Each party’s obligations under this Section 3.01 shall survive the resignation or replacement of theAdministrative Agent or any assignment of rights by, or the replacement of, a Lender or the L/C Issuer, the termination of theCommitments and the repayment, satisfaction or discharge of all other Obligations.(h) For the purposes of this Section 3.01, the term “Lender” includes any L/C Issuer and the term “applicable law” includesFATCA.3.02. Illegality. If any Lender determines that any Law has made it unlawful, or that any Governmental Authority hasasserted that it is unlawful, for any Lender or its applicable Lending Office to make, maintain or fund Loans (whether denominated inDollars or an Alternative Currency) whose interest is determined by reference to the Eurocurrency Rate, or to determine or chargeinterest rates based upon the Eurocurrency Rate, or any Governmental Authority has imposed material restrictions on the authority ofsuch Lender to purchase or sell, or to take deposits of, Dollars or any Alternative Currency in the London or other applicable offshoreinterbank market, then, on notice thereof by such Lender to the Borrower through the Administrative Agent, (i) any obligation of suchLender to make or continue Eurocurrency Rate Loans in the affected currency or currencies or, in the case of Eurocurrency RateLoans in Dollars, to convert Base Rate Loans to Eurocurrency Rate Loans, shall be suspended, and (ii) if such notice asserts theillegality of such Lender making or maintaining Base Rate Loans the interest rate on which is determined by reference to theEurocurrency Rate component of the Base Rate, the interest rate on which Base Rate Loans of such Lender shall, if necessary to avoidsuch illegality, be determined by the Administrative Agent without reference to the Eurocurrency Rate component of the Base Rate, ineach case until such Lender notifies the Administrative Agent and the Borrower that the circumstances giving rise to suchdetermination no longer exist. Upon receipt of such notice, (x) the Borrower shall, upon demand from such Lender (with a copy to theAdministrative Agent), prepay or, if applicable and such Loans are denominated in Dollars, convert all Eurocurrency Rate Loans ofsuch Lender to Base Rate Loans (the interest rate on which Base Rate Loans of such Lender shall, if necessary to avoid such illegality,be determined by the Administrative Agent without reference to the Eurocurrency Rate component of the Base Rate), either on the lastday of the Interest Period therefor, if such Lender may lawfully continue to maintain such Eurocurrency Rate Loans to such day, orimmediately, if such Lender may not lawfully continue to maintain such Eurocurrency Rate Loans and (y) if such notice asserts theillegality of such Lender determining or charging interest rates based upon the Eurocurrency Rate, the Administrative Agent shallduring the period of such suspension compute the Base Rate applicable to such Lender without reference to the Eurocurrency Ratecomponent thereof until the Administrative Agent is advised in writing by such Lender that it is no longer illegal for such Lender todetermine or charge interest rates based upon the Eurocurrency Rate. Upon any such prepayment or conversion, as the case may be,the Borrower shall also pay accrued interest on the amount so prepaid or converted.-85-3.03. Inability to Determine Rates.(a) If in connection with any request for a Eurocurrency Rate Loan or a conversion to or continuation thereof, (i) theAdministrative Agent determines that (x) deposits (whether in Dollars or an Alternative Currency) are not being offered to banks in theapplicable offshore interbank market for such currency for the applicable amount and Interest Period of such Eurocurrency Rate Loan,or (y) adequate and reasonable means do not exist for determining the Eurocurrency Rate for any requested Interest Period with respectto a proposed Eurocurrency Rate Loan (whether denominated in Dollars or an Alternative Currency) or in connection with an existingor proposed Eurocurrency Rate Loan or the Eurocurrency Rate component of the Base Rate, or (ii) the Required Lenders determinethat for any reason the Eurocurrency Rate for any requested Interest Period with respect to a proposed Eurocurrency Rate Loan or anyconversion or continuation thereof does not adequately and fairly reflect the cost to such Lenders of funding such Loan, theAdministrative Agent will promptly so notify the Borrower and each Lender. Thereafter, (A) the obligation of the Lenders to make ormaintain Eurocurrency Rate Loans in the affected currency or currencies shall be suspended (to the extent of the affected EurocurrencyRate Loans or Interest Periods), and (B) in the event of a determination described in the preceding sentence with respect to theEurocurrency Rate component of the Base Rate, the utilization of the Eurocurrency Rate component in determining the Base Rate shallbe suspended, in each case until the Administrative Agent (upon the instruction of the Required Lenders) revokes such notice. Uponreceipt of such notice, (1) in the case of Revolving Loans denominated in Dollars, the Borrower may revoke any pending request for aBorrowing of, conversion to or continuation of Eurocurrency Rate Loans or, failing that, will be deemed to have converted suchrequest into a request for a Borrowing of Base Rate Loans in the amount specified therein, and (2) in the event an alternative ratecannot be determined in accordance with clause (b) below, in the case of Revolving Loans denominated in an Alternative Currency,SEK Term Loans or Sterling Term Loans, the Borrower shall prepay such Loans at the end of the then current Interest Period for suchLoans. Upon any such prepayment or conversion, as the case may be, the Borrower shall also pay accrued interest on the amount soprepaid or converted.(b) Notwithstanding the foregoing, in the case of a request for or conversion or continuation of a Eurocurrency Rate Loan inan Alternative Currency as to which the Administrative Agent or the Required Lenders, as applicable, have made the determinationdescribed in clause (a) above (in each case, for the avoidance of doubt, after applying any comparable or successor rate to LIBOR (orother relevant Eurocurrency Rate), if applicable, in accordance with the definition of “Eurocurrency Rate”), (i) the Borrower shall bedeemed to have requested a Eurocurrency Rate Loan or conversion or continuation, as applicable, in such Alternative Currency (the“Impacted Loans”) with the next shortest Interest Period available as to which no such determination under clause (a) above would bemade, and (ii) (x) if no such Interest Period is available, the Administrative Agent and the Borrower, with the agreement of theRequired Lenders, may establish an alternative interest rate for the Impacted Loans, and (y) if the Administrative Agent, the Borrowerand the Required Lenders are unable to agree on such an alternative rate of interest, the Administrative Agent, with the consent of theRequired Lenders, may establish an alternative interest rate for the Impacted Loans. Such alternative rate of interest as determined inaccordance with clause (ii) above shall apply with respect to the Impacted Loans until (A) the Administrative Agent revokes the noticedelivered with respect to the Impacted Loans under-86-clause (a) above, (B) the Required Lenders notify the Administrative Agent and the Borrower that such alternative interest rate doesnot adequately and fairly reflect the cost to such Lenders of funding the Impacted Loans (in which case the Required Lenders shalldetermine an appropriate alternative rate of interest in accordance with clause (ii)(y) above), or (C) any Lender determines that anyLaw has made it unlawful, or that any Governmental Authority has asserted that it is unlawful, for such Lender or its applicableLending Office to make, maintain or fund Loans whose interest is determined by reference to such alternative rate of interest or todetermine or charge interest rates based upon such rate or any Governmental Authority has imposed material restrictions on theauthority of such Lender to do any of the foregoing and provides the Administrative Agent and the Borrower written notice thereof,and in the case of subclause (C), the Impacted Loans shall be repaid as provided in subsection (a) above.3.04. Increased Costs; Reserves on Eurocurrency Rate Loans.(a) Increased Costs Generally. If any Change in Law shall:(i) impose, modify or deem applicable any reserve, special deposit, compulsory loan, insurance charge or similarrequirement against assets of, deposits with or for the account of, or credit extended or participated in by, any Lender (exceptany reserve requirement contemplated by Section 3.04(e), other than as set forth below) or the L/C Issuer;(ii) subject any Recipient to any Taxes (other than (A) Indemnified Taxes, (B) Taxes described in clauses (b) through(d) of the definition of Excluded Taxes and (C) Connection Income Taxes) on its loans, loan principal, letters of credit,commitments, or other obligations, or its deposits, reserves, other liabilities or capital attributable thereto; or(iii) impose on any Lender or the L/C Issuer or the London interbank market any other condition, cost or expense(other than Taxes) affecting this Agreement or Eurocurrency Rate Loans made by such Lender or any Letter of Credit orparticipation therein;and the result of any of the foregoing shall be to increase the cost to such Lender of making, converting to, continuing or maintainingany Loan the interest on which is determined by reference to the Eurocurrency Rate (or of maintaining its obligation to make any suchLoan), or to increase the cost to such Lender or the L/C Issuer of participating in, issuing or maintaining any Letter of Credit (or ofmaintaining its obligation to participate in or to issue any Letter of Credit), or to reduce the amount of any sum received or receivableby such Lender or the L/C Issuer hereunder (whether of principal, interest or any other amount) then, upon request of such Lender orthe L/C Issuer, the Borrower will pay to such Lender or the L/C Issuer, as the case may be, such additional amount or amounts as willcompensate such Lender or the L/C Issuer, as the case may be, for such additional costs incurred or reduction suffered.-87-(b) Capital Requirements. If any Lender or the L/C Issuer determines that any Change in Law affecting such Lender or theL/C Issuer or any Lending Office of such Lender or such Lender’s or the L/C Issuer’s holding company, if any, regarding capital orliquidity requirements has or would have the effect of reducing the rate of return on such Lender’s or the L/C Issuer’s capital or on thecapital of such Lender’s or the L/C Issuer’s holding company, if any, as a consequence of this Agreement, the Commitments of suchLender or the Loans made by, or participations in Letters of Credit held by, such Lender, or the Letters of Credit issued by the L/CIssuer, to a level below that which such Lender or the L/C Issuer or such Lender’s or the L/C Issuer’s holding company could haveachieved but for such Change in Law (taking into consideration such Lender’s or the L/C Issuer’s policies and the policies of suchLender’s or the L/C Issuer’s holding company with respect to capital adequacy), then from time to time the Borrower will pay to suchLender or the L/C Issuer, as the case may be, such additional amount or amounts as will compensate such Lender or the L/C Issuer orsuch Lender’s or the L/C Issuer’s holding company for any such reduction suffered.(c) Certificates for Reimbursement. A certificate of a Lender or the L/C Issuer setting forth the amount or amounts necessaryto compensate such Lender or the L/C Issuer or its holding company, as the case may be, as specified in subsection (a) or (b) of thisSection and delivered to the Borrower shall be conclusive absent manifest error. The Borrower shall pay such Lender or the L/CIssuer, as the case may be, the amount shown as due on any such certificate within 10 days after receipt thereof.(d) Delay in Requests. Failure or delay on the part of any Lender or the L/C Issuer to demand compensation pursuant to theforegoing provisions of this Section shall not constitute a waiver of such Lender’s or the L/C Issuer’s right to demand suchcompensation, provided that the Borrower shall not be required to compensate a Lender or the L/C Issuer pursuant to the foregoingprovisions of this Section for any increased costs incurred or reductions suffered more than six months prior to the date that suchLender or the L/C Issuer, as the case may be, notifies the Borrower of the Change in Law giving rise to such increased costs orreductions and of such Lender’s or the L/C Issuer’s intention to claim compensation therefor (except that, if the Change in Law givingrise to such increased costs or reductions is retroactive, then the six-month period referred to above shall be extended to include theperiod of retroactive effect thereof).(e) Reserves on Eurocurrency Rate Loans. The Borrower shall pay to each Lender, as long as such Lender shall be requiredto maintain reserves with respect to liabilities or assets consisting of or including Eurocurrency funds or deposits (currently known as“Eurocurrency liabilities”), additional interest on the unpaid principal amount of each Eurocurrency Rate Loan equal to the actual costsof such reserves allocated to such Loan by such Lender (as determined by such Lender in good faith, which determination shall beconclusive), which shall be due and payable on each date on which interest is payable on such Loan, provided that the Borrower shallhave received at least 10 days’ prior notice (with a copy to the Administrative Agent) of such additional interest from such Lender. If aLender fails to give notice 10 days prior to the relevant Interest Payment Date, such additional interest shall be due and payable 10days from receipt of such notice.-88-3.05. Compensation for Losses. Upon demand of any Lender (with a copy to the Administrative Agent) from time to time,the Borrower shall promptly compensate such Lender for and hold such Lender harmless from any loss, cost or expense incurred by itas a result of:(a) any continuation, conversion, payment or prepayment of any Loan other than a Base Rate Loan on a day other than thelast day of the Interest Period for such Loan (whether voluntary, mandatory, automatic, by reason of acceleration, or otherwise);(b) any failure by the Borrower (for a reason other than the failure of such Lender to make a Loan) to prepay, borrow,continue or convert any Loan other than a Base Rate Loan on the date or in the amount notified by the Borrower; or(c) any failure by the Borrower to make payment of any Loan or drawing under any Letter of Credit (or interest due thereon)denominated in an Alternative Currency on its scheduled due date or, in the case of any Loan, any payment thereof in a differentcurrency; or(d) any assignment of a Eurocurrency Rate Loan on a day other than the last day of the Interest Period therefor as a result of arequest by the Borrower pursuant to Section 10.13;including any loss of anticipated profits, any foreign exchange losses and any loss or expense arising from the liquidation orreemployment of funds obtained by it to maintain such Loan or from fees payable to terminate the deposits from which such fundswere obtained or from the performance of any foreign exchange contract. The Borrower shall also pay any customary administrativefees charged by such Lender in connection with the foregoing.For purposes of calculating amounts payable by the Borrower to the Lenders under this Section 3.05, each Lender shall be deemed tohave funded each Eurocurrency Rate Loan made by it at the Eurocurrency Rate for such Loan by a matching deposit or otherborrowing in the London or other applicable offshore interbank market for such currency for a comparable amount and for acomparable period, whether or not such Eurocurrency Rate Loan was in fact so funded.3.06. Mitigation Obligations; Replacement of Lenders.(a) Designation of a Different Lending Office. Each Lender may make any Credit Extension to the Borrower through anyLending Office, provided that the exercise of this option shall not affect the obligation of the Borrower to repay the Credit Extension inaccordance with the terms of this Agreement. If (i) any Lender requests compensation under Section 3.04, (ii) the Borrower is requiredto pay any Indemnified Taxes or additional amounts to any Lender, the L/C Issuer, or any Governmental Authority for the account ofany Lender or the L/C Issuer pursuant to Section 3.01, or (iii) any Lender gives a notice pursuant to Section 3.02, then such Lender orthe L/C Issuer shall, as applicable, use reasonable efforts to designate a different Lending Office for funding or booking its Loanshereunder or to assign its rights and obligations hereunder to another of its offices, branches or affiliates, if, in the judgment of suchLender or the L/C Issuer, such designation or assignment (A) would eliminate or reduce the amounts payable pursuant to Sections 3.01or 3.04, as the case may be, in the future, or eliminate the need for the notice pursuant to Section 3.02, as applicable, and (B) in eachcase, would not subject such Lender or the L/C Issuer, as the case may be, to any unreimbursed cost or expense and-89-would not otherwise be disadvantageous to such Lender or the L/C Issuer, as the case may be. The Borrower hereby agrees to pay allreasonable costs and expenses incurred by any Lender or the L/C Issuer in connection with any such designation or assignment.(b) Replacement of Lenders. If any Lender requests compensation under Section 3.04, or if the Borrower is required to payany Indemnified Taxes or additional amounts to any Lender or any Governmental Authority for the account of any Lender pursuant toSection 3.01, and, in each case, such Lender has declined or is unable to designate a different lending office in accordance withSection 3.06(a), the Borrower may replace such Lender in accordance with Section 10.13.3.07. Survival. All of the Borrower’s obligations under this Article III shall survive termination of the AggregateCommitments, repayment of all other Obligations hereunder, and resignation of the Administrative Agent.ARTICLE IV. CONDITIONS PRECEDENT TO CREDIT EXTENSIONS4.01. Conditions of Initial Credit Extension. The obligations of the L/C Issuer and each Lender to make its initial CreditExtensions hereunder are subject to satisfaction of the following conditions precedent:(a) The Administrative Agent’s receipt of the following, each of which shall be originals or telecopies (followed promptly byoriginals) unless otherwise specified, each properly executed by a Responsible Officer of the signing Loan Party, each dated theClosing Date (or, in the case of certificates of governmental officials, a recent date before the Closing Date) and each in form andsubstance reasonably satisfactory to the Administrative Agent and the Lenders:(i) executed counterparts of this Agreement, sufficient in number for distribution to the Administrative Agent, eachLender and the Borrower;(ii) Notes executed by the Borrower in favor of each Lender requesting Notes;(iii) a certificate from a Responsible Officer of each of the Loan Parties (A) attesting to the resolutions of suchPerson’s Board of Directors (or equivalent) and, if necessary, shareholders (or equivalent) of such Person, authorizing itsexecution, delivery, and performance of this Agreement and any other Loan Documents to which such Person is to become aparty, (B) evidencing the identity, authority and capacity of each Responsible Officer thereof authorized to act as a ResponsibleOfficer in connection with this Agreement and the other Loan Documents to which such Loan Party is a party, and (C)certifying as true, correct and complete, copies of such Person’s Organization Documents, as amended, modified, orsupplemented to the date hereof;(iv) such documents and certifications as the Administrative Agent may reasonably require to evidence that each LoanParty is duly organized or formed, and that the Borrower is validly existing, in good standing and qualified to engage inbusiness in each jurisdiction where its ownership, lease or operation of properties or the conduct of its business requires such-90-qualification, except to the extent that failure to do so could not reasonably be expected to have a Material Adverse Effect;(v) a favorable opinion of Orrick, Herrington & Sutcliffe LLP, counsel to the Loan Parties, addressed to theAdministrative Agent and each Lender and in form and substance satisfactory to the Administrative Agent;(vi) a certificate of a Responsible Officer (x) of each Loan Party either (A) attaching copies of all consents, licensesand approvals required in connection with the execution, delivery and performance by such Loan Party and the validity againstsuch Loan Party of the Loan Documents to which it is a party, and such consents, licenses and approvals shall be in full forceand effect, or (B) stating that no such consents, licenses or approvals are so required and (y) of the Borrower certifying (A) thatthe conditions specified in Sections 4.02(a) and (b) have been satisfied and (B) that there has been no event or circumstancesince the date of the Audited Financial Statements that has had or could be reasonably expected to have, either individually orin the aggregate, a Material Adverse Effect;(vii) a duly completed Compliance Certificate as of the last day of the fiscal quarter of Equinix ended on September30, 2017 (provided that compliance with financial covenants shall be calculated on a pro forma basis after giving effect to theIndebtedness incurred hereunder and the use of proceeds thereof on the Closing Date), signed by a Responsible Officer of theBorrower;(viii) pay-off statements and/or lien release authorizations from the Existing Administrative Agent with respect to allobligations under the Existing Credit Agreement and other Existing Loan Documents;(ix) evidence that all insurance required to be maintained pursuant to the Loan Documents has been obtained and is ineffect;(x) lien search results, dated as of a recent date, together with copies of all effective Uniform Commercial Codefinancing statements that name any Loan Party as debtor; and(xi) such other assurances, certificates, documents, consents or opinions as the Administrative Agent, the L/C Issuer orthe Required Lenders reasonably may require.(b) Any fees required to be paid to the Administrative Agent, the Left Lead Arranger or the Lenders on or before the ClosingDate shall have been paid, including, without limitation, any fees to Lenders as shall have been separately agreed upon in writing in theamounts so specified.(c) The Borrower shall have paid all reasonable fees, charges and disbursements of counsel to the Administrative Agent(directly to such counsel if requested by the Administrative Agent) to the extent invoiced prior to the Closing Date, plus such additionalamounts of such fees, charges and disbursements as shall constitute its reasonable estimate of such fees, charges and disbursementsincurred or to be incurred by it through the closing proceedings (provided that such estimate shall not thereafter preclude a final settlingof accounts between the Borrower and the Administrative Agent).-91-Without limiting the generality of the provisions of the last paragraph of Section 9.03, for purposes of determining compliancewith the conditions specified in this Section 4.01, each Lender that has signed this Agreement shall be deemed to have consented to,approved or accepted or to be satisfied with, each document or other matter required thereunder to be consented to or approved by oracceptable or satisfactory to a Lender unless the Administrative Agent shall have received notice from such Lender prior to theproposed Closing Date specifying its objection thereto.4.02. Conditions to All Credit Extensions. The obligation of each Lender to honor any Request for Credit Extension (otherthan a Loan Notice requesting only a conversion of Loans to the other Type, or a continuation of Eurocurrency Rate Loans) is subjectto the following conditions precedent:(a) The representations and warranties of the Borrower and each other Loan Party contained in Article V or any other LoanDocument, or which are contained in any document furnished at any time under or in connection herewith or therewith, shall be trueand correct in all material respects on and as of the date of such Credit Extension, except (i) for representations and warranties whichare qualified by the inclusion of a materiality standard, which representations and warranties shall be true and correct in all respects,and (ii) to the extent that such representations and warranties specifically refer to an earlier date, in which case they shall be true andcorrect in all material respects as of such earlier date, and except that for purposes of this Section 4.02, the representations andwarranties contained in clauses (a) and (b) of Section 5.05 shall be deemed to refer to the most recent statements furnished pursuant toclauses (a) and (b), respectively, of Section 6.01.(b) No Default or Event of Default shall exist, or would result from such proposed Credit Extension or from the application ofthe proceeds thereof.(c) The Administrative Agent and, if applicable, the L/C Issuer shall have received a Request for Credit Extension (or, if theCredit Extension requested is a Loan, telephonic notice followed immediately by delivery of a written Loan Notice) in accordance withthe requirements hereof.(d) In the case of a Credit Extension to be denominated in an Alternative Currency, there shall not have occurred any changein national or international financial, political or economic conditions or currency exchange rates or exchange controls which in thereasonable opinion of the Administrative Agent, the Required Lenders (in the case of any Loans to be denominated in an AlternativeCurrency) or the L/C Issuer (in the case of any Letter of Credit to be denominated in an Alternative Currency) would make itimpracticable for such Credit Extension to be denominated in the relevant Alternative Currency.Each Request for Credit Extension (other than a Loan Notice requesting only a conversion of Loans to the other Type or acontinuation of Eurocurrency Rate Loans) submitted by the Borrower shall be deemed to be a representation and warranty that theconditions specified in Sections 4.02(a) and (b) have been satisfied on and as of the date of the applicable Credit Extension.-92-ARTICLE V.REPRESENTATIONS AND WARRANTIESEach of the Borrower and Guarantors represents and warrants to the Administrative Agent and the Lenders that:5.01. Existence, Qualification and Power. Each Loan Party and each Restricted Subsidiary (a) is duly organized or formed,validly existing and, as applicable, in good standing under the Laws of the jurisdiction of its incorporation or organization, (b) has allrequisite power and authority and all requisite governmental licenses, authorizations, consents and approvals to (i) own or lease itsassets and carry on its business and (ii) with respect to each such Loan Party only, execute, deliver and perform its obligations underthe Loan Documents to which it is a party, and (c) is duly qualified and is licensed and, as applicable, in good standing under the Lawsof each jurisdiction where its ownership, lease or operation of properties or the conduct of its business requires such qualification orlicense; except (x) in each case referred to in clause (b)(i) or (c), to the extent that failure to do so could not reasonably be expected tohave a Material Adverse Effect, and (y) in the case referred to in clause (a) with respect to any Restricted Subsidiary that is not a LoanParty, to the extent that failure to do so could not reasonably be expected to have a Material Adverse Effect.5.02. Authorization; No Contravention. The execution, delivery and performance by each Loan Party of each LoanDocument to which such Person is party, have been duly authorized by all necessary corporate or other organizational action, and donot and will not (a) contravene the terms of any of such Person’s Organization Documents; (b) except as could not reasonably beexpected to have, either individually or in the aggregate, a Material Adverse Effect, conflict with or result in any breach orcontravention of, or the creation of any Lien under, or require any payment to be made under (i) any Contractual Obligation to whichsuch Person is a party or affecting such Person or the properties of such Person or any of its Subsidiaries or (ii) any order, injunction,writ or decree of any Governmental Authority or any arbitral award to which such Person or its property is subject; or (c) except ascould not reasonably be expected to have, either individually or in the aggregate, a Material Adverse Effect, violate any Law.5.03. Governmental Authorization; Other Consents. No approval, consent, exemption, authorization, or other action by, ornotice to, or filing with, any Governmental Authority or any other Person is necessary or required in connection with the execution,delivery or performance by, or enforcement against, any Loan Party of this Agreement or any other Loan Document.5.04. Binding Effect. This Agreement has been, and each other Loan Document, when delivered hereunder, will have been,duly executed and delivered by each Loan Party that is party thereto. This Agreement constitutes, and each other Loan Documentwhen so delivered will constitute, a legal, valid and binding obligation of such Loan Party, enforceable against each Loan Party that isparty thereto in accordance with its terms, except as limited by bankruptcy, insolvency or other laws of general application relating toor affecting the enforcement of creditors’ rights generally and general principles of equity.-93-5.05. Financial Statements; No Material Adverse Effect.(a) The Audited Financial Statements (i) were prepared in accordance with GAAP consistently applied throughout the periodcovered thereby, except as otherwise expressly noted therein; (ii) fairly present in all material respects the financial condition ofEquinix and its Subsidiaries as of the date thereof and their results of operations for the period covered thereby in accordance withGAAP consistently applied throughout the period covered thereby, except, with respect to GAAP application only, as otherwiseexpressly noted therein; and (iii) show all material indebtedness and other liabilities, direct or contingent, of Equinix and itsSubsidiaries as of the date thereof, including liabilities for material taxes, material commitments and Indebtedness.(b) The unaudited consolidated balance sheets of Equinix and its Subsidiaries dated September 30, 2017, and the relatedconsolidated statements of income or operations, shareholders’ equity and cash flows for the fiscal quarter ended on that date (i) wereprepared in accordance with GAAP consistently applied throughout the period covered thereby, except as otherwise expressly notedtherein, and (ii) fairly present in all material respects the financial condition of Equinix and its Subsidiaries as of the date thereof andtheir results of operations for the period covered thereby, subject, in the case of clauses (i) and (ii), to the absence of footnotes and tonormal year-end audit adjustments.(c) Since the date of the Audited Financial Statements, there has been no event or circumstance, either individually or in theaggregate, that has had or could reasonably be expected to have a Material Adverse Effect.5.06. Litigation. Except as disclosed in Equinix’s public filings with the SEC prior to the Closing Date, there are no actions,suits, proceedings, claims or disputes pending or, to the knowledge of the Borrower after due and diligent investigation, threatened orcontemplated, at law, in equity, in arbitration or before any Governmental Authority, by or against the Borrower or any of itsRestricted Subsidiaries or against any of their properties or revenues that (a) purport to affect or pertain to this Agreement or any otherLoan Document, or any of the transactions contemplated hereby, or (b) either individually or in the aggregate could reasonably beexpected to have a Material Adverse Effect.5.07. No Default. Neither any Loan Party nor any Restricted Subsidiary is in default under or with respect to any ContractualObligation that could, either individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. No Defaulthas occurred and is continuing or would result from the consummation of the transactions contemplated by this Agreement or any otherLoan Document.5.08. Ownership of Property; Liens. The Borrower and each of its Restricted Subsidiaries has good record and marketabletitle in fee simple to, or valid leasehold interests in, all real property necessary or used in the ordinary conduct of its business, except forsuch defects in title as could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. Theproperty of the Borrower and its Restricted Subsidiaries is subject to no Liens, other than Liens permitted by Section 7.01.-94-5.09. Environmental Compliance. The Borrower conducts in the ordinary course of business a review of the effect ofexisting Environmental Laws and claims alleging potential liability or responsibility for violation of any Environmental Law on theBorrower and its Restricted Subsidiaries’ respective businesses, operations and properties, and as a result thereof the Borrower hasreasonably concluded that such Environmental Laws and claims could not, individually or in the aggregate, reasonably be expected tohave a Material Adverse Effect.5.10. Insurance. The properties of the Borrower and its Restricted Subsidiaries are insured with financially sound andreputable insurance companies not Affiliates of the Borrower, in such amounts, with such deductibles and retentions and covering suchrisks as are customarily carried by companies engaged in similar businesses and owning similar properties in localities where theBorrower or its Restricted Subsidiaries operate.5.11. Taxes. The Borrower and its Restricted Subsidiaries have filed all Federal and state income and other material taxreturns and reports required to be filed, and have paid all Federal, state and other material taxes, assessments, fees and othergovernmental charges levied or imposed upon them or their properties, income or assets otherwise due and payable, except thosewhich are being contested in good faith by appropriate proceedings diligently conducted and for which adequate reserves have beenprovided in accordance with GAAP or except as could not reasonably be expected, individually or in the aggregate, to have a MaterialAdverse Effect. There is no proposed tax assessment against the Borrower or any Subsidiary that would, if made, have a MaterialAdverse Effect. Neither any Loan Party nor any wholly-owned Subsidiary thereof is party to any tax sharing agreement other thantaxing sharing agreements solely among one or more of Equinix and its past or present Affiliates (other than shareholders, directors orofficers).5.12. ERISA Compliance.(a) Each Plan is in compliance in all material respects with the applicable provisions of ERISA, the Code and other Federal orstate laws. Each Pension Plan that is intended to be a qualified plan under Section 401(a) of the Code has received a favorabledetermination letter (or may rely on an opinion letter) from the Internal Revenue Service to the effect that the form of such PensionPlan is qualified under Section 401(a) of the Code and the trust related thereto has been determined by the Internal Revenue Service tobe exempt from federal income tax under Section 501(a) of the Code, or an application for such a letter is currently being processed bythe Internal Revenue Service. To the best knowledge of the Borrower, nothing has occurred that would prevent or cause the loss ofsuch tax-qualified status.(b) There are no pending or, to the best knowledge of the Borrower, threatened claims, actions or lawsuits, or action by anyGovernmental Authority, with respect to any Plan that could reasonably be expected to have a Material Adverse Effect. There hasbeen no non-exempt prohibited transaction or violation of the fiduciary responsibility rules with respect to any Plan that has resulted orcould reasonably be expected to result in a Material Adverse Effect.-95-(c) (i) No ERISA Event has occurred, and neither the Borrower nor any ERISA Affiliate is aware of any fact, event orcircumstance that could reasonably be expected to constitute or result in an ERISA Event with respect to any Pension Plan; (ii) theBorrower and each ERISA Affiliate has met all applicable requirements under the Pension Funding Rules in respect of each PensionPlan, and no waiver of the minimum funding standards under the Pension Funding Rules has been applied for or obtained; (iii) as ofthe most recent valuation date for any Pension Plan, the funding target attainment percentage (as defined in Section 430(d)(2) of theCode) is 60% or higher and none of the Borrower or any ERISA Affiliate knows of any facts or circumstances that could reasonablybe expected to cause the funding target attainment percentage for any such plan to drop below 60% as of the most recent valuationdate; (iv) none of the Borrower or any ERISA Affiliate has incurred any liability to the PBGC other than for the payment of premiums,and there are no premium payments which have become due that are unpaid; (v) none of the Borrower or any ERISA Affiliate hasengaged in a transaction that could be subject to Section 4069 or Section 4212(c) of ERISA; and (vi) no Pension Plan has beenterminated by the plan administrator thereof nor by the PBGC, and no event or circumstance has occurred or exists that couldreasonably be expected to cause the PBGC to institute proceedings under Title IV of ERISA to terminate any Pension Plan.(d) As of the Closing Date and throughout the term of this Agreement, at least one of the following is and will be true withrespect to the Borrower:(i) the Borrower is not using “plan assets” (within the meaning of 29 CFR § 2510.3-101, as modified by Section 3(42)of ERISA) of one or more Benefit Plans in connection with the Loans, the Letters of Credit or the Commitments,(ii) the transaction exemption set forth in one or more PTEs, such as PTE 84‑14 (a class exemption for certaintransactions determined by independent qualified professional asset managers), PTE 95-60 (a class exemption for certaintransactions involving insurance company general accounts), PTE 90-1 (a class exemption for certain transactions involvinginsurance company pooled separate accounts), PTE 91-38 (a class exemption for certain transactions involving bank collectiveinvestment funds) or PTE 96-23 (a class exemption for certain transactions determined by in-house asset managers), isapplicable with respect to the Borrower’s entering into and performance of this Agreement, the other Loan Documents, theLoans, the Letters of Credit or the Commitments and each action or obligation hereunder and thereunder, or(iii) (A) the Borrower is an investment fund managed by a “Qualified Professional Asset Manager” (within themeaning of Part VI of PTE 84-14), (B) such Qualified Professional Asset Manager made the investment decision on behalf ofsuch Borrower to enter into and perform this Agreement, the other Loan Documents, the Loans, the Letters of Credit or theCommitments and each action or obligation hereunder and thereunder, (C) the entering into and performance of thisAgreement, the other Loan Documents, the Loans, the Letters of Credit or the Commitments and each action or obligationhereunder and thereunder, each satisfies the requirements of sub-sections (b) through (g) of Part I of PTE 84-14 and (D) to thebest knowledge of the Borrower, the requirements of subsection (a) of Part I of PTE 84-14 are satisfied with respect to theBorrower’s entering into and performance of this Agreement, the other Loan-96-Documents, the Loans, the Letters of Credit or the Commitments and each action or obligation hereunder and thereunder, or(iv) such other representation, warranty and covenant as may be agreed in writing between the Administrative Agent,in its sole discretion, and the Borrower.(e) In addition, unless clause (d)(i) above is true with respect to the Borrower or the Borrower has not provided anotherrepresentation, warranty and covenant as described in clause (d)(iv) above, the Borrower further represents and warrants, as of the datehereof and throughout the term of this Agreement, that:(i) none of the Administrative Agent, any Lender, the Left Lead Arranger, any other Joint Lead Arranger or anyAffiliate of the foregoing is a fiduciary with respect to the assets of the Borrower (including in connection with the reservationor exercise of any rights by the Administrative Agent under this Agreement, any Loan Document or any documents related tohereto or thereto),(ii) the Person making the investment decision on behalf of the Borrower with respect to the entrance into andperformance of this Agreement, the other Loan Documents, the Loans, the Letters of Credit or the Commitments and eachaction or obligation hereunder and thereunder is independent (within the meaning of 29 CFR § 2510.3-21) and is a bank, aninsurance carrier, an investment adviser, a broker-dealer or other person that holds, or has under management or control, totalassets of at least $50 million, in each case as described in 29 CFR § 2510.3-21(c)(1)(i)(A)-(E),(iii) the Person making the investment decision on behalf of the Borrower with respect to the entrance into andperformance of this Agreement, the other Loan Documents, the Loans, the Letters of Credit or the Commitments and eachaction or obligation hereunder and thereunder is capable of evaluating investment risks independently, both in general and withregard to particular transactions and investment strategies (including in respect of the Obligations),(iv) the Person making the investment decision on behalf of the Borrower with respect to the entrance into andperformance of this Agreement, any documents related to this Agreement, the other Loan Documents, the Loans, the Letters ofCredit or the Commitments and each action or obligation hereunder and thereunder is a fiduciary under ERISA or the Code, orboth, with respect to this Agreement, the other Loan Documents, the Loans, the Letters of Credit or the Commitments and eachaction or obligation hereunder and thereunder, and(v) no fee or other compensation is being paid directly to the Administrative Agent, the Left Lead Arranger, any otherJoint Lead Arranger or any Lender or any Affiliates of the foregoing for investment advice (as opposed to other services) inconnection with the transactions contemplated hereby or by any Loan Document.5.13. Subsidiaries; Equity Interests. As of the Closing Date, except for currently inactive subsidiaries, (a) the Borrower hasno Subsidiaries other than those specifically disclosed in Part (a) of Schedule 5.13 and (b) all of the outstanding Equity Interests in eachwholly-owned Subsidiary have-97-been validly issued, are fully paid and nonassessable and are owned by the Borrower or a Subsidiary thereof in the amounts specifiedon Part (a) of Schedule 5.13 free and clear of all Liens (other than Liens granted pursuant to the Loan Documents or otherwiseexpressly permitted by Section 7.01). As of the Closing Date, the Borrower has no equity investments in any other corporation orentity other than (i) investments held in the ordinary course of business in or through money market funds, mutual funds, investment orbrokerages accounts and other similar types of investment vehicles and accounts and (ii) those specifically disclosed in Part (b) ofSchedule 5.13. All of the outstanding Equity Interests in the Borrower have been validly issued and are fully paid and nonassessable.As of the Closing Date, (x) the Unrestricted Subsidiaries are set forth on Schedule 6.14, (y) the aggregate Attributable Asset Share ofall Unrestricted Subsidiaries does not exceed 10% of the consolidated total assets of Equinix and its Subsidiaries, and (z) the aggregateAttributable A/R Share of all Unrestricted Subsidiaries does not exceed 10% of the net accounts receivable of Equinix and itsSubsidiaries.5.14. Margin Regulations; Investment Company Act.(a) None of the Loan Parties is engaged and none will engage, principally or as one of its important activities, in the businessof purchasing or carrying margin stock (within the meaning of Regulation U issued by the FRB), or extending credit for the purpose ofpurchasing or carrying margin stock.(b) None of the Loan Parties is or is required to be registered as an “investment company” under the Investment Company Actof 1940.5.15. Disclosure. No report, financial statement, certificate or other information furnished (whether in writing or orally) by oron behalf of any Loan Party to the Administrative Agent, any Lender or any Guaranteed Party in connection with the transactionscontemplated hereby and the negotiation of this Agreement or delivered hereunder or under any other Loan Document (in each case,as modified or supplemented by other information so furnished) contains any material misstatement of fact or omits to state any materialfact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; providedthat, (a) with respect to any report, financial statement, certificate or other information concerning the target of any PermittedAcquisition, the Borrower, in each case, makes such representation only to the best of its knowledge and (b) with respect to projectedfinancial information, the Borrower represents only that such information was prepared in good faith based upon assumptions believedto be reasonable at the time.5.16. Compliance with Laws. Each Loan Party and each Restricted Subsidiary thereof is in compliance in all materialrespects with the requirements of all Laws and all orders, writs, injunctions and decrees applicable to it or to its properties, except insuch instances in which (a) such requirement of Law or order, writ, injunction or decree is being contested in good faith by appropriateproceedings diligently conducted or (b) the failure to comply therewith, either individually or in the aggregate, could not reasonably beexpected to have a Material Adverse Effect.5.17. Taxpayer Identification Number. Each Loan Party’s true and correct United States taxpayer identification number isset forth on Schedule 10.02.-98-5.18. REIT Status. Equinix (a) qualifies as a REIT (without regard to any election requirement relating to the same) and (b)is in compliance with all other requirements and conditions imposed under the Code to allow it to maintain its status as a REIT.5.19. OFAC and Sanctions. Neither the Borrower, nor any of its Subsidiaries, nor, to the knowledge of the Borrower or anyof its Subsidiaries, any Related Party (a) is an individual or entity currently the subject of any Sanctions or (b) is located, organized orresident in a Designated Jurisdiction. No Loan, nor the proceeds from any Loan, have been used, directly or indirectly, to lend,contribute, provide, or have otherwise been made available to fund, any activity or business in any Designated Jurisdiction or to fundany activity or business of any Person to the extent that Person is located, organized or resident in any Designated Jurisdiction or whois the subject of any Sanctions, or in any other manner that could reasonably be expected to result in any violation of Sanctions by anyparty to this Agreement or any other Loan Document (including any Guaranteed Party).5.20. Anti-Corruption Laws. The Borrower, its Subsidiaries, their respective officers and employees, and, to the knowledgeof the Borrower, the Borrower’s and its Subsidiaries’ directors and agents acting within the scope of their relationships with theBorrower or its Subsidiaries, have conducted their businesses in material compliance with applicable Anti-Corruption Laws and haveinstituted and maintained policies and procedures reasonably designed to promote and achieve compliance with such laws.5.21. EEA Financial Institutions. No Loan Party is an EEA Financial Institution.ARTICLE VI. AFFIRMATIVE COVENANTSSo long as any Lender shall have any Commitment hereunder, any Loan or other Obligation hereunder shall remain unpaid orunsatisfied, or any Letter of Credit shall remain outstanding, the Borrower shall, and shall (except in the case of the covenants set forthin Sections 6.01, 6.02 and 6.03) cause each Restricted Subsidiary to:6.01. Financial Statements. Deliver to the Administrative Agent and each Lender, in form and detail satisfactory to theAdministrative Agent and the Required Lenders:(a) as soon as available, but in any event within 90 days after the end of each fiscal year of Equinix (or such later date as maybe permitted after filing a single applicable request for extension with the SEC and receiving such extension within such 90 days aftersuch fiscal year end, which later date shall not exceed 120 days after such fiscal year end), the audited and unqualified annualconsolidated financial statements of Equinix, accompanied by a report and opinion thereon of an independent certified publicaccountant of nationally recognized standing;(b) as soon as available, but in any event within 45 days after the end of each fiscal quarter of Equinix (or such later date asmay be permitted after filing a single applicable request for extension with the SEC and receiving such extension within such 45 daysafter such fiscal quarter end, which later date shall not exceed 75 days after such fiscal quarter end) (but excluding the last fiscal quarter-99-of Equinix’s fiscal year), quarterly company-prepared consolidated financial statements of Equinix, certified and dated by aResponsible Officer of Equinix; and(c) copies of the Form 10-K Annual Report and Form 10-Q Quarterly Report for Equinix concurrent with the date of filingwith the SEC.6.02. Certificates; Other Information. Deliver to the Administrative Agent and each Lender, in form and detail reasonablysatisfactory to the Administrative Agent and the Required Lenders:(a) concurrently with the delivery of the financial statements referred to in Sections 6.01(a) and (b), a Compliance Certificateof the Borrower, signed by a Responsible Officer of the Borrower, and setting forth, among other things, (i) the information andcomputations (in sufficient detail) to establish compliance with all financial covenants at the end of the period covered by the financialstatements then being furnished, (ii) the Consolidated Net Lease Adjusted Leverage Ratio and current Debt Rating for purposes ofdetermining the Applicable Margin and (iii) whether there existed as of the date of such financial statements and whether there exists asof the date of the certificate, any Default or Event of Default under this Agreement and, if any such Default or Event of Default exists,specifying the nature thereof and the action the Borrower is taking and proposes to take with respect thereto;(b) promptly upon any request by the Administrative Agent or any Lender (but no more frequently than twice per each fiscalyear of Equinix unless an Event of Default has occurred and is continuing), such other books, records, statements, lists of property andaccounts, budgets, forecasts or reports as to the Borrower as the Administrative Agent or such Lender may reasonably request;(c) promptly after the same are available, copies of each annual report, proxy or financial statement or other report orcommunication sent to the stockholders of Equinix, and copies of all annual, regular, periodic and special reports and registrationstatements which the Borrower may file or be required to file with the SEC under Section 13 or 15(d) of the Securities Exchange Actof 1934, and not otherwise required to be delivered to the Administrative Agent pursuant hereto; and(d) promptly, such additional information regarding the business or financial affairs of the Borrower or any wholly-ownedRestricted Subsidiary (and with respect to any non-wholly-owned Restricted Subsidiary, such additional information regarding itsbusiness or financial affairs as is reasonably available), or compliance with the terms of the Loan Documents, as the AdministrativeAgent or any Lender may from time to time reasonably request.Documents required to be delivered pursuant to Section 6.01 or Section 6.02(c) (to the extent any such documents are includedin materials otherwise filed with the SEC) may be delivered electronically and if so delivered, shall be deemed to have been deliveredon the date (i) on which Equinix posts such documents, or provides a link thereto on its website on the Internet at Equinix’s websiteaddress of www.equinix.com (or such other website address Equinix may provide to the Administrative Agent and each Lender inwriting from time to time); provided that: (i) to the extent the Administrative Agent or any Lender is otherwise unable to receive anysuch electronically delivered documents, the Borrower shall, upon request by the Administrative Agent or such Lender, deliver papercopies of such documents to such Person until a written request to cease delivering paper copies is given by such Person, and (ii) theBorrower shall notify the Administrative Agent and each Lender (by-100-facsimile or electronic mail) of the posting of any such documents or provide to the Administrative Agent and the Lenders byelectronic mail electronic versions (i.e., soft copies) of such documents. The Administrative Agent shall have no obligation to requestthe delivery of or to maintain paper copies of the documents referred to above, and in any event shall have no responsibility to monitorcompliance by the Borrower with any such request by a Lender for delivery, and each Lender shall be solely responsible for requestingdelivery to it or maintaining its copies of such documents.The Borrower and each other Loan Party hereby acknowledges that (A) the Administrative Agent and/or the Left LeadArranger may, but shall not be obligated to, make available to the Lenders and the L/C Issuer materials and/or information provided byor on behalf of the Borrower hereunder (collectively, “Borrower Materials”) by posting the Borrower Materials on DebtDomain,IntraLinks, Syndtrak, ClearPar, or another similar electronic system (the “Platform”) and (B) certain of the Lenders (each, a “PublicLender”) may have personnel who do not wish to receive material non-public information with respect to the Borrower or theirAffiliates, or the respective securities of any of the foregoing, and who may be engaged in investment and other market-relatedactivities with respect to such Persons’ securities. The Borrower and each other Loan Party hereby agrees that (w) all BorrowerMaterials that are to be made available to Public Lenders shall be clearly and conspicuously marked “PUBLIC” which, at a minimum,shall mean that the word “PUBLIC” shall appear prominently on the first page thereof; (x) by marking Borrower Materials“PUBLIC,” the Borrower shall be deemed to have authorized the Administrative Agent, the Left Lead Arranger, the L/C Issuer andthe Lenders to treat such Borrower Materials as not containing any material non-public information with respect to the Borrower or itssecurities for purposes of United States Federal and state securities laws (provided, however, that to the extent such Borrower Materialsconstitute Information, they shall be treated as set forth in Section 10.07); (y) all Borrower Materials marked “PUBLIC” are permittedto be made available through a portion of the Platform designated “Public Side Information;” and (z) the Administrative Agent and theLeft Lead Arranger shall be entitled to treat the Borrower Materials that are not marked “PUBLIC” as being suitable only for postingon a portion of the Platform not designated “Public Side Information.”6.03. Notices. Promptly notify the Administrative Agent and each Lender in writing of:(a) any Default or Event of Default;(b) any Material Adverse Effect, including, to the extent that any of the following could reasonably be expected to result in aMaterial Adverse Effect: (i) any breach or non-performance of, or any default under, a Contractual Obligation of the Borrower or anySubsidiary; (ii) any dispute, litigation, investigation, proceeding or suspension between the Borrower or any Subsidiary and anyGovernmental Authority; or (iii) the commencement of, or any material development in, any litigation or proceeding affecting theBorrower or any Subsidiary, including pursuant to any applicable Environmental Laws;-101-(c) any change in the Borrower’s name, legal structure, place of business, or chief executive office if the Borrower has morethan one place of business;(d) any ERISA Event;(e) any material change in accounting policies or financial reporting practices by the Borrower, including any determinationby the Borrower referred to in Section 2.09(b); and(f) any announcement by Moody’s or S&P of any change in Debt Rating or the Borrower’s receipt of any notice fromMoody’s or S&P of any such change.Each notice pursuant to this Section 6.03 shall be accompanied by a statement of a Responsible Officer of the Borrower settingforth details of the occurrence referred to therein and stating what action the Borrower has taken and proposes to take with respectthereto. Each notice pursuant to Section 6.03(a) shall describe with particularity any and all provisions of this Agreement and any otherLoan Document that have been breached.6.04. Payment of Obligations. Pay and discharge, and cause each Restricted Subsidiary to pay and discharge (a) all materialtax liabilities, assessments and governmental charges or levies upon it or its properties or assets, unless the same are being contested ingood faith by appropriate proceedings diligently conducted and adequate reserves in accordance with GAAP are being maintained bythe Borrower; and (b) all lawful claims which, if unpaid, would by law become a Lien upon its property (other than a Lien that is notprohibited by Section 7.01 and could not reasonably be expected to have a Material Adverse Effect).6.05. Preservation of Existence, Etc. (a) Preserve, renew and maintain in full force and effect its and its RestrictedSubsidiaries’ legal existence and good standing under the Laws of the jurisdiction of its organization except (i) in the case of aRestricted Subsidiary that is not a Loan Party, to the extent that failure to do so could not reasonably be expected to have a MaterialAdverse Effect or (ii) in a transaction permitted by Sections 7.04 or 7.05; (b) take all reasonable action to maintain all of its and itsRestricted Subsidiaries’ rights, privileges, permits, licenses and franchises necessary or desirable in the normal conduct of its business,except to the extent that failure to do so could not reasonably be expected to have a Material Adverse Effect; and (c) preserve or renewall of its and its Subsidiaries’ registered patents, trademarks, trade names and service marks, the non-preservation of which couldreasonably be expected to have a Material Adverse Effect.6.06. Maintenance of Properties. (a) Maintain, preserve and protect all of its and its Restricted Subsidiaries’ materialproperties and equipment necessary in the operation of its business in good working order and condition, ordinary wear and tearexcepted, and (b) make all necessary repairs thereto and renewals and replacements thereof, except in each of the foregoing clauses (a)and (b) where the failure to do so could not reasonably be expected to have a Material Adverse Effect.-102-6.07. Maintenance of Insurance. Maintain insurance as is customary and usual for the business of the Borrower and eachRestricted Subsidiary.6.08. Compliance with Laws. Comply with the Laws (including any fictitious or trade name statute), regulations, and ordersof any government body with authority over the Borrower’s or any Restricted Subsidiary’s business, except where the failure tocomply could not reasonably be expected to have a Material Adverse Effect. The Lenders shall have no obligation to make anyadvance to the Borrower except in compliance with all applicable laws and regulations and the Borrower shall fully cooperate with theLenders and the Administrative Agent in complying with all such applicable laws and regulations.6.09. Books and Records. Maintain adequate books and records, in which full, true and correct entries in conformity withGAAP consistently applied shall be made of all financial transactions and matters involving the assets and business of the Borrowerand its Restricted Subsidiaries, as the case may be.6.10. Inspection Rights. Upon prior advance notice, allow the Administrative Agent, any Lender, and any of their respectiveagents to inspect the Borrower’s and Guarantors’ properties and examine and audit their financial records at any reasonable time;provided, however, that (a) unless an Event of Default has occurred and is continuing, no more than two such inspections,examinations and audits may be made the Administrative Agent and the Lenders (acting collectively) per fiscal year of the Borrower,(b) when an Event of Default exists, the Administrative Agent, any Lender, or any of their respective agents may do any of theforegoing (as well as make copies of books and records) at the expense of the Borrower at any reasonable time, and (c) withoutlimiting any of the foregoing, the Borrower shall have the right (if it so elects) to have a representative of the Borrower be presentduring any discussions with auditors and accountants. If the properties, books or records of the Borrower are in the possession of athird party, the Borrower authorizes that third party to permit the Administrative Agent or its agents to have access to performinspections or audits and to respond to the Administrative Agent’s requests for information concerning such properties, books andrecords.6.11. Use of Proceeds. Use the proceeds of the Credit Extensions (a) for working capital, capital expenditures, acquisitions,dividends, distributions, stock buybacks, and the issuance of Letters of Credit, in each case to the extent not prohibited hereunder, (b)to refinance existing Indebtedness of the Borrower and its Subsidiaries, and (c) for other general corporate purposes not incontravention of any Law or of any Loan Document.6.12. ERISA Plans. Promptly during each year, pay and cause its respective Subsidiaries to pay contributions adequate tomeet at least the minimum funding standards under ERISA with respect to each and every Pension Plan; file each annual reportrequired to be filed pursuant to ERISA in connection with each Plan for each year; and notify the Administrative Agent within 10 daysof the occurrence of any Reportable Event that might constitute grounds for termination of any Pension Plan by the PBGC or for theappointment by the appropriate United States District Court of a trustee to administer any Pension Plan.6.13. Additional Subsidiary Guarantors; Automatic Release of Guarantors.-103-(a) Notify the Administrative Agent (x) at any time prior to the Automatic Guaranty Release if one or more Personsconstitutes a Material Domestic Subsidiary (other than a Foreign Subsidiary Holdco) or (y) at any time if one or more Persons that is aSubsidiary that is not already a Guarantor hereunder Guarantees any Indebtedness under any Senior Notes Indenture or any otherpublic or privately-placed debt securities issued by the Borrower, and, in each case, promptly thereafter (and in any event within 30days), cause such Person(s) to become Guarantor(s) hereunder by (i) executing and delivering to the Administrative Agent a JoinderAgreement and/or such other documents as the Administrative Agent shall deem appropriate for such purpose, and (ii) delivering to theAdministrative Agent documents of the types referred to in clauses (iii) and (iv) of Section 4.01(a) and favorable opinions of counsel tosuch Person(s) (which shall cover, among other things, the legality, validity, binding effect and enforceability of the documentationreferred to in clauses (i) and (ii), as applicable, and no conflict with material agreements), in all such cases of the foregoing clauses (i)and (ii), in form, content and scope reasonably satisfactory to the Administrative Agent; provided, however, that, so long as no Defaultor Event of Default has occurred and is continuing, if any such Person constitutes a Material Domestic Subsidiary (other than a ForeignSubsidiary Holdco) solely as a result of it having been acquired through an Acquisition occurring after the Closing Date and does nototherwise Guarantee Indebtedness under any Senior Notes Indenture or any other public or privately-placed debt securities issued bythe Borrower, then such Person shall not be required to become a Guarantor under this Section 6.13(a) unless such Person constitutes aMaterial Domestic Subsidiary (other than a Foreign Subsidiary Holdco) at any time on or after the nine month anniversary of suchAcquisition, at which time it shall promptly become a Guarantor hereunder in accordance with the preceding provisions of this Section6.13(a). In addition, Equinix may, from time to time, elect to cause any Domestic Subsidiary to become a Guarantor in accordancewith the preceding clauses (i) and (ii) of this Section 6.13(a).(b) Notwithstanding anything herein to the contrary, at any time that the Borrower has either (x) a Debt Rating by Moody’s ofat least Baa3 and a Debt Rating by S&P of at least BB or (y) a Debt Rating by S&P of at least BBB- and a Debt Rating by Moody’sof at least Ba2, and so long as (A) no outstanding public or privately-placed debt securities issued by the Borrower are guaranteed byany of the Borrower’s direct or indirect Subsidiaries (it being understood that at any time any public or privately-placed debt securitiesissued by the Borrower are Guaranteed by any of the Borrower’s direct or indirect Subsidiaries, the Borrower shall promptly thereafter(and in any event within 30 days) cause such Subsidiaries to Guarantee the Obligations on a pari passu basis) and (B) no Default orEvent of Default then exists or would result therefrom, each of the Guarantors will be automatically released from the MultipartyGuaranty, without the requirement of any action by the Administrative Agent or the Lenders (the “Automatic Guaranty Release”). TheAdministrative Agent shall cooperate with the Loan Parties to execute and deliver appropriate releases to evidence such release.6.14. Designation of Unrestricted Subsidiaries. The Borrower may, from time to time, designate one or more Subsidiariesas “Unrestricted Subsidiaries” by giving written notice to the Administrative Agent; provided, however, that (a) in no event may theBorrower designate any Subsidiary as an Unrestricted Subsidiary if, at the time of and immediately after giving effect to suchdesignation, either (i) the Attributable Asset Share of Equinix in all Unrestricted Subsidiaries exceeds 10% of the consolidated totalassets of Equinix and its Subsidiaries (based on the most recent consolidated balance sheet of Equinix and its Subsidiaries delivered tothe Administrative Agent and the Lenders under Section 6.01(a) or (b), or (ii) the Attributable A/R Share of Equinix in all Unrestricted-104-Subsidiaries exceeds 10% of the net accounts receivable of Equinix and its Subsidiaries (based on the most recent consolidated balancesheet of Equinix and its Subsidiaries delivered to the Administrative Agent and the Lenders under Section 6.01(a) or (b)), and (b) noSubsidiary that is or is required to become a Guarantor under Section 6.13 may be an Unrestricted Subsidiary. As of the Closing Date,the Unrestricted Subsidiaries are set forth on Schedule 6.14. Any Subsidiary which has been designated as an Unrestricted Subsidiarypursuant to this Section 6.14 may, at any time thereafter, be redesignated as a Restricted Subsidiary by the Borrower; provided,however, that a Subsidiary that has been redesignated as a Restricted Subsidiary as provided in this sentence may not thereafter bedesignated or redesignated as an Unrestricted Subsidiary.6.15. Maintenance of REIT Status. In the case of Equinix, at all times conduct its affairs and the affairs of its Subsidiaries ina manner so as to continue to qualify as a REIT for U.S. federal income tax purposes.6.16. Anti-Corruption Laws and Sanctions Laws. Conduct its businesses in material compliance with applicable Anti-Corruption Laws, and maintain policies and procedures reasonably designed to promote and achieve compliance with such laws andapplicable Sanctions by the Borrower, its Subsidiaries and their respective directors, officers, employees and agents.ARTICLE VII. NEGATIVE COVENANTSSo long as any Lender shall have any Commitment hereunder, any Loan or other Obligation hereunder shall remain unpaid orunsatisfied, or any Letter of Credit shall remain outstanding:7.01. Liens. The Borrower shall not, nor shall it permit any Restricted Subsidiary to, directly or indirectly, create, incur,assume or suffer to exist any Lien upon any of its property, assets or revenues, whether now owned or hereafter acquired, other thanthe following:(a) Liens pursuant to any Loan Document;(b) Liens existing on the date hereof and listed on Schedule 7.01;(c) Liens for taxes and assessments not yet delinquent or which are being contested in good faith and by appropriateproceedings diligently conducted, if adequate reserves with respect thereto are maintained on the books of the applicable Person inaccordance with GAAP;(d) statutory Liens of landlords and Liens of carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s or other likeLiens arising in the ordinary course of business which are not overdue for a period of more than 30 days or which are being contestedin good faith and by appropriate proceedings diligently conducted, if adequate reserves with respect thereto are maintained on thebooks of the applicable Person;(e) Liens in favor of customs and revenue authorities arising as a matter of law to secure payments of customs duties inconnection with the importation of goods;-105-(f) pledges or deposits in the ordinary course of business in connection with workers’ compensation, unemployment insuranceand other social security legislation, other than any Lien imposed by ERISA;(g) normal and customary banker’s Liens and rights of setoff arising in the ordinary course of business with respect to cashand cash equivalents; provided that such cash and cash equivalents are not dedicated cash collateral in favor of such depositoryinstitution and are not otherwise intended to provide collateral security (other than for customary account commissions, fees andreimbursable expenses relating solely to deposit accounts, and for returned items);(h) normal and customary rights of setoff and similar Liens arising under bona fide interest rate or currency hedgingagreements, which are not for speculative purposes;(i) precautionary Uniform Commercial Code financing statements in connection with operating leases permitted hereunder;(j) deposits to secure the performance of bids, trade contracts and leases (other than Indebtedness), statutory obligations, suretyand appeal bonds, performance bonds and other obligations of a like nature incurred in the ordinary course of business;(k) easements, rights-of-way, restrictions and other similar encumbrances affecting real property which, in the aggregate, arenot substantial in amount, and which do not in any case materially detract from the value of the property subject thereto or materiallyinterfere with the ordinary conduct of the business of the applicable Person;(l) Liens securing judgments for the payment of money not constituting an Event of Default under Section 8.01(j);(m) Liens securing Indebtedness in respect of Capital Leases, Synthetic Lease Obligations, purchase money obligations forfixed or capital assets (including the costs of construction, improvement or rehabilitation of such fixed or capital assets) and, to theextent constituting a Lien, the interests of landlords under build-to-suit leases; provided that (i) such Liens do not at any time encumberany property other than the property financed by such Indebtedness, and (ii) the Indebtedness secured thereby does not exceed the costor fair market value, whichever is lower, of the property being acquired on the date of acquisition, or the cost of construction,improvement or rehabilitation of such fixed or capital assets, as applicable;(n) leases, subleases, licenses and sublicenses which do not materially interfere with the business of the Borrower or anySubsidiary;(o) Liens existing on property or assets of any Person at the time such Person becomes a Subsidiary or such property or assetsare acquired, but only, in any such case, (i) if such Lien was not created in contemplation of such Person becoming a Subsidiary orsuch property or assets being acquired, and (ii) so long as such Lien does not encumber any assets other than the property subject tosuch Lien at the time such Person becomes a Subsidiary or such property or assets are acquired;-106-(p) any renewals, replacements or extensions of the Liens described in clauses (b), (m) or (o) above, provided that (i) theproperty covered thereby is not expanded, and (ii) the amount secured or benefited thereby is not increased;(q) Liens on JV Interests held by a Loan Party or a Subsidiary in JV Entities securing the obligations of such Loan Party orSubsidiary to honor put rights and put options in favor of joint venture partners with respect to the JV Interests held by joint venturepartners in such JV Entities, provided that such Liens shall attach only to the JV Interests held by such Loan Party or a DomesticSubsidiary and not to any other assets of such Loan Party or Subsidiary;(r) Liens arising in connection with Sale-Leaseback Transactions permitted under Section 7.05(l);(s) Liens in the form of cash collateral securing reimbursement obligations under bank guarantees, letters of credit and otherdocumentary credits not issued hereunder but permitted by Section 7.03, not to exceed $50,000,000 in the aggregate;(t) Liens arising from sales or discounts of accounts receivable to the extent permitted under Section 7.05(g);(u) Liens granted by (i) any Subsidiary of the Borrower that is not a Loan Party in favor of any Restricted Subsidiary or theBorrower or (ii) any Guarantor in favor of the Borrower or any Guarantor;(v) Liens resulting from escrow or deposits of cash required to satisfy “funds certain” or good faith deposit requirements inconnection with Permitted Acquisitions; provided that (i) the aggregate amount of such escrows and deposits shall not at any timeexceed the cash consideration to be paid by Equinix and its Restricted Subsidiaries for the applicable Permitted Acquisition, and anysuch escrows and deposits in excess of an aggregate amount of $2,000,000,000 shall consist solely of proceeds of term loans, bridgeloans, or debt or equity securities borrowed or issued by Equinix or a Restricted Subsidiary (and permitted hereunder) to fund suchPermitted Acquisition and (ii) the applicable Liens shall terminate upon the earliest of (x) the consummation of the applicable PermittedAcquisition (and such dollar limitation shall be reduced by the applicable amount) and (y) the date of the termination or abandonmentof such Permitted Acquisition; and(w) Liens not otherwise permitted by this Section 7.01, if at the time of, and after giving effect to, the creation or assumptionof any such Lien the sum, without duplication, of (i) the aggregate amount of all Indebtedness of the Borrower and its RestrictedSubsidiaries that is secured by any Liens not otherwise permitted under clauses (a) through (v) of this Section 7.01 plus (ii) theaggregate amount of Indebtedness of Restricted Subsidiaries of the Borrower that are not Guarantors permitted under subsection (n) ofSection 7.03, shall not exceed the greater of $1,500,000,000 and 10% of Adjusted Consolidated Total Assets as of the end of the mostrecently ended fiscal quarter prior to the attachment of such Liens.7.02. Investments. The Borrower shall not, nor shall it permit any Restricted Subsidiary to, directly or indirectly, make anyInvestments that are Acquisitions, other than Permitted Acquisitions;-107-or make any other material Investments outside of the ordinary course of business, except to the extent that no Default shall haveoccurred and be continuing at the time of such Investment or would result therefrom.7.03. Indebtedness. The Borrower shall not, and shall not permit any Restricted Subsidiary to, directly or indirectly, create,incur, assume or otherwise be directly or indirectly liable for any Indebtedness, except:(a) Indebtedness arising under the Loan Documents;(b) Indebtedness outstanding on the Closing Date and set forth on Schedule 7.03 hereto, reduced by the amount of anyscheduled amortization payments, mandatory prepayments when actually paid, conversions or permanent reductions thereof;(c) Indebtedness in respect of Capital Leases, build-to-suit leases, and purchase money obligations for fixed or capital assets,so long as no Default has occurred and is continuing or would result from the creation, incurrence or assumption thereof;(d) Swap Obligations; provided that such Swap Obligations are entered into to protect the Borrower or any of its RestrictedSubsidiaries from fluctuations in interest rates, currency exchange rates or commodity prices (and not for speculative purposes);(e) intercompany Indebtedness constituting Investments permitted by Section 7.02;(f) Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrumentinadvertently (except in the case of daylight overdrafts) drawn against insufficient funds in the ordinary course of business; providedthat such Indebtedness is extinguished within five Business Days of incurrence;(g) Indebtedness in respect of performance bonds, bankers’ acceptances, workers’ compensation claims, surety, bid, appeal orsimilar bonds, completion guarantees, payment obligations in connection with self-insurance or similar obligations, and bank overdrafts(and letters of credit in respect thereof) in the ordinary course of business;(h) (i) any Indebtedness incurred by the Borrower or any Restricted Subsidiary (such Indebtedness, “RefinancingIndebtedness”) that refinances Indebtedness incurred by the Borrower or such Restricted Subsidiary, or that the Borrower or suchRestricted Subsidiary is otherwise permitted to maintain, under Section 7.03(b) or Section 7.03(l); provided, that (w) the weightedaverage life to maturity of such Refinancing Indebtedness is not less than the weighted average life to maturity of the existingIndebtedness being refinanced, (x) the aggregate principal amount of such Refinancing Indebtedness does not exceed the aggregateprincipal amount of such existing Indebtedness being refinanced (plus accrued interest, any premium, and reasonable fees andexpenses incurred by the Borrower or such Restricted Subsidiary in connection with such refinancing), (y) to the extent such existingIndebtedness being refinanced is secured, such Refinancing Indebtedness is secured by no more collateral, and with no more seniorlien priority, than such existing Indebtedness being refinanced and (z) the guarantors and obligors in respect of such RefinancingIndebtedness are the same as, or a-108-subset of, the guarantors and obligors in respect of such Indebtedness being refinanced and (ii) any Guarantee of the RefinancingIndebtedness described in the foregoing clause (i), but only to the extent such Guarantee exists with respect to the Indebtedness beingrefinanced at the time such refinancing occurs and is not created in contemplation of such refinancing;(i) Indebtedness consisting of “earn-out” obligations, guarantees, indemnities or obligations in respect of purchase priceadjustments in connection with the acquisition or disposition of assets;(j) Indebtedness in respect of letters of credit, bank guarantees or similar instruments issued or created in the ordinary course ofbusiness, including in respect of health, disability or other employee benefits or property, casualty or liability insurance or self-insurance or other Indebtedness with respect to reimbursement-type obligations regarding workers’ compensation claims; provided thatany reimbursement obligations in respect thereof are reimbursed within 60 days following the incurrence thereof;(k) Indebtedness arising in connection with Sale-Leaseback Transactions, provided that the Lien securing such Indebtednessis permitted under Section 7.01;(l) Acquired Indebtedness;(m) Indebtedness represented by Guarantees of Indebtedness of a Restricted Subsidiary that such Restricted Subsidiary ispermitted to incur, or that is otherwise permitted to be maintained by such Restricted Subsidiary, under clauses (c) through (g), (i), (j),(k) or, if such Indebtedness is secured by a Lien permitted under Section 7.01 or such Restricted Subsidiary is not a Guarantor, (n) ofthis Section 7.03; and(n) other Indebtedness so long as no Default has occurred and is continuing or would result from the creation, incurrence orassumption thereof; provided that the sum, without duplication, of (i) Indebtedness of the Borrower and its Restricted Subsidiaries thatis secured by Liens permitted under clause (w) of Section 7.01 and (ii) Indebtedness of Restricted Subsidiaries that are not Guarantorsthat is not otherwise permitted by this Section 7.03 shall not exceed the greater of $1,500,000,000 and 10% of Adjusted ConsolidatedTotal Assets as of the end of the most recently ended fiscal quarter prior to the incurrence of such Indebtedness.7.04. Fundamental Changes.(a) The Borrower shall not, nor shall it permit any Restricted Subsidiary to, directly or indirectly, enter into any consolidation,merger, or other combination, except so long as no Event of Default has occurred and is continuing or would result therefrom:(i) any Loan Party may consolidate, merge or combine with any other Loan Party (provided that if any such LoanParty is Equinix, Equinix shall be the surviving entity),(ii) any Loan Party may consolidate, merge or combine with any Subsidiary that is not a Loan Party if such LoanParty is the surviving entity,-109-(iii) any Subsidiary that is not a Loan Party may consolidate, merge or combine with any Subsidiary that is not a LoanParty, and(iv) any Loan Party or Subsidiary may consolidate, merge or combine with any Person in connection with a PermittedAcquisition or a transaction permitted by Section 7.05, so long as (1) in the case of a consolidation, merger or combination of aLoan Party with another Person, such Person expressly assumes all Obligations of such Loan Party (in each case pursuant todocumentation satisfactory to the Administrative Agent) if such Person is the surviving entity, and (2) if Equinix is a party tosuch Permitted Acquisition or transaction permitted by Section 7.05, Equinix shall be the surviving entity; or(b) liquidate or dissolve any Loan Party’s business or any Domestic Subsidiary’s business except as may be permitted bySection 7.05(a) or Section 7.05(b) (but no such liquidation or dissolution shall be permitted for Equinix).7.05. Maintenance of Assets; Dispositions. The Borrower shall not, nor shall it permit any Restricted Subsidiary to, directlyor indirectly, sell, assign, lease, transfer or otherwise Dispose of (collectively, “Transfer”) any part of the business or assets of theBorrower or any Restricted Subsidiary, except:(a) (i) Transfers (including (except in the case of Equinix) any disposition that is in the nature of a liquidation or dissolution)among the Loan Parties or (ii) Transfers (including any disposition that is in the nature of a liquidation or dissolution) by any wholly-owned Subsidiary that is a Guarantor to (1) the Borrower, or (2) any other wholly-owned Subsidiary that is a Guarantor;(b) Transfers (including any disposition that is in the nature of a liquidation or dissolution) (i) by any Subsidiary that is not aLoan Party to the Borrower or any Subsidiary or (ii) so long as no Default would result from such Transfer, by the Borrower to anyRestricted Subsidiary which do not constitute a Change of Control;(c) leases or subleases of, or occupancy agreements with respect to, real property (including IBX centers);(d) non-exclusive licenses of intellectual property and similar arrangements for the use of the property of the Loan Parties inthe ordinary course of business;(e) sales of inventory to customers in the ordinary course of business;(f) Transfers of cash, cash equivalents and marketable securities in the ordinary course of business, including, withoutlimitation, to a Subsidiary;(g) sales or discounts of accounts receivable without recourse in the ordinary course of business (and excluding accountsreceivable which have been fully reserved or written off) in connection with accounts receivable that are more than 90 days past due;(h) Transfers of worn-out, obsolete or surplus equipment no longer used in the ordinary course of business;-110-(i) the abandonment or other disposition of intellectual property that is no longer economically practicable to maintain oruseful in the conduct of business;(j) Transfers of assets subject to a casualty or event of loss covered by insurance following the receipt of insurance proceedswith respect to such casualty or event of loss;(k) Transfers constituting Liens permitted under Section 7.01 and Investments or Restricted Payments that are not prohibitedby this Agreement;(l) Sale-Leaseback Transactions to the extent not otherwise prohibited hereunder;(m) Transfers of assets required by Governmental Authorities as a condition to their approval of the consummation ofPermitted Acquisitions; and(n) other Transfers not otherwise permitted by this Section 7.05, so long as (i) no Default or Event of Default has occurredand is continuing or would result therefrom and (ii) the aggregate book value of assets so Transferred in any fiscal year of Equinixunder this clause (n) does not exceed 15% of Adjusted Consolidated Total Assets; provided, however, that such Transfers thatconstitute Asset Sales shall be subject, as applicable, to the prepayment requirements set forth in Section 2.04(c).7.06. Restricted Payments. The Borrower shall not, nor shall it permit any Restricted Subsidiary to, directly or indirectly,declare or make, directly or indirectly, any Restricted Payment, except:(a) any Subsidiary may pay dividends or distributions on its Equity Interests to the Borrower or to any intervening Subsidiaryof the Borrower;(b) dividends or distributions payable solely in Equity Interests (other than Equity Interests that are mandatorily redeemable orredeemable at the option of the holder thereof on any date that is earlier than 91 days after the Maturity Date in effect at the time of thedeclaration or making of such dividend or distribution);(c) cash payments (i) for repurchases by the Borrower of common stock of the Borrower from officers, directors andemployees of the Borrower or any of its Subsidiaries or their authorized representatives upon the death, disability or termination ofemployment of such employees or termination of their seat on the board of the Borrower, and (ii) in lieu of the issuance of fractionalshares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests ofthe Borrower, in an aggregate amount, for the foregoing sub-clauses (c)(i) and (c)(ii), not to exceed $5,000,000;(d) noncash repurchases of Equity Interests deemed to occur upon the exercise of stock options or warrants if such EquityInterests represent a portion of the exercise price and related statutory withholding taxes of such options or warrants;(e) Equinix may (i) issue and deliver Permitted Junior Securities (as defined in the indentures for the Convertible SubordinatedNotes (the “Convertible Subordinated Notes Indentures”)) upon conversion of the Convertible Subordinated Notes in accordance withthe terms of the Convertible-111-Subordinated Notes Indentures and (ii) unless (x) an Event of Default described in Section 8.01(a) has occurred and is continuing or(y) a Payment Blockage Period (as defined in the Convertible Subordinated Notes Indentures) is in effect, make (A) regularlyscheduled payments of cash interest and, to the extent not prohibited hereunder, mandatory principal payments on the ConvertibleSubordinated Notes, in each case, in accordance with the terms thereof, and (B) cash Restricted Payments in satisfaction of fractionalshares in connection with a conversion of the Convertible Subordinated Notes into Permitted Junior Securities in accordance with theterms of Convertible Subordinated Notes Indentures;(f) so long as (i)(A) Equinix believes in good faith that it qualifies as a REIT, (B) Equinix has not publicly disclosed anintention to no longer be treated as a REIT, and (C) no resolution shall have been adopted by Equinix’s board of directors abandoningor otherwise contradicting its intent to elect to be treated as a REIT, or (ii) Equinix is a REIT, Equinix may make cash dividends anddistributions to its shareholders notwithstanding that any Default may have occurred and be continuing (x) provided such cashdividends and distributions do not exceed in the aggregate for any period of four consecutive fiscal quarters of Equinix up to 100% ofFunds From Operations for such period or (y) in such greater amount as may be required for Equinix to continue to be qualified as aREIT or to avoid the imposition of income or excise taxes on Equinix; and(g) to the extent that no Default shall have occurred and be continuing at the time of such action or would result therefrom,Restricted Payments not otherwise permitted by clauses (a) through (f).7.07. Change in Nature of Business. The Borrower shall not, nor shall it permit any Restricted Subsidiary to, directly orindirectly, engage in any business activities substantially different from the present business of the Borrower and its Subsidiaries on thedate hereof or reasonably related thereto.7.08. Transactions with Affiliates. The Borrower shall not, nor shall it permit any Restricted Subsidiary to, directly orindirectly, enter into any transaction of any kind with any Affiliate of a Loan Party, whether or not in the ordinary course of business,other than (a) on fair and reasonable terms substantially as favorable to the Borrower or such Restricted Subsidiary, as the case may be,as would be obtainable by the Borrower or such Restricted Subsidiary, as the case may be, at the time in a comparable arm’s lengthtransaction with a Person other than an Affiliate, (b) transactions expressly permitted by Section 7.04(a), Section 7.05(a), Section7.05(b), or, in the case of transactions with Subsidiaries only, Section 7.05(f), (c) transactions between the Borrower and its wholly-owned Subsidiaries, (d) transactions among the Borrower’s wholly-owned Subsidiaries, or (e) other individual transactions that do notinvolve amounts in excess of $50,000,000 per transaction or series of related transactions.7.09. Burdensome Agreements. The Borrower shall not, nor shall it permit any Restricted Subsidiary to, directly orindirectly, enter into any Contractual Obligation (other than this Agreement or any other Loan Document) that (a) limits the ability (i)of any Material Domestic Subsidiary to make Restricted Payments to the Borrower or any Guarantor or to otherwise transfer propertyto the Borrower or any Guarantor, (ii) of any Material Domestic Subsidiary to Guarantee the Indebtedness of the Borrower or anyGuarantor or (iii) of the Borrower or any Material Domestic Subsidiary to create, incur, assume or suffer to exist Liens on property ofsuch Person; provided, however, that (A) none of the foregoing shall apply to restrictions and conditions imposed by applicable Laws(which (taken as-112-a whole) could not reasonably be expected to have a Material Adverse Effect), (B) none of the foregoing shall apply to customaryrestrictions and conditions contained in agreements relating to the sale of the assets or Equity Interests permitted under Section 7.05pending such sale, provided such restrictions and conditions apply only to the Person whose assets or Equity Interests are to be sold,(C) clauses (i) and (iii) shall not apply to restrictions or conditions imposed on specific assets which are the subject of any leases(including Capital Leases and build-to-suit leases) or to customary provisions in leases (including Capital Leases and build-to-suitleases) and other contracts restricting the assignment of such leases and other contracts, (D) clauses (ii) and (iii) shall not apply to therestrictions contained in the Senior Notes Indentures (as such restrictions are in effect on the Closing Date), (E) clauses (ii) and (iii)shall not apply to customary restrictions contained in the documentation relating to financings permitted hereunder, provided that suchrestrictions shall not restrict (x) any Loan Party’s or Material Domestic Subsidiary’s ability to grant Liens in favor of the AdministrativeAgent and the Guaranteed Parties (or the Administrative Agent and any Guaranteed Party’s ability to enforce such Liens) under or inconnection with the Loan Documents or (y) any Loan Party’s or Material Domestic Subsidiary’s ability to guarantee the Obligationsand (F) such clause (i) shall not apply to restrictions imposed on any Foreign Subsidiary pursuant to the terms of any agreementgoverning Indebtedness of such Foreign Subsidiary permitted under Section 7.03 (including restrictions imposed on Equinix JapanK.K. and its Subsidiaries contained in the documentation relating to the Existing Japanese Yen Loan) provided that any suchrestrictions shall not limit the ability of any such Persons, so long as no default or event of default has occurred under such financing, tomake Restricted Payments in an amount equal to at least 50% of consolidated net income to the Borrower or to such person’s Parent, awholly owned Subsidiary of the Borrower; or (b) requires the grant of a Lien to secure an obligation of such Person if a Lien is grantedto secure the Obligations, other than the requirements contained in the Senior Notes Indentures (as such requirements are in effect onthe Closing Date).7.10. Use of Proceeds. The Borrower shall not, nor shall it permit any Restricted Subsidiary to, directly or indirectly, use theproceeds of any Credit Extension, whether directly or indirectly, and whether immediately, incidentally or ultimately, to purchase orcarry margin stock (within the meaning of Regulation U of the FRB) or to extend credit to others for the purpose of purchasing orcarrying margin stock or to refund indebtedness originally incurred for such purpose.7.11. Financial Covenants. The Borrower shall not:(a) Consolidated Fixed Charge Coverage Ratio. Permit the Consolidated Fixed Charge Coverage Ratio as of the end of anyfiscal quarter of Equinix to be less than 1.50 to 1.00.(b) Consolidated Net Lease Adjusted Leverage Ratio. Permit the Consolidated Net Lease Adjusted Leverage Ratio as of theend of any fiscal quarter of Equinix to exceed 6.00 to 1.00.(c) Consolidated Lease Adjusted Secured Leverage Ratio. Permit the Consolidated Lease Adjusted Secured Leverage Ratioas of the end of any fiscal quarter of Equinix to exceed 2.25 to 1.00.-113-7.12. Prepayments of Certain Indebtedness. The Borrower shall not, nor shall it permit any Restricted Subsidiary to,directly or indirectly, prepay, redeem, purchase, defease or otherwise satisfy prior to the scheduled maturity thereof in any manner, ormake any payment in violation of any subordination terms of, any portion of, except to the extent provided in Section 7.06(e), anyConvertible Subordinated Notes or other Indebtedness that is subordinated to the Obligations, unless no Default or Event of Defaulthas occurred and is continuing or would result therefrom.7.13. Sanctions. The Borrower shall not, nor shall it permit any Restricted Subsidiary to, directly or indirectly, directly orindirectly, use the proceeds of any Credit Extension, or lend, contribute or otherwise make available such proceeds to any Subsidiary,joint venture partner or other Person, to fund any activities of or business with any Person that, at the time of the use of such proceeds,is the subject of Sanctions or is located, organized or resident in any Designated Jurisdiction, or in any other manner that couldreasonably be expected to result in a violation of Sanctions by any party to this Agreement or any other Loan Document (including anyGuaranteed Party).7.14. Anti-Corruption Laws. The Borrower shall not, nor shall it permit any Restricted Subsidiary to, directly or indirectly,directly or indirectly use the proceeds of any Credit Extension for any purpose that would materially breach any Anti-Corruption Lawsor cause any party to this Agreement or any other Loan Document (including any Guaranteed Party) to be in violation of anyapplicable Anti-Corruption Laws.7.15. Foreign Subsidiary Holdcos. At any time prior to the Automatic Guaranty Release, the Borrower shall not permit anyForeign Subsidiary Holdco to engage in any business or activity other than (a) the ownership of Equity Interests and Indebtedness ofone or more Foreign Subsidiaries or Foreign Subsidiary Holdcos, (b) maintaining its corporate or company existence, (c) participatingin tax, accounting and other administrative activities as part of a consolidated group of companies, and (d) activities incidental to theforegoing.ARTICLE VIII.EVENTS OF DEFAULT AND REMEDIES8.01. Events of Default. Any of the following shall constitute an Event of Default:(a) Non-Payment. The Borrower or any other Loan Party fails to pay (i) when and as required to be paid herein, and in thecurrency required hereunder, any amount of principal of any Loan or any L/C Obligation, or any interest on any Loan or on any L/CObligation, or (ii) within three Business Days after the same becomes due, any fee due hereunder or any other amount payablehereunder or under any other Loan Document; or(b) Covenants. Any Loan Party breaches, or fails to perform or observe, any term, covenant or agreement contained in any ofSections 6.01, 6.02, 6.03, 6.05 (as to existence only), 6.10, 6.11, 6.13, 6.14, 6.15, 6.16 or Article VII; or(c) Other Breaches. Any Loan Party fails to perform or observe any covenant or agreement (not specified in subsections (a) or(b) above) contained in any Loan Document on its part to be performed or observed and such failure continues for 30 days after theearlier of (i) a Responsible Officer of a-114-Loan Party obtaining knowledge of such failure and (ii) the Administrative Agent or a Lender notifying such Loan Party in writing ofsuch failure; or(d) Default under Other Loan Documents. Any default or event of default occurs under any other Loan Document or otherdocument required by or delivered in connection with this Agreement (after giving effect to any applicable grace periods) or any suchdocument is no longer in effect, or any Guarantor purports to revoke or disavow a guaranty, including the Multiparty Guaranty, of anyof the Obligations; or(e) Representations and Warranties. Any representation, warranty, certification or statement of fact made or deemed made byor on behalf of the Borrower or any other Loan Party herein, in any other Loan Document, or in any document delivered in connectionherewith or therewith shall be incorrect or misleading in any material respect when made or deemed made; or(f) Cross-Default. (i) Any default occurs under any agreement of the Borrower or its Subsidiaries (other than any agreemententered into by any Unrestricted Subsidiary with respect to Indebtedness of such Unrestricted Subsidiary for which there is no recourseto the Borrower or any Restricted Subsidiary) that permits the counterparty to such agreement to declare to be due and payable prior tothe stated maturity thereof an obligation of the Borrower or any of its Subsidiaries of $200,000,000 or more, individually or in theaggregate for any or all such entities; or (ii) the Borrower or any Subsidiary thereof (x) fails to observe or perform any other agreementor condition relating to any such obligation or contained in any instrument or agreement evidencing, securing or relating thereto, or (y)any other event occurs, the effect of which default or other event is to cause, or to permit the holder or holders of such obligation or thebeneficiary or beneficiaries of such obligation (or a trustee or agent on behalf of such holder or holders or beneficiary or beneficiaries)to cause, with the giving of notice if required, such obligation to be demanded or to become due or to be repurchased, prepaid,defeased or redeemed (automatically or otherwise), or an offer to repurchase, prepay, defease or redeem such obligation to be made,prior to its stated maturity, or such obligation to become payable or cash collateral in respect thereof to be demanded, unless, in the caseof clause (f)(ii)(y), the Borrower would not be prohibited from prepaying such Indebtedness under Section 7.12, disregarding for thispurpose any Default that would otherwise arise under this Section 8.01(f)(ii)(y); or (iii) there occurs under any Swap Contract (otherthan a Swap Contract entered into by an Unrestricted Subsidiary for which there is no recourse to the Borrower or any RestrictedSubsidiary) an Early Termination Date (as defined in such Swap Contract) resulting from (A) any event of default under such SwapContract as to which the Borrower or any Subsidiary is the Defaulting Party (as defined in such Swap Contract) or (B) anyTermination Event (as so defined) under such Swap Contract as to which the Borrower or any Subsidiary is an Affected Party (as sodefined) and, in either event, the Swap Termination Value owed by the Borrower or such Subsidiary as a result thereof is$200,000,000 or more; or(g) Insolvency Proceedings. Any Loan Party or any Material Subsidiary institutes or consents to the institution of anyproceeding under any Debtor Relief Law, or makes an assignment for the benefit of creditors; or any proceeding under any DebtorRelief Law relating to any such Person or to all or any material part of its property is instituted without the consent of such Person andcontinues undismissed or unstayed for 60 calendar days, or an order for relief is entered in any such proceeding; or-115-(h) Receivers. A receiver or similar official is appointed for a substantial portion of any Loan Party’s or any MaterialSubsidiary’s business, or the business is terminated; or(i) Inability to Pay Debts; Attachment. (i) Any Loan Party or any Material Subsidiary becomes unable or admits in writing itsinability or fails generally to pay its debts as they become due, or (ii) any writ or warrant of attachment or execution or similar processis issued or levied against all or any material part of the property of any such Person and is not released, vacated or fully bonded within45 days after its issue or levy; or(j) Judgments. (i) Any judgments or arbitration awards are entered against the Borrower or any Subsidiary thereof (other than,solely with respect to judgments or awards as to which there is no claim or recourse against the Borrower or any Restricted Subsidiary,any Unrestricted Subsidiary) in an aggregate amount of $200,000,000 or more, and there is a period of 45 consecutive days duringwhich either such judgments or arbitration awards remain unpaid or unsatisfied or a stay of enforcement of such judgments, by reasonof a pending appeal, is not in effect; or (ii) any one or more non-monetary final judgments are entered against the Borrower or anySubsidiary thereof that have, or could reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect, andthere is a period of 45 consecutive days during which a stay of enforcement of such non-monetary final judgment(s), by reason of apending appeal, is not in effect; or(k) ERISA. An ERISA Event occurs with respect to a Pension Plan or Multiemployer Plan which has resulted or couldreasonably be expected to result in liability of any Loan Party under Title IV of ERISA to the Pension Plan, Multiemployer Plan or thePBGC in an aggregate amount of $200,000,000 or more, or (ii) the Borrower or any ERISA Affiliate fails to pay when due, after theexpiration of any applicable grace period, any installment payment with respect to its withdrawal liability under Section 4201 ofERISA under a Multiemployer Plan in an aggregate amount of $200,000,000 or more; or(l) Invalidity of Loan Documents. The Borrower or any other Loan Party asserts in writing that this Agreement or any otherLoan Documents, or part thereof, is invalid, or a court of competent jurisdiction invalidates any part of this Agreement or any otherLoan Document; or(m) Change of Control. A Change of Control occurs.8.02. Remedies Upon Event of Default. If any Event of Default occurs and is continuing, the Administrative Agent shall, atthe request of, or may, with the consent of, the Required Lenders, take any or all of the following actions:(i) declare the commitment of each Lender to make Loans and any obligation of the L/C Issuer to make L/C CreditExtensions to be terminated, whereupon such commitments and obligations shall be terminated;(ii) declare the unpaid principal amount of all outstanding Loans, all interest accrued and unpaid thereon, and all otheramounts owing or payable hereunder or under any other Loan Document to be immediately due and payable, withoutpresentment, demand, protest or other notice of any kind, all of which are hereby expressly waived by the Borrower and theGuarantors;-116-(iii) require that the Borrower Cash Collateralize the L/C Obligations (in an amount equal to the then OutstandingAmount thereof); and(iv) exercise on behalf of itself, the Lenders and the L/C Issuer all rights and remedies available to it, the Lenders andthe L/C Issuer under the Loan Documents;provided, however, that upon the occurrence of an actual or deemed entry of an order for relief with respect to any Loan Party underthe Bankruptcy Code of the United States, the obligation of each Lender to make Loans and any obligation of the L/C Issuer to makeL/C Credit Extensions shall automatically terminate, the unpaid principal amount of all outstanding Loans and all interest and otheramounts as aforesaid shall automatically become due and payable, and the obligation of the Borrower to Cash Collateralize the L/CObligations as aforesaid shall automatically become effective, in each case without further act of the Administrative Agent or anyLender.8.03. Application of Funds. After the exercise of remedies provided for in Section 8.02 (or after the Loans haveautomatically become immediately due and payable and the L/C Obligations have automatically been required to be CashCollateralized as set forth in the proviso to Section 8.02), any amounts received on account of the Guaranteed Obligations shall, subjectto the provisions of Sections 2.14 and 2.15, be applied by the Administrative Agent in the following order:First, to payment of that portion of the Guaranteed Obligations constituting fees, indemnities, expenses and other amounts(including fees, charges and disbursements of counsel to the Administrative Agent and amounts payable under Article III) payable tothe Administrative Agent in its capacity as such;Second , to payment of that portion of the Guaranteed Obligations constituting fees, indemnities and other amounts (other thanprincipal, interest and Letter of Credit Fees) payable to the Lenders and the L/C Issuer (including fees, charges and disbursements ofcounsel to the respective Lenders and the L/C Issuer and amounts payable under Article III), ratably among them in proportion to therespective amounts described in this clause Second payable to them;Third, to payment of that portion of the Guaranteed Obligations constituting accrued and unpaid Letter of Credit Fees andinterest on the Loans, L/C Borrowings and other Guaranteed Obligations arising under the Loan Documents, ratably among theLenders and the L/C Issuer in proportion to the respective amounts described in this clause Third payable to them;Fourth, to payment of that portion of the Guaranteed Obligations constituting unpaid principal of the Loans and L/CBorrowings and that portion of the Guaranteed Obligations owing under Guaranteed Hedge Agreements and Guaranteed CashManagement Agreements, ratably among the Lenders, Hedge Banks and the Cash Management Banks in proportion to the respectiveamounts described in this clause Fourth held by them;-117-Fifth, to the Administrative Agent for the account of the L/C Issuer, to Cash Collateralize that portion of L/C Obligationscomprised of the aggregate undrawn amount of Letters of Credit to the extent not otherwise Cash Collateralized by the Borrowerpursuant to Sections 2.03 and 2.14; andLast, the balance, if any, after all of the Guaranteed Obligations have been indefeasibly paid in full, to the Borrower or asotherwise required by Law.Subject to Sections 2.03(c) and 2.14, amounts used to Cash Collateralize the aggregate undrawn amount of Letters of Credit pursuantto clause Fifth above shall be applied to satisfy drawings under such Letters of Credit as they occur. If any amount remains on depositas Cash Collateral after all Letters of Credit have either been fully drawn or expired, such remaining amount shall be applied to theother Guaranteed Obligations, in the order set forth above.Notwithstanding the foregoing, Guaranteed Obligations arising under Guaranteed Cash Management Agreements and GuaranteedHedge Agreements shall be excluded from the application described above if the Administrative Agent has not received a GuaranteedParty Designation Notice, together with such supporting documentation as the Administrative Agent may request, from the applicableCash Management Bank or Hedge Bank, as the case may be. Each Cash Management Bank or Hedge Bank not a party to thisAgreement that has given the notice contemplated by the preceding sentence shall, by such notice, be deemed to have acknowledgedand accepted the appointment of the Administrative Agent pursuant to the terms of Article IX for itself and its Affiliates as if a“Lender” party hereto.Notwithstanding the foregoing, Excluded Swap Obligations with respect to any Loan Party shall not be paid with amounts receivedfrom such Loan Party or its assets, but appropriate adjustments shall be made with respect to payments from other Loan Parties topreserve the allocation to Guaranteed Obligations otherwise set forth above in this Section.ARTICLE IX.ADMINISTRATIVE AGENT9.01. Appointment and Authority. Each of the Lenders and the L/C Issuer hereby irrevocably appoints Bank of America toact on its behalf as the Administrative Agent hereunder and under the other Loan Documents and authorizes the Administrative Agentto take such actions on its behalf and to exercise such powers as are delegated to the Administrative Agent by the terms hereof orthereof, together with such actions and powers as are reasonably incidental thereto. The provisions of this Article are solely for thebenefit of the Administrative Agent, the Lenders and the L/C Issuer, and neither the Borrower nor any other Loan Party shall haverights as a third party beneficiary of any of such provisions. It is understood and agreed that the use of the term “agent” herein or in anyother Loan Documents (or any other similar term) with reference to the Administrative Agent is not intended to connote any fiduciaryor other implied (or express) obligations arising under agency doctrine of any applicable Law. Instead such term is used as a matter ofmarket custom, and is intended to create or reflect only an administrative relationship between contracting parties.-118-9.02. Rights as a Lender. The Person serving as the Administrative Agent hereunder shall have the same rights and powersin its capacity as a Lender as any other Lender and may exercise the same as though it were not the Administrative Agent and the term“Lender” or “Lenders” shall, unless otherwise expressly indicated or unless the context otherwise requires, include the Person servingas the Administrative Agent hereunder in its individual capacity. Such Person and its Affiliates may accept deposits from, lend moneyto, own securities of, act as the financial advisor or in any other advisory capacity for and generally engage in any kind of businesswith the Borrower or any Subsidiary or other Affiliate thereof as if such Person were not the Administrative Agent hereunder andwithout any duty to account therefor to the Lenders.9.03. Exculpatory Provisions. The Administrative Agent shall not have any duties or obligations except those expressly setforth herein and in the other Loan Documents, and its duties hereunder shall be administrative in nature. Without limiting the generalityof the foregoing, the Administrative Agent:(a) shall not be subject to any fiduciary or other implied duties, regardless of whether a Default has occurred and is continuing;(b) shall not have any duty to take any discretionary action or exercise any discretionary powers, except discretionary rightsand powers expressly contemplated hereby or by the other Loan Documents that the Administrative Agent is required to exercise asdirected in writing by the Required Lenders (or such other number or percentage of the Appropriate Lenders as shall be expresslyprovided for herein or in the other Loan Documents), provided that the Administrative Agent shall not be required to take any actionthat, in its opinion or the opinion of its counsel, may expose the Administrative Agent to liability or that is contrary to any LoanDocument or applicable law, including for the avoidance of doubt any action that may be in violation of the automatic stay under anyDebtor Relief Law or that may effect a forfeiture, modification or termination of property of a Defaulting Lender in violation of anyDebtor Relief Law; and(c) shall not, except as expressly set forth herein and in the other Loan Documents, have any duty to disclose, and shall not beliable for the failure to disclose, any information relating to the Borrower or any of their Affiliates that is communicated to or obtainedby the Person serving as the Administrative Agent or any of its Affiliates in any capacity.The Administrative Agent shall not be liable for any action taken or not taken by it (i) with the consent or at the request of theRequired Lenders (or such other number or percentage of the Appropriate Lenders as shall be necessary, or as the AdministrativeAgent shall believe in good faith shall be necessary, under the circumstances as provided in Sections 10.01 and 8.02) or (ii) in theabsence of its own gross negligence or willful misconduct as determined by a court of competent jurisdiction by final andnonappealable judgment. The Administrative Agent shall be deemed not to have knowledge of any Default unless and until noticedescribing such Default is given in writing to the Administrative Agent by the Borrower, a Lender or the L/C Issuer.The Administrative Agent shall not be responsible for or have any duty to ascertain or inquire into (i) any statement, warrantyor representation made in or in connection with this Agreement or any other Loan Document, (ii) the contents of any certificate, reportor other document delivered hereunder-119-or thereunder or in connection herewith or therewith, (iii) the performance or observance of any of the covenants, agreements or otherterms or conditions set forth herein or therein or the occurrence of any Default, (iv) the validity, enforceability, effectiveness orgenuineness of this Agreement, any other Loan Document or any other agreement, instrument or document, or (v) the satisfaction ofany condition set forth in Article IV or elsewhere herein, other than to confirm receipt of items expressly required to be delivered to theAdministrative Agent.9.04. Reliance by Administrative Agent. The Administrative Agent shall be entitled to rely upon, and shall not incur anyliability for relying upon, any notice, request, certificate, consent, statement, instrument, document or other writing (including anyelectronic message, Internet or intranet website posting or other distribution), including, without limitation, any representation orwarranty contained therein, believed by it to be genuine and to have been signed, sent or otherwise authenticated by the proper Person.The Administrative Agent also may rely upon any statement made to it orally or by telephone and believed by it to have been made bythe proper Person, and shall not incur any liability for relying thereon. In determining compliance with any condition hereunder to themaking of a Loan, or the issuance, extension, renewal or increase of a Letter of Credit, that by its terms must be fulfilled to thesatisfaction of a Lender or the L/C Issuer, the Administrative Agent may presume that such condition is satisfactory to such Lender orthe L/C Issuer unless the Administrative Agent shall have received notice to the contrary from such Lender or the L/C Issuer prior tothe making of such Loan or the issuance of such Letter of Credit. The Administrative Agent may consult with legal counsel (who maybe counsel for the Borrower), independent accountants and other experts selected by it, and shall not be liable for any action taken ornot taken by it in accordance with the advice of any such counsel, accountants or experts.9.05. Delegation of Duties. The Administrative Agent may perform any and all of its duties and exercise its rights andpowers hereunder or under any other Loan Document by or through any one or more sub‑agents appointed by the AdministrativeAgent. The Administrative Agent and any such sub‑agent may perform any and all of its duties and exercise its rights and powers byor through their respective Related Parties. The exculpatory provisions of this Article shall apply to any such sub‑agent and to theRelated Parties of the Administrative Agent and any such sub‑agent, and shall apply to their respective activities in connection with thesyndication of the credit facilities provided for herein as well as activities as Administrative Agent. The Administrative Agent shall notbe responsible for the negligence or misconduct of any sub‑agents except to the extent that a court of competent jurisdiction determinesin a final and non appealable judgment that the Administrative Agent acted with gross negligence or willful misconduct in the selectionof such sub-agents.9.06. Resignation of Administrative Agent.(a) The Administrative Agent may at any time give notice of its resignation to the Lenders, the L/C Issuer and the Borrower.Upon receipt of any such notice of resignation, the Required Lenders shall have the right, in consultation with the Borrower, to appointa successor, which shall be a bank with an office in the United States, or an Affiliate of any such bank with an office in the UnitedStates. If no such successor shall have been so appointed by the Required Lenders and shall have accepted such appointment within 30days after the retiring Administrative Agent gives notice of its resignation (or such earlier day as shall be agreed by the RequiredLenders) (the “Resignation Effective Date”),-120-then the retiring Administrative Agent may (but shall not be obligated to) on behalf of the Lenders and the L/C Issuer, appoint asuccessor Administrative Agent meeting the qualifications set forth above. Whether or not a successor has been appointed, suchresignation shall become effective in accordance with such notice on the Resignation Effective Date.(b) If the Person serving as Administrative Agent is a Defaulting Lender pursuant to clause (d) of the definition thereof, theRequired Lenders may, to the extent permitted by applicable law, by notice in writing to the Borrower and such Person remove suchPerson as Administrative Agent and, in consultation with the Borrower, appoint a successor. If no such successor shall have been soappointed by the Required Lenders and shall have accepted such appointment within 30 days (or such earlier day as shall be agreed bythe Required Lenders) (the “Removal Effective Date”), then such removal shall nonetheless become effective in accordance with suchnotice on the Removal Effective Date.(c) With effect from the Resignation Effective Date or the Removal Effective Date (as applicable) (1) the retiring or removedAdministrative Agent shall be discharged from its duties and obligations hereunder and under the other Loan Documents (except thatin the case of any collateral security held by the Administrative Agent on behalf of the Lenders or the L/C Issuer under any of the LoanDocuments, the retiring or removed Administrative Agent shall continue to hold such collateral security until such time as a successorAdministrative Agent is appointed) and (2) except for any indemnity payments or other amounts then owed to the retiring or removedAdministrative Agent, all payments, communications and determinations provided to be made by, to or through the AdministrativeAgent shall instead be made by or to each Lender and the L/C Issuer directly, until such time, if any, as the Required Lenders appoint asuccessor Administrative Agent as provided for above. Upon the acceptance of a successor’s appointment as Administrative Agenthereunder, such successor shall succeed to and become vested with all of the rights, powers, privileges and duties of the retiring (orremoved) Administrative Agent (other than as provided in Section 3.01(g) and other than any rights to indemnity payments or otheramounts owed to the retiring or removed Administrative Agent as of the Resignation Effective Date or the Removal Effective Date, asapplicable), and the retiring or removed Administrative Agent shall be discharged from all of its duties and obligations hereunder orunder the other Loan Documents (if not already discharged therefrom as provided above in this Section). The fees payable by theBorrower to a successor Administrative Agent shall be the same as those payable to its predecessor unless otherwise agreed betweenthe Borrower and such successor. After the retiring or removed Administrative Agent’s resignation or removal hereunder and under theother Loan Documents, the provisions of this Article and Section 10.04 shall continue in effect for the benefit of such retiring orremoved Administrative Agent, its sub agents and their respective Related Parties in respect of any actions taken or omitted to be takenby any of them while the retiring or removed Administrative Agent was acting as Administrative Agent.9.07. Non-Reliance on Administrative Agent and Other Lenders. Each Lender and the L/C Issuer acknowledges that ithas, independently and without reliance upon the Administrative Agent or any other Lender or any of their Related Parties and basedon such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into thisAgreement. Each Lender and the L/C Issuer also acknowledges that it will, independently and without reliance upon theAdministrative Agent or any other Lender or any of their Related Parties and based on such documents and information as it shall fromtime to time deem appropriate, continue to make its own decisions in-121-taking or not taking action under or based upon this Agreement, any other Loan Document or any related agreement or any documentfurnished hereunder or thereunder.9.08. No Other Rights or Duties, Etc. Anything herein to the contrary notwithstanding, no Joint Lead Arranger nor anybookrunner, syndication agent or documentation agents listed on the cover page hereof shall have any rights, privileges, powers, dutiesor responsibilities under this Agreement or any of the other Loan Documents, except (a) in the case of any such Person, in its capacity,as applicable, as the Administrative Agent, a Lender or the L/C Issuer hereunder and (b) in the case of the Left Lead Arranger, as setforth in the Fee Letter.9.09. Administrative Agent May File Proofs of Claim; Credit Bidding. In case of the pendency of any proceeding underany Debtor Relief Law or any other judicial proceeding relative to any Loan Party, the Administrative Agent (irrespective of whetherthe principal of any Loan or L/C Obligation shall then be due and payable as herein expressed or by declaration or otherwise andirrespective of whether the Administrative Agent shall have made any demand on the Borrower) shall be entitled and empowered, byintervention in such proceeding or otherwise:(a) to file and prove a claim for the whole amount of the principal and interest owing and unpaid in respect of the Loans, L/CObligations and all other Guaranteed Obligations that are owing and unpaid and to file such other documents as may be necessary oradvisable in order to have the claims of the Lenders, the L/C Issuer and the Administrative Agent (including any claim for thereasonable compensation, expenses, disbursements and advances of the Lenders, the L/C Issuer and the Administrative Agent and theirrespective agents and counsel and all other amounts due the Lenders, the L/C Issuer and the Administrative Agent under Sections2.03(i) and (j), 2.08 and 10.04) allowed in such judicial proceeding; and(b) to collect and receive any monies or other property payable or deliverable on any such claims and to distribute the same;and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is herebyauthorized by each Lender and the L/C Issuer to make such payments to the Administrative Agent and, in the event that theAdministrative Agent shall consent to the making of such payments directly to the Lenders and the L/C Issuer, to pay to theAdministrative Agent any amount due for the reasonable compensation, expenses, disbursements and advances of the AdministrativeAgent and its agents and counsel, and any other amounts due the Administrative Agent under Sections 2.08 and 10.04.Nothing contained herein shall be deemed to authorize the Administrative Agent to authorize or consent to or accept or adopton behalf of any Lender or the L/C Issuer any plan of reorganization, arrangement, adjustment or composition affecting theSecured/Guaranteed Obligations or the rights of any Lender or the L/C Issuer to authorize the Administrative Agent to vote in respectof the claim of any Lender or the L/C Issuer in any such proceeding.-122-9.10. Multiparty Guaranty Matters. Each of the Lenders (including to the extent applicable, in its capacities as a CashManagement Bank and a Hedge Bank) and the L/C Issuer irrevocably authorize the Administrative Agent, at its option and in itsdiscretion (other than in the case of clause (ii), which release shall be automatic), to release any Guarantor from its obligations underthe Multiparty Guaranty (i) if such Person ceases to be a Subsidiary as a result of a transaction permitted under the Loan Documents or(ii) in connection with the Automatic Guaranty Release.Upon request by the Administrative Agent at any time, the Required Lenders will confirm in writing the AdministrativeAgent’s authority to release any Guarantor from its obligations under the Multiparty Guaranty pursuant to this Section 9.10. In eachcase as specified in this Section 9.10, the Administrative Agent will, at the Borrower’s expense, execute and deliver to the applicableLoan Party such documents as such Loan Party may reasonably request to release such Guarantor from its obligations under theMultiparty Guaranty, in each case in accordance with the terms of the Loan Documents and this Section 9.10.9.11. Guaranteed Cash Management Agreements and Guaranteed Hedge Agreements. Except as otherwise expresslyset forth herein, no Cash Management Bank or Hedge Bank that obtains the benefit of the provisions of Section 8.03 or the MultipartyGuaranty by virtue of the provisions hereof shall have any right to notice of any action or to consent to, direct or object to any actionhereunder or under any other Loan Document or otherwise (or to notice of or to consent to any amendment, waiver or modification ofthe provisions hereof or of the Multiparty Guaranty) other than (i) pursuant to Section 10.01(i), and (ii) in its capacity as a Lender and,in such case, only to the extent expressly provided in the Loan Documents. Notwithstanding any other provision of this Article IX tothe contrary, the Administrative Agent shall not be required to verify the payment of, or that other satisfactory arrangements have beenmade with respect to, Guaranteed Obligations arising under Guaranteed Cash Management Agreements and Guaranteed HedgeAgreements except to the extent expressly provided herein and unless the Administrative Agent has received a Guaranteed PartyDesignation Notice of such Guaranteed Obligations, together with such supporting documentation as the Administrative Agent mayrequest, from the applicable Cash Management Bank or Hedge Bank, as the case may be. The Administrative Agent shall not berequired to verify the payment of, or that other satisfactory arrangements have been made with respect to, Guaranteed Obligationsarising under Guaranteed Cash Management Agreements and Guaranteed Hedge Agreements in the case of a Facility TerminationDate.9.12. Lender ERISA Non-Fiduciary Representations and Covenants.(a) Each Lender (i) represents and warrants, as of the date such Person became a Lender party hereto, to, and (ii) covenants,from the date such Person became a Lender party hereto to the date such Person ceases being a Lender party hereto, for the benefit of,the Administrative Agent, the Left Lead Arranger, and each other Joint Lead Arranger and their respective Affiliates, and not, for theavoidance of doubt, to or for the benefit of the Borrower or any other Loan Party, that at least one of the following is and will be true:-123-(i) such Lender is not using “plan assets” (within the meaning of 29 CFR § 2510.3-101, as modified by Section 3(42)of ERISA) of one or more Benefit Plans in connection with the Loans, the Letters of Credit or the Commitments,(ii) the transaction exemption set forth in one or more PTEs, such as PTE 84‑14 (a class exemption for certaintransactions determined by independent qualified professional asset managers), PTE 95-60 (a class exemption for certaintransactions involving insurance company general accounts), PTE 90-1 (a class exemption for certain transactions involvinginsurance company pooled separate accounts), PTE 91-38 (a class exemption for certain transactions involving bank collectiveinvestment funds) or PTE 96-23 (a class exemption for certain transactions determined by in-house asset managers), isapplicable with respect to such Lender’s entrance into, participation in, administration of and performance of the Loans, theLetters of Credit, the Commitments and this Agreement,(iii) (A) such Lender is an investment fund managed by a “Qualified Professional Asset Manager” (within themeaning of Part VI of PTE 84-14), (B) such Qualified Professional Asset Manager made the investment decision on behalf ofsuch Lender to enter into, participate in, administer and perform the Loans, the Letters of Credit, the Commitments and thisAgreement, (C) the entrance into, participation in, administration of and performance of the Loans, the Letters of Credit, theCommitments and this Agreement satisfies the requirements of sub-sections (b) through (g) of Part I of PTE 84-14 and (D) tothe best knowledge of such Lender, the requirements of subsection (a) of Part I of PTE 84-14 are satisfied with respect to suchLender’s entrance into, participation in, administration of and performance of the Loans, the Letters of Credit, theCommitments and this Agreement, or(iv) such other representation, warranty and covenant as may be agreed in writing between the Administrative Agent,in its sole discretion, and such Lender.(b) In addition, unless clause (a)(i) above is true with respect to a Lender or such Lender has not provided anotherrepresentation, warranty and covenant as provided in clause (a)(iv) above, such Lender further (i) represents and warrants, as of thedate such Person became a Lender party hereto, to, and (ii) covenants, from the date such Person became a Lender party hereto to thedate such Person ceases being a Lender party hereto, for the benefit of, the Administrative Agent, the Left Lead Arranger, and eachother Joint Lead Arranger and their respective Affiliates, and not, for the avoidance of doubt, to or for the benefit of the Borrower orany other Loan Party, that:(i) none of the Administrative Agent, the Left Lead Arranger, and each other Joint Lead Arranger or any of theirrespective Affiliates is a fiduciary with respect to the assets of such Lender (including in connection with the reservation orexercise of any rights by the Administrative Agent under this Agreement, any Loan Document or any documents related tohereto or thereto),(ii) the Person making the investment decision on behalf of such Lender with respect to the entrance into, participationin, administration of and performance of the Loans, the Letters of Credit, the Commitments and this Agreement is independent(within the meaning of 29 CFR § 2510.3-21) and is a bank, an insurance carrier, an investment adviser, a broker-dealer or other-124-person that holds, or has under management or control, total assets of at least $50 million, in each case as described in 29 CFR§ 2510.3-21(c)(1)(i)(A)-(E),(iii) the Person making the investment decision on behalf of such Lender with respect to the entrance into, participationin, administration of and performance of the Loans, the Letters of Credit, the Commitments and this Agreement is capable ofevaluating investment risks independently, both in general and with regard to particular transactions and investment strategies(including in respect of the Obligations),(iv) the Person making the investment decision on behalf of such Lender with respect to the entrance into, participationin, administration of and performance of the Loans, the Letters of Credit, the Commitments and this Agreement is a fiduciaryunder ERISA or the Code, or both, with respect to the Loans, the Letters of Credit, the Commitments and this Agreement andis responsible for exercising independent judgment in evaluating the transactions hereunder, and(v) no fee or other compensation is being paid directly to the Administrative Agent, the Left Lead Arranger, and eachother Joint Lead Arranger or any their respective Affiliates for investment advice (as opposed to other services) in connectionwith the Loans, the Letters of Credit, the Commitments or this Agreement.ARTICLE X.MISCELLANEOUS10.01. Amendments, Etc. No amendment or waiver of any provision of this Agreement or any other Loan Document, andno consent to any departure by the Borrower or any other Loan Party therefrom, shall be effective unless in writing signed by theRequired Lenders and the Borrower or the applicable Loan Party, as the case may be, and acknowledged by the Administrative Agent,and each such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given; provided,however, that no such amendment, waiver or consent shall:(a) waive any condition set forth in Section 4.01(a) without the written consent of each Lender;(b) extend or increase the Commitment of any Lender (or reinstate any Commitment terminated pursuant to Section 8.02)without the written consent of such Lender;(c) postpone any date fixed by this Agreement or any other Loan Document for any payment of principal, interest, fees orother amounts due to the Lenders (or any of them) hereunder or under any other Loan Document without the written consent of eachLender directly affected thereby;(d) reduce the principal of, or the rate of interest specified herein on, any Loan or L/C Borrowing, or (subject to clause (iii) ofthe immediately succeeding sentence) any fees or other amounts payable hereunder or under any other Loan Document without thewritten consent of each Lender directly affected thereby; provided, however, that (i) only the consent of the Required Lenders shall benecessary to amend the definition of “Default Rate” or to waive any obligation of the Borrower to pay-125-interest or Letter of Credit Fees at the Default Rate and (ii) only the consent of the Required Lenders shall be necessary to amend anyfinancial covenant hereunder (or any defined term used therein) even if the effect of such amendment would be to reduce the rate ofinterest on any Loan or L/C Borrowing or to reduce any fee payable hereunder;(e) change (i) Sections 2.12 or 8.03 in a manner that would alter the pro rata sharing of payments required thereby without thewritten consent of each Lender or (ii) the order of application of any reduction in the Commitments or any prepayment of Loansamong the Facilities from the application thereof set forth in the applicable provisions of Section 2.04(c) or 2.05(b), respectively, in anymanner that materially and adversely affects the Lenders under a Facility without the written consent of (x) if such Facility is theRevolving Facility, the Required Revolving Lenders, and (y) if such Facility is the Term Facility, the Required Term Lenders;(f) (i) change any provision of this Section 10.01 or the definition of “Required Lenders” or any other provision hereofspecifying the number or percentage of Lenders required to amend, waive or otherwise modify any rights hereunder or make anydetermination or grant any consent hereunder (other than the definitions specified in clause (ii) of this Section 10.01(f)), without thewritten consent of each Lender or (ii) the definition of “Required Lenders”, “Required Revolving Lenders”, or “Required TermLenders” without the written consent of each Lender under the applicable Facilities or Facility;(g) (i) amend Section 1.06 or the definition of “Alternative Currency”, other than to eliminate currencies available to beutilized as Alternative Currencies, without the written consent of each Lender, or (ii) amend the first parenthetical appearing indefinition of “Interest Period” other than to eliminate such parenthetical or any period set forth in such parenthetical without the writtenconsent of each Lender;(h) release all or substantially all of the value of the Multiparty Guaranty without the written consent of each Lender, except tothe extent the release of any Guarantor is permitted pursuant to Section 9.10 (in which case such release may be made by theAdministrative Agent acting alone); or(i) prior to the Automatic Guaranty Release, change Section 8.03 or the definition of “Guaranteed Cash ManagementAgreement”, “Cash Management Bank”, “Hedge Bank”, “Guaranteed Hedge Agreements”, “Guaranteed Obligations”, or“Guaranteed Parties” (as defined in this Agreement or any applicable Credit Document), in each case in a manner that would alter thepro rata sharing of payments required thereby without the written consent of each affected Cash Management Bank or Hedge Bank.Notwithstanding anything to the contrary in this Section 10.01 or in any other provision of this Agreement or any other LoanDocument:(i) no amendment, waiver or consent shall, unless in writing and signed by the L/C Issuer in addition to the Lendersrequired above, affect the rights or duties of the L/C Issuer under this Agreement or any Issuer Document relating to any Letterof Credit issued or to be issued by it;-126-(ii) the definition of “Letter of Credit Sublimit” may be amended with only the consent of the Borrower, theAdministrative Agent, the L/C Issuer and the Required Revolving Lenders;(iii) the amount of any L/C Issuer’s L/C Issuer Sublimit may be increased, and Schedule 2.01 may be amended toreflect such increase and any corresponding reductions in the amount of any other L/C Issuer’s L/C Issuer Sublimit, with onlythe consent of the Borrower and the L/C Issuer that is increasing its L/C Issuer Sublimit;(iv) this Agreement may be amended as contemplated by clause (ii) of Section 2.13(e) in connection with the additionof a new term loan tranche with the consent of only the Administrative Agent, the Lenders providing such Term Loan and theBorrower;(v) no amendment, waiver or consent shall, unless in writing and signed by the Administrative Agent in addition to theLenders required above, affect the rights or duties of the Administrative Agent under this Agreement or any other LoanDocument;(vi) the Fee Letter may be amended, or rights or privileges thereunder waived, in a writing executed only by theparties thereto;(vii) the Administrative Agent and the Borrower may amend any Loan Document to (1) cure any ambiguity, omission,mistake, defect or inconsistency, in each case, of a technical nature or (2) make any change that would add or make morerestrictive any covenant of the Loan Parties or provide an additional right or benefit to the Lenders or the L/C Issuer, so long as,in each case, (x) such changes shall not be adverse to the Lenders or the L/C Issuer, (y) the Lenders and the L/C Issuer shallhave received at least five (5) Business Days’ prior written notice thereof and (z) the Administrative Agent shall not havereceived, within five (5) Business Days following the date of such notice to the Lenders, written notice from (I) the RequiredLenders stating that the Required Lenders object to such amendment or (II) if affected by such amendment, L/C Issuer statingthat it objects to such amendment;(viii) this Agreement may be amended by an Extension Amendment or a Refinancing Amendment as contemplated byand in accordance with Section 2.16 or Section 2.17 with the consent of only the Borrower, the Administrative Agent, the L/CIssuer (to the extent the terms of this Section 10.01 would require the L/C Issuer for the amendments effected in such ExtensionAmendment) and each (1) Extending Lender, in the case of an Extension Amendment, or (2) each applicable CreditAgreement Refinancing Facility Lender, in the case of a Refinancing Amendment;(ix) no Defaulting Lender shall have any right to approve or disapprove any amendment, waiver or consent hereunder(and any amendment, waiver or consent which by its terms requires the consent of all Lenders or each affected Lender may beeffected with the consent of the applicable Lenders other than Defaulting Lenders), except that (x) the Commitment of anyDefaulting Lender may not be increased or extended without the consent of such Lender and (y) any waiver, amendment ormodification requiring the consent of all-127-Lenders or each affected Lender that by its terms affects any Defaulting Lender more adversely than other affected Lendersshall require the consent of such Defaulting Lender;(x) any Lender may exchange, continue or rollover all or a portion of its Loans in connection with any refinancing,extension, loan modification or similar transaction permitted by the terms of this Agreement, pursuant to a cashless settlementmechanism approved by the Borrower, the Administrative Agent and such Lender; and(xi) the Administrative Agent and the Borrower may amend this Agreement to provide for a LIBOR Successor Rateto the extent permitted by the procedures prescribed in the definition of “Eurocurrency Rate”.10.02. Notices; Effectiveness; Electronic Communication.(a) Notices Generally. Except in the case of notices and other communications expressly permitted to be given by telephone(and except as provided in subsection (b) below), all notices and other communications provided for herein shall be in writing and shallbe delivered by hand or overnight courier service, mailed by certified or registered mail or sent by facsimile as follows, and all noticesand other communications expressly permitted hereunder to be given by telephone shall be made to the applicable telephone number,as follows:(i) if to the Borrower or any other Loan Party, the Administrative Agent or the L/C Issuer, to the address, facsimilenumber, electronic mail address or telephone number specified for such Person on Schedule 10.02; and(ii) if to any other Lender, to the address, facsimile number, electronic mail address or telephone number specified inits Administrative Questionnaire (including, as appropriate, notices delivered solely to the Person designated by a Lender on itsAdministrative Questionnaire then in effect for the delivery of notices that may contain material non-public information relatingto the Borrower).Notices and other communications sent by hand or overnight courier service, or mailed by certified or registered mail, shall be deemedto have been given when received; notices and other communications sent by facsimile shall be deemed to have been given when sent(except that, if not given during normal business hours for the recipient, shall be deemed to have been given at the opening of businesson the next Business Day for the recipient). Notices and other communications delivered through electronic communications to theextent provided in subsection (b) below, shall be effective as provided in such subsection (b).(b) Electronic Communications. Notices and other communications to the Lenders and the L/C Issuer hereunder may bedelivered or furnished by electronic communication (including e‑mail, FpML messaging, and Internet or intranet websites) pursuant toprocedures approved by the Administrative Agent, provided that the foregoing shall not apply to notices to any Lender or the L/CIssuer pursuant to Article II if such Lender or the L/C Issuer, as applicable, has notified the Administrative Agent that it is incapable ofreceiving notices under such Article by electronic communication. The Administrative Agent or the Borrower may, in its respectivediscretion, agree to accept notices and-128-other communications to it hereunder by electronic communications pursuant to procedures approved by it, provided that approval ofsuch procedures may be limited to particular notices or communications.Unless the Administrative Agent otherwise prescribes, (i) notices and other communications sent to an e-mail address shall bedeemed received upon the sender’s receipt of an acknowledgement from the intended recipient (such as by the “return receiptrequested” function, as available, return e-mail or other written acknowledgement), and (ii) notices or communications posted to anInternet or intranet website shall be deemed received upon the deemed receipt by the intended recipient at its e-mail address asdescribed in the foregoing clause (i) of notification that such notice or communication is available and identifying the website addresstherefor; provided that, for both clauses (i) and (ii), if such notice, email or other communication is not sent during the normal businesshours of the recipient, such notice, email or communication shall be deemed to have been sent at the opening of business on the nextbusiness day for the recipient.(c) The Platform. THE PLATFORM IS PROVIDED “AS IS” AND “AS AVAILABLE.” THE AGENT PARTIES (ASDEFINED BELOW) DO NOT WARRANT THE ACCURACY OR COMPLETENESS OF THE BORROWER MATERIALSOR THE ADEQUACY OF THE PLATFORM, AND EXPRESSLY DISCLAIM LIABILITY FOR ERRORS IN OROMISSIONS FROM THE BORROWER MATERIALS. NO WARRANTY OF ANY KIND, EXPRESS, IMPLIED ORSTATUTORY, INCLUDING ANY WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE,NON-INFRINGEMENT OF THIRD PARTY RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS, ISMADE BY ANY AGENT PARTY IN CONNECTION WITH THE BORROWER MATERIALS OR THE PLATFORM. In noevent shall the Administrative Agent or any of its Related Parties (collectively, the “Agent Parties”) have any liability to the Borrower,any Lender, the L/C Issuer or any other Person for losses, claims, damages, liabilities or expenses of any kind (whether in tort, contractor otherwise) arising out of the Borrower’s or the Administrative Agent’s transmission of Borrower Materials or notices through theplatform, any other electronic platform or electronic messaging service, or through the Internet, except to the extent that such losses,claims, damages, liabilities or expenses are determined by a court of competent jurisdiction by a final and nonappealable judgment tohave resulted from the gross negligence or willful misconduct of such Agent Party; provided, however, that in no event shall anyAgent Party have any liability to the Borrower, any Lender, the L/C Issuer or any other Person for indirect, special, incidental,consequential or punitive damages (as opposed to direct or actual damages).(d) Change of Address, Etc. The Borrower, the Administrative Agent and the L/C Issuer may change its respective address,facsimile or telephone number for notices and other communications hereunder by notice to the other parties hereto. Each other Lendermay change its address, facsimile or telephone number for notices and other communications hereunder by notice to the Borrower, theAdministrative Agent and the L/C Issuer. In addition, each Lender agrees to notify the Administrative Agent from time to time toensure that the Administrative Agent has on record (i) an effective address, contact name, telephone number, facsimile number andelectronic mail address to which notices and other communications may be sent and (ii) accurate wire instructions for such Lender.Furthermore, each Public Lender agrees to cause at least one individual at or on behalf of such Public Lender to at all times haveselected the “Private Side Information” or similar designation on the content declaration screen of the Platform in order to enable suchPublic Lender or its delegate, in accordance with such-129-Public Lender’s compliance procedures and applicable Law, including United States Federal and state securities Laws, to makereference to Borrower Materials that are not made available through the “Public Side Information” portion of the Platform and that maycontain material non-public information with respect to the Borrower or its securities for purposes of United States Federal or statesecurities laws.(e) Reliance by Administrative Agent, L/C Issuer and Lenders. The Administrative Agent, the L/C Issuer and the Lendersshall be entitled to rely and act upon any notices (including telephonic notices, Loan Notices and Letter of Credit Applications)purportedly given by or on behalf of the Borrower or any Guarantor even if (i) such notices were not made in a manner specifiedherein, were incomplete or were not preceded or followed by any other form of notice specified herein, or (ii) the terms thereof, asunderstood by the recipient, varied from any confirmation thereof. The Borrower shall indemnify the Administrative Agent, the L/CIssuer, each Lender and the Related Parties of each of them from all losses, costs, expenses and liabilities resulting from the reliance bysuch Person on each notice purportedly given by or on behalf of the Borrower or any Guarantor. All telephonic notices to and othertelephonic communications with the Administrative Agent may be recorded by the Administrative Agent, and each of the partieshereto hereby consents to such recording.10.03. No Waiver; Cumulative Remedies; Enforcement. No failure by any Lender, the L/C Issuer or the AdministrativeAgent to exercise, and no delay by any such Person in exercising, any right, remedy, power or privilege hereunder or under any otherLoan Document shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilegehereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege. The rights,remedies, powers and privileges herein provided, and provided under each other Loan Document, are cumulative and not exclusive ofany rights, remedies, powers and privileges provided by law.Notwithstanding anything to the contrary contained herein or in any other Loan Document, the authority to enforce rights andremedies hereunder and under the other Loan Documents against the Loan Parties or any of them shall be vested exclusively in, and allactions and proceedings at law in connection with such enforcement shall be instituted and maintained exclusively by, theAdministrative Agent in accordance with Section 8.02 for the benefit of all the Lenders and the L/C Issuer; provided, however, that theforegoing shall not prohibit (a) the Administrative Agent from exercising on its own behalf the rights and remedies that inure to itsbenefit (solely in its capacity as Administrative Agent) hereunder and under the other Loan Documents, (b) the L/C Issuer fromexercising the rights and remedies that inure to its benefit (solely in its capacity as L/C Issuer) hereunder and under the other LoanDocuments, (c) any Lender from exercising setoff rights in accordance with Section 10.08 (subject to the terms of Section 2.12), or (d)any Lender from filing proofs of claim or appearing and filing pleadings on its own behalf during the pendency of a proceedingrelative to any Loan Party under any Debtor Relief Law; and provided, further, that if at any time there is no Person acting asAdministrative Agent hereunder and under the other Loan Documents, then (i) the Required Lenders shall have the rights otherwiseascribed to the Administrative Agent pursuant to Section 8.02 and (ii) in addition to the matters set forth in clauses (b), (c) and (d) ofthe preceding proviso and subject to Section 2.12, any Lender may, with the consent of the Required Lenders, enforce any rights andremedies available to it and as authorized by the Required Lenders.-130-10.04. Expenses; Indemnity; Damage Waiver.(a) Costs and Expenses. The Borrower shall pay (i) all reasonable out‑of‑pocket expenses incurred by the AdministrativeAgent and its Affiliates (including the reasonable fees, charges and disbursements of counsel for the Administrative Agent), inconnection with the syndication of the credit facilities provided for herein, the preparation, negotiation, execution, delivery andadministration of this Agreement and the other Loan Documents or any amendments, modifications or waivers of the provisions hereofor thereof (whether or not the transactions contemplated hereby or thereby shall be consummated), (ii) all reasonable out‑of‑pocketexpenses incurred by the L/C Issuer in connection with the issuance, amendment, renewal or extension of any Letter of Credit or anydemand for payment thereunder and (iii) all out‑of‑pocket expenses incurred by the Administrative Agent, any Lender or the L/CIssuer (including the fees, charges and disbursements of any counsel for the Administrative Agent, any Lender or the L/C Issuer), inconnection with the enforcement or protection of its rights (A) in connection with this Agreement and the other Loan Documents,including its rights under this Section, or (B) in connection with the Loans made or Letters of Credit issued hereunder, including allsuch out-of-pocket expenses incurred during any workout, restructuring or negotiations in respect of such Loans or Letters of Credit.(b) Indemnification by the Loan Parties. The Loan Parties shall jointly and severally indemnify the Administrative Agent (andany sub-agent thereof), each Lender and the L/C Issuer, and each Related Party of any of the foregoing Persons (each such Personbeing called an “Indemnitee”) against, and hold each Indemnitee harmless from, any and all losses, claims, damages, liabilities,penalties and related expenses (including the fees, charges and disbursements of any counsel for any Indemnitee), incurred by anyIndemnitee or asserted against any Indemnitee by any third party or by the Borrower or any other Loan Party arising out of, inconnection with, or as a result of (i) the execution or delivery of this Agreement, any other Loan Document or any agreement orinstrument contemplated hereby or thereby, the performance by the parties hereto of their respective obligations hereunder orthereunder, the consummation of the transactions contemplated hereby or thereby, or, in the case of the Administrative Agent (and anysub-agent thereof) and its Related Parties only, the administration of this Agreement and the other Loan Documents (including inrespect of any matters addressed in Section 3.01), (ii) any Loan or Letter of Credit or the use or proposed use of the proceeds therefrom(including any refusal by the L/C Issuer to honor a demand for payment under a Letter of Credit if the documents presented inconnection with such demand do not strictly comply with the terms of such Letter of Credit), (iii) any actual or alleged presence orrelease of Hazardous Materials on or from any property owned or operated by the Borrower or any of its Subsidiaries, or anyEnvironmental Liability related in any way to the Borrower or any of its Subsidiaries, or (iv) any actual or prospective claim, litigation,investigation or proceeding relating to any of the foregoing, whether based on contract, tort or any other theory, whether brought by athird party or by the Borrower or any other Loan Party, and regardless of whether any Indemnitee is a party thereto; provided that suchindemnity shall not, as to any Indemnitee, be available to the extent that such losses, claims, damages, liabilities or related expenses(x) are determined by a court of competent jurisdiction by final and nonappealable judgment to have resulted from the gross negligenceor willful misconduct of such Indemnitee or (y) result from a claim brought by the Borrower or any other Loan Party against suchIndemnitee for breach in bad faith of such Indemnitee’s obligations hereunder or under any other Loan Document, if the Borrower orsuch other Loan Party has obtained a final and nonappealable judgment in its favor on such claim as determined-131-by a court of competent jurisdiction. Without limiting the provisions of Section 3.01(c), this Section 10.04(b) shall not apply withrespect to Taxes other than any Taxes that represent losses, claims, damages, etc. arising from any non-Tax claim.(c) Reimbursement by Lenders. To the extent that the Borrower or any other Loan Party for any reason fails to indefeasiblypay any amount required under subsection (a) or (b) of this Section to be paid by it to the Administrative Agent (or any sub-agentthereof), the L/C Issuer or any Related Party of any of the foregoing, each Lender severally agrees to pay to the Administrative Agent(or any such sub-agent), the L/C Issuer or such Related Party, as the case may be, such Lender’s pro rata share (determined as of thetime that the applicable unreimbursed expense or indemnity payment is sought based on each Lender’s share of the Total CreditExposure at such time) of such unpaid amount (including any such unpaid amount in respect of a claim asserted by such Lender), suchpayment to be made severally among them based on such Lender’s Applicable Percentage (determined as of the time that theapplicable unreimbursed expense or indemnity payment is sought), provided further that the unreimbursed expense or indemnified loss,claim, damage, liability or related expense, as the case may be, was incurred by or asserted against the Administrative Agent (or anysuch sub-agent) or the L/C Issuer in its capacity as such, or against any Related Party of any of the foregoing acting for theAdministrative Agent (or any such sub-agent) or L/C Issuer in connection with such capacity. The obligations of the Lenders underthis subsection (c) are subject to the provisions of Section 2.11(d).(d) Waiver of Consequential Damages, Etc. To the fullest extent permitted by applicable law, the Borrower and each otherLoan Party shall not assert, and each hereby waives, and acknowledges that no other Person shall have, any claim against anyIndemnitee, on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages)arising out of, in connection with, or as a result of, this Agreement, any other Loan Document or any agreement or instrumentcontemplated hereby, the transactions contemplated hereby or thereby, any Loan or Letter of Credit or the use of the proceeds thereof.No Indemnitee referred to in subsection (b) above shall be liable for any damages arising from the use by unintended recipients of anyinformation or other materials distributed to such unintended recipients by such Indemnitee through telecommunications, electronic orother information transmission systems in connection with this Agreement or the other Loan Documents or the transactionscontemplated hereby or thereby other than for direct or actual damages resulting from the gross negligence or willful misconduct ofsuch Indemnitee as determined by a final and nonappealable judgment of a court of competent jurisdiction.(e) Payments. All amounts due under this Section shall be payable not later than ten Business Days after demand therefor.-132-(f) Survival. The agreements in this Section and the indemnity provisions of Section 10.02(e) shall survive the resignation ofthe Administrative Agent and the L/C Issuer, the replacement of any Lender, the termination of the Aggregate Commitments and therepayment, satisfaction or discharge of all the other Obligations.10.05. Payments Set Aside. To the extent that any payment by or on behalf of the Borrower or any other Loan Party is madeto the Administrative Agent, the L/C Issuer or any Lender, or the Administrative Agent, the L/C Issuer or any Lender exercises itsright of setoff, and such payment or the proceeds of such setoff or any part thereof is subsequently invalidated, declared to befraudulent or preferential, set aside or required (including pursuant to any settlement entered into by the Administrative Agent, the L/CIssuer or such Lender in its discretion) to be repaid to a trustee, receiver or any other party, in connection with any proceeding underany Debtor Relief Law or otherwise, then (a) to the extent of such recovery, the obligation or part thereof originally intended to besatisfied shall be revived and continued in full force and effect as if such payment had not been made or such setoff had not occurred,and (b) each Lender and the L/C Issuer severally agrees to pay to the Administrative Agent upon demand its applicable share (withoutduplication) of any amount so recovered from or repaid by the Administrative Agent, plus interest thereon from the date of suchdemand to the date such payment is made at a rate per annum equal to the applicable Overnight Rate from time to time in effect, in theapplicable currency of such recovery or payment. The obligations of the Lenders and the L/C Issuer under clause (b) of the precedingsentence shall survive the payment in full of the Obligations and the termination of this Agreement.10.06. Successors and Assigns.(a) Successors and Assigns Generally. The provisions of this Agreement shall be binding upon and inure to the benefit of theparties hereto and their respective successors and assigns permitted hereby, except that neither the Borrower nor any Guarantor mayassign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of the Administrative Agent andeach Lender, and no Lender may assign or otherwise transfer any of its rights or obligations hereunder except (i) to an assignee inaccordance with the provisions of subsection (b) of this Section, (ii) by way of participation in accordance with the provisions ofsubsection (d) of this Section, or (iii) by way of pledge or assignment of a security interest subject to the restrictions of subsection (f) ofthis Section (and any other attempted assignment or transfer by any party hereto shall be null and void). Nothing in this Agreement,expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors andassigns permitted hereby, Participants to the extent provided in subsection (d) of this Section and, to the extent expressly contemplatedhereby, the Related Parties of each of the Administrative Agent, the L/C Issuer and the Lenders) any legal or equitable right, remedy orclaim under or by reason of this Agreement.(b) Assignments by Lenders. Any Lender may at any time assign to one or more assignees all or a portion of its rights andobligations under this Agreement (including all or a portion of its Commitment under any Facility and the Loans (including forpurposes of this subsection (b), participations in L/C Obligations) at the time owing to it); provided that, in each case with respect toany Facility, any such assignment shall be subject to the following conditions:-133-(i) Minimum Amounts.(A) in the case of an assignment of the entire remaining amount of the assigning Lender’s Commitment underany Facility and the Loans at the time owing to it under such Facility or in the case of an assignment to a Lender, anAffiliate of a Lender or an Approved Fund, no minimum amount need be assigned; and(B) in any case not described in subsection (b)(i)(A) of this Section, the aggregate amount of the RevolvingCommitments under the Revolving Facility or the principal outstanding balance of the Term Loans of the assigningLender subject to each such assignment, determined as of the date the Assignment and Assumption with respect to suchassignment is delivered to the Administrative Agent or, if “Trade Date” is specified in the Assignment and Assumption,as of the Trade Date, shall not be less than $10,000,000, unless each of the Administrative Agent and, so long as noEvent of Default has occurred and is continuing, the Borrower otherwise consents (each such consent not to beunreasonably withheld or delayed); provided, however, that concurrent assignments to members of an Assignee Groupand concurrent assignments from members of an Assignee Group to a single Eligible Assignee (or to an EligibleAssignee and members of its Assignee Group) will be treated as a single assignment for purposes of determiningwhether such minimum amount has been met.(ii) Proportionate Amounts. Each partial assignment shall be made as an assignment of a proportionate part of all theassigning Lender’s rights and obligations under this Agreement with respect to the Loans or the Commitment assigned;(iii) Required Consents. No consent shall be required for any assignment except to the extent required by subsection(b)(i)(B) of this Section and, in addition:(A) the consent of the Borrower (such consent not to be unreasonably withheld or delayed) shall be requiredunless (1) an Event of Default has occurred and is continuing at the time of such assignment or (2) such assignment is toa Lender, an Affiliate of a Lender or an Approved Fund; provided that, the Borrower shall be deemed to haveconsented to any such assignment unless it shall object thereto by written notice to the Administrative Agent within ten(10) Business Days after having received notice thereof;(B) the consent of the Administrative Agent (such consent not to be unreasonably withheld or delayed) shallbe required if such assignment is to a Person that is not a Lender, an Affiliate of such Lender or an Approved Fundwith respect to such Lender; and(C) the consent of the L/C Issuer (such consent not to be unreasonably withheld or delayed) shall be requiredfor any assignment of Revolving Loans or Revolving Commitments.-134-(iv) Assignment and Assumption. The parties to each assignment shall execute and deliver to the AdministrativeAgent an Assignment and Assumption, together with a processing and recordation fee in the amount of $3,500; provided,however, that the Administrative Agent may, in its sole discretion, elect to waive such processing and recordation fee in thecase of any assignment. The assignee, if it is not a Lender, shall deliver to the Administrative Agent an AdministrativeQuestionnaire.(v) No Assignment to Certain Persons. No such assignment shall be made (A) to the Borrower or any of theBorrower’s Affiliates or Subsidiaries, (B) to any Defaulting Lender or any of its Subsidiaries, or any Person who, uponbecoming a Lender hereunder, would constitute any of the foregoing Persons described in this clause (B), or (C) to a naturalperson.(vi) Certain Additional Payments. In connection with any assignment of rights and obligations of any DefaultingLender hereunder, no such assignment shall be effective unless and until, in addition to the other conditions thereto set forthherein, the parties to the assignment shall make such additional payments to the Administrative Agent in an aggregate amountsufficient, upon distribution thereof as appropriate (which may be outright payment, purchases by the assignee of participationsor subparticipations, or other compensating actions, including funding, with the consent of the Borrower and the AdministrativeAgent, the applicable pro rata share of Loans previously requested but not funded by the Defaulting Lender, to each of whichthe applicable assignee and assignor hereby irrevocably consent), to (x) pay and satisfy in full all payment liabilities then owedby such Defaulting Lender to the Administrative Agent, the L/C Issuer or any Lender hereunder (and interest accrued thereon)and (y) acquire (and fund as appropriate) its full pro rata share of all Loans and participations in Letters of Credit in accordancewith its Applicable Percentage. Notwithstanding the foregoing, in the event that any assignment of rights and obligations of anyDefaulting Lender hereunder shall become effective under applicable Law without compliance with the provisions of thissubsection, then the assignee of such interest shall be deemed to be a Defaulting Lender for all purposes of this Agreement untilsuch compliance occurs.Subject to acceptance and recording thereof by the Administrative Agent pursuant to subsection (c) of this Section, from and after theeffective date specified in each Assignment and Assumption, the assignee thereunder shall be a party to this Agreement and, to theextent of the interest assigned by such Assignment and Assumption, have the rights and obligations of a Lender under this Agreement,and the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment and Assumption, be released fromits obligations under this Agreement (and, in the case of an Assignment and Assumption covering all of the assigning Lender’s rightsand obligations under this Agreement, such Lender shall cease to be a party hereto) but shall continue to be entitled to the benefits ofSections 3.01, 3.04, 3.05, and 10.04 with respect to facts and circumstances occurring prior to the effective date of such assignment;provided, that except to the extent otherwise expressly agreed by the affected parties, no assignment by a Defaulting Lender willconstitute a waiver or release of any claim of any party hereunder arising from that Lender’s having been a Defaulting Lender. Uponrequest, the Borrower (at its expense) shall execute and deliver a Note to the assignee Lender. Any assignment or transfer by a Lenderof rights or obligations under this Agreement that does not comply with this subsection shall-135-be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance withsubsection (d) of this Section.(c) Register. The Administrative Agent, acting solely for this purpose as an agent of the Borrower (and such agency beingsolely for tax purposes), shall maintain and update at the Administrative Agent’s Office a copy of each Assignment and Assumptiondelivered to it (or the equivalent thereof in electronic form) and a register for the recordation of the names and addresses of the Lenders,and the Commitments of, and principal amounts (and stated interest) of the Loans and L/C Obligations owing to, each Lender pursuantto the terms hereof from time to time (the “Register”). The entries in the Register shall be conclusive in the absence of manifest error,and the Borrower, the Administrative Agent and the Lenders shall treat each Person whose name is recorded in the Register pursuantto the terms hereof as a Lender hereunder for all purposes of this Agreement, notwithstanding notice to the contrary. In addition, theAdministrative Agent shall maintain on the Register information regarding the designation, and revocation of designation, of anyLender as a Defaulting Lender. The Register shall be available for inspection by the Borrower and any Lender, at any reasonable timeand from time to time upon reasonable prior notice.(d) Participations. Any Lender may at any time, without the consent of, or notice to, the Borrower or the AdministrativeAgent, sell participations to any Person (other than (w) a natural person, (x) a Defaulting Lender, or (y) the Borrower or any of theBorrower’s Affiliates or Subsidiaries) (each, a “Participant”) in all or a portion of such Lender’s rights and/or obligations under thisAgreement (including all or a portion of its Commitment and/or the Loans (including such Lender’s participations in L/C Obligations)owing to it); provided that (i) such Lender’s obligations under this Agreement shall remain unchanged, (ii) such Lender shall remainsolely responsible to the other parties hereto for the performance of such obligations and (iii) the Borrower, the Administrative Agent,the Lenders and the L/C Issuer shall continue to deal solely and directly with such Lender in connection with such Lender’s rights andobligations under this Agreement. For the avoidance of doubt, each Lender shall be responsible for the indemnity underSection 10.04(c) without regard to the existence of any participation.Any agreement or instrument pursuant to which a Lender sells such a participation shall provide that such Lender shall retainthe sole right to enforce this Agreement and to approve any amendment, modification or waiver of any provision of this Agreement;provided that such agreement or instrument may provide that such Lender will not, without the consent of the Participant, agree to anyamendment, waiver or other modification described in the first proviso to Section 10.01 that affects such Participant. The Borroweragrees that each Participant shall be entitled to the benefits of Sections 3.01, 3.04 and 3.05 to the same extent as if it were a Lender andhad acquired its interest by assignment pursuant to subsection (b) of this Section (it being understood that the documentation requiredunder Section 3.01(e) shall be delivered to the Lender who sells the participation) to the same extent as if it were a Lender and hadacquired its interest by assignment pursuant to subsection (b) of this Section; provided that such Participant (A) agrees to be subject tothe provisions of Sections 3.06 and 10.13 as if it were an assignee under subsection (b) of this Section and (B) shall not be entitled toreceive any greater payment under Sections 3.01 or 3.04, with respect to any participation, than the Lender from whom it acquired theapplicable participation would have been entitled to receive, except to the extent such entitlement to receive a greater payment resultsfrom a Change in Law that occurs after the Participant acquired the applicable participation. Each Lender that sells a participationagrees, at the Borrower’s request-136-and expense, to use commercially reasonable efforts to cooperate with the Borrower to effectuate the provisions of Section 10.13 withrespect to any Participant.Each Lender that sells a participation shall, acting solely for this purpose as a non-fiduciary agent of the Borrower, maintain aregister on which it enters the name and address of each Participant to which that Lender has sold a participation and the principalamounts (and stated interest) of each such Participant’s interest in the Commitments, Loans, L/C Obligations or other obligations underthis Agreement (the “Participant Register”); provided that no Lender shall have any obligation to disclose all or any portion of theParticipant Register to any Person (including the identity of any Participant or any information relating to a Participant’s interest in anyCommitments, Loans, L/C Obligations or its other obligations under any Loan Document) except to the extent that such disclosure isnecessary to establish that such Commitment, Loan, L/C Obligation or other obligation is in registered form under Section 5f.103-1(c)of the United States Treasury Regulations. The entries in the Participant Register shall be conclusive absent manifest error, and suchLender shall treat each Person whose name is recorded in the Participant Register as the owner of such participation for all purposes ofthis Agreement notwithstanding any notice to the contrary. For the avoidance of doubt, the Administrative Agent (in its capacity asAdministrative Agent) shall have no responsibility for maintaining a Participant Register.(e) Certain Pledges. Any Lender may at any time pledge or assign a security interest in all or any portion of its rights underthis Agreement (including under its Note, if any) to secure obligations of such Lender, including any pledge or assignment to secureobligations to a Federal Reserve Bank or other central banking authority; provided that no such pledge or assignment shall release suchLender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto.(f) Resignation By Bank of America as L/C Issuer after Assignment. Notwithstanding anything to the contrary containedherein, if at any time Bank of America assigns all of its Commitment and Loans pursuant to subsection (b) above, Bank of Americamay, upon 30 days’ notice to the Borrower and the Revolving Lenders, resign as L/C Issuer. In the event of any such resignation asL/C Issuer, the Borrower shall be entitled to appoint from among the Revolving Lenders a successor L/C Issuer hereunder; provided,however, that no failure by the Borrower to appoint any such successor shall affect the resignation of Bank of America as L/C Issuer.If Bank of America resigns as L/C Issuer, it shall retain all the rights, powers, privileges and duties of the L/C Issuer hereunder withrespect to all Letters of Credit outstanding as of the effective date of its resignation as L/C Issuer and all L/C Obligations with respectthereto (including the right to require the Revolving Lenders to make Base Rate Revolving Loans or fund risk participations inUnreimbursed Amounts pursuant to Section 2.03(c)). Upon the appointment of a successor L/C Issuer, (i) such successor shall succeedto and become vested with all of the rights, powers, privileges and duties of the retiring L/C Issuer, and (ii) the successor L/C Issuershall issue letters of credit in substitution for the Letters of Credit, if any, outstanding at the time of such succession or make otherarrangements satisfactory to Bank of America to effectively assume the obligations of Bank of America with respect to such Letters ofCredit.-137-10.07. Treatment of Certain Information; Confidentiality. Each of the Administrative Agent, the Lenders and the L/CIssuer agrees to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (a) to itsAffiliates and to its Related Parties (it being understood that the Persons to whom such disclosure is made will be informed of theconfidential nature of such Information and instructed to keep such Information confidential), (b) to the extent required or requested byany regulatory authority purporting to have jurisdiction over such Person or its Related Parties (including any self-regulatory authority,such as the National Association of Insurance Commissioners), (c) to the extent required by applicable laws or regulations or by anysubpoena or similar legal process, (d) to any other party hereto, (e) in connection with the exercise of any remedies hereunder or underany other Loan Document or any action or proceeding relating to this Agreement or any other Loan Document or the enforcement ofrights hereunder or thereunder, (f) subject to an agreement containing provisions substantially the same as those of this Section, to (i)any assignee of or Participant in, or any prospective assignee of or Participant in, any of its rights or obligations under this Agreementor any Eligible Assignee invited to be a Lender pursuant to Section 2.13(c) or (ii) any actual or prospective party (or its Related Parties)to any swap, derivative or other transaction under which payments are to be made by reference to the Borrower and its obligations, thisAgreement or payments hereunder, (g) with the consent of the Borrower, (h) on a confidential basis to (i) any rating agency inconnection with rating the Borrower or its Subsidiaries or the credit facilities provided hereunder, (ii) to any credit insurance providerrelating to the Borrower or its Subsidiaries and their respective obligations, or (iii) the CUSIP Service Bureau or any similar agency inconnection with the issuance and monitoring of CUSIP numbers or other market identifiers with respect to the credit facilities providedhereunder, or (i) to the extent such Information (x) becomes publicly available other than as a result of a breach of this Section or (y)becomes available to the Administrative Agent, any Lender, the L/C Issuer or any of their respective Affiliates on a nonconfidentialbasis from a source other than the Borrower. For purposes of this Section, “Information” means all information received from theBorrower or any Subsidiary relating to the Borrower or any Subsidiary or any of their respective businesses, other than any suchinformation that is available to the Administrative Agent, any Lender or the L/C Issuer on a nonconfidential basis prior to disclosure bythe Borrower or any Subsidiary, provided that, in the case of information received from the Borrower or any Subsidiary after the datehereof, such information is clearly identified at the time of delivery as confidential. Any Person required to maintain the confidentialityof Information as provided in this Section shall be considered to have complied with its obligation to do so if such Person has exercisedthe same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidentialinformation.Each of the Administrative Agent, the Lenders and the L/C Issuer acknowledges that (a) the Information may include materialnon-public information concerning the Borrower or a Subsidiary, as the case may be, (b) it has developed compliance proceduresregarding the use of material non-public information and (c) it will handle such material non-public information in accordance withapplicable Law, including United States Federal and state securities Laws.10.08. Right of Setoff. If an Event of Default shall have occurred and be continuing, each Lender, the L/C Issuer and each oftheir respective Affiliates is hereby authorized at any time and from time to time, to the fullest extent permitted by applicable law, to setoff and apply any and all deposits (general or special, time or demand, provisional or final, in whatever currency) at any time held andother obligations (in whatever currency) at any time owing by such Lender, the L/C Issuer or any such-138-Affiliate to or for the credit or the account of the Borrower or any other Loan Party against any and all of the obligations of theBorrower and the other Loan Parties now or hereafter existing under this Agreement or any other Loan Document to such Lender orthe L/C Issuer, irrespective of whether or not such Lender or the L/C Issuer shall have made any demand under this Agreement or anyother Loan Document and although such obligations of the Borrower or Loan Parties may be contingent or unmatured or are owed to abranch or office of such Lender or the L/C Issuer different from the branch or office holding such deposit or obligated on suchindebtedness; provided that, in the event that any Defaulting Lender shall exercise any such right of setoff, (x) all amounts so set offshall be paid over immediately to the Administrative Agent for further application in accordance with the provisions of Section 2.15and, pending such payment, shall be segregated by such Defaulting Lender from its other funds and deemed held in trust for the benefitof the Administrative Agent, the L/C Issuer and the Lenders, and (y) the Defaulting Lender shall provide promptly to theAdministrative Agent a statement describing in reasonable detail the Guaranteed Obligations owing to such Defaulting Lender as towhich it exercised such right of setoff. The rights of each Lender, the L/C Issuer and their respective Affiliates under this Section are inaddition to other rights and remedies (including other rights of setoff) that such Lender, the L/C Issuer or their respective Affiliates mayhave. Each Lender and the L/C Issuer agrees to notify the Borrower or other relevant Loan Party and the Administrative Agentpromptly after any such setoff and application, provided that the failure to give such notice shall not affect the validity of such setoffand application.10.09. Interest Rate Limitation. Notwithstanding anything to the contrary contained in any Loan Document, the interestpaid or agreed to be paid under the Loan Documents shall not exceed the maximum rate of non-usurious interest permitted byapplicable Law (the “Maximum Rate”). If the Administrative Agent or any Lender shall receive interest in an amount that exceeds theMaximum Rate, the excess interest shall be applied to the principal of the Loans or, if it exceeds such unpaid principal, refunded to theBorrower. In determining whether the interest contracted for, charged, or received by the Administrative Agent or a Lender exceedsthe Maximum Rate, such Person may, to the extent permitted by applicable Law, (a) characterize any payment that is not principal asan expense, fee, or premium rather than interest, (b) exclude voluntary prepayments and the effects thereof, and (c) amortize, prorate,allocate, and spread in equal or unequal parts the total amount of interest throughout the contemplated term of the Obligationshereunder.10.10. Counterparts; Integration; Effectiveness. This Agreement may be executed in counterparts (and by different partieshereto in different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute asingle contract. This Agreement and the other Loan Documents constitute the entire contract among the parties relating to the subjectmatter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof.Except as provided in Section 4.01, this Agreement shall become effective when it shall have been executed by the AdministrativeAgent and when the Administrative Agent shall have received counterparts hereof that, when taken together, bear the signatures ofeach of the other parties hereto. Delivery of an executed counterpart of a signature page of this Agreement by facsimile or otherelectronic imaging means shall be effective as delivery of an original executed counterpart of this Agreement.-139-10.11. Survival of Representations and Warranties. All representations and warranties made hereunder and in any otherLoan Document or other document delivered pursuant hereto or thereto or in connection herewith or therewith shall survive theexecution and delivery hereof and thereof. Such representations and warranties have been or will be relied upon by the AdministrativeAgent and each Lender, regardless of any investigation made by the Administrative Agent or any Lender or on their behalf andnotwithstanding that the Administrative Agent or any Lender may have had notice or knowledge of any Default at the time of anyCredit Extension, and shall continue in full force and effect as long as any Loan or any other Obligation hereunder shall remain unpaidor unsatisfied or any Letter of Credit shall remain outstanding.10.12. Severability. If any provision of this Agreement or the other Loan Documents is held to be illegal, invalid orunenforceable, (a) the legality, validity and enforceability of the remaining provisions of this Agreement and the other LoanDocuments shall not be affected or impaired thereby and (b) the parties shall endeavor in good faith negotiations to replace the illegal,invalid or unenforceable provisions with valid provisions the economic effect of which comes as close as possible to that of the illegal,invalid or unenforceable provisions. The invalidity of a provision in a particular jurisdiction shall not invalidate or render unenforceablesuch provision in any other jurisdiction. Without limiting the foregoing provisions of this Section 10.12, if and to the extent that theenforceability of any provisions in this Agreement relating to Defaulting Lenders shall be limited by Debtor Relief Laws, asdetermined in good faith by the Administrative Agent or the L/C Issuer, as applicable, then such provisions shall be deemed to be ineffect only to the extent not so limited.10.13. Replacement of Lenders. If (i) any Lender requests compensation under Section 3.04, (ii) the Borrower is required topay any additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 3.01, (iii)any Lender is a Defaulting Lender or a Non-Extending Lender, or (iv) any Lender has refused or failed, within a reasonable period oftime (as determined by Administrative Agent in its reasonable discretion) from first receiving a written request therefor fromAdministrative Agent, to provide its written approval of any amendment, consent or waiver in respect of any matter related to thisAgreement or the other Loan Documents requiring that all Lenders or all affected Lenders will have given written approval of suchrequested amendment, consent or waiver pursuant to Section 10.01 and in such instance Lenders sufficient to constitute RequiredLenders have already provided such written approval pursuant to Section 10.01, then the Borrower may, at its sole expense and effort,upon notice to such Lender and the Administrative Agent, require such Lender to assign and delegate, without recourse (in accordancewith and subject to the restrictions contained in, and consents required by, Section 10.06), all of its interests, rights (other than itsexisting rights to payments pursuant to Sections 3.01 and 3.04) and obligations under this Agreement and the related Loan Documentsto an Eligible Assignee that shall assume such obligations (which assignee may be another Lender, if a Lender accepts suchassignment), provided that:-140-(a) the Borrower shall have paid to the Administrative Agent the assignment fee specified in Section 10.06(b);(b) such Lender shall have received payment of an amount equal to 100% of the outstanding principal of its Loans and L/CAdvances, accrued interest thereon, accrued fees and all other amounts payable to it hereunder and under the other Loan Documents(including any amounts under Section 3.05) from the assignee (to the extent of such outstanding principal and accrued interest andfees) or the Borrower (in the case of all other amounts);(c) in the case of any such assignment resulting from a claim for compensation under Section 3.04 or payments required to bemade pursuant to Section 3.01, such assignment will result in a reduction in such compensation or payments thereafter;(d) such assignment does not conflict with applicable Laws;(e) in the case of an assignment resulting from a Lender refusing or failing to provide its written approval referenced in clause(iv) above, the applicable assignee shall have consented to the applicable amendment, waiver or consent; and(f) in the case of an assignment from a Non-Extending Lender, such assignment shall not be effective until the applicableExisting Revolving Maturity Date or Existing Term Maturity Date, as applicable, in accordance with Section 2.16(d).A Lender shall not be required to make any such assignment or delegation if, prior thereto, as a result of a waiver by suchLender or otherwise, the circumstances entitling the Borrower to require such assignment and delegation cease to apply.10.14. Governing Law; Jurisdiction; Etc.(a) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED INACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.(b) SUBMISSION TO JURISDICTION. THE BORROWER AND EACH OTHER LOAN PARTY IRREVOCABLYAND UNCONDITIONALLY AGREES THAT IT WILL NOT COMMENCE ANY ACTION, LITIGATION ORPROCEEDING OF ANY KIND OR DESCRIPTION, WHETHER IN LAW OR EQUITY, WHETHER IN CONTRACT OR INTORT OR OTHERWISE, AGAINST THE ADMINISTRATIVE AGENT, ANY LENDER, THE L/C ISSUER, OR ANYRELATED PARTY OF THE FOREGOING IN ANY WAY RELATING TO THIS AGREEMENT OR ANY OTHER LOANDOCUMENT OR THE TRANSACTIONS RELATING HERETO OR THERETO, IN ANY FORUM OTHER THAN,EXCLUSIVELY, THE COURTS OF THE STATE OF NEW YORK SITTING IN NEW YORK COUNTY AND OF THEUNITED STATES DISTRICT COURT OF THE SOUTHERN DISTRICT OF NEW YORK, AND ANY APPELLATE COURTFROM ANY THEREOF, AND EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLYSUBMITS TO THE JURISDICTION OF SUCH COURTS AND AGREES THAT ALL CLAIMS IN RESPECT OF ANYSUCH ACTION, LITIGATION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW YORK STATECOURT OR, TO THE FULLEST EXTENT PERMITTED BY-141-APPLICABLE LAW, IN SUCH FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT A FINALJUDGMENT IN ANY SUCH ACTION, LITIGATION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BEENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BYLAW. NOTHING IN THIS AGREEMENT OR IN ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY RIGHT THATTHE ADMINISTRATIVE AGENT, ANY LENDER OR THE L/C ISSUER MAY OTHERWISE HAVE TO BRING ANYACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AGAINST THEBORROWER OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION.(c) WAIVER OF VENUE. THE BORROWER AND EACH GUARANTOR IRREVOCABLY ANDUNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTIONTHAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY ACTION OR PROCEEDINGARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT IN ANY COURTREFERRED TO IN SUBSECTION (b) OF THIS SECTION. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLYWAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE DEFENSE OF AN INCONVENIENTFORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH COURT.(d) SERVICE OF PROCESS. EACH PARTY HERETO IRREVOCABLY CONSENTS TO SERVICE OF PROCESSIN THE MANNER PROVIDED FOR NOTICES IN SECTION 10.02. NOTHING IN THIS AGREEMENT WILL AFFECTTHE RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BYAPPLICABLE LAW.10.15. Waiver of Jury Trial. EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLESTEXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGALPROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANYOTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHERBASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NOREPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OROTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCETHE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEENINDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHERTHINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.10.16. No Advisory or Fiduciary Responsibility. In connection with all aspects of each transaction contemplated hereby(including in connection with any amendment, waiver or other modification hereof or of any other Loan Document), the Borrower andeach other Loan Party acknowledges and agrees, and acknowledges its Affiliates’ understanding, that: (i) (A) the arranging and otherservices regarding this Agreement provided by the Administrative Agent, the Joint Lead Arrangers and the Lenders are arm’s-lengthcommercial transactions between the Borrower, each other Loan Party and their respective Affiliates, on the one hand, and theAdministrative Agent, the Joint-142-Lead Arrangers and the Lenders, on the other hand, (B) each of the Borrower and the other Loan Parties has consulted its own legal,accounting, regulatory and tax advisors to the extent it has deemed appropriate, and (C) the Borrower and each other Loan Party iscapable of evaluating, and understands and accepts, the terms, risks and conditions of the transactions contemplated hereby and by theother Loan Documents; (ii) (A) the Administrative Agent, each Joint Lead Arranger and each Lender is and has been acting solely as aprincipal and, except as expressly agreed in writing by the relevant parties, has not been, is not, and will not be acting as an advisor,agent or fiduciary for the Borrower, any other Loan Party or any of their respective Affiliates, or any other Person and (B) neither theAdministrative Agent nor any Lender or Joint Lead Arranger has any obligation to the Borrower, any other Loan Party or any of theirrespective Affiliates with respect to the transactions contemplated hereby except those obligations expressly set forth herein and in theother Loan Documents; and (iii) the Administrative Agent, the Joint Lead Arrangers, the Lenders and their respective Affiliates may beengaged in a broad range of transactions that involve interests that differ from those of the Borrower, the other Loan Parties and theirrespective Affiliates, and neither the Administrative Agent nor any Lender or Joint Lead Arranger has any obligation to disclose any ofsuch interests to the Borrower, any other Loan Party or any of their respective Affiliates. Each of the Borrower and the other LoanParties agrees that it will not claim that any of the Administrative Agent, Joint Lead Arrangers or Lenders has rendered advisoryservices of any nature or respect or owes a fiduciary or similar duty to the Borrower or such Loan Party, in connection with thetransactions contemplated hereby or the process leading thereto.10.17. Electronic Execution of Assignments and Certain Other Documents. The words “execute,” “execution,” “signed,”“signature,” and words of like import in or related to any document to be signed in connection with this Agreement and thetransactions contemplated hereby (including without limitation Assignment and Assumptions, amendments or other modifications,Loan Notices, waivers and consents) shall be deemed to include electronic signatures, the electronic matching of assignment terms andcontract formations on electronic platforms approved by the Administrative Agent, or the keeping of records in electronic form, each ofwhich shall be of the same legal effect, validity or enforceability as a manually executed signature or the use of a paper-basedrecordkeeping system, as the case may be, to the extent and as provided for in any applicable law, including the Federal ElectronicSignatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any other similarstate laws based on the Uniform Electronic Transactions Act; provided that notwithstanding anything contained herein to the contrarythe Administrative Agent is under no obligation to agree to accept electronic signatures in any form or in any format unless expresslyagreed to by the Administrative Agent pursuant to procedures approved by it.10.18. USA PATRIOT Act. Each Lender that is subject to the Act (as hereinafter defined) and the Administrative Agent (foritself and not on behalf of any Lender) hereby notifies the Loan Parties that pursuant to the requirements of the USA PATRIOT Act(Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the “Act”), it is required to obtain, verify and record information thatidentifies each Loan Party, which information includes the name and address of each Loan Party and other information that will allowsuch Lender or the Administrative Agent, as applicable, to identify each Loan Party in accordance with the Act. Each Loan Party shall,promptly following a request by the Administrative Agent or any Lender, provide all documentation and other information that theAdministrative Agent or such Lender requests in order to comply with its ongoing obligations under applicable “know your customer”and anti-money laundering rules and regulations, including the Act.-143-10.19. Multiparty Guaranty.(a) Multiparty Guaranty. Each Guarantor hereby absolutely and unconditionally, jointly and severally guarantees, as aguaranty of payment and performance and not merely as a guaranty of collection, prompt payment when due, whether at statedmaturity, by required prepayment, upon acceleration, demand or otherwise, and at all times thereafter, of any and all of the GuaranteedObligations, whether for principal, interest, premiums, fees, indemnities, damages, costs, expenses or otherwise, of the Borrower orany other Loan Party or their Subsidiaries to the Guaranteed Parties, arising hereunder or under any other Loan Document, anyGuaranteed Cash Management Agreement or any Guaranteed Hedge Agreement (including all renewals, extensions, amendments,refinancings and other modifications thereof and all costs, attorneys’ fees and expenses incurred by the Guaranteed Parties inconnection with the collection or enforcement thereof). Notwithstanding the foregoing, the liability of each Guarantor individually withrespect to this Multiparty Guaranty shall be limited to an aggregate amount equal to the largest amount that would not render itsobligations hereunder subject to avoidance under Section 548 of the United States Bankruptcy Code or any comparable provisions ofany applicable state law. The Administrative Agent’s books and records showing the amount of the Guaranteed Obligations shall beadmissible in evidence in any action or proceeding, and shall be binding upon each Guarantor, and conclusive for the purpose ofestablishing the amount of the Guaranteed Obligations. This Multiparty Guaranty shall not be affected by the genuineness, validity,regularity or enforceability of the Guaranteed Obligations or any instrument or agreement evidencing any Guaranteed Obligations, orby the existence, validity, enforceability, perfection, non-perfection or extent of any collateral therefor, or by any fact or circumstancerelating to the Guaranteed Obligations which might otherwise constitute a defense to the obligations of the Guarantors, or any of them,under this Multiparty Guaranty, and each Guarantor hereby irrevocably waives any defenses it may now have or hereafter acquire inany way relating to any or all of the foregoing.(b) Rights of Lenders. Each Guarantor consents and agrees that the Guaranteed Parties may, at any time and from time totime, without notice or demand, and without affecting the enforceability or continuing effectiveness hereof: (i) amend, extend, renew,compromise, discharge, accelerate or otherwise change the time for payment or the terms of the Guaranteed Obligations or any partthereof; (ii) take, hold, exchange, enforce, waive, release, fail to perfect, sell, or otherwise dispose of any security for the payment ofthis Multiparty Guaranty or any Guaranteed Obligations ; (iii) apply such security and direct the order or manner of sale thereof as theAdministrative Agent, the L/C Issuer and the Lenders in their sole discretion may determine; and (iv) release or substitute one or moreof any endorsers or other guarantors of any of the Guaranteed Obligations. Without limiting the generality of the foregoing, eachGuarantor consents to the taking of, or failure to take, any action which might in any manner or to any extent vary the risks of suchGuarantor under this Multiparty Guaranty or which, but for this provision, might operate as a discharge of such Guarantor.-144-(c) Certain Waivers. Each Guarantor waives (i) any defense arising by reason of any disability or other defense of theBorrower or any other guarantor, or the cessation from any cause whatsoever (including any act or omission of any Guaranteed Party)of the liability of the Borrower; (ii) any defense based on any claim that such Guarantor’s obligations exceed or are more burdensomethan those of the Borrower; (iii) the benefit of any statute of limitations affecting any Guarantor’s liability hereunder; (iv) any right toproceed against the Borrower, proceed against or exhaust any security for the Guaranteed Obligations, or pursue any other remedy inthe power of any Guaranteed Party whatsoever; (v) any benefit of and any right to participate in any security now or hereafter held byany Guaranteed Party; and (vi) to the fullest extent permitted by law, any and all other defenses or benefits that may be derived from orafforded by applicable Law limiting the liability of or exonerating guarantors or sureties. Each Guarantor expressly waives all setoffsand counterclaims and all presentments, demands for payment or performance, notices of nonpayment or nonperformance, protests,notices of protest, notices of dishonor and all other notices or demands of any kind or nature whatsoever with respect to the GuaranteedObligations, and all notices of acceptance of this Multiparty Guaranty or of the existence, creation or incurrence of new or additionalGuaranteed Obligations. Each Guarantor waives any rights and defenses that are or may become available to it by reason of §§ 2787 to2855, inclusive, and §§ 2899 and 3433 of the California Civil Code.(d) Obligations Independent. The obligations of each Guarantor hereunder are those of primary obligor, and not merely assurety, and are independent of the Guaranteed Obligations and the obligations of any other guarantor, and a separate action may bebrought against each Guarantor to enforce this Multiparty Guaranty whether or not the Borrower or any other person or entity is joinedas a party.(e) Subrogation. No Guarantor shall exercise any right of subrogation, contribution, indemnity, reimbursement or similarrights with respect to any payments it makes under this Multiparty Guaranty until all of the Guaranteed Obligations and any amountspayable under this Multiparty Guaranty have been indefeasibly paid and performed in full and the Commitments and the Facilities areterminated. If any amounts are paid to a Guarantor in violation of the foregoing limitation, then such amounts shall be held in trust forthe benefit of the Guaranteed Parties and shall forthwith be paid to the Guaranteed Parties to reduce the amount of the GuaranteedObligations, whether matured or unmatured.(f) Termination; Reinstatement. This Multiparty Guaranty is a continuing and irrevocable guaranty of all GuaranteedObligations now or hereafter existing and shall remain in full force and effect until the Facility Termination Date (whereupon theGuarantors’ obligations under this Multiparty Guaranty shall terminate, other than contingent indemnification obligations and subject tothe following sentences). Notwithstanding the foregoing, this Multiparty Guaranty shall continue in full force and effect or be revived,as the case may be, if any payment by or on behalf of the Borrower or a Guarantor is made, or any of the Guaranteed Parties exercisesits right of setoff, in respect of the Guaranteed Obligations and such payment or the proceeds of such setoff or any part thereof issubsequently invalidated, declared to be fraudulent or preferential, set aside or required (including pursuant to any settlement enteredinto by any of the Guaranteed Parties in their discretion) to be repaid to a trustee, receiver or any other party, in connection with anyproceeding under any Debtor Relief Laws or otherwise, all as if such payment had not been made or such setoff had not occurred andwhether or-145-not the Guaranteed Parties are in possession of or have released this Multiparty Guaranty and regardless of any prior revocation,rescission, termination or reduction. The obligations of each Guarantor under this subsection shall survive termination of thisMultiparty Guaranty.(g) Stay of Acceleration. If acceleration of the time for payment of any of the Guaranteed Obligations is stayed, in connectionwith any case commenced by or against a Guarantor or the Borrower under any Debtor Relief Laws, or otherwise, all such amountsshall nonetheless be payable by each Guarantor, jointly and severally, immediately upon demand by the Guaranteed Parties.(h) Condition of Borrower. Each Guarantor acknowledges and agrees that it has the sole responsibility for, and has adequatemeans of, obtaining from the Borrower and any other guarantor such information concerning the financial condition, business andoperations of the Borrower and any such other guarantor as such Guarantor requires, and that none of the Guaranteed Parties has anyduty, and such Guarantor is not relying on the Guaranteed Parties at any time, to disclose to it any information relating to the business,operations or financial condition of the Borrower or any other guarantor (each Guarantor waiving any duty on the part of theGuaranteed Parties to disclose such information and any defense relating to the failure to provide the same).(i) Appointment of Borrower. Each of the Guarantors hereby appoints the Borrower to act as its agent for all purposes of thisAgreement and the other Loan Documents and agrees that (i) the Borrower may execute such documents on behalf of such Guarantoras the Borrower deems appropriate in its sole discretion and each Guarantor shall be obligated by all of the terms of any such documentexecuted on its behalf, (ii) any notice or communication delivered by the Administrative Agent or the Lender to the Borrower shall bedeemed delivered to each Guarantor and (iii) the Administrative Agent or the Lenders may accept, and be permitted to rely on, anydocument, instrument or agreement executed by the Borrower on behalf of each Guarantor.(j) Right of Contribution. The Guarantors agree among themselves that, in connection with payments made hereunder, eachGuarantor shall have contribution rights against the other Guarantors as permitted under applicable Law.(k) Keepwell. Each Loan Party that is a Qualified ECP Guarantor at the time the Multiparty Guaranty or the grant of thesecurity interest under the Loan Documents, in each case, by any Specified Loan Party, becomes effective with respect to any SwapObligation, hereby jointly and severally, absolutely, unconditionally and irrevocably undertakes to provide such funds or other supportto each Specified Loan Party with respect to such Swap Obligation as may be needed by such Specified Loan Party from time to timeto honor all of its obligations under this Multiparty Guaranty and the other Loan Documents in respect of such Swap Obligation (but,in each case, only up to the maximum amount of such liability that can be hereby incurred without rendering such Qualified ECPGuarantor’s obligations and undertakings under this Section 10.19(k) voidable under applicable law relating to fraudulent conveyanceor fraudulent transfer, and not for any greater amount). The obligations and undertakings of each Qualified ECP Guarantor under thisSection shall remain in full force and effect until the Obligations have been indefeasibly paid and performed in full. Each QualifiedECP Guarantor intends this Section to constitute, and this Section shall be deemed to constitute, a guarantee of the obligations of, and a“keepwell, support, or other agreement” for the benefit of, each Specified Loan Party for all purposes of the Commodity ExchangeAct.-146-10.20. Designation as Senior Debt. All Obligations shall be “Designated Senior Indebtedness” for purposes of, and asdefined in any subordinated indentures or similar instruments issued by any Loan Party after the Closing Date.10.21. Judgment Currency. If, for the purposes of obtaining judgment in any court, it is necessary to convert a sum duehereunder or any other Loan Document in one currency into another currency, the rate of exchange used shall be that at which inaccordance with normal banking procedures the Administrative Agent could purchase the first currency with such other currency onthe Business Day preceding that on which final judgment is given. The obligation of the Borrower in respect of any such sum duefrom it to the Administrative Agent or any Lender hereunder or under the other Loan Documents shall, notwithstanding any judgmentin a currency (the “Judgment Currency”) other than that in which such sum is denominated in accordance with the applicableprovisions of this Agreement (the “Agreement Currency”), be discharged only to the extent that on the Business Day following receiptby the Administrative Agent or such Lender, as the case may be, of any sum adjudged to be so due in the Judgment Currency, theAdministrative Agent or such Lender, as the case may be, may in accordance with normal banking procedures purchase theAgreement Currency with the Judgment Currency. If the amount of the Agreement Currency so purchased is less than the sumoriginally due to the Administrative Agent or any Lender from the Borrower in the Agreement Currency, the Borrower agrees, as aseparate obligation and notwithstanding any such judgment, to indemnify the Administrative Agent or such Lender, as the case maybe, against such loss. If the amount of the Agreement Currency so purchased is greater than the sum originally due to theAdministrative Agent or any Lender in such currency, the Administrative Agent or such Lender, as the case may be, agrees to returnthe amount of any excess to the Borrower (or to any other Person who may be entitled thereto under applicable law).10.22. Subordination. Each Loan Party (a “Subordinating Loan Party”) hereby subordinates the payment of all obligationsand indebtedness of any other Loan Party owing to it, whether now existing or hereafter arising, including but not limited to anyobligation of any such other Loan Party to the Subordinating Loan Party as subrogee of the Guaranteed Parties or resulting from suchSubordinating Loan Party’s performance under the Multiparty Guaranty, to the indefeasible payment in full in cash of all Obligations.If the Administrative Agent on behalf of the Guaranteed Parties so requests while a Default or Event of Default has occurred and iscontinuing (any such request, a “Turnover Request”), any such obligation or indebtedness of any such other Loan Party to theSubordinating Loan Party shall be enforced and performance received by the Subordinating Loan Party as trustee for the GuaranteedParties and the proceeds thereof shall be paid over to the Administrative Agent for the benefit of the Guaranteed Parties on account ofthe Guaranteed Obligations, but without reducing or affecting in any manner the liability of the Subordinating Loan Party under thisAgreement. Without limitation of the foregoing, so long as no Default or Event of Default has occurred and is continuing and theAdministrative Agent on behalf of the Guaranteed Parties has not made a Turnover Request, the Loan Parties may make and receivepayments with respect to intercompany obligations and Indebtedness; provided that, in the event that any Loan Party receives anypayment of any intercompany obligations and Indebtedness at a time when such payment is prohibited by this Section, such paymentshall be held by such Loan Party, in trust for the benefit of, and shall be paid forthwith over and delivered, upon written request, to theAdministrative Agent.-147-10.23. Waiver of Certain Notices Under the Existing Credit Agreement. Immediately prior to giving effect to thisAgreement, the Existing Administrative Agent and each Lender that is a “Lender” under and as defined in the Existing CreditAgreement hereby agree to waive the requirements set forth in (i) Sections 2.04(a) and (b) of the Existing Credit Agreement requiringthe Borrower to provide an Optional Prepayment Notice (as defined in the Existing Credit Agreement) not less than three BusinessDays prior to the date of prepayment of Eurocurrency Rate Revolving Loans or Term Loans (each as defined in the Existing CreditAgreement), respectively, and (b) Section 2.05 of the Existing Credit Agreement requiring the Borrower to provide an OptionalTermination/Reduction Notice (as defined in the Existing Credit Agreement) not less than five Business Days prior to the date oftermination of the Aggregate Revolving Commitments (as defined in the Existing Credit Agreement).10.24. Acknowledgement and Consent to Bail-In of EEA Financial Institutions. Solely to the extent any Lender or L/CIssuer that is an EEA Financial Institution is a party to this Agreement and notwithstanding anything to the contrary in any LoanDocument or in any other agreement, arrangement or understanding among any such parties, each party hereto acknowledges that anyliability of any Lender or L/C Issuer that is an EEA Financial Institution arising under any Loan Document, to the extent such liabilityis unsecured, may be subject to the write-down and conversion powers of an EEA Resolution Authority and agrees and consents to,and acknowledges and agrees to be bound by:(a) the application of any Write-Down and Conversion Powers by an EEA Resolution Authority to any such liabilities arisinghereunder which may be payable to it by any Lender or L/C Issuer that is an EEA Financial Institution; and(b) the effects of any Bail-In Action on any such liability, including, if applicable:(i) a reduction in full or in part or cancellation of any such liability;(ii) a conversion of all, or a portion of, such liability into shares or other instruments of ownership in such EEAFinancial Institution, its parent undertaking, or a bridge institution that may be issued to it or otherwise conferred on it, and thatsuch shares or other instruments of ownership will be accepted by it in lieu of any rights with respect to any such liability underthis Agreement or any other Loan Document; or(iii) the variation of the terms of such liability in connection with the exercise of the write-down and conversionpowers of any EEA Resolution Authority.10.25. ERISA Non-Fiduciary Provisions.(a) The Administrative Agent, the Left Lead Arranger, each other Joint Lead Arranger and each Lender hereby informs theBorrower that such Person is not undertaking to provide impartial investment advice, or to give advice in a fiduciary capacity, inconnection with the transactions contemplated hereby, and that such Person or an Affiliate has a financial interest in the transactionscontemplated hereby in that such Person or an Affiliate thereof (i) may receive interest or other payments with respect to the Loans, theLetters of Credit or the Commitments, (ii) may recognize a gain if it purchased the Loans, the Letters of Credit or the Commitments foran amount less than the par amount thereof or sells the Loans, the Letters of Credit or the Commitments for an amount in excess ofwhat-148-it paid therefor or extended to the Borrower hereunder and/or (iii) may receive fees or other payments in connection with thetransactions contemplated hereby, the Loan Documents or otherwise, including structuring fees, commitment fees, arrangement fees,facility fees, upfront fees, underwriting fees, ticking fees, agency fees, administrative agent or collateral agent fees, utilization fees,minimum usage fees, letter of credit fees, fronting fees, deal-away or alternate transaction fees, amendment fees, processing fees, termout premiums, banker’s acceptance fees, breakage or other early termination fees or fees similar to the foregoing.(b) The Administrative Agent, the Left Lead Arranger, and each other Joint Lead Arranger hereby informs the Lenders thateach such Person is not undertaking to provide impartial investment advice, or to give advice in a fiduciary capacity, in connectionwith the transactions contemplated hereby, and that such Person has a financial interest in the transactions contemplated hereby in thatsuch Person or an Affiliate thereof (i) may receive interest or other payments with respect to the Loans, the Letters of Credit, theCommitments and this Agreement, (ii) may recognize a gain if it extended the Loans, the Letters of Credit or the Commitments for anamount less than the amount being paid for an interest in the Loans, the Letters of Credit or the Commitments by such Lender or (iii)may receive fees or other payments in connection with the transactions contemplated hereby, the Loan Documents or otherwise,including structuring fees, commitment fees, arrangement fees, facility fees, upfront fees, underwriting fees, ticking fees, agency fees,administrative agent or collateral agent fees, utilization fees, minimum usage fees, letter of credit fees, fronting fees, deal-away oralternate transaction fees, amendment fees, processing fees, term out premiums, banker’s acceptance fees, breakage or other earlytermination fees or fees similar to the foregoing.10.26. Hedge Banks’ and Cash Management Banks’ Acknowledgment of Release of Collateral and AutomaticGuaranty Release.(a) Each Hedge Bank hereby acknowledges and agrees that (i) the refinancing of the credit facilities provided under theExisting Credit Agreement with the credit facilities provided for herein, including the release of the collateral securing the obligationsof Equinix and its Subsidiaries under the Existing Credit Agreement and under any Guaranteed Hedge Agreement and (ii) the releaseof the Multiparty Guaranty pursuant to the Automatic Guaranty Release, in each case, has not resulted in, and will not result in an“Event of Default”, “Termination Event” or “Additional Termination Event” (as those terms are defined in any Guaranteed HedgeAgreement to which such Hedge Bank or any of its Affiliates is a party) or other similar event or circumstance under any GuaranteedHedge Agreement to which such Hedge Bank or any of its Affiliates is a party.(b) Each Cash Management Bank hereby acknowledges and agrees that (i) the refinancing of the credit facilities providedunder the Existing Credit Agreement with the credit facilities provided for herein, including the release of the collateral securing theobligations of Equinix and its Subsidiaries under the Existing Credit Agreement and under any Cash Management Agreement and (ii)the release of the Multiparty Guaranty pursuant to the Automatic Guaranty Release, in each case, has not resulted in, and will not resultin a default, event of default, event permitting such Cash Management Bank to terminate, accelerate any obligations under or request orrequire the provision of any collateral to secure any Cash Management Agreement to which such Cash Management Bank or any of itsAffiliates is a-149-party) other similar event or circumstance under any Cash Management Agreement to which such Cash Management Bank or any ofits Affiliates is a party.[Rest of page intentionally left blank; signature pages follow.]-150-IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the date first above written.BORROWER:EQUINIX, INC. By: /s/ Keith D. Taylor Name: Keith D. Taylor Title: Chief Financial Officer GUARANTORS:EQUINIX LLC By: /s/ Melanie Mock Name: Melanie Mock Title: Treasurer SWITCH & DATA LLCBy: Equinix LLC, its sole managing member By: /s/ Melanie Mock Name: Melanie Mock Title: Treasurer EQUINIX (US) ENTERPRISES, INC. By: /s/ Melanie Mock Name: Melanie Mock Title: Treasurer [SIGNATURE PAGE TO CREDIT AGREEMENT]BANK OF AMERICA, N.A., as Administrative AgentBy: /s/ Angela LarkinName: Angela LarkinTitle: Assistant Vice PresidentBANK OF AMERICA, N.A., as Existing Administrative AgentBy: /s/ Angela LarkinName: Angela LarkinTitle: Assistant Vice PresidentBANK OF AMERICA, N.A., as a Lender and L/C IssuerBy: /s/ Bassam WehbeName: Bassam WehbeTitle: Senior Vice President[SIGNATURE PAGE TO CREDIT AGREEMENT]CITIBANK, N.A., as a LenderBy: /s/ Robert F. ParrName: Robert F. ParrTitle: Managing Director and Vice President[SIGNATURE PAGE TO CREDIT AGREEMENT]JPMorgan Chase Bank, N.A., as a LenderBy: /s/ Bruce BordenName: Bruce BordenTitle: Executive Director[SIGNATURE PAGE TO CREDIT AGREEMENT]ROYAL BANK OF CANADA as a LenderBy: /s/ Scott JohnsonName: Scott JohnsonTitle: Authorized Signatory[SIGNATURE PAGE TO CREDIT AGREEMENT]The Bank of Tokyo-Mitsubishi UFJ, Ltd. as a LenderBy: /s/ Matthew AntiocoName: Matthew AntiocoTitle: Director[SIGNATURE PAGE TO CREDIT AGREEMENT]BARCLAYS BANK PLC as a LenderBy: /s/ Ritam BhallaName: Ritam BhallaTitle: Director[SIGNATURE PAGE TO CREDIT AGREEMENT]GOLDMAN SACHS BANK USA, as a LenderBy: /s/ Rebecca KratzName: Rebecca KratzTitle: Authorized Signatory[SIGNATURE PAGE TO CREDIT AGREEMENT]HSBC BANK USA, N.A., as a LenderBy: /s/ Rumesha AhmedName: Rumesha AhmedTitle: Vice President[SIGNATURE PAGE TO CREDIT AGREEMENT]ING Capital LLC, as a LenderBy: /s/ Pim RothweilerName: Pim RothweilerTitle: Managing DirectorBy: /s/ Aimee SunaryoName: Aimee SunaryoTitle: Vice President[SIGNATURE PAGE TO CREDIT AGREEMENT]The Toronto-Dominion Bank, New York Branch, as a LenderBy: /s/ Annie DorvalName: Annie DorvalTitle: Authorized Signatory[SIGNATURE PAGE TO CREDIT AGREEMENT]Wells Fargo Bank, National Association,as a LenderBy: /s/ Elizabeth GaynorName: Elizabeth GaynorTitle: Director[SIGNATURE PAGE TO CREDIT AGREEMENT]BNP PARIBAS, as a LenderBy: /s/ Charles de ClapiersName: Charles de ClapiersTitle: DirectorBy: /s/ Liz ChengName: Liz ChengTitle: Vice President[SIGNATURE PAGE TO CREDIT AGREEMENT]MORGAN STANLEY BANK, N.A., as a LenderBy: /s/ Michael KingName: Michael KingTitle: Authorized Signatory[SIGNATURE PAGE TO CREDIT AGREEMENT]MIZUHO BANK, LTD., as a LenderBy: /s/ Daniel GuevaraName: Daniel GuevaraTitle: Authorized Signatory[SIGNATURE PAGE TO CREDIT AGREEMENT]PNC Bank, National Association, as a LenderBy: /s/ Brandon K. FiddlerName: Brandon K. FiddlerTitle: Senior Vice President[SIGNATURE PAGE TO CREDIT AGREEMENT]Sumitomo Mitsui Banking Corporation,as a LenderBy: /s/ James D. WeinsteinName: James D. WeinsteinTitle: Managing Director[SIGNATURE PAGE TO CREDIT AGREEMENT]The Bank of Nova Scotia, as a LenderBy: /s/ Winston LuaName: Winston LuaTitle: Director[SIGNATURE PAGE TO CREDIT AGREEMENT]U.S. Bank National Association, as a LenderBy: /s/ Lukas ColemanName: Lukas ColemanTitle: Vice President[SIGNATURE PAGE TO CREDIT AGREEMENT]Exhibit 12.1EQUINIX, INC.Computation of Ratio of Earnings to Fixed Charges(in thousands, except ratio data) Years ended December 31, 2013 2014 2015 2016 2017 Earnings: Income from continuing operations beforeincome taxes$112,279 $84,733 $210,998 $159,859 $286,832 Fixed charges: Interest expense248,792 270,553 299,055 392,156 478,698 Amortization of capitalized interest4,858 5,536 6,277 6,840 8,121 Interest factor on operating leases33,811 31,617 30,464 42,181 47,374 Subtotal$287,461 $307,706 $335,796 $441,177 $534,193 Total earnings$399,740 $392,439 $546,794 $601,036 $821,025 Fixed charges: Interest expense248,792 270,553 299,055 392,156 478,698 Capitalized interest10,608 19,004 10,943 13,338 22,625 Interest factor operating leases33,811 31,617 30,464 42,181 47,374 Total fixed charges$293,211 $321,174 $340,462 $447,675 $548,697 Ratio of earnings to fixed charges1.4x1.2x1.6x1.3x1.5xExhibit 21.1Subsidiaries of Equinix, Inc.NameJurisdictionEquinix, Inc.Delaware, U.S.Equinix Pacific LLCDelaware, U.S.Equinix South America Holdings, LLCDelaware, U.S.Equinix RP II LLCDelaware, U.S.CHI 3, LLCDelaware, U.S.CHI 3 Procurement, LLCIllinois, U.S.Equinix (EMEA) Management Inc.Delaware, U.S.SV1, LLCDelaware, U.S.LA4, LLCDelaware, U.S.NY2 Hartz Way, LLCDelaware, U.S.Switch & Data Facilities Company LLCDelaware, U.S.Switch and Data Operating Company LLCDelaware, U.S.Equinix Canada Ltd. (f/k/a Switch and Data Toronto Ltd.)CanadaSwitch and Data CA Nine LLCDelaware, U.S.Switch & Data MA One LLCDelaware, U.S.Switch And Data NJ Two LLCDelaware, U.S.Switch & Data/NY Facilities Company LLCDelaware, U.S.Switch and Data VA Four LLCDelaware, U.S.Switch & Data WA One LLCDelaware, U.S.Equinix do Brasil Telecomunicações LTDA.BrazilEquinix do Brasil Soluções de Tecnologia em Informática Ltda.BrazilEquinix (Canada) Enterprises Ltd.CanadaEquinix (US) Enterprises, Inc. (f/k/a Equinix RP, Inc.)Delaware, U.S.Switch & Data LLC (formerly Switch & Data Facilities Company, Inc.) (Formed as LLCeffective 12/20/2012)Delaware, U.S.Equinix LLC (f/k/a Equinix Operating Co., Inc.) (Formed as LLC effective 12/31/2013)Delaware, U.S.EPS Enterprises, Inc.Delaware, U.S.Moran Road Partners, LLCDelaware, U.S.Equinix Professional Services, Inc.Delaware, U.S.Equinix (Government) Enterprises LLCDelaware, U.S.Equinix (Velocity) Holding CompanyDelaware, U.S.Equinix (Government) LLCDelaware, U.S.Equinix Impact LLCDelaware, U.S.Equinix Hong Kong LimitedHong KongNameJurisdictionEquinix Information Technology (Shanghai) Co., Ltd. (亿利互连信息技术（上海）有限公司)People’s Republic of ChinaEquinix YP Information Technology (Shanghai) Co., Ltd. (亿利互连数据系统（上海）有限公司)People’s Republic of ChinaEquinix Japan K.K.JapanEquinix Australia Pty LimitedAustraliaEquinix Asia Pacific Pte. Ltd.SingaporeEquinix Singapore Holdings Pte. Ltd.SingaporeEquinix Singapore Pte. Ltd. (formerly i-STT Pte Ltd)SingaporeEquinix (Japan) Enterprises K.K.JapanEquinix (Singapore) Enterprises Pte. Ltd.SingaporeEquinix (Hong Kong) Enterprises LimitedHong KongEquinix (Australia) Enterprises Pty LimitedAustraliaEquinix (China) Investment Holding Co., Ltd (亿利互连（中国）投资有限公司）People’s Republic of ChinaEquinix (EMEA) Acquisition Enterprises B.V.The NetherlandsQAON G.K.JapanEJAE2 G.K.JapanEquinix (Japan) Technology Services K.K.JapanEquinix Asia Pacific Holdings Pte Ltd.SingaporeEquinix WGQ Information Technology (Shanghai) Co., Ltd.People’s Republic of ChinaEquinix (London) LimitedUnited KingdomEquinix (Germany) GmbHGermanyEquinix (Real Estate) GmbHGermanyUpminster GmbHGermanyAncotel UK LimitedUnited KingdomEquinix France SASFranceInterconnect Exchange Europe SLSpainEquinix Italia S.r.l.ItalyEquinix Middle East FZ-LLCUnited Arab Emiratesupminster GmbHGermanyEquinix (Netherlands) Holdings B.V.The NetherlandsEquinix (Netherlands) B.V.The NetherlandsEquinix (EMEA) B.V.The NetherlandsEquinix (Real Estate) B.V.The NetherlandsEquinix (Netherlands) Enterprises B.V.The NetherlandsEquinix (Switzerland) Enterprises GmbHSwitzerlandEquinix (Switzerland) GmbHSwitzerlandEquinix (France) Enterprises SASFranceEquinix (Germany) Enterprises GmbHGermanyNameJurisdictionEquinix Group LimitedUnited KingdomEquinix (UK) LimitedUnited KingdomEquinix (UK) Enterprises LimitedUnited KingdomEquinix (Services) LimitedUnited KingdomEquinix Corporation LimitedUnited KingdomEquinix Investments LimitedUnited KingdomEquinix (Spain), S.L.U.SpainEquinix (UK) Acquisition Enterprises LimitedUnited KingdomTelecity Group LimitedUnited KingdomTelecity Group Investments LimitedUnited KingdomTelecity Group International Ltd.United KingdomEquinix Turkey Internet Hizmetleri Anonim SirketiTurkeyEquinix (Poland) Sp. Z o.o.PolandTelecityGroup UK Ltd.United KingdomEquinix (Bulgaria) Data Centers EADBulgariaTelecityGroup Holdings Ltd.United KingdomEquinix Turkey Enterprises Internet Hizmetleri Anonim SirketiTurkeyEquinix (Finland) OyFinlandEquinix (Sweden) ABSwedenTelecityGroup Spain S.A.SpainEquinix (Ireland) Holdings LimitedIrelandTelecity UK Ltd.United KingdomEquinix (Ireland) LimitedIrelandEquinix (Ireland) Enterprises LimitedIrelandEquinix (Sweden) Enterprises ABSwedenEquinix (Real Estate) Holdings SCFranceEquinix (Real Estate) SCIFranceEquinix (LD10) Holdings LimitedUnited KingdomEquinix (Italy) Enterprises S.R.L.ItalyEquinix (Finland) Enterprises OyFinlandEquinix (Poland) Enterprises sp. Z o.o.PolandVDC I, LLCDelaware, U.S.VDC II, LLCDelaware, U.S.VDC III, LLCDelaware, U.S.VDC IV, LLCDelaware, U.S.VDC V, LLCDelaware, U.S.VDC VI, LLCDelaware, U.S.VDC VII, LLCDelaware, U.S.VDC VIII, LLCDelaware, U.S.NameJurisdictionEquinix Colombia, Inc.,ColombiaEquinix Do Brasil Ltda.BrazilZenium EM 2 LimitedCayman IslandsZenium Turkey Holdco LimitedIrelandData Merkezi Bir Uretim Insaat Sanayi ve Ticaret Limited SirketiTurkeyEquinix (Iberia) Holdings S.L.U.SpainCloudMas Iberica, S.L.U.SpainItconic, S.A.U.SpainItconic Portugal, S.A.PortugalMeteorfunction Unipessoal Lda.PortugalKiinteisto Oy Espoon Sinimaentie 12FinlandEquinix (LD10) LimitedUnited KingdomVirtu Secure Web Services, B.V.The NetherlandsOpen Hub Med Societa Consortile a responsabilita limitataItalyExhibit 23.1CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRMWe hereby consent to the incorporation by reference in the Registration Statements on Form S-3 (No. 333-221380) and Form S-8 (No. 333-45280, 333-58074, 333-71870, 333-85202, 333-104078, 333-113765, 333-117892, 333-122142, 333-132466, 333-140946, 333-149452, 333-157545, 333-165033,333-166581, 333-172447, 333-179677, 333-186873, 333-194229) of Equinix, Inc. of our report dated February 26, 2018 relating to the financial statements,financial statement schedule and the effectiveness of internal control over financial reporting, which appears in this Form 10-K./s/ PricewaterhouseCoopers LLPSan Jose, CaliforniaFebruary 26, 2018Exhibit 31.1CERTIFICATION PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002 I, Peter Van Camp, certify that:1. I have reviewed this annual report on Form 10-K of Equinix, Inc.;2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make thestatements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects thefinancial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined inExchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for theregistrant and have:(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure thatmaterial information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly duringthe period in which this report is being prepared;(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, toprovide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordancewith generally accepted accounting principles;(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of thedisclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscalquarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, theregistrant's internal control over financial reporting; and5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to theregistrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely toadversely affect the registrant's ability to record, process, summarize and report financial information; and(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control overfinancial reporting.Dated: February 26, 2018/s/ Peter Van CampPeter Van CampChief Executive Officer and PresidentExhibit 31.2CERTIFICATION PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002 I, Keith D. Taylor, certify that:1. I have reviewed this annual report on Form 10-K of Equinix, Inc.;2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make thestatements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects thefinancial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined inExchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for theregistrant and have:(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure thatmaterial information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly duringthe period in which this report is being prepared;(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, toprovide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordancewith generally accepted accounting principles;(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of thedisclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscalquarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, theregistrant's internal control over financial reporting; and5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to theregistrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely toadversely affect the registrant's ability to record, process, summarize and report financial information; and(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control overfinancial reporting.Dated: February 26, 2018/s/ Keith D. TaylorKeith D. TaylorChief Financial OfficerExhibit 32.1CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 In connection with the Annual Report of Equinix, Inc. (the “Company”) on Form 10-K for the period ending December 31,2017, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Peter Van Camp, Chief ExecutiveOfficer and President of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Actof 2002, that:(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and (2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations ofthe Company. /s/ Peter Van CampPeter Van Camp Chief Executive Officer and PresidentFebruary 26, 2018Exhibit 32.2CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 In connection with the Annual Report of Equinix, Inc. (the “Company”) on Form 10-K for the period ending December 31,2017, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Keith D. Taylor, Chief FinancialOfficer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and (2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations ofthe Company. /s/ Keith D. TaylorKeith D. Taylor Chief Financial Officer February 26, 2018

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