June 29, 2006
Equinix Reports New Developments on Stock Option Grants
Foster City, CA — June 29, 2006 — Equinix, Inc. (Nasdaq: EQIX) today announced that it received a grand jury subpoena from the U.S. Attorney for the Northern District of California and it intends to cooperate fully with the U.S. Attorney's Office in connection with this subpoena. The subpoena requests documents relating to Equinix's stock option grants and practices.
As previously announced, Equinix is also currently cooperating with the Securities and Exchange Commission regarding the SEC's informal inquiry requesting documents related to Equinix's stock option grants and practices.
Prior to receiving either of these requests, and as previously announced by Equinix on June 12th, the audit committee of the Equinix Board of Directors has been conducting an internal review and analysis of historical stock option practices and related accounting. The Company requested the internal review following the release of a third party report regarding the timing and pricing of stock option grants at a large number of public companies. Independent outside legal counsel is assisting the audit committee with this review.
The Company also reported that it has been notified that a shareholder derivative complaint was filed in the Superior Court of the State of California, County of San Mateo on June 29, 2006. The complaint against certain current and former officers and directors alleges that since 2000 stock option grants to certain employees were awarded with exercise prices that were lower than the market price on the actual grant dates and resulted in breaches of fiduciary duties with respect to the Company's historic stock option granting practices. Equinix may be subject to other lawsuits from private plaintiffs concerning this subject area, and Equinix does not currently expect to disclose these additional lawsuits.
Forward Looking Statements
This press release contains forward-looking statements that involve risks and uncertainties. Actual results may differ materially from expectations discussed in such forward-looking statements. Factors that might cause such differences include, but are not limited to, the challenges of acquiring, operating and constructing IBX centers and developing, deploying and delivering Equinix services; unanticipated costs or difficulties relating to the integration of IXEurope into Equinix; a failure to receive significant revenue from customers in recently built out data centers; failure to complete any financing arrangements contemplated from time to time; competition from existing and new competitors; the ability to generate sufficient cash flow or otherwise obtain funds to repay new or outstanding indebtedness; the loss or decline in business from our key customers; the results of any litigation relating to past stock option grants and practices; and other risks described from time to time in Equinix's filings with the Securities and Exchange Commission. In particular, see Equinix's recent quarterly and annual reports filed with the Securities and Exchange Commission, copies of which are available upon request from Equinix. Equinix does not assume any obligation to update the forward-looking information contained in this press release.
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