- Annual and Transition Report (foreign private issuer) (20-F)

As filed with the Securities and Exchange Commission on April 27, 2012

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 20-F

(Mark One)

REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR 12(g) OF THE SECURITIES EXCHANGE ACT OF 1934

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2011

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from [ ] to [ ]

SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Date of event requiring this shell company report

For the transition period from [ ] to [ ]

Commission file number: 001-35053

InterXion Holding N.V.

(Exact name of registrant as specified in its charter)

The Netherlands

(Jurisdiction of incorporation or organization)

Tupolevlaan 24

1119 NX Schiphol-Rijk

The Netherlands

+31 20 880 7600

(Name, Telephone, E-mail and/or Facsimile number and Address of Company Contact Person)

Securities registered or to be registered pursuant to Section 12(b) of the Act:


Title of Each Class				Name of Each Exchange on Which Registered

Ordinary shares, with a nominal value of €0.10 each				New York Stock Exchange

Securities registered or to be registered pursuant to Section 12(g) of the Act:

None

(Title of Class)

Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act:

None

(Title of Class)

Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of the close of the period covered by the annual report: 66,129,363 ordinary shares

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act: Yes ¨ No x

If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934. Yes ¨ No x

Note – Checking the box above will not relieve any registrant required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 from their obligations under those Sections.

Indicate 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 1934 during 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 filing requirements 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 File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ¨ No x

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer ¨ Accelerated filer ¨ Non-accelerated filer x

Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:

U.S. GAAP ¨

International Financial Reporting Standards as issued

by the International Accounting Standards Board x

Other ¨

If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow: Item 17 ¨ Item 18 ¨

If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No x

(APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PAST FIVE YEARS)

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. Yes ¨ No ¨

Introduction

Presentation of Financial Information

Unless otherwise indicated, the financial information in this annual report has been prepared in accordance with International Financial Reporting Standards, or IFRS, as issued by the International Accounting Standards Board. The significant IFRS accounting policies applied to our financial information in this annual report have been applied consistently.

Financial Information

The financial information included in “Financial Statements” is covered by the auditors’ report included therein. The audit was carried out in accordance with standards issued by the Public Company Accounting Oversight Board (United States).

EBITDA and Adjusted EBITDA

In this annual report we refer to our EBITDA and Adjusted EBITDA. We define EBITDA as operating profit plus depreciation, amortization and impairment of assets. We define Adjusted EBITDA as EBITDA adjusted to exclude share-based payments and exceptional and non-recurring items. For a reconciliation of EBITDA and Adjusted EBITDA to operating profit/(loss), see “Management’s Discussion and Analysis of Financial Condition and Results of Operations—EBITDA and Adjusted EBITDA.” EBITDA, Adjusted EBITDA and other key performance indicators may not be indicative of our historical results of operations, nor are they meant to be predictive of future results.

Additional Key Performance Indicators

In addition to EBITDA and Adjusted EBITDA, our management also uses the following key performance indicators as measures to evaluate our performance:

•

Equipped Space: the amount of data center space that, on the relevant date, is equipped and either sold or could be sold, without making any significant additional investments to common infrastructure. Equipped Space at a particular data center may decrease if either (a) the power requirements of customers at such data center change so that all or a portion of the remaining space can no longer be sold as the space does not have enough power and/or common infrastructure to support it without further investment or (b) if the design and layout of a data center changes to meet among others, fire regulations or customer requirements, and necessitates the introduction of common space (such as corridors) which cannot be sold to individual customers;

•

Utilization Rate: on the relevant date, Revenue Generating Space as a percentage of Equipped Space; Revenue Generating Space is defined as the amount of Equipped Space that is under contract and billed on the relevant date. Some Equipped Space is not fully utilized due to customers’ specific requirements regarding the layout of their equipment. In practice, therefore, Utilization Rate does not reach 100%;

•

Recurring Revenue Percentage: Recurring Revenue during the relevant period as a percentage of total revenue in the same period. Recurring Revenue comprises revenue that is incurred from colocation and associated power charges, office space, amortized set-up fees and certain recurring managed services (but excluding any ad hoc managed services) provided by us directly or through third parties. Rents received for the sublease of unused sites are excluded. Monthly Recurring Revenue is the contracted Recurring Revenue over a full month excluding power usage revenues, amortized set-up fees and the sub-leasing of office space;

•

Average Monthly Churn: the average of the Churn Percentage in each month of the relevant period. Churn Percentage in a month is the contracted Monthly Recurring Revenue which came to an end during the month as a percentage of the total contracted Monthly Recurring Revenue at the beginning of the month.

EBITDA, Adjusted EBITDA, Recurring Revenue and Average Monthly Churn are all non-GAAP measures. Together with the other key performance indicators listed above, they serve as additional indicators of our operating performance and are not required by, or presented in accordance with, IFRS. They are not intended as a replacement for, or alternatives to, measures such as cash flows from operating activities and operating profit as defined and required under IFRS. We believe that EBITDA, Adjusted EBITDA and our other key performance indicators are measures commonly used by analysts, investors and peers in our industry. Accordingly, we have disclosed this information to permit a more complete analysis of our operating performance. EBITDA, Adjusted EBITDA and our other key performance indicators, as we calculate them, may not be comparable to similarly titled measures reported by other companies. For a reconciliation of EBITDA and Adjusted EBITDA to operating profit/(loss), see “Management’s Discussion and Analysis of Financial Condition and Results of Operations—EBITDA and Adjusted EBITDA.” EBITDA, Adjusted EBITDA and our other key performance indicators listed above may not be indicative of our historical results of operations, nor are they meant to be predictive of future results.

Currency Presentation and Convenience Translations

Unless otherwise indicated, all references in this annual report to “euro” or “€” are to the currency introduced at the start of the third stage of the European Economic and Monetary Union pursuant to the Treaty establishing the European Community, as amended. All references to “dollars,” “$,” “U.S. $” or “U.S. dollars” are to the lawful currency of the United States. We prepare our financial statements in euro.

Solely for convenience, this annual report contains translation of certain euro amounts into U.S. dollars based on the noon buying rate of €1.00 to U.S. $ 1.2973 in The City of New York for cable transfers of euro as certified for customs purposes by the Federal Reserve Bank of New York as of December 31, 2011. These translation rates should not be construed as representations that the euro amounts have been, could have been or could be converted into U.S. dollars at that or any other rate. See “Exchange Rate Information.”

Metric Convenience Conversion

This annual report contains certain metric measurements and for your convenience, we provide the conversion of metric units into U.S. customary units. The standard conversion relevant for this annual report is approximately 1 meter = 3.281 feet or 1 square meter = 10.764 square feet.

Rounding

Certain financial data in this annual report, including financial, statistical and operating information have been subject to rounding adjustment. Accordingly, in certain instances, the sum of the numbers in a column or a row in tables contained in this annual report may not conform exactly to the total figure given for that column or row. Percentages in tables have been rounded and accordingly may not add up to 100%.

No Incorporation of Website Information

The contents of our website do not form part of this annual report.

Terminology

The terms the “Group”, “we”, “our” and “us” refer to InterXion Holding N.V. (the “Company”) and its subsidiaries, as the context requires.

MARKET, ECONOMIC AND INDUSTRY DATA

Information regarding markets, market size, market share, market position, growth rates and other industry data pertaining to our business contained in this annual report consists of estimates based on data and reports compiled by professional organizations and analysts, on data from other external sources, and on our knowledge of our sales and markets. In many cases, there is no readily available external information (whether from trade associations, government bodies or other organizations) to validate market-related analyses and estimates, requiring us to rely on internally developed estimates. While we have compiled, extracted and reproduced market or other industry data from external sources which we believe to be reliable, including third parties or industry or general publications, we have not independently verified that data. Similarly, our internal estimates have not been verified by any independent sources.

Forward-Looking Statements

This annual report on Form 20-F contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, with respect to all statements other than statements of historical fact regarding our business, financial condition, results of operations and certain of our plans, objectives, assumptions, projections, expectations or beliefs with respect to these items and statements regarding other future events or prospects. These statements include, without limitation, those concerning: our strategy and our ability to achieve it; expectations regarding sales, profitability and growth; plans for the construction of new data centers; our possible or assumed future results of operations; research and development, capital expenditure and investment plans; adequacy of capital; and financing plans. The words “aim,” “may,” “will,” “expect,” “anticipate,” “believe,” “future,” “continue,” “help,” “estimate,” “plan,” “schedule,” “intend,” “should,” “shall” or the negative or other variations thereof as well as other statements regarding matters that are not historical fact, are or may constitute forward-looking statements.

In addition, this annual report includes forward-looking statements relating to our potential exposure to various types of market risks, such as foreign exchange rate risk, interest rate risks and other risks related to financial assets and liabilities. We have based these forward-looking statements on our management’s current view with respect to future events and financial performance. These views reflect the best judgment of our management but involve a number of risks and uncertainties which could cause actual results to differ materially from those predicted in our forward-looking statements and from past results, performance or achievements. Although we believe that the estimates reflected in the forward-looking statements are reasonable, such estimates may prove to be incorrect. By their nature, forward-looking statements involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future. There are a number of factors that could cause actual results and developments to differ materially from these expressed or implied by these forward-looking statements. These factors include, among other things:

•

operating expenses cannot be easily reduced in the short term;

•

inability to utilize the capacity of newly planned data centers and data center expansions;

•

significant competition;

•

cost and supply of electrical power;

•

data center industry over-capacity; and

•

performance under service level agreements.

These risks and others described under “Risk Factors” are not exhaustive. Other sections of this annual report describe additional factors that could adversely affect our business, financial condition or results of operations. We urge you to read the sections of this annual report entitled Item 3 “Key Information—“Risk Factors,” Item 4 “Information on the Company” and Item 5 “Operating and Financial Review and Prospects” for a more complete discussion of the factors that could affect our future performance and the industry in which we operate. Additionally, new risk factors can emerge from time to time, and it is not possible for us to predict all such risk factors, nor can we assess the impact of all such risk factors to differ materially from those contained in any forward-looking statements. Given these risks and uncertainties, you should not place undue reliance on forward-looking statements as a prediction of actual results.

All forward-looking statements included in this annual report are based on information available to us on the date of this annual report. We undertake no obligation to update publicly or revise any forward-looking statement, whether as a result of new information, future events or otherwise, except as may be required by applicable law. All subsequent written and oral forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by the cautionary statements contained throughout this annual report.

TABLE OF CONTENTS


	Page
PART I

ITEM 1: IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS		6

ITEM 2: OFFER STATISTICS AND EXPECTED TIMETABLE		7

ITEM 3: KEY INFORMATION		8

ITEM 4: INFORMATION ON THE COMPANY		28

ITEM 4A: UNRESOLVED STAFF COMMENTS		38

ITEM 5: OPERATING AND FINANCIAL REVIEW AND PROSPECTS		39

ITEM 6: DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES		55

ITEM 7: MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS		63

ITEM 8: FINANCIAL INFORMATION		67

ITEM 9: THE OFFER AND LISTING		68

ITEM 10: ADDITIONAL INFORMATION		69

ITEM 11: QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK		85

ITEM 12: DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES		86

PART II

ITEM 13: DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES		87

ITEM 14: MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS		88

ITEM 15: CONTROLS AND PROCEDURES		89

ITEM 16A: AUDIT COMMITTEE FINANCIAL EXPERT		90

ITEM 16B: CODE OF ETHICS		91

ITEM 16C: PRINCIPAL ACCOUNTANT FEES AND SERVICES		92

ITEM 16D: EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES		93

ITEM 16E: PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS		94

ITEM 16F: CHANGE IN REGISTRANT’S CERTIFYING ACCOUNTANT		95

ITEM 16G: CORPORATE GOVERNANCE		96

PART III

ITEM 17: FINANCIAL STATEMENTS		97

ITEM 18: FINANCIAL STATEMENTS		98

PART I

ITEM 1: IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS

For the identity of Directors and Senior Management reference is made to “Item 6: Directors, Senior Management and Employees”. Identification of Advisors is not applicable for this form 20-F.

ITEM 2: OFFER STATISTICS AND EXPECTED TIMETABLE

Not applicable.

ITEM 3: KEY INFORMATION

Selected Historical Consolidated Financial Data

The following selected financial data as of and for the years ended December 31, 2011, 2010 and 2009 have been derived from our audited consolidated financial statements, which are included elsewhere in this annual report. The selected financial data as of and for the years ended December 31, 2008 and December 31, 2007 have been derived from our audited consolidated financial statements not included in this annual report. Our audited consolidated financial statements included in this annual report have been prepared and presented in accordance with IFRS as issued by the International Accounting Standards Board and have been audited by KPMG Accountants N.V., an independent registered public accounting firm.

You should read the selected financial data in conjunction with our consolidated financial statements and related notes and Item 5 “Operating and Financial Review and Prospects” included elsewhere in this annual report. Our historical results do not necessarily indicate our expected results for any future periods.


	Year ended December 31,			Year ended December 31,
	2011 ⁽¹⁾			2011			2010			2009			2008 ⁽²⁾			2007 ⁽²⁾⁽³⁾
	(U.S. $’000, except per share amounts and number of shares)			(€’000, except per share amounts and number of shares)
Income statement data
Revenue		316,943			244,310			208,379			171,668			138,180			100,450
Cost of sales		(132,021	)		(101,766	)		(91,154	)		(78,548	)		(63,069	)		(51,998	)

Gross profit		184,922			142,544			117,225			93,120			75,111			48,452
Other income		632			487			425			746			2,291			988
Sales and marketing costs		(22,936	)		(17,680	)		(15,072	)		(11,253	)		(9,862	)		(7,297	)
General and administrative costs		(87,254	)		(67,258	)		(55,892	)		(50,628	)		(35,352	)		(34,837	)

Operating profit		75,364			58,093			46,686			31,985			32,188			7,306
Net finance expense		(29,558	)		(22,784	)		(29,444	)		(6,248	)		(3,713	)		(4,126	)

Profit before taxation		45,806			35,309			17,242			25,737			28,475			3,180
Income tax (expense) / income		(12,631	)		(9,737	)		(2,560	)		715			8,899			10,405

Profit for the year attributable to shareholders		33,175			25,572			14,682			26,452			37,374			13,585

Basic earnings per share ⁽⁴⁾		0.52			0.40			0.33			0.60			0.87			0.33

Diluted earnings per share ⁽⁴⁾		0.50			0.39			0.31			0.57			0.87			0.30

Number of shares ^{(4) (} ⁵ ⁾		66,129			66,129			44,354			44,351			43,646			42,741

Weighted average number of shares for Basic earnings per share ^{(4) (} ⁶ ⁾		64,176			64,176			44,352			43,999			43,194			42,741

Weighted average number of shares for Diluted earnings per share ^{(4) (} ⁶ ⁾		65,896			65,896			47,707			46,792			46,302			45,400


	Year ended December 31,			Year ended December 31,
	2011 ⁽¹⁾			2011			2010			2009			2008 ⁽²⁾			2007 ⁽²⁾⁽³⁾
	(U.S. $’000, except per share amounts and number of shares)			(€’000, except per share amounts and number of shares)
Cash flow statement data
Net cash flows from operating activities		83,083			64,043			74,379			51,378			35,991	⁽ ⁷ ⁾		24,756
Net cash flows from investing activities		(208,880	)		(161,011	)		(100,164	)		(100,949	)		(92,252	)		(49,548	)
Net cash flows from financing activities		182,050			140,330			92,748			19,764			82,057			45,419
Capital expenditures including intangibles ⁽ ⁸ ⁾		(210,106	)		(161,956	)		(100,394	)		(101,053	)		(92,252	)		(49,548	)

	Year ended December 31,			Year ended December 31,
	2011 ⁽¹⁾			2011			2010			2009			2008			2007 ⁽²⁾⁽³⁾
	(U.S. $’000)			(€’000)
Balance sheet data
Trade and other current assets		88,053			67,874			55,672			55,610			49,874			29,313
Cash and cash equivalents ⁽⁹ ⁾		185,084			142,669			99,115			32,003			61,775			35,848

Current assets		273,137			210,543			154,787			87,613			111,649			65,161
Non-current assets ⁽³⁾		692,419			533,738			391,975			320,407			250,307			145,016
Total assets		965,556			744,281			546,762			408,020			361,956			210,177

Current liabilities		173,577			133,799			112,375			120,894			122,322			74,271
Non-current liabilities		363,142			279,921			279,118			152,749			134,708			66,748

Total liabilities		536,719			413,720			391,493			273,643			257,030			141,019
Shareholders’ equity		428,837			330,561			155,269			134,377			104,926			69,158
Total liabilities and shareholders’ equity		965,556			744,281			546,762			408,020			361,956			210,177

Notes:

(1)

The “Income statement data,” “Cash flow statement data” and “Balance sheet data” as of and for the year ended December 31, 2011 have been translated for convenience only based on the noon buying rate in The City of New York for cable transfers of euro as certified for customs purposes by the Federal Reserve Bank of New York as of December 31, 2011 for euro into U.S. dollars of €1.00 = U.S. $1.2973. See “Exchange Rate Information” for additional information.

(2)	In fiscal year 2008, income not related to our core activities was reclassified to the line item “Other income.” Fiscal year 2007 figures have been adjusted to reflect the same reclassification.

(3)

In fiscal year 2007, the useful economic lives of certain data center assets were increased from 10 to 15 years. This change of accounting estimate was applied from January 1, 2007. This extension in the useful economic lives of certain data center assets resulted in an estimated decrease in depreciation of €3.6 million during the fiscal year 2007. Additionally, fiscal year 2007 figures have been adjusted to reflect the impairment of €1,885,000 in the “Depreciation, amortization and impairments” line item instead of in the “Exceptional general and administrative costs” line item.

(4)	“Basic earnings per share”, “Diluted earnings per share” and “Number of shares” have been adjusted to reflect the five-to-one reverse stock split, which occurred in conjunction with our initial public offering in January 2011.

(5)	“Number of shares” are in thousands as at the end of the year.

(6)	“Weighted average number of shares for Basic earnings per share” and “Weighted average number of shares for Diluted earnings per share” are in thousands.

(7)	The 2008 “Net cash flows from operating activities” include a reclassification for foreign exchange results on working capital balances.

(8)	Capital expenditures including intangible assets, represent payments to acquire property, plant & equipment and intangible assets as recorded on our consolidated statement of cash flows as “Purchase of property, plant and equipment” and “Purchase of intangible assets” respectively.

(9)

Cash and cash equivalents includes €4.8 million, €4.2 million, €3.9 million, €3.9 million and €3.6 million as of December 31, 2011, December 31, 2010, December 31, 2009, December 31, 2008 and December 31, 2007, respectively, which is restricted and held as collateral to support the issuance of bank guarantees on behalf of a number of subsidiary companies.

Exchange Rates

We publish our financial statements in euro. The conversion of euro into U.S. dollars in this annual report is solely for the convenience of readers. Exchange rates of euro into U.S. dollars are based on the noon buying rate in The City of New York for cable transfers of euro as certified for customs purposes by the Federal Reserve Bank of New York. Unless otherwise noted, all translations from euro to U.S. dollars and from U.S. dollars to euro in this annual report were made at a rate of €1.00 to U.S. $ 1.2973, the noon buying rate in effect as of December 31, 2011. We make no representation that any euro or U.S. dollar amounts could have been, or could be, converted into U.S. dollars or euro, as the case may be, at any particular rate, the rates stated below, or at all.

The following table sets forth information concerning exchange rates between the euro and the U.S. dollar for the periods indicated.


	Low		High
	(U.S. $ per €1.00)
Month :
October 2011		1.3281		1.4172
November 2011		1.3244		1.3803
December 2011		1.2926		1.3487
January 2012		1.2682		1.3192
February 2012		1.3087		1.3463
March 2012		1.3025		1.3336
April 2012 (through April 20, 2012)		1.3064		1.3337


	Average for Period ⁽¹⁾
	(U.S. $ per €1.00)
Year ended December 31, :
2007		1.3797
2008		1.4695
2009		1.3955
2010		1.3211
2011		1.4002

Source: Federal Reserve Bank of New York

Note:

(1)	Annual averages are calculated from month-end exchange rates, calculated by using the average of the exchange rates on the last day of each month during the year.

On April 20, 2012, the noon buying rate was €1.00 to U.S. $1.3212.

Risk Factors

In addition to the other information contained in this annual report on Form 20-F, you should carefully consider the following risk factors. If any of the possible events described below occurs, our business, financial condition, results of operations or prospects could be adversely affected. The risks and uncertainties below are those known to us and that we currently believe may materially affect us.

Risks Related to our Business

We cannot easily reduce our operating expenses in the short term, which could have a material adverse effect on our business in the event of a slowdown in demand for our services or a decrease in revenue for any reason.

Our operating expenses primarily consist of personnel, power and property costs. Personnel and property costs cannot be easily reduced in the short term. Therefore, we are unlikely to be able to reduce significantly our expenses in response to a slowdown in demand for our services or any decrease in revenue. The terms of our leases with landlords for facilities that serve as data centers are typically for 10 to 15 years (excluding our extension options) and do not provide us with an early termination right, while our colocation contracts with customers are initially typically for only three to five years. As at December 31, 2011, 42% of our Monthly Recurring Revenue was generated by contracts with terms of one year or less remaining. Our personnel costs are fixed due to our contracts with our employees having set notice periods and local law limitations in relation to the termination of employment contracts. In respect of our power costs, there is a minimum level of power required to keep our data centers running irrespective of the number of customers using them so our power costs may exceed the amount of revenue derived from power. We could have higher than expected levels of unused capacity in our data centers if, among other things:

•

our existing customers contracts are not renewed and such customers are not replaced by new customers;

•

internet and telecommunications equipment becomes smaller and more compact in the future;

•

there is an unexpected slowdown in demand for our services; or

•

we are unable to terminate or amend our leases when we have underutilized space at a data center.

If we have higher than expected levels of unused space at a data center at any given time, we may be required to operate a data center at a loss for a period of time. If we have higher than expected levels of unused capacity in our data centers and we are unable to reduce our expenses accordingly, our business, financial condition and results of operations would be materially adversely affected.

Our inability to utilize the capacity of newly planned data centers and data center expansions in line with our business plan would have a material adverse effect on our business, financial condition and results of operations.

Historically, we have made significant investments in our property, plant and equipment and intangible assets in order to expand our data center footprint and total Equipped Space as we have grown our business. In the year ended December 31, 2011 we invested € 162.0 million in property, plant and equipment (€154.6 million) and intangible assets (€7.4 million). In the year ended December 31, 2010, we invested €100.4 million in property, plant and equipment (€98.2 million) and intangible assets (€2.2 million). Investments in property, plant and equipment includes expansion, upgrade, maintenance and general administrative IT equipment. Investments in intangibles assets include power grid rights and software development.

We expect to continue to invest as we expand our data center footprint and increase our Equipped Space based on demand in our target markets. Our total annual investment in property, plant and equipment includes maintenance and replacement capital expenditures. Although in any one year the amount of maintenance and replacement capital expenditures may vary, we expect that long term such expenses will be between 4% and 6% of total revenue. Except for two Paris datacenters (PAR3 and PAR5), acquired in December 2011, and our Amsterdam datacenter premises (AMS6), acquired in February 2012, we typically lease space for a data center and begin building it out before we have entered into agreements with customers to cover the capacity of the data center. In some cases, we enter into lease agreements for data centers or begin expansions at our existing data centers without any pre-existing customer commitments to use the additional space that will be created. If we open a new data center or complete an expansion at an existing data center, we will be required to pay substantial up-front and ongoing costs associated with that data center, including leasehold improvements, basic overhead costs and rental payments regardless of whether or not we have any agreements with customers to fill the space.

As a result of our expansion plans, we will incur capital expenditures, and as a result, an increase in other operating expenses, which will negatively impact our cash flow, and depreciation that together will negatively impact our profitability unless and until these new and expanded data centers generate enough revenue to exceed their operating costs and related capital expenditures.

We incurred substantial losses during the period of 2001 to 2003 as a result of high churn and other factors. There can be no guarantee that we will be able to sustain or increase our profitability if our planned expansion is not successful or if there is not sufficient customer demand in the future to realize expected returns on these investments. Any such development would have a material adverse effect on our business, financial condition and results of operations.

If we are unable to expand our existing data centers or locate and secure suitable sites for additional data centers on commercially acceptable terms our ability to grow our business may be limited.

Our ability to meet the growing needs of our existing customers and to attract new customers depends on our ability to add capacity by expanding existing data centers or by locating and securing suitable sites for additional data centers that meet our specifications, such as proximity to numerous network service providers, access to a significant supply of electrical power and the ability to sustain heavy floor loading. We have reached high utilization levels at some of our data centers and therefore any increase in these locations would need to be accomplished through the lease of additional property that satisfies our requirements. Property meeting our specifications may be scarce in our target markets. If we are unable to identify and enter into leases on commercially acceptable terms on a timely basis for any reason including due to competition from other companies seeking similar sites who may have greater financial resources than us, or are unable to expand our space in our current data centers, our rate of growth may be substantially impaired.

Our capital expenditures, together with ongoing operating expenses and obligations to service our debt, will be a drain on our cash flow and may decrease our cash balances. The capital markets in the recent past have been and may again become limited for external financing opportunities. Additional debt or equity financing, especially in the current credit-constrained climate, may not be available when needed or, if available, may not be available on satisfactory terms. Our inability to obtain needed debt and/or equity financing or to generate sufficient cash from operations may require us to prioritize projects or curtail capital expenditures which could adversely affect our results of operations.

Failure to renew or maintain real estate leases for our existing data centers on commercially acceptable terms, or at all, could harm our business.

Except for two Paris datacenters (PAR3 and PAR5), acquired in December 2011, and the Amsterdam datacenter premises (AMS6), acquired in February 2012, we do not own the property on which our data centers are located and instead lease the majority of our data center space. We generally enter leases for initial periods of 10 to 15 years (excluding renewal options). The majority of our leases are subject to an annual inflation-linked increase in rent and, on renewal (or earlier in some cases), the rent we pay may be reset to the current market rate. There is, therefore, a risk that there will be significant rent increases when the rent is reviewed. Our leases in France, Ireland, Belgium and the United Kingdom do not contain contractual options to renew or extend those leases, and we have exhausted or may in the future exhaust such options in other leases. With respect to our leases in France, certain landlords may terminate our leases following the expiration of the original lease period (being 12 years from the commencement date), and the other leases in France may be terminated by the landlords at the end of each three year period upon giving six months prior notice in the event the landlord wishes to carry out construction works to the building. The non-renewal of leases for our existing data center locations, or the renewal of such leases on less favorable terms, is a potentially significant risk to our ongoing operations. We would incur significant costs if we were forced to vacate one of our data centers due to the high costs of relocating our own and our customers’ equipment, installing the necessary infrastructure in a new data center and, as required by most of our leases, reinstating the vacated data center to its original state. In addition, if we were forced to vacate a data center, we could lose customers that chose our services based on location. If we fail to renew any of our leases, or the renewal of any of our leases is on less favorable terms and we fail to increase revenues sufficiently to offset the higher rental costs, this could have a material adverse effect on our business, financial condition and results of operations.

Our leases may obligate us to make payments beyond our use of the property.

Our leases generally do not give us the right to terminate without penalty. Accordingly, we may incur costs under leases of data center space that is not or no longer is Revenue Generating Space. Some of our leases do not give us the right to sublet, and even if we have that right we may not be able to sublet the space on favorable terms or at all. We have incurred moderate costs in relation to such onerous lease contracts in recent years.

We may experience unforeseen delays and expenses when fitting out and upgrading data centers, and the costs could be greater than anticipated.

As we attempt to grow our business, substantial management effort and financial resources are employed by us in fitting out new, and upgrading existing, data centers. In addition, we periodically upgrade and replace certain equipment at our data centers. We may experience unforeseen delays and expenses in connection with a particular client project or data center build-out. In addition, unexpected technological changes could affect customer requirements and we may not have built such requirements into our data centers and may not have budgeted for the financial resources necessary to build out or redesign the space to meet such new requirements. Furthermore, the redesign of existing space is difficult to implement in practice as it normally requires moving existing customers. Although we have budgeted for expected build-out and equipment expenses, additional expenses in the event of unforeseen delays, cost overruns, unanticipated expenses, regulatory changes, unexpected technological changes and increases in the price of equipment may negatively affect our business, financial condition and results of operations.

No assurance can be given that we will complete the build-out of new data centers or expansions of existing data centers within the proposed timeframe and cost parameters or at all. Any such failure could have a material adverse effect on our business, financial condition and results of operations.

We face significant competition and we may not be able to compete successfully against current and future competitors.

Our market is highly competitive. Most companies operate their own data centers and in many cases continue to invest in data center capacity, although there is a trend towards outsourcing. We compete against other carrier-neutral colocation data center service providers, such as Equinix, Telecity and Telehouse. We also compete with other types of data centers, including carrier-operated colocation, wholesale and IT outsourcers and managed services provider data centers. The cost, operational risk and inconvenience involved in relocating a customer’s networking and computing equipment to another data center are significant and have the effect of protecting a competitor’s data center from significant levels of customer churn.

Further, the growth of the European data center market has encouraged new, larger companies to consider entering the market, in particular those from the United States who are active in this sector. This growth and other factors have also led to increasing alliances and consolidation. Many of these companies may have significantly greater financial, marketing and other resources than we do. Some of our competitors may be willing to, and due to greater financial resources, may be better able to adopt aggressive pricing policies, including the provision of discounted data center services as an encouragement for customers to utilize their other services. Certain of our competitors may also provide our target customers with additional benefits, including bundled communications services, and may do so in a manner that is more attractive to potential customers than obtaining space in our data centers.

While not currently a direct competitive threat to us, wholesale providers of data center space might change their business plan to compete with us directly or open new data centers, thus making large amounts of capacity available at a single point in time and facilitating the entry into the market or expansion of our direct competitors. Wholesale providers of data center space may compete with us for the acquisition of new sites, thereby increasing the average rental prices for suitable sites.

In addition, corporations that have already invested substantial resources in in-house data center operations may be reluctant to outsource these services to a third party, or may choose to acquire space within a wholesale provider’s data center, which would allow them to manage the equipment themselves. If existing customers were to conclude that they could provide the same service in-house at a lower cost, with greater reliability, with increased security or for other reasons, they might move such services in-house and we would lose customers and business.

We may also see increased competition for data center space and customers from wholesale data center providers, such as large real estate companies. Rather than leasing available space to large single tenants, real estate companies, including certain of our landlords, may decide to convert the space instead to smaller square foot units designed for multi-tenant colocation use. In addition to the risk of losing customers to wholesale data center providers, this could also reduce the amount of space available to us for expansion in the future. As a result of such competition, we could suffer from downward pricing pressure and the loss of customers (and potential customers), which would have a material adverse effect on our business, financial condition and results of operations.

Our services may have a long sales cycle that may materially adversely affect our business, financial condition and results of operations.

A customer’s decision to take space in one of our data centers typically involves a significant commitment of resources by us and by potential customers, who often require internal approvals. In addition, some customers will be reluctant to commit to locating in our data centers until they are confident that the data center has adequate available carrier connections and network density. As a result, we may have a long sales cycle lasting anywhere from three months for smaller customers to periods in excess of one year for some of our larger customers. Furthermore, we may expend significant time and resources in pursuing a particular sale or customer that does not result in revenue.

The slowdown in global economies and their delayed recovery may further impact this long sales cycle by making it extremely difficult for customers to accurately forecast and plan future business activities. This could cause customers to slow spending, or delay decision-making, on our services, which would delay and lengthen our sales cycle.

Delays due to the length of our sales cycle may have a material adverse effect on our business, financial condition and results of operations.

Our business is dependent on the adequate supply of electrical power and could be harmed by prolonged electrical power outages or increases in the cost of power.

The operation of each of our data centers requires an extremely large amount of power and we are among the largest power consumers in certain cities in which we operate data centers. We cannot be certain that there will be adequate power in all of the locations in which we operate, or intend to open additional data centers. We attempt to limit exposure to system downtime caused by power outages by using back-up generators and uninterrupted power supply systems; however, we may not be able to limit our exposure entirely even with these protections in place. We also cannot guarantee that the generators will always provide sufficient power or restore power in time to avoid loss of or damage to our customers’ and our equipment. Any loss of services or damage to equipment resulting from a temporary loss of or reduction in power at any of our data centers could harm our customers, reduce customers’ confidence in our services, impair our ability to attract new customers and retain existing customers, and result in us incurring financial obligations to our customers as they might be eligible for service credits pursuant to their service level agreements with us. Our customers may also seek damages from us.

In addition, we are susceptible to fluctuations in power costs in all of the locations in which we operate. Clients have two options with respect to power usage: either (i) to pay for power usage in “plugs” in advance (typically included in the total cabinet price), which are contractually defined amounts of power per month, for which the customer must pay in full, regardless of how much power is actually used; or (ii) to pay for their actual power usage in arrears on a metered basis. While we are contractually able to recover power cost increases from our customers, some portion of the increased costs may not be recovered or recovered in a delayed fashion based on commercial reasons and as a result, may have a negative impact on our results of operations.

Although we have not experienced any power outages that have had a material impact on our financial condition in the past, power outages or increases in the cost of power to us could have a material adverse effect on our business, financial condition and results of operations.

A general lack of electrical power resources sufficient to meet our customers’ demands may impair our ability to utilize fully the available space at our existing data centers or our plans to open new data centers.

In each of our markets, we rely on third parties to provide a sufficient amount of power for current and future customers. Power and cooling requirements are generally growing on a per customer basis. Some of our customers are increasing and may continue to increase their use of high-density electrical power equipment, such as blade servers, which can significantly increase the demand for power per customer and cooling requirements for our data centers. Future demand for electrical power and cooling may exceed the designed electrical power and cooling infrastructure in our data centers. As the electrical power infrastructure is typically one of the most important limiting factors in our data centers, our ability to utilize available space fully may be limited. This, as well as any inability to secure sufficient power resources from third-party providers, could have a negative impact on the effective available capacity of a given data center and limit our ability to grow our business.

The ability to increase the power capacity or power infrastructure of a data center, should we decide to, is dependent on several factors including, but not limited to, the local utility’s ability and willingness to provide additional power, the length of time required to provide such power and/or whether it is feasible to upgrade the electrical infrastructure and cooling systems of a data center to deliver additional power to customers.

The availability of sufficient power may also pose a risk to the successful development of future data centers. In cities where we intend to open new data centers, we may face delays in obtaining sufficient power to operate our data centers. Our ability to secure adequate power sources will depend on several factors, including whether the local power supply is at or close to its limit, whether new connections for our data center would require the local power company to install a new substation or feeder and whether new connections for our data center would increase the overall risks of blackouts or power outages in a given geographic area.

If we are unable to utilize fully the physical space available within our data centers or successfully develop additional data centers or expand existing data centers due to restrictions on available electrical power or cooling, we may be unable to accept new customers or increase the services provided to existing customers, which may have a material adverse effect on our business, results of operations and financial condition.

A significant percentage of our Monthly Recurring Revenue is generated by contracts with terms of one year or less remaining. If such contracts are not renewed, or if their pricing terms are negotiated downwards, our business, financial condition and results of operations would be materially adversely affected.

The majority of our initial customer contracts are entered into on a fixed-term basis for periods from three to five years, which, unless terminated in advance, are automatically renewed for subsequent one-year periods. Please see Item 4 “Information on the Company—Customer Contracts.” As at December 31, 2011, 42% of our Monthly Recurring Revenue was generated by contracts with terms of one year or less remaining. Consequently, a large part of our customer base could either terminate their contracts with us at relatively short notice, or seek to re-negotiate the pricing of such contracts downwards, which, if either were to occur, would have a material adverse effect on our business, financial condition and results of operations.

Our inability to use all or part of our net deferred tax assets could cause us to pay taxes at an earlier date and in greater amounts than expected.

As at December 31, 2011, we had €37.8 million of recognized and €2.1 million of unrecognized, net deferred tax assets. We cannot assure you that we will generate sufficient profit in the relevant jurisdictions to utilize these deferred tax assets fully or that the tax loss availability will not expire before we have been able to fully utilize them. In addition, applicable law could change in one or more jurisdictions in which we have deferred tax assets, rendering such assets unusable. Either such event would cause us to pay taxes in greater amounts than would otherwise occur, which may have a material adverse effect on our results of operations.

Our operating results have fluctuated in the past and may fluctuate in the future, which may make it difficult to evaluate our business and prospects.

Our operating results have fluctuated in the past and may continue to fluctuate in the future, due to a variety of factors, which include:

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demand for our services;

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competition from other data center operators;

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the cost and availability of power;

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the introduction of new services by us and/or our competitors;

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data center expansion by us and/or our competitors;

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changes in our pricing policies and those of our competitors;

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a change in our customer retention rates;

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economic conditions affecting the Internet, telecommunications and e-commerce industries; and

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changes in general economic conditions.

Any of the foregoing factors, or other factors discussed elsewhere in this annual report, could have a material adverse effect on our business, results of operations and financial condition. Although we have experienced growth in revenues during the past three financial years, this growth rate is not necessarily indicative of future operating results. In addition, a relatively large portion of our expenses cannot be reduced in the short-term, particularly personnel and property costs and part of our power costs, which means that our results of operations are particularly sensitive to fluctuations in revenues. As such, comparisons to prior reporting periods should not be relied upon as indications of our future performance. In addition, our operating results in one or more future periods may fail to meet the expectations of securities analysts or investors. If this happens, the market price of our ordinary shares may decline significantly.

We are dependent on third-party suppliers for equipment, technology and other services.

We contract with third parties for the supply of equipment (including generators, UPS systems and cabinet equipment) on which we are dependent to operate our business. Poor performance by, or any inability of, our suppliers to provide necessary equipment, products, services and maintenance could have a negative effect on our reputation and harm our business.

We depend on the ongoing service of our personnel and senior management team and may not be able to attract, train and retain a sufficient number of qualified personnel to maintain and grow our business.

Our success depends upon our ability to attract, retain and motivate highly-skilled employees, including the data center personnel who are integral to the establishment and running of our data centers, as well as sales and marketing personnel who play a large role in attracting and retaining customers. Due to several factors, including the rapid growth of the Internet, there is aggressive competition for experienced data center employees. We compete intensely with other companies to recruit and hire from this limited pool. In addition, the training of new employees requires a large amount of our time and resources. If we cannot attract, train and retain qualified personnel, we may be unable to expand our business in line with our strategy, compete for new customers or retain existing customers, which could cause our business, financial condition and results of operations to suffer.

Our future performance also depends to a significant degree upon the continued contributions of our senior management team. The loss of any member of our senior management team could significantly harm us. To the extent that the services of members of our senior management team would be unavailable to us for any reason, we would be required to hire other personnel to manage and operate our Company. There can be no assurance that we would be able to locate or employ such personnel on acceptable terms or on a timely basis.

Our failure to maintain competitive compensation packages, including equity incentives, may be disruptive to our business. If one or more of our key personnel resigns from our Company to join or form a competitor, the loss of such personnel and any resulting loss of existing or potential customers to any such competitor could harm our business, financial condition and results of operations. In addition, we may be unable to prevent the unauthorized disclosure or use of our technical knowledge, practices or procedures by departed personnel.

Disruptions to our physical infrastructure could lead to significant costs, reduce our revenues and harm our business reputation and financial results.

Our business depends on providing customers with highly reliable and secure services. A number of factors may disrupt our ability to provide services to our customers, including:

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human error;

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power loss;

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physical or electronic security breaches;

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terrorist acts;

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interruptions to the fiber network;

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hardware and software defects;

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fire, earthquake, flood and other natural disasters;

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improper maintenance by our landlords; and

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sabotage and vandalism.

Disruptions at one or more of our data centers, whether or not within our control, could result in service interruptions or significant equipment damage, leading to significant costs and revenue reductions. Please see “—Risks Related to our Industry—Terrorist activity throughout the world and military action to counter terrorism could adversely impact our business.”

Substantial indebtedness could adversely affect our financial condition and our ability to operate our business, and we may not be able to generate sufficient cash flows to meet our debt service obligations.

We have a significant amount of debt and expect to incur additional debt to support our growth. As of December 31, 2011, our total indebtedness was approximately €262.5 million, our stockholders’ equity was €330.6 million and our cash and cash equivalents totaled €142.7 million. Our substantial amount of debt could have important consequences. For example, it could:

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make it more difficult for us to satisfy our debt obligations;

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restrict us from making strategic acquisitions;

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limit our flexibility in planning for, or reacting to, changes in our business and future business opportunities, thereby placing us at a competitive disadvantage if our competitors are not as highly leveraged;

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increase our vulnerability to general adverse economic and industry conditions; or

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require us to dedicate a substantial portion of our cash flow from operations to make interest and principal payments on our debt, reducing the availability of our cash flow to fund future capital expenditures, working capital, execution of our expansion strategy and other general corporate requirements;

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limit our ability to borrow additional funds, even when necessary to maintain adequate liquidity, which would also limit our ability to further expand our business; and

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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 not entirely 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, such as our €260.0 million 9.50% senior secured notes due 2017. There is a risk that we may not be able to refinance existing debt or that the 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 of refinancing result in higher interest rates upon refinancing, then the interest expense relating to that refinanced indebtedness would increase. These risks could materially adversely affect our financial condition, cash flows and results of operations

If we increase our indebtedness by borrowing under our revolving credit facility or incur other new indebtedness, the risks described above would increase.

Our insurance may not be adequate to cover all losses.

The insurance we maintain covers material damage to property, business interruption and third-party liability. This insurance contains limitations on the total coverage for damage due to catastrophic events, such as flooding or terrorism. In addition, there is an overall cap on our general insurance coverage of €34 million in any one year. There is, therefore, a risk that if one or more data centers were damaged, the total amount of the loss would not be recoverable by us. As we have multiple data centers in close proximity to each other located in Amsterdam, Frankfurt, Paris and Dublin, this increases the chance of us suffering uninsured losses.

Also, our insurance policies include customary exclusions, deductibles and other conditions that could limit our ability to recover losses. In addition, some of our policies are subject to limitations involving co-payments and policy limits that may not be sufficient to cover losses. If we experience a loss that is uninsured or that exceeds policy limits, or if customers consider that there is a significant risk that such an event will occur, this may negatively affect our reputation, business, financial condition and results of operations.

Our failure to meet the performance standards under our service level agreements may subject us to liability to our customers, which could have a material adverse effect on our reputation, business, financial condition or results of operations.

We have service level agreements with substantially all of our customers in which we provide various guarantees regarding our level of service. Our inability to provide services consistent with these guarantees may lead to large losses for our customers, who consequently may be entitled to service credits for their accounts or to terminate their relationship with us. We have issued service credits to customers in the past due to our failure to meet service level commitments, as was the case in connection with an outage in some cabinets in one of our Paris and one of our Frankfurt data centers in 2011, and we may do so in the future. We cannot be sure that our customers will accept these service credits as compensation in the future. Our failure or inability to meet a customer’s expectations or any deficiency in the services we provide to customers could result in a claim against us for substantial damages. Provisions contained in our agreements with customers attempting to limit damages, including provisions to limit liability for damages, may not be enforceable in all instances or may otherwise fail to protect us for liability damages.

We could be subject to costs, as well as claims, litigation or other potential liability, in connection with risks associated with the security of our data centers.

One of our key service offerings is our high level of physical premises security. Many of our customers entrust their key strategic IT services and applications to us due, in part, to the level of security we offer. A party who is able to breach our security could physically damage our and our customers’ equipment and/or misappropriate either our proprietary information or the information of our customers or cause interruptions or malfunctions in our operations.

There can be no assurance that the security of any of our data centers will not be breached or the equipment and information of our customers put at risk. Any security breach could have a serious effect on our reputation and could prevent new customers from choosing our services and lead to customers terminating their contracts early and seeking to recover losses suffered, which could have a material adverse effect on our business, financial condition and results of operations. We may incur significant additional costs to protect against physical premises security breaches or to alleviate problems caused by such breaches.

We face risks relating to foreign currency exchange rate fluctuations.

Our reporting currency for purposes of our financial statements is the euro. However, we also incur revenues and operating costs in non-euro denominated currencies, such as British pounds, Swiss francs, Danish kroner and Swedish krona. We recognize foreign currency gains or losses arising from our operations in the period incurred. As a result, currency fluctuations between the euro and the non-euro currencies in which we do business will cause us to incur foreign currency translation gains and losses. We cannot predict the effects of exchange rate fluctuations upon our future operating results because of the number of currencies involved, the variability of currency exposure and the potential volatility of currency exchange rates. We do not currently engage in foreign exchange hedging transactions to manage the risk of our foreign currency exposure.

The slowdown in global economies and their delayed recovery may have an impact on our business and financial condition in ways that we currently cannot predict.

The European debt crisis and slowdown and delayed recovery in the global financial markets could continue to have an adverse effect on our business and our financial condition. If the market conditions continue to remain weak or uncertain, some of our customers may have difficulty paying us and we may experience increased churn in our customer base. Our sales cycle could also lengthen as customers slow spending, or delay decision-making, on our services, which could adversely affect our revenue growth. Finally, we could also experience pricing pressure as a result of economic conditions if our competitors lower prices and attempt to lure away our customers.

Additionally, our ability to access the capital markets may be severely restricted at a time when we would like, or need, to do so, which could have an impact on our flexibility to pursue additional expansion opportunities and maintain our desired level of revenue growth in the future.

Acquisitions present many risks, and we may not realize the financial or strategic goals that were contemplated at the time of any transaction.

We may make acquisitions in the future, which may include acquisitions of businesses, products, services or technologies that we believe to be complementary. We may pay for future acquisitions by using our existing cash resources (which may limit other potential uses of our cash), incurring additional debt (which may increase our interest expense, leverage and debt service requirements) and/or issuing shares (which may dilute our existing stockholders and have a negative effect on our earnings per share). Acquisitions expose us to several potential risks, including:

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the possible disruption of our ongoing business and diversion of management’s attention by acquisition, transition and integration activities;

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our potential inability to successfully pursue or realize some or all of the anticipated revenue opportunities associated with an acquisition or investment;

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the possibility that we may not be able to successfully integrate acquired businesses, or businesses in which we invest, or achieve anticipated operating efficiencies or cost savings;

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the possibility that announced acquisitions may not be completed, due to failure to satisfy the conditions to closing or for other reasons;

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the dilution of our existing stockholders as a result of our issuing stock in transactions;

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the possibility of customer dissatisfaction if we are unable to achieve levels of quality and stability on par with past practices;

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the possibility that additional capital expenditures may be required or that transaction expenses associated with acquisitions may be higher than anticipated;

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the possibility that required financing to fund the requirements of an acquisition may not be available on acceptable terms or at all;

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the possibility that we may be unable to obtain required approvals from governmental authorities under antitrust and competition laws on a timely basis or at all, which could, among other things, delay or prevent us from completing an acquisition, limit our ability to realize the expected financial or strategic benefits of an acquisition or have other adverse effects on our current business and operations;

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the possible loss or reduction in value of acquired businesses;

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the possibility that carriers may find it cost-prohibitive or impractical to bring fiber and networks into a new data center;

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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; and

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the possibility of pre-existing undisclosed liabilities, including but not limited to lease or landlord related liability, environmental or asbestos liability, for which insurance coverage may be insufficient or unavailable.

The occurrence of any of these risks could have a material adverse effect on our business, results of operations, financial condition or cash flows.

Risks Related to our Industry

The European data center industry has suffered from over-capacity in the past, and a substantial increase in the supply of new data center capacity and/or a general decrease in demand for data center services could have an adverse impact on industry pricing and profit margins.

Between 2001 and 2004, the European data center industry suffered from overcapacity due to difficult telecommunications and technology market conditions when the value of many new Internet-based companies fell after a period of significant growth. During the period of growth, many customers contracted to use more space than they needed and in the downturn in the market that followed, the number of Internet-related business failures increased significantly, resulting in high levels of customer churn due to the termination or non-renewal of contracts.

A substantial increase in the supply of new data center capacity in the European data center market and/or a general decrease in demand, or in the rate of increase in demand, for data center services could have an adverse impact on industry pricing and profit margins. If there is not sufficient customer demand for data center services, our business, financial condition and operating results would be adversely affected.

If we do not keep pace with technological changes, evolving industry standards and customer requirements, our competitive position will suffer.

The Internet and telecommunications industries are characterized by rapidly changing technology, evolving industry standards and changing customer needs. Accordingly, our future success will depend, in part, on our ability to meet the challenge of these changes. Among the most important challenges that we may face are the need to: continue to develop our strategic and technical expertise, influence and respond to emerging industry standards and other technological changes, enhance our current services and develop new services that meet changing customer needs.

All of these challenges must be met in a timely and cost-effective manner. Some of our competitors may have greater financial resources, which would allow them to react better or more quickly to changes than we may be able to. We may not effectively meet these challenges as rapidly as our competitors or at all and our failure to do so could harm our business.

Terrorist activity throughout the world and military action to counter terrorism could adversely impact our business.

Due to the high volume of important data that passes through data centers, there is a real risk that terrorists seeking to damage financial and technological infrastructure view data centers generally, and those in concentrated areas specifically, as potential targets. These factors may increase our costs due to the need to provide enhanced security, which would have a material adverse effect on our business, financial condition and results of operations if we were unable to pass such costs on to our customers. These circumstances may also adversely affect the ability of companies, including ourselves, to raise capital. We may not have adequate property and liability insurance to cover terrorist attacks.

In addition, we depend heavily on the physical infrastructure (particularly as it relates to power) that exists in the markets in which we operate. Any damage to such infrastructure, particularly in the major European markets such as Amsterdam, Frankfurt, London, Madrid and Paris, where we derive a substantial amount of our revenue and which are likely to be more prone to terrorist activities, may materially and adversely affect our business.

Our carrier neutral business model depends on the presence of numerous telecommunications carrier networks in our data centers.

The presence of diverse telecommunications carriers’ fiber networks in our 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 non-carrier customers with carrier services. We cannot assure you that the carriers operating within our data centers will not cease to do so. For example, as a result of strategic decisions or consolidations, some carriers may decide to downsize or terminate connectivity within our data centers, which could have an adverse effect on our business, financial condition and results of operations.

We may be subject to reputational damage and legal action in connection with the information disseminated by our customers.

We may face potential direct and indirect liability for claims of defamation, negligence, copyright, patent or trademark infringement and other claims, as well as reputational damage, based on the nature and content of the materials disseminated from our data centers, including on the grounds of allegations of the illegality of certain activities carried out by customers through their equipment located in our data centers. For example, lawsuits may be brought against us claiming that content distributed by our customers may be regulated or banned. Our general liability insurance may not cover any such claim or may not be adequate to protect us against all liability that may be imposed. In addition, on a limited number of occasions in the past, businesses, organizations and individuals have sent unsolicited commercial e-mails (“spam”), which may be viewed as offensive by recipients, from servers hosted at our data centers to a number of people, typically to advertise products or services. We have in the past received, and may in the future receive, letters from recipients of information transmitted by our customers objecting to spam. Although our contracts with our customers prohibit them from spamming, there can be no assurance that customers will not engage in this practice, which could subject us to claims for damages, damage our reputation and have a material adverse effect on our business.

Risks Related to Regulation

Laws and government regulations governing Internet-related services, related communication services and information technology and electronic commerce, across the European countries in which we operate, continue to evolve and, depending on the evolution of such regulations, may adversely affect our business.

Laws and governmental regulations governing Internet-related services, related communications services and information technology and electronic commerce continue to evolve. This is true across the various European countries in which we operate. In particular, the laws regarding privacy and those regarding gambling and other activities that certain countries deem illegal are continuing to evolve.

Changes in laws or regulations (or the interpretation of such laws or regulations) or national or EU policy affecting our activities and/or those of our customers and competitors, including regulation of prices and interconnection arrangements, regulation of access arrangements to types of infrastructure, regulation of privacy requirements through the protection of personal data and regulation of activity considered illegal through rules affecting data center and managed service providers could materially adversely affect our results by decreasing revenue, increasing costs or impairing our ability to offer services.

The industry in which we operate is subject to environmental and health and safety laws and regulations and may be subject to more stringent efficiency, environmental and health and safety laws and regulations in the future.

We are subject to various environmental and health and safety laws and regulations, including those relating to the generation, storage, handling and disposal of hazardous substances and technological equipment, the maintenance of warehouse facilities and the generation and use of electricity. Certain of these laws and regulations are capable of imposing liability for the entire cost of the investigation and remediation of contaminated sites, without regard to fault or the lawfulness of the disposal activity, on former owners and operators of real property and persons who have disposed of or released hazardous substances at any location. Compliance with these laws and regulations could impose substantial ongoing compliance costs and operating restrictions on us.

Hazardous substances or regulated materials of which we are not aware may be present at data centers leased and operated by us. If any such contaminants are discovered at our data centers, we may be responsible under applicable laws, regulations or leases for any required removal or clean-up or other action at substantial cost.

Our facilities contain tanks and other containers for the storage of diesel fuel and significant quantities of lead acid batteries to provide back-up power. We cannot guarantee that our environmental compliance program will be able to prevent leaks or spills in these or other technical installations.

In addition, as consumers of substantial amounts of electricity, we may be affected by the new UK Carbon Reduction Commitment Energy Efficiency Scheme, or the Scheme. The CRC Energy Efficiency Scheme Order 2010 entered into force on March 22, 2010 introducing a mandatory cap and trade scheme from April 1, 2010 applying to organizations, including our own, whose mandatory half hourly metered electricity consumption is greater than 6,000 MWh in the qualification period (which for the first phase of the CRC is calendar year 2008). Potential impacts on our data centers in the UK include the costs associated with improving energy efficiency and the administrative costs of participating in the Scheme. We will be required to purchase emissions allowances from the UK Government to cover our direct and indirect emissions in April of each year of the Scheme beginning in April 2012 (where allowances will be purchased for emissions from the 2011 fiscal year). The cost of the allowances for the initial period of the scheme will be £12/tonne, although the cost could increase in the later years of the Scheme, as allowances will be auctioned after the initial three-year introductory phase (as opposed to sold at a fixed price of £12/tonne).

Our data centers may also be adversely affected by any future application of additional regulation relating to energy usage, for example seeking to reduce the power consumption of companies and fees or levies in this regard (including the EU Energy End-Use Efficiency and Energy Services Directive (Directive 2006/32/EC)). It is possible that the resulting legislation will mean that service providers that consume energy, such as us, may incur increased energy costs, and/or caps on energy use. The European Union is continuing to implement its Climate and Energy Package legislation with a 20% greenhouse gas emissions reduction target against 1990 for the 2013-2020 period and, following the December 2011 Durban climate summit, is actively involved in the extension of the Kyoto Protocol beyond 2012. It is expected that this commitment may give rise to future domestic legislation relating to energy efficiency across the jurisdictions in which we have data centers and this may affect our business.

Non-compliance with, or liabilities under, existing or future environmental or health and safety laws and regulations, including failure to hold requisite permits, or the adoption of more stringent requirements in the future, could result in fines, penalties, third-party claims and other costs that could have a material adverse effect on us.

Risks Related Our Ordinary Shares

The market price for our ordinary shares may continue to be volatile.

The market price for our shares is likely to be highly volatile and subject to wide fluctuations in response to factors including, but not limited to, the following:

•

announcements of new products and services by us or our competitors;

•

technological breakthroughs in the data center, networking or computing industries;

•

news regarding any gain or loss of customers by us;

•

news regarding recruitment or loss of key personnel by us or our competitors;

•

announcements of competitive developments, acquisitions or strategic alliances in our industry;

•

changes in the general condition of the global economy and financial markets;

•

general market conditions or other developments affecting us or our industry;

•

the operating and stock price performance of other companies, other industries and other events or factors beyond our control;

•

cost and availability of power and cooling capacity;

•

cost and availability of additional space inventory either through lease or acquisition in our target markets;

•

regulatory developments in our target markets affecting us, our customers or our competitors;

•

changes in demand for interconnection and colocation products and services in general or at our facilities in particular;

•

actual or anticipated fluctuations in our quarterly results of operations;

•

changes in financial projections or estimates about our financial or operational performance by securities research analysts;

•

changes in the economic performance or market valuations of other data center companies;

•

release or expiry of lock-up or other transfer restrictions on our outstanding ordinary shares; and

•

sales or perceived sales of additional ordinary shares.

In addition, the securities market has from time to time experienced significant price and volume fluctuations that are not related to the operating performance of particular companies. These market fluctuations may also have a material adverse effect on the market price of our ordinary shares.

A substantial portion of our total outstanding ordinary shares may be sold into the market at any time. Such future sales or issuances, or perceived future sales or issuances, could adversely affect the price of our shares.

If our existing shareholders sell, or are perceived as intending to sell, substantial amounts of our ordinary shares, including those issued upon the exercise of our outstanding share options, the market price of our ordinary shares could be adversely impacted. Such sales, or perceived potential sales, by our existing shareholders might make it more difficult for us to issue new equity or equity-related securities in the future at a time and price we deem appropriate. The ordinary shares offered in our initial public offering were eligible for immediate resale in the public market without restrictions. Shares previously held by our existing shareholders may also be sold in the public market in the future if registered under the Securities Act of 1933, as amended (the “Securities Act”), or if such shares qualify for an exemption from registration, including by reason of Rules 144 or 701 under the Securities Act. Additionally, we intend to register all of our ordinary shares that we may issue under our employee stock ownership plans. Once we register those shares, they can be freely sold in the public market upon issuance, unless pursuant to their terms these stock awards have transfer restrictions attached to them.

You may not be able to exercise pre-emptive rights.

Our board of directors has the power to limit or exclude pre-emptive rights in respect of any issue and/or grant rights to subscribe for ordinary shares. Such designation will be limited to our authorized share capital from time to time and will be effective for a period of five years. As a result, we may issue additional shares for future acquisitions or other purposes while excluding any pre-emptive rights. If we issue additional shares without pre-emptive rights, your ownership interests in our Company would be diluted and this in turn could have a material adverse effect on the price of our shares.

We may need additional capital and may sell additional ordinary shares or other equity securities or incur indebtedness, which could result in additional dilution to our shareholders or increase our debt service obligations.

We believe that our current cash, anticipated cash flow from operations and proceeds from our initial public offering and high yield note issuances will be sufficient to meet our anticipated cash needs for the foreseeable future. We may, however, require additional cash resources due to changed business conditions or other future developments, including any investments or acquisitions we may decide to pursue. If these resources are insufficient to satisfy our cash requirements, we may seek to sell additional equity or debt securities or utilize our existing or obtain a new credit facility. The sale of additional equity securities could result in additional dilution to our shareholders. The incurrence of indebtedness would limit our ability to pay dividends or require us to seek consents for the payment of dividends, increase our vulnerability to general adverse economic and industry conditions, limit our ability to pursue our business strategies, require us to dedicate a substantial portion of our cash flow from operations to service our debt, thereby reducing the availability of our cash flow to fund capital expenditure, working capital requirements and other general corporate needs, and limit our flexibility in planning for, or reacting to, changes in our business and our industry. We cannot assure you that financing will be available in amounts or on terms acceptable to us, if at all.

We have never paid, do not currently intend to pay and may not be able to pay any dividends on our ordinary shares.

We have never declared or paid any dividends on our ordinary shares and currently do not plan to declare dividends on our ordinary shares in the foreseeable future. If we were to choose to declare dividends in the future, the payment of cash dividends on our shares is restricted under the terms of the agreements governing our indebtedness. In addition, because we are a holding company, our ability to pay cash dividends on our ordinary shares may be limited by restrictions on our ability to obtain sufficient funds through dividends from subsidiaries, including restrictions under the terms of the agreements governing our and our subsidiaries’ indebtedness. In that regard, our wholly-owned subsidiaries are limited in their ability to pay dividends or otherwise make distributions to us. Under Dutch law, we may only pay dividends out of profits as shown in our adopted statutory annual accounts. We will only be able to declare and pay dividends to the extent our equity exceeds the sum of the paid and called up portion of our ordinary share capital and the reserves that must be maintained in accordance with provisions of Dutch law and our articles of association. Our board of directors will have the discretion to determine to what extent profits shall be retained by way of a reserve. Appropriation and distribution of dividends will be subject to the approval of our general meeting of shareholders. Our board of directors, in determining to what extent profits shall be retained by way of a reserve, will consider our ability to declare and pay dividends in light of our future operations and earnings, capital expenditure requirements, general financial conditions, legal and contractual restrictions and other factors that it may deem relevant.

Your rights and responsibilities as a shareholder will be governed by Dutch law and will differ in some respects from the rights and responsibilities of shareholders under U.S. law, and your shareholder rights under Dutch law may not be as clearly established as shareholder rights are established under the laws of some U.S. jurisdictions.

Our corporate affairs are governed by our articles of association and by the laws governing companies incorporated in The Netherlands. The rights of our shareholders and the responsibilities of members of our board of directors under Dutch law may not be as clearly established as under the laws of some U.S. jurisdictions. In the performance of its duties, our board of directors will be required by Dutch law to consider the interests of our Company, our shareholders, our employees and other stakeholders in all cases with reasonableness and fairness. It is possible that some of these parties will have interests that are different from, or in addition to, your interests as a shareholder. We anticipate that all of our shareholder meetings will take place in The Netherlands.

In addition, the rights of holders of ordinary shares and many of the rights of shareholders as they relate to, for example, the exercise of shareholder rights, are governed by Dutch law and our articles of association and differ from the rights of shareholders under U.S. law. For example, Dutch law does not grant appraisal rights to a company’s shareholders who wish to challenge the consideration to be paid upon a merger or consolidation of the company. See Item 10 “Additional Information—General.”

The provisions of Dutch corporate law and our articles of association have the effect of concentrating control over certain corporate decisions and transactions in the hands of our board of directors. As a result, holders of our shares may have more difficulty in protecting their interests in the face of actions by members of our board of directors than if we were incorporated in the United States. See Item 10 “Additional Information—General.”

The interests of our principal shareholders may be inconsistent with your interests.

As of April 1, 2012, private equity investment funds affiliated with Baker Capital indirectly own 30.88% of our equity. Upon completion of our initial public offering, we entered into a shareholders agreement with affiliates of Baker Capital. For so long as Baker Capital or its affiliates continue to be the owner of shares representing more than 25% of our outstanding ordinary shares, Baker Capital will have the right to designate for nomination a majority of the members of our board of directors, including the right to nominate the chairman of our board of directors. Please see Item 7: “Major Shareholders and Related Party Transactions”, “Related Party Transactions—Shareholders Agreement with Baker Capital.” As a result, these shareholders have, and will continue to have, directly or indirectly, the power, among other things, to affect our legal and capital structure and our day-to-day operations, as well as the ability to elect and change our management and to approve other changes to our operation. The interests of Baker Capital and its affiliates could conflict with your interests, particularly if we encounter financial difficulties or are unable to pay our debts when due. Affiliates of Baker Capital may also have an interest in pursuing acquisitions, divestitures, financings or other transactions that, in their judgment, could enhance their equity investments, although such transactions might involve risks to you as a holder of ordinary shares. In addition, Baker Capital or its affiliates may, in the future, own businesses that directly compete with ours or do business with us. The concentration of ownership may further have the effect of delaying, preventing or deterring a change of control of our Company, could deprive our shareholders of an opportunity to receive a premium for their ordinary shares as part of a sale of our Company and might ultimately affect the market price of our ordinary shares.

We are a foreign private issuer and, as a result, as permitted by the listing requirements of the New York Stock Exchange, we may rely on certain home country governance practices rather than the corporate governance requirements of the New York Stock Exchange.

Many of the corporate governance rules in the New York Stock Exchange (“NYSE”) Listed Company Manual (the “NYSE Manual”) do not apply to the Company as a “foreign private issuer”; however, Rule 303A.11 requires foreign private issuers to describe significant differences between their corporate governance standards and the corporate governance standards applicable to U.S. companies listed on the NYSE. While the Company’s management believes that its corporate governance practices are similar in many respects to those of U.S. NYSE-listed companies and provide investors with protections that are comparable in many respects to those established by the NYSE Manual, there are certain key differences which are described below.

Under Sections 303A.04 and 303A.05 of the NYSE Manual, which govern nominating/corporate governance committees and compensation committees, respectively, the Company’s Nominating Committee and Compensation Committee do not meet the independence standard of the NYSE Manual, as one (1) member of each respective committee is not “independent” as defined under the applicable NYSE Manual standard.

For an overview of our corporate governance principles, see Item 16G “Corporate Governance.” Accordingly, you may not have the same protections afforded to stockholders of companies that are not foreign private issuers.

You may be unable to enforce judgments obtained in U.S. courts against us.

We are incorporated under the laws of The Netherlands, and all or a substantial portion of our assets are located outside of the United States and certain of our directors and officers and certain other persons named in this annual report are, and will continue to be, non-residents of the United States. As a result, although we have appointed an agent for service of process in the United States, it may be difficult or impossible for United States investors to effect service of process within the United States upon us or our non-U.S. resident directors and officers or to enforce in the United States any judgment against us or them including for civil liabilities under the United States securities laws. Therefore, any judgment obtained in any United States federal or state court against us may have to be enforced in the courts of The Netherlands, or such other foreign jurisdiction, as applicable. Because there is no treaty or other applicable convention between the United States and The Netherlands with respect to legal judgments, a judgment rendered by any United States federal or state court will not be enforced by the courts of The Netherlands unless the underlying claim is relitigated before a Dutch court. Under current practice, however, a Dutch court will generally grant the same judgment without a review of the merits of the underlying claim (i) if that judgment resulted from legal proceedings compatible with Dutch notions of due process, (ii) if that judgment does not contravene public policy of The Netherlands and (iii) if the jurisdiction of the United States federal or state court has been based on grounds that are internationally acceptable. Investors should not assume, however, that the courts of The Netherlands, or such other foreign jurisdiction, would enforce judgments of United States courts obtained against us predicated upon the civil liability provisions of the United States securities laws or that such courts would enforce, in original actions, liabilities against us predicated solely upon such laws.

We incur increased costs as a result of being a public company.

As a newly listed public company, we incur additional legal, accounting, insurance and other expenses that we have not incurred as a private company. We incur costs associated with our public company reporting requirements. In addition, the Sarbanes-Oxley Act and related rules implemented by the U.S. Securities and Exchange Commission (the “SEC”) and the NYSE have imposed increased regulation and required enhanced corporate governance practices for public companies. Our efforts to comply with evolving laws, regulations and standards in this regard are likely to result in increased general and administrative expenses and a diversion of management time and attention from revenue generating activities to compliance activities. We also expect these new rules and regulations to make it more expensive for us to obtain director and officer liability insurance, and we may be required to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage.

ITEM 4: INFORMATION ON THE COMPANY

Overview

We are a leading provider of carrier-neutral colocation data center services in Europe. We support over 1,200 customers through 28 data centers in 11 countries enabling them to protect, connect, process and distribute their most valuable information. Within our data centers, we enable our customers to connect to a broad range of telecommunications carriers, Internet service providers and other customers. Our data centers act as content, cloud and connectivity hubs that facilitate the processing, storage, sharing and distribution of data, content, applications and media among carriers and customers, creating an environment that we refer to as a community of interest.

Our core offering of carrier-neutral colocation services includes space, power, cooling and a secure environment in which to house our customers’ computing, network, storage and IT infrastructure. We enable our customers to reduce operational and capital costs while improving application performance and flexibility. We supplement our core colocation offering with a number of additional services, including network monitoring, remote monitoring of customer equipment, systems management, engineering support services, cross connects, data backup and storage.

We are headquartered near Amsterdam, The Netherlands, and we operate in major metropolitan areas, including London, Frankfurt, Paris, Amsterdam and Madrid the main data center markets in Europe. Our data centers are located in close proximity to the intersection of telecommunications fiber routes, and we house more than 400 carriers and Internet service providers and 18 European Internet exchanges. Our data centers allow our customers to lower their telecommunications costs and reduce latency, thereby improving the response time of their applications. This high level of connectivity fosters the development of communities of interest.

Strategy

Target New Customers in High Growth Segments to Further Develop our Communities of Interest

We categorize our customers into segments, and we will continue to target new customers in high growth market segments, including financial services, cloud and managed services providers, digital media and carriers. Winning new customers in these target markets enables us to expand existing, and build new, high value communities of interest within our data centers. For example, customers in the digital media segment benefit from the close proximity to content delivery network providers and Internet exchanges in order to rapidly deliver content to consumers. We expect the high value and reduced cost benefits of our communities of interest to continue to attract new customers, which will lead to decreased customer acquisition costs for us.

Increase Share of Spend from Existing Customers

We focus on increasing revenue from our existing customers in our target market segments. New revenue from our existing customers comprises a substantial portion of our new business, generating the majority of our new bookings. Our sales and marketing teams focus on proactively working with customers to identify expansion opportunities in new or existing markets.

Maintain Connectivity Leadership

We seek to increase the number of carriers in each of our data centers by expanding the presence of our existing carriers into additional data centers and targeting new carriers. We also will continue to develop our relationships with Internet exchanges and work to increase the number of Internet service providers in these exchanges. In countries where there is no significant Internet exchange, we will work with Internet service providers and other parties to create the appropriate Internet exchange. Our carrier sales and business development team will continue to work with our existing carriers and Internet service providers, and target new carriers and Internet service providers, to maximize our share of their data center spend, and to achieve the highest level of connectivity in each of our data centers.

Continue to Deliver Best-in-Class Customer Service

We will continue to provide a high level of customer service in order to maximize customer satisfaction and minimize churn. Our European Customer Service Center operates 24 hours a day, 365 days a year, providing continual monitoring and troubleshooting and giving our customers one call access to full, multilingual technical support, thereby reducing our customers’ internal support costs. In addition, we will continue to develop our customer tools, which include an online customer portal to provide our customers with real-time access to information. We will continue to invest in our local service delivery and assurance teams, which provide flexibility and responsiveness to customer needs.

Disciplined Expansion and Conservative Financial Management

We plan to invest in our data center capacity, while maintaining our disciplined investment approach and prudent financial policy. We will continue to determine the size of our expansions based on selling patterns, pipeline and trends in existing demand as well as working with our customers to identify future capacity requirements. We only begin new expansions once we have identified customers and we have the capital to fully fund the build out. Our expansions are done in phases in order to manage the timing and scale of our capital expenditure obligations, reduce risk and improve our return on capital. Finally, we will continue to manage our capital deployment and financial management decisions based on adherence to our target internal rate of return on new expansions and target leverage ratios. For a description of past and current capital expenditures, see Item 5 “Operating and Financial Review and Prospects.”

Our Services

We offer carrier-neutral colocation and managed services to our customers.

Colocation

Our colocation services provide clients with the space and power to deploy IT infrastructure in our world-class data centers. Through a number of redundant subsystems, including power, fiber and cooling, we are able to provide our customers with highly reliable services. Our colocation services are scalable, allowing our customers to upgrade space, connectivity and services as their requirements evolve. Our data centers employ a wide range of physical security features, including biometric scanners, man traps, smoke detection, fire suppression systems, and secure access. We provide colocation services including:

Space

Each of our data centers houses our customers’ IT infrastructure in a highly connected facility, designed and outfitted to ensure a high level of network reliability. This service provides space and power to our clients to deploy their own IT infrastructure. Customers can choose individual cabinets or a secure cage depending on their space and security requirements.

Power

Each of our data centers is equipped to offer our customers high power availability, including power backup in case of outage as the availability of power is essential to the operation of a data center. The vast majority of our data centers have redundant grid connections and all of our data centers have a power backup installation in case of outage. Generators in combination with uninterrupted power supply, or UPS, system, endeavor to ensure maximum availability. We provide a full range of output voltages and currents and we offer our customers a choice of guaranteed levels of availability between 99.9% and 99.999%.

Connectivity

We provide connectivity services that allow our customers to connect their IT infrastructure. These services offer connectivity with more than 400 telecommunications carriers and allow our customers to reduce costs while enhancing the reliability and performance associated with the exchange of Internet and other data traffic. Our connectivity options offer our customers a key strategic advantage by providing direct, high-speed connections to peers, partners, customers and some of the most important sources of IP data, content and distribution in the world.

Cross Connect

We install and manage physical connections running from our customers’ equipment to the equipment of our telecommunications carrier, Internet service providers and Internet exchange customers as well as other customers. Cross connects are physically secured in dedicated areas called Meet-Me rooms. Our staff test and install cables and patches and maintain cable trays and patch panels according to industry best practice.

Availability Monitoring

We assist our customers in evaluating their Internet service providers. We inspect our customers’ Internet connections and notify customers of defects. Our technicians are available to make repairs as requested.

Managed Services

In addition to providing colocation services, we provide a number of additional managed services, including systems monitoring, systems management, engineering support services, data back-up and storage. Some managed services are only performed on an ad hoc basis, as and when requested by the customer, while others are more recurring in nature. These services are provided either by us directly, or in conjunction with third parties.

Customers

We categorize our customers into customer segments including: digital media and distribution, enterprises, financial services, managed services providers and network providers. We have over 1,200 customers. The majority of our customers have entered into contracts with us for an initial three to five year term, which are typically renewed perpetually and automatically for successive one year periods.

In the year ended December 31, 2011, 31% of our Monthly Recurring Revenue came from our top 20 customers, 21% of our Monthly Recurring Revenue came from our top 10 customers and no single customer accounted for more than 5% of our Monthly Recurring Revenue.

The following table sets forth some of our representative customers by segment:

Digital Media and Distribution

Enterprises

Financial Services

Cloud Service

Providers

Network Providers

Akamai

Bwin

Crytek

Internap

I-stream Planet

Limelight

RTL Interactive

Bacardi

Canon

Ferovial

Lease Plan

Pfizer

ABN Amro Bank N.V.

Aviva

Interactive Data 7ticks

LME

NYSE Euronext

Trading Technologies

Sungard

Fixnetix

Hewlett-Packard

IBM

Terremark

AT&T

British Telecom

Bouygues Telecom

Interoute Communications

Colt Technology Services

Customer service is provided locally by our in-country teams and centrally via our European Customer Service Center located in London. The European Customer Service Center supports five European languages (Dutch, English, French, German and Spanish) and is run by technical support staff and operates 24 hours a day, 365 days a year, in order to provide rapid and cost-effective technical and business support to all of our clients. In addition to its service desk functions, the European Customer Service Center monitors and manages the performance of our data centers and takes care of network monitoring and other network operations center functions. The European Customer Service Center arranges, as necessary, local engineering support, rapid response (out of hours emergency assistance), “backup and restore” and other managed services. There is also a customer relationship management system in place to electronically log each issue that the European Customer Service Center is requested to address to ensure efficient and timely support.

Customer Contracts

Our customers typically sign contracts for the provision of colocation space together with basic service level agreements that provide for support services and other managed services. Unless customers notify us of their intention to terminate 90 days in advance of the end of the contract period, contracts (a majority of which have an initial term of three to five years) typically renew perpetually and automatically for successive one year periods. However, where beneficial to us we will, prior to the expiry of a customer contract, seek to re-negotiate and re-sign with a customer (generally for a minimum one-year period). Our contracts generally allow us the option to increase prices in accordance with local price indices in each jurisdiction and we are able to adjust the amount charged for power at any time and as frequently as necessary during the life of the contract to account for any increases in power costs we are charged by our suppliers.

Contracts for colocation services are priced on the basis of a monthly recurring fee reflecting charges for space, power used in the common parts of the data center, power “plugs” and metered power usage, with related infrastructure and implementation costs included in an initial set-up fee. Clients have two options with respect to power usage: either (i) to pay for power usage in “plugs” in advance (typically included in the total cabinet price), which are contractually defined amounts of power per month, for which the customer must pay in full, regardless of how much power is actually used; or (ii) to pay for their actual power usage in arrears on a metered basis. The first option (power plugs) is usually sold in shared areas of our data centers where customers pay per cabinet. The second option (metered power usage) is usually sold to customers taking dedicated space such as a cage, suite or private room where they are charged on a per square meter basis.

As with colocation services, our managed services are typically contracted on the basis of an annual contract (or longer where appropriate) and the fee generally consists of monthly recurring charges and usage based charges as appropriate, and may also include an initial set-up fee. If managed services are ad hoc in nature, they are invoiced on completion of the service.

Each new customer contract we enter into provides that in the event of a power outage or other equivalent service level agreement breach (e.g. for repeatedly crossing a temperature or humidity benchmark), the customer will receive a service credit in the form of a reduction in its next service fee payment, the credit being on a sliding scale to reflect the seriousness of the breach. Our customer contracts typically exclude liability for consequential or indirect loss suffered as a result of a service level agreement breach and for force majeure. Historically, our penalty payments under our service level agreements have been minimal.

Customer Accounts

Fees are typically invoiced quarterly in advance, with the exception of metered power usage which is invoiced monthly in arrears. On new contracts, we generally require deposits, which we are able to use to cover any non-payment of invoices. If accounts are not paid on time, we seek recovery through the court system.

Sales and Marketing

Our sales and marketing teams focus on proactively identifying and converting opportunities for both existing customers and prospects within our target segments, to expand their space within our data center portfolio.

Sales

We sell our products and services through a local direct sales force and a centralized Major Accounts Team and by attending tradeshows, networking events and industry seminars. Our Major Accounts Team focuses on maximizing revenues across our European footprint from our largest customers and on identifying and developing new major accounts. We utilize a number of indirect channel partners in the United States to secure both referrals and orders from companies based out of the United States.

Marketing

Our marketing organization is responsible for identifying target customer segments, development of the value proposition that will enable us to succeed in our chosen segments, building and communicating a distinct brand, driving qualified leads into the sales pipeline and ensuring strategic alignment with key partners. Our marketing team supports our strategic priorities through the following primary objectives:

Customer Segmentation

Identification of the high-growth customer segments and associated companies that we wish to target and development of the value proposition to enable success in our chosen markets. Working with our sales team, our marketing organization is also responsible for business development of key accounts in each segment.

Brand Management and Positioning

This includes brand identity unification, positioning at the corporate and country levels, the development of methodology, marketing assets and brand awareness programs for all of our business units.

Lead Generation

Utilizing online marketing, targeted advertising, direct marketing, event marketing and public relations programs and strategies to design and execute successful lead-generation campaigns leveraging telemarketing and direct sales to grow our pipeline and deliver our revenue goals.

Employees

As of December 31, 2011 we had a total of 358 employees (full time equivalents, excluding contractors and interim staff) of which 200 employees worked in operations and support, 72 employees worked in sales and marketing and 86 employees in general and administrative. Geographically, 265 of our employees were based in our country operations and 93 employees worked from our headquarters near Amsterdam and corporate offices in London as of December 31, 2011. We believe that relations with our employees are good. Except for collective rights granted by local law, none of our employees are subject to collective bargaining agreements.

Leases

Except for two of our Paris datacenters (PAR3 and PAR5), acquired in December 2011, and the Amsterdam datacenter premises (AMS6), acquired in February 2012, we do not own any other data centers and instead lease our data center space. We generally seek to secure property leases for terms of 20 to 25 years. Where possible, we try to mitigate the long-term financial commitment by contracting for initial lease terms of 10 to 15 years with tenant-only rights to extend the lease with multiple 5-year increments, or alternatively through tenant-only rights to terminate the lease in year 10 or year 15. Our leases generally have Consumer Price Index based annual rent increases over the full term of the lease.

Data Center Operations

We have 28 carrier-neutral data centers in 13 metropolitan areas in 11 countries, representing approximately 68,100 square meters of maximum equippable space (as of December 31, 2011). Maximum equippable space is the maximum amount of space in our data centers which is designed to be used and sold as Equipped Space.

All of our data centers are located in Europe and all of our revenues are generated in Europe. For more information on the geographic breakdown of our revenues, see Note 5 of our 2011 consolidated financial statements, included elsewhere herein.

We select sites for our data centers based primarily on expected customer demand, availability of power and access to telecommunications fiber routes. Most of our data centers are stand-alone structures, close to power sub-stations and telecommunication networks in light industrial areas outside of city centers, rather than residential areas where more prohibitive environmental regulations exist. Data center design and development is a highly complex process. Data center construction requires extensive planning and must navigate regulatory procedures which can vary by jurisdiction. We have developed extensive technical experience in building data centers in Europe and we are well-positioned to bring new data centers to market rapidly to meet customer demand.

The following table presents the key characteristics of our data centers.


Country	Location	Initially ready for service Quarter	Maximum Equippable Space as of December 31, 2011
			Square Meters

Austria	Vienna	Third Quarter, 2000	4,700

Belgium	Brussels	Third Quarter, 2000	4,800

Denmark	Copenhagen	Third Quarter, 2000	3,500

France	Paris—1	First Quarter, 2000	1,400

France	Paris—2	Third Quarter, 2001	3,000

France	Paris—3	Third Quarter, 2007	2,000

France	Paris—4	Third Quarter, 2007	1,300

France	Paris—5	Fourth Quarter, 2009	4,100

France	Paris—6	Third Quarter, 2009	1,400

Germany	Dusseldorf	Second Quarter, 2000	2,800

Germany	Frankfurt—1	First Quarter, 1999	500

Germany	Frankfurt—2	Fourth Quarter, 1999	1,100

Germany	Frankfurt—3	First Quarter, 2000	2,100


Country	Location	Initially ready for service Quarter	Maximum Equippable Space as of December 31, 2011
			Square Meters
Germany	Frankfurt—4	First Quarter, 2001	1,400

Germany	Frankfurt—5	Third Quarter, 2008	1,700

Germany	Frankfurt—6	Second Quarter, 2010	1,600

Ireland	Dublin—1	Second Quarter, 2001	1,100

Ireland	Dublin—2	First Quarter, 2010	2,400

The Netherlands	Amsterdam—1	First Quarter, 1998	600

The Netherlands	Amsterdam—2	First Quarter, 1999	700

The Netherlands	Amsterdam—3	Fourth Quarter, 1999	3,100

The Netherlands	Amsterdam—4*	Fourth Quarter, 2000	*

The Netherlands	Amsterdam—5	Fourth Quarter, 2008	4,500

The Netherlands	Hilversum	Third Quarter, 2001	800

Spain	Madrid—1	Third Quarter, 2000	4,000

Sweden	Stockholm	Third Quarter, 2000	1,900

Switzerland	Zurich	Fourth Quarter, 2000	6,400

UK	London—1	Third Quarter, 2000	5,200


Subtotal			68,100


Announced as at December 31, 2011**
France	Paris—7	Expected Second Quarter, 2012	4,600

Germany	Frankfurt—7	First Quarter, 2012	1,500

The Netherlands	Amsterdam—6	Expected Fourth Quarter, 2012	4,400

UK	London—2	Expected Second Quarter, 2012	1,500


Subtotal			12,000


Total			80,100

Note:

*	The maximum equippable space of Amsterdam—4 is included in the maximum equippable space of Amsterdam—1.

**	These are announced expansions scheduled to become ready for service in 2012.

Competition

We compete with all providers of data center services including in-house and outsourced data centers. Our chief competitors among each of the types of competition are listed below.

Carrier-Neutral Colocation Data Centers

Carrier-neutral colocation data centers in Europe include Equinix, Telecity and Telehouse. These companies are our chief competitors.

IT Outsourcers and Managed Services Provider Data Centers

IT outsourcers and managed services providers in Europe include HP, IBM, Logica, Rackspace and Sungard.

Wholesale Data Centers

Competitor wholesale data center providers include Digital Realty Trust and Global Switch.

Carrier-Operated Data Centers

Carriers that operate their own data centers in Europe include AT&T, BT, Cable & Wireless, Colt Technology Services, Savvis and Verizon.

Please see Item 3 “Key Information—Risk Factors—We face significant competition and we may not be able to compete successfully against current and future competitors.”

Litigation

We have not been party to any legal proceedings, governmental or arbitration proceedings during the 12 months preceding the date of this annual report which may have, or have had in the recent past, a significant effect on our financial position.

Regulation

Although we are not subject to any financial regulations (such as outsourcing requirements, MiFID or Basel II), our financial services customers commonly are. In their contracts with us, these financial services customers impose access, audit and inspection rights to those parts of our data centers that contain their equipment so that they can satisfy their regulatory requirements.

As an operator of data centers which act as content and connectivity hubs facilitating the storage, sharing and distribution of data, content and media for customers, we have in place an Acceptable Use Policy which applies to all of our customers using Internet connectivity services provided by us and which requires our customers to respect all legislation pertaining to the use of Internet services, including email.

We are subject to telecommunications regulation in the various European jurisdictions in which we presently operate, most notably the EU Regulatory Framework. Under these regulations, we are not required to obtain licenses for the provision of our services. However, we may be required to notify the national telecommunications regulator in certain European jurisdictions about these services. We have made the necessary notifications for such jurisdictions.

By operating data centers, we will process personal data under the EU Data Protection Directive (95/46/EC). This directive is implemented through adoption in local legislation of the EU member states. We are subject to this legislation in most European jurisdictions as processors and controllers in the meaning of this Directive. This may impose obligations on us, such as an obligation to take reasonable steps to protect that information.

Insurance

We have in place insurance coverage which we consider to be reasonable and against the type of risks usually insured by companies carrying on the same or similar types of business as ours in the markets in which we operate. Our insurance broadly falls under the following four categories: professional indemnity, general third party liability, directors and officers liability and property damage insurance and business interruption insurance.

Our History and Organizational Structure

European Telecom Exchange BV was incorporated on April 6, 1998, which (after being renamed InterXion Holding B.V. on June 12, 1998) was converted into InterXion Holding N.V. on January 11, 2000. For further information on the history and development of the Company, see Item 10 “Additional Information—General.” From inception onwards we have grown our colocation business organically. We have developed our current footprint (both in terms of countries and cities) between 1999 and 2001 and now operate in 11 countries and 13 cities. Following the industry downturn beginning in 2001 as a result of a sharp decline in demand for Internet-based businesses, we restructured to refocus on a broader and more stable customer base. We have since focused on shifting our customer base from primarily emerging Internet companies and carriers to a wide variety of established businesses seeking to house their IT infrastructure.

Our subsidiaries perform various tasks, such as servicing our clients, operating our datacenters, customers support, and providing management, sales and marketing support to the Group.

The following table sets forth the name, country of incorporation and (direct and indirect) ownership interest of our most significant subsidiaries based on revenues and total assets:


Entity	Country of incorporation	Ownership %	Activity

Interxion HeadQuarters B.V.	the Netherlands	100%	Management

Interxion Operational B.V.	the Netherlands	100%	Management/Holding

Interxion Nederland B.V.	the Netherlands	100%	Provision of co-location services

Interxion Datacenter B.V.	the Netherlands	100%	Datacenter sales & marketing

Interxion Real Estate Holding B.V.	the Netherlands	100%	Real Estate Management/Holding

Interxion Real Estate I B.V.	the Netherlands	100%	Real Estate

Interxion Real Estate IV B.V.	the Netherlands	100%	Real Estate

Interxion Österreich GmbH	Austria	100%	Provision of co-location services

Interxion Belgium N.V.	Belgium	100%	Provision of co-location services

Interxion Denmark ApS	Denmark	100%	Provision of co-location services

Interxion France SAS	France	100%	Provision of co-location services

Interxion Real Estate II SARL	France	100%	Real Estate

Interxion Real Estate III SARL	France	100%	Real Estate

Interxion Deutschland GmbH	Germany	100%	Provision of co-location services

Interxion Ireland Ltd	Ireland	100%	Provision of co-location services

Interxion España SA	Spain	100%	Provision of co-location services

Interxion Sverige AB	Sweden	100%	Provision of co-location services

Interxion (Schweiz) AG	Switzerland	100%	Provision of co-location services

Interxion Carrier Hotel Ltd.	United Kingdom	100%	Provision of co-location services

ITEM 4A: UNRESOLVED STAFF COMMENTS

Not applicable.

ITEM 5: OPERATING AND FINANCIAL REVIEW AND PROSPECTS

The following information should be read in conjunction with the consolidated financial statements and notes thereto and with the financial information presented in Item 18 “Financial Statements” included elsewhere in this annual report. The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Such statements are based upon current expectations that involve risks and uncertainties. Any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements. For example, the words “believes,” “anticipates,” “plans,” “expects,” “intends” and similar expressions are intended to identify forward-looking statements. Our actual results could differ materially from those discussed in these forward-looking statements. Factors that might cause such a discrepancy include, but are not limited to, those discussed in “—Liquidity and Capital Resources” below and Item 3 “Key Information—Risk Factors” above. All forward-looking statements in this annual report are based on information available to us as of the date of this annual report and we assume no obligation to update any such forward-looking statements.

Overview

We are a leading carrier-neutral colocation data center services provider in Europe. Our core offering is carrier-neutral colocation services, which we sell to over 1,200 customers. Within our data centers, we enable our customers to connect to a broad range of telecommunications carriers, Internet service providers and other customers. Our data centers act as content, cloud and connectivity hubs that facilitate the processing, storage, sharing and distribution of data, content, applications and media among carriers and customers, creating an environment that we refer to as a community of interest.

Our core offering is carrier-neutral colocation services, which includes space, uninterrupted power and a secure environment in which to house our customers’ computing, network, storage and IT infrastructure. Our carrier-neutral colocation services enable our customers to reduce operational and capital expenses while improving application performance and flexibility. We supplement our core colocation offering with a number of additional services, including network monitoring, remote monitoring of customer equipment, systems management, engineering support services, cross connects, data backup and storage.

We are headquartered near Amsterdam, The Netherlands, and deliver our services through 28 data centers in 11 countries strategically located in major metropolitan areas, including London, Frankfurt, Paris, Amsterdam and Madrid, which are the main data center markets in Europe. Because our data centers are located in close proximity to the intersection of telecommunications fiber routes and power sources, we are able to provide our customers with high levels of connectivity and the requisite power to meet their needs.

Our data centers house connections to more than 400 carriers and Internet service providers and 18 European Internet exchanges, which allows our customers to lower their telecommunications costs and, by reducing latency, improve the response time of their applications. This connectivity to carriers and Internet service providers, and to other customers, fosters the development of value-added communities of interest, which are important to customers in each of our segments: network providers, cloud services providers, enterprises, financial services and digital media. Development of our communities of interest generates network effects for our customers that enrich the value and attractiveness of the community to both existing and potential customers.

Growth in Internet traffic, cloud computing and the use of customer-facing hosted applications are driving significant demand for high quality carrier-neutral colocation data center services. This demand results from the need for either more space or more power, or both. These needs, in turn, are driven by, among other factors, decreased cost of Internet access, increased broadband penetration, increased usage of high-bandwidth content, increased number of wireless access points and growing availability of Internet and network based applications. If the global economy’s recovery stalls or is reversed, global IP traffic may grow at a lesser rate, which could lead to a slowdown in the increase in demand for our services.

Our ability to meet the demand for high quality carrier-neutral colocation data center services depends on our ability to add capacity by expanding existing data centers or by locating and securing suitable sites for additional data centers that meet our specifications, such as proximity to numerous network service providers, access to a significant supply of electrical power and the ability to sustain heavy floor loading.

Key Aspects of Our Financial Model

We offer carrier-neutral colocation services to our customers. Our revenues are mostly recurring in nature and in the last several years, Recurring Revenue has consistently represented over 90% of our total revenue. Our contracted Recurring Revenue model together with low levels of Average Monthly Churn provide significant predictability of future revenue.

Revenue

We enter into contracts with our customers for initial terms of generally three to five years, with annual price escalators and with automatic one-year renewals after the end of the initial term. Our customer contracts provide for a fixed monthly recurring fee for our colocation, managed services and, in the case of cabinets, fixed amounts of power pre-purchased at a fixed price. These fees are billed monthly, quarterly or bi-annually in advance, together with fees for other services such as the provision of metered power (based on a price per kilowatt hour actually consumed), billed monthly in arrears, or fees for services such as remote hands and eyes support, billed on an as-incurred basis.

The following table presents our future committed revenues expected to be generated from our fixed-term customer contracts as of December 31, 2011, 2010 and 2009.


	2011		2010		2009
	(€’000)
Within 1 year		139,475		154,634		101,235
Between 1 to 5 years		201,620		149,900		96,392
After 5 years		103,934		18,606		16,093

Total		445,029		323,140		213,720

We recognize revenue when it is probable that future economic benefits will be realized and these benefits can be measured reliably. Revenues are measured at the fair value of the consideration received or receivable.

Revenues from contracts with multiple-element arrangements (e.g. installations and setup, equipment sales, data center and managed services) are recognized based on the residual value method, provided the delivered elements have value to customers on a stand-alone basis.

Colocation revenues are earned by providing data center services to customers at our data centers. Colocation revenues are recognized in profit or loss on a straight-line basis over the term of the customer contract. Incentives granted are recognized as an integral part of the total income, over the term of the customer contract. Customers are usually invoiced quarterly in advance and income is recognized on a straight-line basis over the quarter.

Power revenues vary with the amount of power our customers use and are generally matched with corresponding power costs. At the start of the contract, we also bill our customers in advance a fee for the installation and set-up of their contracted space within our data centers. The revenue from this initial set-up fee is recognized over the term of the customer contract and also recorded as Recurring Revenue.

Other services revenue relates mainly to managed services and connectivity. Revenue from other services is recognized when the services are rendered.

Deferred revenues relating to invoicing in advance and initial set-up fees are carried on the statement of financial position. Deferred revenues due to be recognized after more than one year are held in non-current liabilities.

Recurring Revenue comprises revenue that is incurred monthly from colocation and associated power charges, office space, amortized set-up fees and certain recurring managed services (but excluding any ad hoc managed services) provided by us directly or through third parties. Rents received for the sublease of unused sites are excluded.

Costs

Our cost base consists primarily of personnel, power and property costs.

We employ the majority of our personnel in operations and support roles that operate our data centers 24 hours a day, 365 days a year. As of December 31, 2011 we employed 358 full-time employees: 200 in operations and support; 72 in sales and marketing; and 86 in general and administrative. A data center typically requires a fixed number of personnel to run, irrespective of customer utilization. Increases in operations and support personnel occur when we bring new data centers into service. Our approach is, where possible, to locate new data centers close to our existing data centers. In addition to other benefits of proximity, in some cases it also allows us to leverage existing personnel within a data center campus.

In 2009, 2010 and 2011, we invested resources in sales and marketing personnel to engage with our existing and potential customers on an industry basis. This has enabled us to establish closer relationships with our customers thereby allowing us to understand and anticipate their needs and to forecast demand and helping us plan the scope and timing of our expansion activities.

Our customers’ equipment consumes significant amounts of power and generates heat. In recent years the amount of power consumed by an individual piece of equipment, or power density, has increased as processing capacity has increased. In maintaining the correct environmental conditions for the equipment to operate most effectively, our cooling and air conditioning infrastructure also consume significant amounts of power. Our power costs are variable and directly dependent on the amount of power consumed by our customers’ equipment. Our power costs also increase as the Utilization Rate of a data center increases. Increases in power costs due to increased usage by our customers are generally matched by corresponding increases in power revenues.

The unit price we pay for our power also has an impact on our power costs. We generally enter into contracts with local utility companies to purchase power at fixed prices for periods of one or two years. Within substantially all of our customer contracts, we have the right to adjust at any time the price we charge for our power services to allow us to recover increases in the unit price we pay.

Except for two of our Paris datacenters (PAR3 and PAR5), acquired in December 2011. and the Amsterdam datacenter premises (AMS6), acquired in February 2012, we do not own any other data centers and instead lease our data center space. We generally seek to secure property leases for terms of 20 to 25 years. Where possible, we try to mitigate the long-term financial commitment by contracting for initial lease terms of 10 to 15 years with tenant-only rights to extend the lease with multiple 5-year increments, or alternatively through tenant-only rights to terminate the lease in year 10 or year 15. Our leases generally have fixed annual rent increases over the full term of the lease.

Larger increases in our property costs occur when we bring new data centers into service. Bringing new data centers into service also has the effect of temporarily reducing our overall Utilization Rate while the utilization of the new data center increases as we sell to customers.

In addition, we enter into annual maintenance contracts with our major plant and equipment suppliers. This cost increases as new maintenance contracts are entered into in support of new data center operations.

Operating Leverage

Due to the relatively fixed nature of our costs, we generally experience margin expansion as our Utilization Rate at existing data centers increases. Our margins and the rate of margin expansion will vary based upon the scope and scale of our capacity expansions, which affects our overall Utilization Rate.

Exceptional Items

We disclose exceptional items separately as “Other income” and “Exceptional expenses” to enable a better understanding of our financial performance.

Exceptional income and expense that we have disclosed separately in the last three annual financial periods have included IPO transaction costs, abandoned transaction costs, net insurance compensation benefits from a large insurance claim and movements in the provision for onerous lease contracts. Onerous lease contracts are those in which we expect losses to be incurred in respect of unused data center sites over the term of the lease contract. Provisions for these leases are based upon the present value of the future contracted payout under these leases, and movements in the provision for onerous lease contracts are reflected on our income statement. These movements arise principally from changes in the underlying discount rate and are treated as exceptional items. We sublease portions of these unused sites to third parties and treat the income from these subleases as exceptional income.

The provision for onerous lease contracts principally relates to two unused data center sites in Germany, one in Munich terminating in March 2016 and one in Dusseldorf terminating in August 2016.

Net Finance Expense

Towards the end of 2006, we started an expansion program of our data centers based on customer demand. This expansion program, closely matched to both customer demand and available capital resources, has continued since that time. We do not commit to a phase of an expansion or construction of a data center unless we have cash and committed capital available to complete the phase. Since 2006, we have raised debt capital to fund our expansion program, and this has contributed to increases in our finance expense. During the period of construction of a data center, we capitalize the borrowing costs as part of the construction costs of the data center. In 2010, we refinanced the Company’s debt in February 2010 when we issued €200 million of 9.5% senior secured notes, which was primarily used to repay existing debt, and a further tap offering of €60 million in November 2010. For the full year 2011, the major components of net finance expense consisted of interest expense of €23.9 million and interest income of €2.3 million. For the year 2010, the major components of net finance expense consisted of interest expense of €18.3 million and a €10.2 million one-time write off of costs associated with the refinancing in February 2010 together with an unwinding of interest on provisions that had been discounted to their present value at initial recognition.

We fund the expansion programs within operating entities principally through intra-group loans and since 2008, exchange differences arising, if any, on net investments including receivables from or payable to a foreign operation, are recognized directly in the foreign currency translation reserve within equity in accordance with IAS 21. Prior to 2008, these exchange differences were recognized as net finance expense or income.

We discuss our capital expenditures and our capital expansion program below in “—Liquidity and Capital Resources.”

Income Tax Expense

Since inception we have generated significant tax loss carry forwards in all of our jurisdictions. In 2006, we became taxable income positive and began offsetting our tax loss carry forwards against taxable profits. As at December 31, 2011 we have recognized most of our tax losses. We will continue to recognize the remaining deferred tax assets progressively as we become profitable in the respective jurisdiction. We expect to be able to continue to use our tax loss carry forwards to minimize cash taxes going forward.

Segment Reporting

We report our financials in two segments, which we have determined based on our management and internal reporting structure: the first being France, Germany, The Netherlands and UK and the second being the Rest of Europe, which comprises our operations in Austria, Belgium, Denmark, Ireland, Spain, Sweden and Switzerland. Segment results, assets and liabilities include items directly attributable to a segment as well as those that can be allocated on a reasonable basis. Unallocated items are presented as “corporate and other” and comprise mainly general and administrative expenses, assets and liabilities associated with our headquarters operations, provisions for onerous contracts (relating to the discounted amount of future losses expected to be incurred in respect of unused data center sites over the term of the relevant leases, as further explained below) and revenue and expenses related to such onerous contracts, loans and borrowings and related expenses and income tax assets and liabilities. Segment capital expenditure is the total cost directly attributable to a segment incurred during the period to acquire property, plant and equipment.

Results of Operations

The following table presents our operating results for the years ended December 31, 2011, 2010 and 2009:


	Year ended December 31,			Year ended December 31,
	2011 ⁽¹⁾			2011			2010			2009
	(U.S. $’000, except per share amounts)			(€’000, except per share amounts)
Revenue		316,943			244,310			208,379			171,668
Cost of sales		(132,021	)		(101,766	)		(91,154	)		(78,548	)

Gross profit		184,922			142,544			117,225			93,120
Other Income		632			487			425			746
Sales and marketing costs		(22,936	)		(17,680	)		(15,072	)		(11,253	)
General and administrative costs
Depreciation, amortization and impairments		(46,122	)		(35,552	)		(31,108	)		(21,960	)
Exceptional expenses		(2,261	)		(1,743	)		(150	)		(8,594	)
Share-based payment		(3,549	)		(2,736	)		(1,684	)		(950	)
Other general and administrative costs		(35,322	)		(27,227	)		(22,950	)		(19,124	)

General and administrative costs		(87,254	)		(67,258	)		(55,892	)		(50,628	)

Operating profit		75,364			58,093			46,686			31,985
Net finance expense		(29,558	)		(22,784	)		(29,444	)		(6,248	)

Profit before taxation		45,806			35,309			17,242			25,737
Income tax (expense) / income		(12,631	)		(9,737	)		(2,560	)		715

Profit for the year attributable to shareholders		33,175			25,572			14,682			26,452

Basic earnings per share		0.52			0.40			0.33			0.60

Adjusted EBITDA ⁽ ² ⁾		126,664			97,637			79,203			62,743

The following table presents our operating results as a percentage of revenues for the years ended December 31, 2011, 2010 and 2009:


	Year ended December 31,
	2011			2010			2009
Revenue		100	%		100	%		100	%
Cost of sales		(42	)		(44	)		(46	)

Gross profit		58			56			54
Other income		0			0			0
Sales and marketing costs		(7	)		(7	)		(7	)
General & administrative costs
Depreciation, amortization and impairments		(15	)		(15	)		(13	)
Exceptional expenses		(1	)		0			(5	)
Share-based payments		(1	)		(1	)		(1	)
Other general and administrative costs		(11	)		(11	)		(11	)

General and administrative costs		(28	)		(27	)		(29	)

Operating profit		24			22			19
Net finance expense		(9	)		(14	)		(4	)

Profit before taxation		14			8			15
Income tax (expense) / income		(4	)		(1	)		0

Profit for the year attributable to shareholders		10	%		7	%		15	%

Adjusted EBITDA margin ⁽²⁾		40	%		38	%		37	%

Notes:

(1)

The operating results for the year ended December 31, 2011 have been translated for convenience only based on the noon buying rate in The City of New York for cable transfers of euro as certified for customs purposes by the Federal Reserve Bank of New York as of December 31, 2011 and for euro into U.S. dollars of €1.00 = U.S. 1.2973. See Item 3 “Key Information—Exchange Rates” for additional information.

(2)

EBITDA is defined as operating profit plus depreciation, amortization and impairment of assets. We define Adjusted EBITDA as EBITDA adjusted to exclude share-based payments and exceptional and non-recurring items. Adjusted EBITDA margin is defined as Adjusted EBITDA as a percentage of revenue. We present EBITDA, Adjusted EBITDA and Adjusted EBITDA margin as additional information because we understand that they are measures used by certain investors and because they are used in our financial covenants in our €50 million revolving credit facility and €260 million 9.50% Senior Secured Notes due 2017. However, other companies may present EBITDA, Adjusted EBITDA and Adjusted EBITDA margin differently than we do. EBITDA, Adjusted EBITDA and Adjusted EBITDA margin are not measures of financial performance under IFRS and should not be considered as an alternative to operating profit or as a measure of liquidity or an alternative to net income as indicators of our operating performance or any other measure of performance derived in accordance with IFRS. See “—EBITDA and Adjusted EBITDA” for a more detailed description.

The following table presents a reconciliation of EBITDA and Adjusted EBITDA to operating profit according to our income statement, the most directly comparable IFRS performance measure, for the periods indicated:


	Year ended December 31,			Year ended December 31,
	2011 ⁽¹⁾ *			2011			2010			2009
	(U.S. $’000)			(€’000)
Other financial data
Operating profit		75,364			58,093			46,686			31,985
Depreciation, amortization and impairments		46,122			35,552			31,108			21,960

EBITDA		121,486			93,645			77,794			53,945
Share-based payments		3,549			2,736			1,684			950
Exceptional expenses
Increase/(decrease) in provision for onerous lease contracts ^(a)		23			18			150			3,753
IPO transaction costs ^(b ⁾		2,238			1,725			—			—
Abandoned transaction costs ^(c ⁾		—			—			—			4,841
Exceptional income		(632	)		(487	)		(425	)		(746	)

Adjusted EBITDA ⁽²⁾ *		126,664			97,637			79,203			62,743

Note:

*	References are to the footnotes above.

(a)	“Increase (decrease) in provision for onerous lease contracts” does not reflect the deduction of income from subleases on unused data center sites.

(b)	“IPO transaction costs” represents expenses associated with the write off of the proportion of the IPO costs allocated to the selling shareholders at the Initial Public Offering.

(c)	“Abandoned transaction costs” represents expenses associated with the write-off of capitalized initial public offering costs.

The following table sets forth some of our key performance indicators as of the dates indicated:


	As of December 31,
	2011			2010			2009
Equipped Space ⁽¹⁾ (square meters)		62,800			61,000			54,800
Utilization Rate ⁽²⁾		75	%		72	%		70	%

Notes:

(1)

Equipped Space is the amount of data center space that, on the date indicated, is equipped and either sold or could be sold, without making any additional investments to common infrastructure. Equipped Space at a particular data center may decrease if either (a) the power requirements of customers at such data center change so that all or a portion of the remaining space can no longer be sold as the space does not have enough power and/or common infrastructure to support it without further investment or (b) if the design and layout of a data center changes to meet among others, fire regulations or customer requirements, and necessitates the introduction of common space which cannot be sold to individual customers, such as corridors.

(2)	Utilization Rate is, on the relevant date, Revenue Generating Space as a percentage of Equipped Space; some Equipped Space is not fully utilized due to customers’ specific requirements regarding the layout of their equipment. In practice, therefore, Utilization Rate may not reach 100%.

Years Ended December 31, 2011 and 2010

Revenue

Our revenue for the years ended December 31, 2011 and 2010 was as follows:


	Year ended December 31,								Change
	2011		%		2010		%		€		%
	(€’000, except percentages)

Revenue
Recurring revenue		228,328		93		192,973		93		35,355		18
Non-recurring revenue		15,982		7		15,406		7		576		4

		244,310		100		208,379		100		35,931		17

Revenue increased to €244.3 million for the year ended December 31, 2011 from €208.4 million for the year ended December 31, 2010, an increase of 17%. Recurring revenue increased by 18% and non-recurring revenue increased by 4% from the year ended December 31, 2010 to the year ended December 31, 2011. The period over period growth in recurring revenue was primarily the result of an increase of approximately 3,400 square meters in Revenue Generating Space as a result of sales to both existing and new customers in all of our regions.

Cost of Sales

Cost of sales increased to €101.8 million for the year ended December 31, 2011 from €91.2 million for the year ended December 31, 2010, an increase of 12%. Cost of sales was 42% of revenue for the year ended December 31, 2011 and 44% for the year ended December 31, 2010. The increase in cost of sales was due to increased costs associated with our overall revenue growth and data center expansion projects, including (i) an increase of €5.5 million in power costs, (ii) an increase of €1.3 million in higher datacenter rent costs and (iii) an increase of €0.9 million in compensation costs. Equipped Space increased by approximately 1,800 square meters during the year ended December 31, 2011 as a result of expansions to existing data centers in Dublin, London and Vienna. We expect cost of sales as a percentage of revenue to decrease as we increase utilization at our existing facilities. This decrease may be offset by the impact of lower utilization in new data centers we open as part of our data center expansion projects.

Sales and Marketing Costs

Our sales and marketing costs increased to €17.7 million for the year ended December 31, 2011 from €15.1 million for the year ended December 31, 2010, an increase of 17%. Sales and marketing costs were 7% of revenue for each of the years ended December 31, 2011 and 2010.

The increase in sales and marketing costs was primarily a result of an increase of €2.3 million in compensation and related costs due to increases in employee headcount and marketing expenses associated with our continued strategy to invest in our industry focused customer development and acquisition approach.

General and Administrative Costs

General and administrative costs consist of depreciation, amortization and impairments, exceptional expenses, share-based payments and other general and administrative costs.

Depreciation, Amortization and Impairments

Depreciation, amortization and impairments increased to €35.6 million for the year ended December 31, 2011 from €31.1 million for the year ended December 31, 2010, an increase of 14%. Depreciation, amortization and impairments was 15% of revenue for each of the years ended December 31, 2011 and 2010. The increase was due to new data centers and data center expansion. The increase was partially offset by a reversal of impairment amounting to €0.8 million related to our Sweden datacenter.

Exceptional Expenses

In determining Adjusted EBITDA we also add back share-based payments. For the year ended December 31, 2011 we recorded share-based payments of €2.7 million, an increase of 62% from the year ended December 31, 2010.

Other General and Administrative Costs

Other general and administrative costs increased to €27.2 million for the year ended December 31, 2011 from €23.0 million for the year ended December 31, 2010, an increase of 19%. Other general and administrative costs were 11% of revenue for each of the years ended December 31, 2011 and December 31, 2010. The increase in the other general and administrative costs was due to an increase of €1.8 million in compensation costs resulting from headcount growth and an increase of €1.3 million in expenses for professional services mainly due to higher public company cost such as the implementation of the Sarbanes-Oxley Act.

Net Finance Expense

Net finance expense for the year ended December 31, 2011 primarily consists of a €23.7 million net interest expense. Net finance expense decreased to €22.8 million for the year ended December 31, 2011 from €29.4 million for the year ended December 31, 2010, a decrease of 23%. Net finance expense was 9% of revenue for the year ended December 31, 2011 and 14% of revenue for the year ended December 31, 2010. The decrease in net finance expense for the year December 31, 2011 was due primarily to the one-off charges amounting to €10.2 million associated with the debt refinancing in the first quarter of 2010, which was partially offset by increased interest expense in 2011 due to the greater outstanding principal amount of the Senior Secured Notes as result of the €60.0 million bond tap in November 2010.

We capitalized €2.7 million of finance expense to construction in progress during the year ended December 31, 2011 and €2.0 million during the year ended December 31, 2010.

Other Income

Other income represents income that we do not consider part of our core business, including income from the sublease of parts of our onerous lease contracts.

Income Taxes

Income tax expense was €9.7 million for the year ended December 31, 2011 compared to €2.6 million for the year ended December 31, 2010. Income tax expense was 4% of revenue for the year ended December 31, 2011 and 1% of revenue for the year ended December 31, 2010.

We recorded current tax expenses of €5.0 million for the year ended December 31, 2011 and €1.8 million for the year ended December 31, 2010. We recorded deferred tax expense of €4.7 million for the year ended December 31, 2011 and €0.7 million for the year ended December 31, 2010, arising from the net impact of the utilization of deferred tax assets on loss carry-forwards as well as the initial recognition of deferred tax assets on loss carry-forwards.

Years Ended December 31, 2010 and 2009

Revenue

Our revenue for the years ended December 31, 2010 and 2009 was as follows:


	Year ended December 31,								Change
	2010		%		2009		%		€		%
	(€’000, except percentages)

Revenue
Recurring revenue		192,973		93		161,314		94		31,659		20
Non-recurring revenue		15,406		7		10,354		6		5,052		49

		208,379		100		171,668		100		36,711		21

Revenue increased to €208.4 million for the year ended December 31, 2010 from €171.7 million for the year ended December 31, 2009, an increase of 21%. Recurring revenue increased by 20% and non-recurring revenue increased by 49% from the year ended December 31, 2009 to the year ended December 31, 2010. The period over period growth in recurring revenue was primarily the result of an increase of approximately 5,300 square meters in Revenue Generating Space as a result of sales to both existing and new customers in all of our regions. During the year ended December 31, 2010, we recorded approximately €6.3 million of revenue from our new data centers in Dublin and Frankfurt as well as expansions to existing data centers in Amsterdam, London, and Zurich.

Cost of Sales

Cost of sales increased to €91.2 million for the year ended December 31, 2010 from €78.5 million for the year ended December 31, 2009, an increase of 16%. Cost of sales was 44% of revenue for the year ended December 31, 2010 and 46% for the year ended December 31, 2009. The increase in cost of sales was due to increased costs associated with our overall revenue growth and data center expansion projects, including (i) an increase of €4.3 million in external installation costs, (ii) an increase of €3.3 million in property costs, (iii) €2.0 million in higher compensation costs and (iv) €1.5 million in utility costs as a result of increased customer installations.

Equipped Space increased by approximately 6,200 square meters during the year ended December 31, 2010 as a result of a new data center in Dublin and Frankfurt as well as expansions to existing data centers in Amsterdam, Paris and Zurich. We expect cost of sales as a percentage of revenue to decrease as we increase utilization at our existing facilities. This decrease may be partially offset by the impact of lower utilization in new data centers we open as part of our data center expansion projects.

Sales and Marketing Costs

Our sales and marketing costs increased to €15.1 million for the year ended December 31, 2010 from €11.3 million for the year ended December 31, 2009, an increase of 34%. Sales and marketing costs were 7% of revenue for each of the years ended December 31, 2010 and 2009.

The increase in sales and marketing costs was primarily a result of an increase of €2.5 million in compensation and related costs due to increases in employee headcount as we have continued to invest in our industry focused customer development and acquisition approach.

General and Administrative Costs

General and administrative costs consist of depreciation, amortization and impairments, exceptional expenses, share-based payments and other general and administrative costs.

Depreciation, Amortization and Impairments

Depreciation, amortization and impairments increased to €31.1 million for the year ended December 31, 2010 from €22.0 million for the year ended December 31, 2009, an increase of 42%. Depreciation, amortization and impairments was 15% of revenue for the year ended December 31, 2010 and 13% of revenue for the year ended December 31, 2009. This increase was due to new data centers and data center expansion.

Exceptional Expenses

Exceptional expenses comprise significant items which are separately disclosed by virtue of their size, nature or incidence to enable a better understanding of our financial performance. In the year ended December 31, 2010, we recorded €0.2 million of exceptional expenses relating to an increase in the provision we have made for our onerous leases, which was offset by the sublease revenue in the unused data center site in Munich terminating in March 2016.

In determining Adjusted EBITDA we also add back share-based payments. For the year ended December 31, 2010 we recorded share-based payments of €1.7 million.

Other General and Administrative Costs

Other general and administrative costs increased to €23.0 million for the year ended December 31, 2010 from €19.1 million for the year ended December 31, 2009, an increase of 20%. Other general and administrative costs were 11% of revenue for each of the years ended December 31, 2010 and December 31, 2009. The increase in the other general and administrative costs was due to an increase of €1.7 million in compensation costs resulting from headcount growth.

Net Finance Expense

Net finance expense for the year ended December 31, 2010 primarily consists of a €29.4 million net interest expense. Net finance expense increased to €29.4 million for the year ended December 31, 2010 from €6.2 million for the year ended December 31, 2009, an increase of 374%. Net finance expense was 14% of revenue for the year ended December 31, 2010 and 4% of revenue for the year ended December 31, 2009. The increase in net finance expense for the year December 31, 2010 was due primarily to the one-off charges amounting to €10.2 million associated with the debt refinancing in the first quarter and the greater outstanding principal amount of the Senior Secured Notes and higher interest rate compared to the old bank facilities.

During each of the years ended December 31, 2010 and 2009, we capitalized €2.0 million of finance expense to construction in progress.

Other Income

Other income represents income that we do not consider part of our core business, including income from the sublease of parts of our onerous lease contracts. Additionally, we reported a net insurance compensation benefit of €0.3 million for the year ended December 31, 2009 as a result of fire damage incurred in 2008.

Income Taxes

Income tax expense was €2.6 million for the year ended December 31, 2010 compared to an income tax benefit of €0.7 million for the year ended December 31, 2009. Income tax expense was 1% of revenue for the year ended December 31, 2010 and 0% of revenue for the year ended December 31, 2009.

We recorded current tax expenses of €1.8 million for the year ended December 31, 2010 and €0.7 million for the year ended December 31, 2009. We recorded deferred tax expense of €0.7 million for the year ended December 31, 2010 and a benefit of €1.4 million for the year ended December 31, 2009, arising from the net impact of the utilization of deferred tax assets on loss carry-forwards as well as the initial recognition of deferred tax assets on loss carry-forwards.

Liquidity and Capital Resources

As of December 31, 2011, our total indebtedness consisted of (i) €260.0 million 9.50% Senior Secured Notes due 2017 and (ii) other debt and finance lease obligations totaling €2.5 million.

Historically, we have made significant investments in our property, plant and equipment and intangibles assets in order to expand our data center footprint and total Equipped Space as we have grown our business. In the year ended December 31, 2011 we invested €162.0 million in property, plant and equipment (€154.6 million) and intangible assets (€7.4 million), of which €145.7 million, including acquisition of PAR3 and PAR 5 datacenters (€19.1 million), was attributed to expansion capital expenditures and the remainder to maintenance and other capital expenditures. In the year ended December 31, 2010, we invested €100.4 million in property, plant and equipment (€98.2 million) and intangibles (€2.2 million). Intangible assets include investments in power grid rights and software development.

Although in any one year the amount of maintenance and replacement capital expenditures may vary, we expect that long-term such expenses will be between 4% and 6% of total revenue.

As of December 31, 2011, we had €142.7 million of cash and cash equivalents of which €4.8 million was restricted cash, mostly denominated in euro. As of December 31, 2010, we had €99.1 million of cash and cash equivalents of which €4.2 million was restricted cash, mostly denominated in euro. Our primary source of cash is from our financing activities and customer collections.

Sources and Uses of Cash


	Year ended December 31,
	2011			2010			2009
	(€’000)

Cash generated from operations		90,048			85,308			58,586

Net cash flows from operating activities		64,043			74,379			51,378
Net cash flows used in investing activities		(161,011	)		(100,164	)		(100,949	)
Net cash flows from financing activities		140,330			92,748			19,764

Operating Activities

The increase in cash generated from operations in the year ended December 31, 2011 compared to the year ended December 31, 2010 was primarily due to improved operational performance.

The decrease in net cash flows from operating activities in the year ended December 31, 2011 compared to the year ended December 31, 2010 was primarily due to higher interest and income tax payments and the decrease in net working capital movements partly offset by the improved operating performance of the Company. The increase in net cash flows from operating activities in the year ended December 31, 2010 was primarily due to the improved operating performance of the Company as discussed above and an increase in movements in trade and other liabilities as compared to the year ended December 31, 2009.

Investing Activities

The increase in net cash used in investing activities in the year ended December 31, 2011 was primarily due to capital expenditures in the expansion of existing or construction of new data centers. The decrease in net cash used in investing activities in the year ended December 31, 2010 was primarily due to the timing of capital expenditures in the expansion of existing or construction of new data centers. The increase in net cash used in investing activities in the year ended December 31, 2009 was also primarily due to capital expenditures in the expansion of existing data centers or construction of new data centers.

Financing Activities

Net cash flows from financing activities during the year ended December 31, 2011 was primarily the result of €143.0 million in gross proceeds from the issuance of new shares at the IPO, which was partly offset by the associated costs and fees. Net cash flows from financing activities during the year ended December 31, 2010 was primarily the result of €254.3 million in gross proceeds from the issuance of the Senior Secured Notes (and after deducting deferred financing fees related to the Revolving Credit Facility), which was partly offset by repayment of our previously outstanding credit facility and associated costs and fees. Net cash flows from financing activities during the year ended December 31, 2009 was primarily the result of €22.2 million in gross proceeds drawn under our prior credit facilities.

We anticipate that cash flows from operating activities and from the utilization of credit available will be sufficient to meet our operating requirements on a short-term (twelve months) and long-term basis, including repayment of the current portion of our debt as it becomes due, and to complete our publicly announced expansion projects.

EBITDA and Adjusted EBITDA

EBITDA for the year ended December 31, 2011 was €93.6 million, €77.8 million for the year ended December 31, 2010, and €53.9 million for the year ended December 31, 2009, representing 37%, 31% and 34% of revenue, respectively. Adjusted EBITDA for the year ended December 31, 2011 was 97.6 million, €79.2 million for the year ended December 31, 2010 and €62.7 million for the year ended December 31, 2009 representing 40%, 38% and 37% of revenue, respectively.

We present EBITDA and Adjusted EBITDA as additional information because we understand that they are measures used by certain investors and because they are used in our financial covenants in our €50 million revolving credit facility and €260 million 9.50% Senior Secured Notes due 2017.

Failure to comply with the financial covenants in our €50 million revolving credit facility would result in an event of default, which may cause all amounts outstanding under the facility to become immediately due and payable. Acceleration of such outstanding amounts under the facility may lead to an event of default under the indenture governing our €260 million 9.50% Senior Secured Notes. Failure to satisfy the financial covenants in the indenture would result in our inability to incur additional debt under certain circumstances.

EBITDA is defined as operating profit plus depreciation, amortization and impairment of assets. We define Adjusted EBITDA as EBITDA adjusted to exclude share-based payments and exceptional and non-recurring items. However, other companies may present EBITDA and Adjusted EBITDA differently than we do. EBITDA and Adjusted EBITDA are not measures of financial performance under IFRS and should not be considered as an alternative to operating profit or as a measure of liquidity or an alternative to net income as indicators of our operating performance or any other measure of performance derived in accordance with IFRS.

The following table presents a reconciliation of EBITDA and Adjusted EBITDA to operating profit according to our income statement, for the periods indicated:


	Year ended December 31,
	2011			2010			2009
	(€’000)

Operating profit		58,093			46,686			31,985
Depreciation, amortization and impairments		35,552			31,108			21,960

EBITDA		93,645			77,794			53,945
Share-based payments		2,736			1,684			950
Exceptional expenses ⁽¹ ⁾
Increase/(decrease) in provision for onerous lease contracts ⁽ ² ⁾		18			150			3,753
IPO transaction costs ⁽ ³⁾		1,725			—			—
Abandoned transaction costs ⁽ ⁴⁾		—			—			4,841
Exceptional income ⁽⁵ ⁾		(487	)		(425	)		(746	)

Adjusted EBITDA		97,637			79,203			62,743

Notes:

(1)	Exceptional expenses comprise significant items which are separately disclosed by virtue of their size, nature or incidence to enable a better understanding of our financial performance.

(2)	“Increase in provision for onerous lease contracts” does not reflect the deduction of income from subleases on unused data center sites.

(3)	“IPO transaction costs” represents expenses associated with the write off of the proportion of the IPO costs allocated to the selling shareholders at the Initial Public Offering.

(4)	“Abandoned transaction costs” represents expenses associated with the write-off of capitalized initial public offering costs.

(5)	Exceptional income is reported within “Other income.” Other income represents income that we do not consider part of our core business including income from the sublease of parts of our onerous lease contracts.

Contractual Obligations and Off-Balance Sheet Arrangements

We lease a majority of our data centers and certain equipment under non-cancellable lease agreements. The following represents our debt maturities, financings, leases and other contractual commitments as of December 31, 2011:


	Total		Less than 1 year		1 – 3 years		3 – 5 years		More than 5 years
	(€’000)

Long-term debt obligations ⁽¹ ⁾		262,605		895		105		1,605		260,000
Financial leases		332		236		96		—		—
Operating leases in relation to onerous lease contracts		13,668		3,083		6,166		4,419		—
Operating leases		282,030		22,446		47,871		44,285		167,428
Other contractual commitments		15,800		15,800		—		—		—
Capital commitments		101,204		101,204		—		—		—

Total		675,639		143,664		54,238		50,309		427,428

Notes:

(1)	Long-term debt obligations include the Senior Secured Notes and loans from suppliers and/or landlords.

In connection with 13 of our data center leases, we entered into 15 irrevocable bank guarantees totaling €4.8 million with ABN AMRO Bank, Royal Bank of Scotland, La Caixa and Sparkasse. These bank guarantees were provided in lieu of cash deposits and automatically renew in successive one-year periods until the final lease expiration date. The bank guarantees are cash collateralized and the collateral is reflected as restricted cash on our statement of financial position. These contingent commitments are not reflected in the table above.

Primarily as a result of our various data center expansion projects, as of December 31, 2011, we were contractually committed for €101.2 million of unaccrued capital expenditures, primarily for data center equipment not yet delivered and labor not yet provided, in connection with the work necessary to complete construction and open these data centers prior to making them available to customers for installation. This amount, which is expected to be paid in 2012, is reflected in the table above as “Capital commitments.”

We have other non-capital purchase commitments in place as of December 31, 2011, such as commitments to purchase power in select locations, through the year 2012, and other open purchase orders, which contractually bind us for goods or services to be delivered or provided during the remainder of 2012 and beyond. Such other purchase commitments as of December 31, 2011, which total € 15.8 million, are also reflected in the table above as “Other contractual commitments.”

In addition, although we are not contractually obligated to do so, we expect to incur additional capital expenditures consistent with our disciplined expansion and conservative financial management in our various data center expansion projects during the remainder of 2011 in order to complete the work needed to open these data centers. These non-contractual capital expenditures are not reflected in the table above.

Critical Accounting Estimates

Basis of Measurement

We present our financial statements in thousands of euro. They are prepared under the historical cost convention except for certain financial instruments. The financial statements are presented on the going-concern basis. Our functional currency is the euro.

The accounting policies set out below have been applied consistently by us and our wholly-owned subsidiaries and to all periods presented in these consolidated financial statements.

Use of Estimates and Judgments

The preparation of financial statements in conformity with IFRS requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimates are revised and in any future periods affected.

In particular, information about significant areas of estimation uncertainty and critical judgments in applying accounting policies that have the most significant effect on amounts recognized in the financial statements are discussed below.

Property, Plant and Equipment Depreciation

Estimated remaining useful lives and residual values are reviewed annually. The carrying values of property, plant and equipment are also reviewed for impairment where there has been a triggering event by assessing the present value of estimated future cash flows and net realizable value compared with net book value. The calculation of estimated future cash flows and residual values is based on our best estimates of future prices, output and costs and is therefore subjective.

Costs of Site Restoration

Liabilities in respect of obligations to restore premises to their original condition are estimated at the commencement of the lease. The actual cost of these may be different depending upon whether the Group renews the lease.

Provision for Onerous Lease Contracts

Provision is made for the discounted amount of future losses expected to be incurred in respect of unused data center sites over the term of the leases. Where unused sites have been sublet or partly sublet, management has taken account of the contracted rental income to be received over the minimum sublease term in arriving at the amount of future losses. Currently, the provision for onerous lease contracts principally relates to two unused data center sites in Germany, one in Munich terminating in March 2016 and one in Dusseldorf terminating in August 2016.

Deferred Taxation

Provision is made for deferred taxation at the rates of tax prevailing at the period end dates unless future rates have been substantively enacted. Deferred tax assets are recognized where it is probable that they will be recovered based on estimates of future taxable profits for each tax jurisdiction. The actual profitability may be different depending upon local financial performance in each tax jurisdiction.

Recent Accounting Pronouncements

The following new standards, amendments to standards and interpretations set out below were issued but were not effective for the financial year ending December 31, 2011 and were not applied in preparing the financial statements for the years ended December 31, 2011 and 2010:

Revision to IAS 12 “Income taxes”

Revision to IAS 32, “Financial Instruments: Presentation of Rights Issues”;

IFRS 9, “Financial Instruments”

IFRS 10 “Consolidated Financial Statements”

IFRS 11 “Joint arrangements”

IFRS 12 “Disclosures of interests in Other entities”

IFRS 13 “Fair value measurement”

Revision to IFRIC 14, IAS 19, “The Limit on a Defined Benefit Assets, Minimum Funding Requirements and their Interaction”

Following an internal review it is not anticipated that the adoption of these standards and interpretations will have a material financial impact on the financial statements in the period of initial application and the subsequent reporting periods, except for IFRS 9 “Financial Instruments” which becomes mandatory for the Groups 2013’s consolidated financial statements and could change the classification and measurement of financial assets.

ITEM 6: DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES

Introduction

We have a one-tier board structure (the “Board”) comprised of directors with the title “Executive Directors” and directors with the title “Non-Executive Directors” (together with the Executive Directors, the “Directors”). The majority of our Directors are independent as required by the NYSE Manual.

Senior Management and Board of Directors

The following table lists the names, positions and ages of the members of our Senior Management and our Directors:


Name	Age	Position ⁽ ² ⁾	Term Expiration Date ⁽¹⁾
David Ruberg	66	President, Chief Executive Officer, Vice-Chairman and Executive Director	2013
M.V. “Josh” Joshi	44	Chief Financial Officer
Kevin Dean	49	Chief Marketing Officer
Peter Cladingbowl	46	Senior Vice President, Engineering and Operations Support
Jaap Camman	45	Senior Vice President, Legal
Jan Pieter Anten	39	Vice President, Human Resources
John C. Baker	62	Chairman and Non-Executive Director	2013
Robert M. Manning	52	Non-Executive Director	2012
David Lister	53	Non-Executive Director	2014
Cees van Luijk	62	Non-Executive Director	2012
Michel Massart	61	Non-Executive Director	2014
Jean F.H.P. Mandeville	52	Non-Executive Director	2013

Notes:

(1)	The term of office expires at the annual general meeting of our shareholders held in the year indicated.

(2)	A majority of our Directors is independent as required by the NYSE Manual. Of our Non-Executive Directors, Mr. Baker and Mr. Manning are considered to be non-independent as they are both general partners of Baker capital affiliates. Our other Non-Executive Directors are all independent.

The business address of all members of our Senior Management and of our Directors is at our registered offices located at Tupolevlaan 24, 1119 NX Schiphol-Rijk, The Netherlands.

The principal functions and experience of each of the members of our Senior Management and our Directors are set out below:

David Ruberg, President, Chief Executive Officer, Vice-Chairman and Executive Director

David Ruberg joined us as President and Chief Executive Officer in November 2007 and became Vice-Chairman of the board of directors when it became a one-tier board in 2011. David served as Chairman of the Supervisory Board from 2002 to 2007 and on the Management Board from 2007 until the conversion into a one-tier board. David was affiliated with Baker Capital, a private equity firm from January 2002 until October 2007. From April 1993 until October 2001 he was Chairman, President and CEO of Intermedia Communications, a NASDAQ-listed broadband communications services provider, as well as Chairman of its majority-owned subsidiary, Digex, Inc., a NASDAQ-listed managed web hosting company. He began his career as a scientist at AT&T Bell Labs, contributing to the development of operating systems and computer languages. David serves on the board of QSC AG. He holds a Bachelor’s Degree from Middlebury College and a Masters in Computer and Communication Sciences from the University of Michigan.

M.V. “Josh” Joshi, Chief Financial Officer

Josh Joshi joined us as Chief Financial Officer in August 2007. From June 2006 to December 2006 he was CFO of Leisure and Gaming plc, an online gaming and gambling business, and from April 2003 to May 2006 he was CFO of TeleCity plc, a pan European carrier-neutral data center business, both publicly traded companies on the London Stock Exchange. He was one of the founders and CFO of private-equity-backed Storm Telecommunications Limited, a U.S. and pan European data and network service provider. In his early career, Josh spent 8 years in professional practice, predominantly with Arthur Andersen. Josh holds a Bachelor’s Degree in Civil Engineering from Imperial College, London and is a Chartered Accountant.

Kevin Dean, Chief Marketing Officer

Kevin Dean was appointed Senior Vice President Marketing and Chief Marketing Officer in December 2009. From 2003 to 2009 he served as Marketing Director for COLT Telecommunications, a FTSE 200 listed European voice, data and hosting company. From 1994 to 2003 he worked at Cable and Wireless, a FTSE 200 listed global telecommunications company, holding a number of positions including General Manager sector marketing and business development, Director Marketing and Vice President Marketing Analysis, Planning and Strategy. Mr. Dean graduated from Manchester Metropolitan University with a Degree in Applied Physics, and subsequently earned an MBA from the Open Business School and is a Chartered Marketer.

Peter Cladingbowl, Senior Vice President, Engineering and Operations Support

Peter Cladingbowl joined us as Senior Vice President, Engineering and Operations Support in August of 2010. Prior to joining us, Peter was the Vice President Operations EMEA at Global Crossing. Previous roles at Global Crossing, where he spent a total of 12 years, included CIO EMEA and Director of Business Operations. Peter also has substantial operational and general management experience in manufacturing and started his career as a geophysical engineer in the off-shore oil industry. He holds a BSc (Mechanical Engineering) from the University of Cape Town, South Africa.

Jaap Camman, Senior Vice President, Legal

Jaap Camman is responsible for all legal and corporate affairs across the Group. He joined us in November 1999 as Manager Legal and has been our Executive Vice President Legal since July 2002. Before joining us, he worked for the Dutch Government from February 1994 until October 1999. His latest position was Deputy Head of the Insurance Division within The Netherlands Ministry of Finance. Jaap holds a Law Degree from Utrecht University.

Jan-Pieter Anten, Vice President, Human Resources

Jan-Pieter Anten joined us as Vice President Human Resources in October 2011. Prior to joining us, Jan-Pieter worked for Hay Group, a global management consulting firm, as Director International Strategic Clients Europe, where he led major accounts within the European market. Prior to that, he held the position of Vice President Human Resources at Synthon, an international organization with worldwide affiliates. Before Synthon he worked for Hay Group as a Senior Consultant. Jan-Pieter holds a degree from the University of Utrecht.

John C. Baker, Chairman and Non-Executive Director

Mr. Baker serves as Chairman of the board of directors. Prior to our conversion into a one-tier board of directors in January 2011, Mr. Baker served as Chairman of our Supervisory Board, which he joined in 2007. Mr. Baker founded Baker Capital in 1995. Mr. Baker is a graduate of Harvard College and Harvard Business School.

Robert M. Manning, Non-Executive Director

Mr. Manning serves on our board of directors. Prior to our conversion into a one-tier board of directors in January 2011, Mr. Manning served on our Supervisory Board, which he joined in 2002. Mr. Manning is a general partner with Baker Capital. Prior to joining Baker Capital, Mr. Manning was CFO of Intermedia Communications, Inc., an integrated communications service provider, from 1996 to 2001, and a director of its majority-owned subsidiary Digex, Inc., a provider of complex, managed, web hosting services, from 1998 to 2001. Prior to Intermedia, Mr. Manning was a founding executive of DMX, Inc., the first satellite- and cable-delivered digital radio network, from 1990 to 1996. Prior to DMX, Mr. Manning worked as an investment banker to the cable television and communications industries. Mr. Manning serves on the boards of Broadview, Inc., PlusTV, Wine.com (Chairman) and Adaptix (Chairman) and is a graduate of Williams College.

David Lister, Non-Executive Director

Mr. Lister serves on our board of directors, to which he was appointed in June 2011. Mr. Lister joined National Grid as Global Chief Information Officer in March 2009. He is also a Non-Executive Director of the UK Government’s Department of Work and Pensions. Before joining National Grid, David held CIO positions at a number of leading international companies including Royal Bank of Scotland, Reuters, Boots, Glaxo, Wellcome, and Guinness plc. Prior to these assignments, he held a series of increasingly senior positions in Information Technology across a range of industries including Chemicals, Construction, and Electronics as well as time in Management Consultancy with Coopers & Lybrand. He was a Non-Executive Director of IXEurope, a European IT Services company, prior to its acquisition. He is a member of several IT consultative boards including the Board of eSkills, the Skills Sector Council for Business and Information Technology in the UK and is a Fellow of the British Computer Society. Before entering industry, David studied Architecture at the University of Edinburgh.

Cees van Luijk, Non-Executive Director

Mr. Van Luijk serves on our board of directors. Prior to our conversion into a one-tier board of directors in January 2011, Mr. Van Luijk served on our Supervisory Board, which he joined in 2002. Since 2003 he has been Chairman and co-managing partner of Capital-C Ventures, a Benelux-focused technology venture capital firm. Mr. Van Luijk was formerly the CEO of Getronics between 1999 and 2001 and prior to that a member of the Global Leadership Team of PricewaterhouseCoopers. Mr. Van Luijk serves on the boards of PontMeyer NV, Intersafe Groeneveld, Holland Colours NV, Parkking Holding BV and Lirema BV. Mr. Van Luijk is a Certified Public Accountant in The Netherlands and holds a Master’s Degree in Business Economics from the Erasmus University Rotterdam.

Michel Massart, Non-Executive Director

Mr. Massart serves on our board of directors, to which he was appointed in January 2012. He is a former managing partner of PricewaterhouseCoopers (PWC) in Belgium, where he held various positions in the field of audit, specializing in Technology and FMCG companies and the Public Sector. From 1988 to 1996, he also assumed HR responsibilities for PWC Belgium. In 1997, he set up the Corporate Finance Department of PWC Belgium specializing in M&A, valuations and corporate restructuring. From 2003 to 2011, he was a director and chairman of the audit committee of Millicom International Cellular S.A., a mobile telephone operator in emerging countries listed on the NASDAQ and Stockholm stock exchanges. He is a former member of the Board of the Belgian Institute of Statutory Auditors. He is currently a professor at Solvay Brussels School of Economics and Management in Brussels, Belgium where he lectures on accounting, risk management and corporate governance.

Jean F.H.P. Mandeville, Non-Executive Director

Mr. Mandeville serves on our board of directors, to which he was appointed in January 2011. From October 2008 to December 2010, Mr. Mandeville served as Chief Financial Officer and board member of MACH S.à.r.l. He served as an Executive Vice President and Chief Financial Officer of Global Crossing Holdings Ltd/Global Crossing Ltd., from February 2005 to September 2008. Mr. Mandeville joined Global Crossing in February 2005, where he was responsible for all of its financial operations. He served as Chief Financial Officer of Singapore Technologies Telemedia Pte. Ltd./ST Telemedia from July 2002 to January 2005. Mr. Mandeville was a Senior Consultant with Coopers & Lybrand, Belgium from 1989 to 1992. In 1992, he joined British Telecom and served in various capacities covering all sectors of the telecommunications market (including wireline, wireless and multi-media) in Europe, Asia and the Americas. From 1992 to June 2002, Mr. Mandeville served in various capacities at British Telecom PLC, including President of Asia Pacific from July 2000 to June 2002, Director of International Development Asia Pacific from June 1999 to July 2000 and General Manager, Special Projects from January 1998 to July 1999. He graduated from the University Saint-Ignatius Antwerp with a Masters in Applied Economics in 1982 and a Special degree in Sea Law in 1985.

Board Powers and Function

Our Board is responsible for the overall conduct of our business and has the powers, authorities and duties vested in it by and pursuant to the relevant laws of The Netherlands and our articles of association. In all its dealings, our Board shall be guided by the interests of our Group as a whole, including but not limited to our shareholders. Our Board has the final responsibility for the management, direction and performance of us and our Group. Our Executive Director will be responsible for the day-to-day management of the Company. Our Non-Executive Directors will supervise the Executive Director and our general affairs and provide general advice to the Executive Director.

Our CEO is the general manager of our business, subject to the control of our Board, and is entrusted with all of our Board’s powers, authorities and discretions (including the power to sub-delegate) delegated by the full Board from time to time by a resolution of our Board. Matters expressly delegated to our CEO are validly resolved upon by our CEO and no further resolutions, approvals or other involvement of our Board is required. Our Board may also delegate authorities to its committees. Upon any such delegation our Board supervises the execution of its responsibilities by our CEO and/or our Board committees. It remains ultimately responsible for the fulfilment of its duties by them.

Our articles of association provide that in the event we have a conflict of interest with one or more Directors, we may still be represented by the Board or an Executive Director. In the event of a conflict of interest, however, our general meeting of shareholders has the power to designate one or more other persons to represent us. Directors who have a conflict of interest are not prohibited from participating in Board meetings or the decision making process.

Board Meetings and Decisions

All resolutions of our Board are adopted by an absolute majority of votes cast in a meeting at which at least the majority of the Directors are present or represented. A member of the Board may authorize another member of the Board to represent him/her at the Board meeting and vote on his/her behalf. Each Director is entitled to one vote (provided that, for the avoidance of doubt, a member representing one or more absent members of the Board by written power of attorney will be entitled to cast the vote of each such absent member). If there is a tie, the Chairman has the casting vote.

Our Board meets as often as it deems necessary or appropriate or upon the request of any member of our Board. Our Board has adopted rules, which contain additional requirements for our decision-making process, the convening of meetings and, through separate resolution by our Board, details on the assignment of duties and a division of responsibilities between Executive Directors and Non-Executive Directors. Our Board has appointed one of the Directors as Chairman and one of more Directors as Vice-Chairman of the Board. Our Board is further assisted by a corporate secretary. The corporate secretary may be a member of our Board or our Senior Management and is appointed by our Board.

Composition of Board

The majority of our Directors are independent as required by the NYSE Manual.

Our Board consists of a minimum of one Executive Director and a minimum of three Non-Executive Directors, provided that our Board is comprised of a maximum of 7 (seven) members. The number of Executive Directors and Non-Executive Directors is determined by our general meeting of shareholders, provided that the majority of our Board must consist of Non-Executive Directors. Only natural persons can be Non-Executive Directors. The Executive Directors and Non-Executive Directors as such are appointed by our general meeting of shareholders, provided that our Board is classified, with respect to the term for which each member of our Board will severally be appointed and serve as member of our Board, into three classes, as nearly equal in number as reasonably possible.

The class I Directors serve for a term expiring at the annual general meeting of shareholders in 2014, the class II Directors serve for a term expiring at the annual general meeting of shareholders in 2012, and the class III Directors serve for a term expiring at the annual general meeting of shareholders in 2013. At each annual general meeting of shareholders, Directors appointed to succeed those Directors whose terms expire are appointed to serve for a term of office to expire at the third succeeding annual general meeting of shareholders after their appointment. Notwithstanding the foregoing, the Directors appointed to each class continue to serve their term in office until their successors are duly appointed and qualified or until their earlier resignation, death or removal. If a vacancy occurs, any Director so appointed to fill that vacancy serves its term in office for the remainder of the full term of the class of Directors in which the vacancy occurred.

Our Board has nomination rights with respect to the appointment of a Director. Any nomination by our Board may consist of one or more candidates per vacant seat. If a nomination consists of a list of two or more candidates, it is binding and the appointment to the vacant seat concerned will be from the persons placed on the binding list of candidates and will be effected through election. Notwithstanding the foregoing, our general meeting of shareholders may, at all times, by a resolution passed with a two-thirds majority of the votes cast representing more than half of our issued and outstanding capital, resolve that such list of candidates will not be binding. See Item 7 “Major Shareholder and Related Party Transactions—Related Party Transactions—Shareholders Agreement with Baker Capital” for nomination rights granted to Baker Capital.

Directors may be suspended or removed at any time by our general meeting of shareholders. A resolution to suspend or remove a Director must be adopted by at least a two-thirds majority of the votes cast, provided such majority represents more than half of our issued and outstanding share capital. Currently, Dutch law does not allow Directors to be suspended by our Board; however, Dutch law is expected to be amended to facilitate the suspension of executive directors by a board of directors and following such amendment a Director may also be suspended by our Board for no longer than three months in the aggregate. If, at the end of that period, no decision has been taken on termination of the suspension, the suspension shall end.

Directors’ Insurance and Indemnification

In order to attract and retain qualified and talented persons to serve as members of our Board or our Senior Management, we currently do and expect to continue to provide such persons with protection through a directors’ and officers’ insurance policy. Under this policy, any of our past, present or future Directors and members of our Senior Management will be insured against any claim made against any one of them for any wrongful act in their respective capacities.

Under our articles of association, we are required to indemnify each current and former member of our Board who was or is involved, in that capacity, as a party to any actions or proceedings, against all conceivable financial loss or harm suffered in connection with those actions or proceedings, unless it is ultimately determined by a court having jurisdiction that the damage was caused by intent ( opzet ), willful recklessness ( bewuste roekeloosheid ) or serious culpability ( ernstige verwijtbaarheid ) on the part of such member.

Insofar as indemnification of liabilities arising under the Securities Act may be permitted to members of our Board, officers or persons controlling us pursuant to the foregoing provisions, we have been informed that, in the opinion of the SEC, such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable.

Board Committees

Our Board has established an audit committee, a compensation committee and a nominating committee. The audit committee is in compliance with the NYSE listed company board committee independence requirements. The compensation committee and the nominating committee do not meet the independence standard of the NYSE Manual. Rule 303A permits foreign private issuers like us to follow home country practice with regard to, amongst others, the independence requirement for the compensation committee and for the nominating committee. Our Board may also establish such other committees as it deems appropriate, in accordance with applicable law and regulations and our articles of association and any applicable Board rules.

Many of the corporate governance rules in the NYSE Manual do not apply to the Company as a “foreign private issuer”; however, Rule 303A.11 requires foreign private issuers to describe significant differences between their corporate governance standards and the corporate governance standards applicable to U.S. companies listed on the NYSE. While the Company’s management believes that its corporate governance practices are similar in many respects to those of U.S. NYSE-listed companies and provide investors with protections that are comparable in many respects to those established by the NYSE Manual, there are certain key differences which are described below.

Audit Committee

Our audit committee consists of three independent Directors, Cees van Luijk, Michel Massart and Jean Mandeville, with Cees van Luijk serving as the chairperson of the audit committee. The audit committee is independent as defined under and required by Rule 10A-3 under the U.S. Securities Exchange Act of 1934, as amended (“Rule 10A-3”) and the NYSE. Our board of directors has determined that Cees van Luijk qualifies as an “audit committee financial expert,” as that term is defined in Item 16A of Form 20-F. The audit committee has the responsibility, subject to Board and shareholder approval, for the appointment, compensation, retention and oversight of the work of our independent registered public accounting firm, KPMG Accountants N.V. In addition, approval of the audit committee is required prior to our entering into any related-party transaction. It is also responsible for “whistle-blowing” procedures, certain other compliance matters and the evaluation of the Company’s policies with respect to risk assessment and risk management.

Compensation Committee

Our compensation committee consists of two independent Directors, Cees van Luijk and David Lister, and one non-independent Director, John C. Baker, who also serves as the chairperson of the compensation committee. Among other things, the compensation committee reviews, and makes recommendations to the Board regarding, the compensation and benefits of our CEO and our Board. The compensation committee also administers the issuance of stock options and other awards under our equity incentive plan and evaluates and reviews policies relating to the compensation and benefits of our employees and consultants.

Under Section 303A.05 of the NYSE Manual, which governs compensation committees, the Company’s Compensation Committee does not meet the independence standard of the NYSE Manual, as one (1) member of that committee is not “independent” as defined under the applicable NYSE Manual standard.

Nominating Committee

Our nominating committee consists of two independent Directors, Cees van Luijk and Jean Mandeville, and one non-independent Director, John C. Baker, who serves as the chairman of the nominating committee. The nominating committee is responsible for, among other things, developing and recommending to our Board our corporate governance guidelines, identifying individuals qualified to become Directors, overseeing the evaluation of the performance of the Board, selecting the Director nominees for the next annual meeting of shareholders, and selecting director candidates to fill any vacancies on the Board.

Under Section 303A.04 of the NYSE Manual, which governs nominating/corporate governance committees, the Company’s Nominating Committee does not meet the independence standard of the NYSE Manual, as one (1) member of that committee is not “independent” as defined under the applicable NYSE Manual standard.

Compensation

The aggregate annual compensation of our Senior Management and Non-Executive Directors for the year ended December 31, 2011 was approximately €5.1 million. For amounts set aside for post-employment benefits, see Note 23 of our 2011 consolidated financial statements, included elsewhere herein.

The aggregate compensation of our Non-Executive, Executive Directors, and other Senior Management members for the year ended December 31, 2011 is set forth below.


	Salaries		Bonus		Share- based payment charges		Termination / post- employment benefits		Total
	(€’000)

D.C. Ruberg		540		747		832		—		2,119

J.C. Baker		35		—		—		—		35
R.M. Manning		35		—		—		—		35
C.G. van Luijk		45		—		—		—		45
D. Lister (appointed June 2011)		18		—		7		—		25
M. Massart (appointed January 2012)		—		—		—		—		—
J.F.H.P. Mandeville		35		—		14		—		49
P. E.D. Ekelund (resigned as per June 2011)		18		—		—		—		18
P. Schröder (resigned as per January 2012)		35		—		—		—		35

Subtotal		761		747		853		—		2,361

Senior Management (excluding D.C. Ruberg)		1,386		733		431		159		2,709


Total		2,147		1,480		1,284		159		5,070

None of the non-executive directors is entitled to any contractually agreed benefit upon termination. Upon termination, the Executive Director is entitled to a contractually agreed benefit compensation equal to 12 months base salary.

Employee Share Ownership Plans

Our InterXion Holding N.V. 2011 International Stock Option and Incentive Master Award Plan (the “2011 Plan”) provides for the grant of options to employees. The purpose of the Plan is to attract, retain and motivate employees responsible for the success and growth of our Company by providing them with appropriate incentives and rewards and enabling them to participate in the growth of our Company.

On January 26, 2011, our general meeting of shareholders authorized our Board to establish this new option plan following the offering, to be called the InterXion Holding N.V. 2011 International Stock Option Plan and Incentive Master Award Plan (the “2011 Plan”), under and in accordance with which our Board may grant options for ordinary shares to certain eligible persons following completion of the offering. The 2008 Plan was discontinued following our initial public offering, but outstanding options will remain governed by the terms of the 2008 Plan until such options have been exercised in full.

Corporate Governance

The Dutch Corporate Governance Code, as revised, became effective on January 1, 2009, and applies to all Dutch companies listed on a government-recognized stock exchange, whether in the Netherlands or elsewhere. The Dutch Corporate Governance Code is based on a “comply or explain” principle, under which all companies filing annual reports in the Netherlands must disclose whether or not they are in compliance with the various rules of the Dutch Corporate Governance Code and explain the reasons for any instance of noncompliance.

With exception to Sections 303A.04 and 303A.05 of the NYSE Manual, which govern nominating/corporate governance committees and compensation committees, respectively, we intend to comply with the NYSE Manual. We also intend to comply with the Dutch Corporate Governance Code, but where the NYSE Manual conflicts with the Dutch Corporate Governance Code we intend to comply with the NYSE Manual. For further information with respect to the composition of our Board committees, see the discussed above under “—Board Committees.”

Stock Options

In 2011, certain of our senior managers and directors were granted options under the “2011 Plan” as set forth in the table below.

The ordinary shares beneficially owned by our senior managers and directors are disclosed in Item 7 “Major Shareholders and Related Party Transactions.”


Name	Options granted		Option Exercise Price(s)		Option Expiration Date
D. Ruberg		600,000	$	14.74		June 29, 2019

D. Lister		15,000	$	14.74		June 29, 2016

J.F.H.P. Mandeville		15,000	$	13.00		June 29, 2016

Employees

For a discussion of the number of employees, see Item 4 “Information on the Company—Employees.”

ITEM 7: MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS

Major Shareholders

The following table sets forth information with respect to Directors, Senior Management and major shareholders, meaning shareholders that are beneficial owners or 5% or more of our ordinary shares as of April 1, 2012.

Beneficial ownership is determined in accordance with rules of the SEC and generally includes any shares over which a person exercises sole or shared voting and/or investment power. Ordinary shares subject to options and warrants currently exercisable or exercisable within 60 days are deemed outstanding and have therefore been included in the number of shares beneficially owned and the calculation of the percentage ownership of the person holding the options but are not deemed outstanding for computing the percentage ownership of any other person. Except as otherwise indicated, we believe the beneficial owners of the ordinary shares listed below, based on information furnished by them, have sole voting and investment power with respect to the number of shares listed opposite their names. Except as otherwise set forth below, the address of each beneficial owner is c/o InterXion Holding N.V., Tupolevlaan 24, 1119 NX Schiphol-Rijk, The Netherlands.


	Shares Beneficially Owned
Name of Beneficial Owner	Number		Percent (%)
5% Shareholders
Baker Capital ⁽¹⁾⁽ ² ⁾		20,657,892		30.88
Lamont Finance N.V. ⁽¹⁾⁽ ² ⁾		20,641,613		30.86
Baker Communications Fund II, L.P. ⁽ ¹ ^{) (} ² ^{) (} ³ ⁾		16,279		*
Parc-IT II B.V. ⁽ ⁴ ⁾		5,930,517		8.89

Directors ⁽ ⁴ ⁾ and Senior Management
David Ruberg ⁽ ⁵ ⁾		1,300,000		1.94
Josh Joshi ⁽ ⁶ ⁾		256,000		*
Kevin Dean ⁽ ⁷ ⁾		76,250		*
Peter Cladingbowl ⁽ ⁸ ⁾		22,500		*
Jaap Camman ⁽ ⁹ ⁾		0		*
Jan Pieter Anten ⁽ ¹⁰ ⁾		0		*
John C. Baker ⁽ ² ⁾		60,618		*
Robert M. Manning ⁽ ² ⁾		10,144		*
David Lister		0		*
Cees van Luijk ⁽ ⁴ ⁾		0		*
Michel Massart		0		*
Jean F.H.P. Mandeville		5,000		*

Notes:

(1)	The address of Baker Communications Fund II, L.P. is 540 Madison Avenue, New York, NY 10022.

(2)

The board of managers of the general partners of each of BCF II and Baker Communications Fund II, L.P. consists of John C. Baker, Robert M. Manning, Jonathan I. Grabel and Henry G. Baker and each manager may be deemed to share voting and dispositive control over the shares held by those entities. Each of Mr. Baker and Mr. Manning serves as one of our directors. Each of Mr. Baker and Mr. Manning disclaims beneficial ownership of shares held by Baker Capital except to the extent of his pecuniary interest therein.

(3)

David Ruberg, Jean Mandeville, John Baker and Rob Manning own our shares or share options. Messrs. Van Luijk, Lister and Massart do not own any of our shares or share options. Messrs. Baker and Manning are associated with (i) Baker Capital, through Lamont Finance N.V., which owned 30.88% of our shares as of April 1, 2012; and (ii) Baker Communications Fund II, L.P., which owned less than one percent of our shares as of April 1, 2012. Mr. van Luijk and Mr. Schröder are indirect minority shareholders of Parc-IT II B.V., which owns 8.89% of our shares as of April 1, 2012, and which is ultimately owned by Parcom Capital B.V.

(4)

The majority shareholder of Parc-IT II B.V. is Parc-IT Holding B.V. The remainder of Parc-IT II B.V.’s shares are held by individual investors. Investment control of Parc-IT II B.V. is held by an investment committee, which is made up of Erik Westerink, Rob Ouwerkerk and Cees van Luijk. Messrs. Westerink and Ouwerkerk serve on behalf of Parc-IT Holding B.V. and Mr. van Luijk serves on behalf of individual investors. Mr. van Luijk also serves as one of our directors. Mr. van Luijk disclaims beneficial ownership of shares held by Parc-IT II B.V. except to the extent of his pecuniary interest therein. Voting power of Parc-IT II B.V. is held by Parcom Capital Management B.V., which is the managing director of Parc-IT II B.V. Erik Westerink is the managing director of Parcom Capital Management B.V. The address of Parc-IT II B.V. is Schiphol Boulevard 375 D7, 1118 BJ Schiphol Airport, The Netherlands. Parc-IT Holding B.V.is fully owned by Parcom Capital B.V. of which the ultimate beneficial shareholder is ING Groep N.V.

(5)	David Ruberg is our President, Chief Executive Officer, Vice-Chairman and Executive Director. David Ruberg’s shares beneficially owned consist of our ordinary shares and options for our ordinary shares.

(6)	Josh Joshi is our Chief Financial Officer. Josh Joshi’s total shares beneficially owned consist of options for our ordinary shares.

(7)	Kevin Dean is our Chief Marketing Officer. Kevin Dean’s total shares beneficially owned consist of options for our ordinary shares.

(8)	Peter Cladingbowl is our Senior Vice President of Engineering and Operations Support. Peter Cladingbowl’s shares beneficially owned consist of options for our ordinary shares.

(9)	Jaap Camman is our Senior Vice President of Legal and Corporate Secretary.

(10)	Jan Pieter Anten is our Vice President of Human Resources.

We effected a registered public offering of our ordinary shares and our ordinary shares began trading on the NYSE on January 28, 2011. Accordingly, certain of our principal shareholders acquired their ordinary shares either at or subsequent to this time. Our major shareholders have the same voting rights as our other shareholders, but Baker Capital currently has the right to nominate a majority of the members of our Board, as described below in “Related Party Transactions – Shareholders Agreement with Baker Capital.” As of April 1, 2012, we had eleven shareholders of record. Four of the shareholders of record were located in the United States and held in the aggregate 66,449,053 ordinary shares representing approximately 99% of our outstanding ordinary shares. However, the United States shareholders of record include Cede & Co., which, as nominee for The Depository Trust Company, is the record holder of 45,764,949 ordinary shares. Accordingly, we believe that the shares held by Cede & Co. include ordinary shares beneficially owned by both holders in the United States and non-United States beneficial owners. As a result, these numbers may not accurately represent the number of beneficial owners in the United States.

Related Party Transactions

Shareholders Agreement with Baker Capital

On February 2, 2011, we entered into a Shareholders Agreement with affiliates of Baker Capital. For so long as Baker Capital or its affiliates continue to be the owner of shares representing more than 25% of our outstanding ordinary shares, Baker Capital will have the right to designate for nomination a majority of the members of our Board. As such, upon consummation of the initial public offering, Baker Capital will be entitled to designate four nominees for the seven-member board. At such time that a majority of our Board is required to be independent in accordance with the listing requirements of the NYSE, Baker Capital will remain entitled to designate for nomination four of the seven members of the Board, provided, that at least two of the Baker Capital nominees shall satisfy the criteria for independent directors as set forth in the corporate governance rules of the NYSE.

For so long as Baker Capital or its affiliates continues to be the owner of shares representing less than or equal to 25% but more than 15% of our outstanding ordinary shares, Baker Capital will have the right to designate for nomination three of the seven members of our Board, at least one of whom shall satisfy the criteria for independent directors as set forth in the applicable listing standards. For so long as Baker Capital or its affiliates continues to be the owner of shares representing less than or equal to 15% but more than 10% of our outstanding ordinary shares, Baker Capital will have the right to designate for nomination two of the seven members of our Board, none of whom shall be required to be independent. At such time that the ownership of Baker Capital or its affiliates is less than or equal to 10% but more than 5% of our outstanding ordinary shares, Baker Capital will have the right to designate for nomination one of the seven members of our Board, who shall not be required to be independent.

Furthermore, for so long as Baker Capital or its affiliates continues to be the owner of shares representing more than 25% of our outstanding ordinary shares, Baker Capital will have the right, but not the obligation, to nominate the Chairman of our Board.

In addition, as long as Baker Capital or its affiliates continues to be the owner of shares representing more than 15% of our outstanding ordinary shares, at least one of Baker Capital’s director nominees shall be appointed to each of our standing committees, provided that, when required by the transition provisions for companies listing in conjunction an initial public offering, such Baker Capital nominees shall meet any independence or other requirements of the applicable listing standards.

In the event of a change in the number of members of our Board, Baker Capital will have the right to designate a proportional amount of the members of the nominees for our Board to most closely approximate the rights described above.

Registration Rights Agreement

We have entered into a registration rights agreement with affiliates of Baker Capital (the “Baker Shareholders”), pursuant to which 30,801,491 ordinary shares are entitled to the registration rights described below. Of these shares 10,143,599 have been distributed by Baker Capital to its limited partners on March 15, 2012.

Demand registration rights. We are required to effect up to four registrations at the request of one or more of the Baker Shareholders holding ordinary shares representing in the aggregate a majority of ordinary shares held by the Baker Shareholders (the “Majority Baker Shareholders”). We are not required to effect a registration within 90 days after the effective date of a registration statement. We may not effect a registration for our own account (other than a registration effected solely with respect to an employee benefit plan or pursuant to a registration on Form F-4 or S-4) within 90 days after any such registration without the consent of the Majority Baker Shareholders.

In the event that the managing underwriter advises us that the number of ordinary shares requested to be included in such registration exceeds the number that can be sold in such offering without adversely affecting the underwriter’s ability to effect an orderly distribution of such ordinary shares, we will include in the registration statement the number of ordinary shares that, in the opinion of the managing underwriter, can be sold. The allocation of such ordinary shares to be included in such registration statement will be done on a pro rata basis.

Registration on Form F-3. After we become eligible under applicable securities laws to file a registration statement on Form F-3, we will file a registration statement on Form F-3 at the request of the Majority Baker Shareholders. These shareholders may request such a registration no more than once every six months. There is no limit to the number of such registrations that these shareholders may request. In connection with the foregoing registrations: (1) we are not required to effect a registration pursuant to a request by shareholders holding registrable securities if, within the 12-month period preceding the date of such request, we have already effected one registration on Form F-3, (2) each registration on Form F-3 must be for anticipated proceeds of at least U.S. $500,000, and (3) we may not effect a registration for our own account (other than a registration effected solely with respect to an employee benefit plan) within 90 days after any such registration without the consent of the Majority Baker Shareholders.

Piggyback registration rights. Baker Shareholders also have the right to request the inclusion of their registrable shares in any registration statements filed by us in the future for the purposes of a public offering, subject to specified exceptions. In the event that the managing underwriter advises that the number of our securities included in such a request exceeds the number that can be sold in such offering without adversely affecting such underwriters’ ability to effect an orderly distribution of our securities, the shares will be included in the registration statement in the following order of preference: first, the shares that we wish to include for our own account and second, ordinary shares held by the Baker Shareholders on a pro rata basis.

Termination. All registration rights granted to holders of registrable shares terminate when all ordinary shares resulting from the conversion of the Preferred Shares have been effectively registered under the Securities Act, or, with respect to any holder, can be sold freely during a three-month period without registration under the Securities Act.

Expenses. We will be required to pay all expenses relating to up to two demand registration and up to two registrations on Form F-3. We will be required to pay all expenses relating to piggyback registrations.

CEO

On October 31, 2007, Mr. Ruberg resigned as a partner of Baker Capital LLP and on November 5, 2007 he was appointed as our CEO. On June 23, 2008, Mr. Ruberg sold his interest in Baker Capital funds.

ITEM 8: FINANCIAL INFORMATION

Reference is made to Item 18 for a list of all financial statements filed as part of this annual report. For information on legal proceedings, please refer to Item 4 “Information on the Company,” above.

Dividends and Dividend Policy

We have never declared or paid cash dividends on our ordinary shares. We currently intend to retain any future earnings to fund the development and growth of our business and we do not currently anticipate paying dividends on our ordinary shares. Our board of directors will have the discretion to determine to what extent profits shall be retained by way of a reserve. The remaining profits will be at the disposal of our general meeting of shareholders for distribution of a dividend or to be added to the reserves or for such other purposes as our general meeting of shareholders decides, upon a proposal of our board of directors. Our board of directors, in determining whether to recommend to our shareholders the payment of dividends, will consider our ability to declare and pay dividends in light of our future operations and earnings, capital expenditure requirements, general financial conditions, legal and contractual restrictions and other factors that it may deem relevant. In addition, our outstanding €260 million 9.50% Senior Secured Notes due 2017 and our credit agreements limit our ability to pay dividends and we may in the future become subject to debt instruments or other agreements that further limit our ability to pay dividends. To the extent we pay dividends in euro, the amount of U.S. dollars realized by shareholders will vary depending on the rate of exchange between U.S. dollars and euro. Shareholders will bear any costs related to the conversion of euro into U.S. dollars.

We are a holding company incorporated in The Netherlands. Under Dutch law, we may only pay dividends out of our profits or our share premium account subject to our ability to service our debts as they fall due in the ordinary course of our business and subject to Dutch law and our articles of association. See Item 10 “Additional Information—General.” We rely on dividends paid to us by our wholly-owned subsidiaries in the United Kingdom, France, Germany, Austria, The Netherlands, Ireland, Spain, Sweden, Switzerland, Belgium and Denmark to fund the payment of dividends, if any, to our shareholders.

ITEM 9: THE OFFER AND LISTING

Markets

Our ordinary shares began trading on the New York Stock Exchange under the symbol “INXN” on January 28, 2011.

New York Stock Exchange Trading History

The following table shows, for the periods indicated, the high and low sales prices per ordinary share as reported on the New York Stock Exchange.


Yearly highs and lows	High		Low
	($ per ordinary shares)

2011		15.88		10.71


Quarterly highs and lows	High		Low
	($ per ordinary shares)

2012
First quarter		15.39		15.00

2011
First quarter		15.88		12.11
Second quarter		15.62		12.93
Third quarter		15.39		10.71
Fourth quarter		14.24		11.12


Monthly highs and lows	High		Low
	($ per ordinary shares)

2012
January		14.42		13.42
February		15.93		14.10
March		18.32		14.94
April (through April 25, 2012)		19.17		17.49
2011
October		14.07		11.12
November		14.24		12.40
December		13.49		12.05

On April 25, 2012, the closing price of InterXion’s ordinary shares listed on The New York Stock Exchange was $18.99.

ITEM 10: ADDITIONAL INFORMATION

Material contracts

Senior Multicurrency Revolving Facility Agreement dated as of February 1, 2010 among InterXion Holding N.V. and the financial institutions party thereto, as Lenders and Barclays Bank PLC, as agent and security trustee.

On February 1, 2010, we entered into the Revolving Facilities Agreement, (the “Revolving Facilities Agreement”) which, among other things, provides for an amount available for drawing under the Revolving Credit Facility of up to €60.0 million (the “Revolving Credit Facility”). We have amended the Revolving Facilities Agreement to reduce the amount available for drawing under the Revolving Credit Facility to €50.0 million.

The Revolving Credit Facility bears interest at a rate per annum equal to EURIBOR (or, for loans denominated in Sterling, U.S. $ or CHF, LIBOR) plus certain mandatory costs and a margin of 4.00% per annum, subject to a margin ratchet based on the ratio of consolidated Total Debt at each quarter end to the pro forma EBITDA for the 12 months ending on that quarter end (as such terms are defined in the Revolving Credit Facility).

Borrowings under the Revolving Credit Facility are secured by various share pledges, inter-company loan receivables owed to the Company or any of the guarantors under the Revolving Credit Facility and the bank accounts of the Company and the guarantors under the Revolving Credit Facility.

The Revolving Credit Facility contains customary affirmative, negative and financial covenants, subject to certain agreed exception as well as customary events of default, including a cross default with respect to an event of default under the Indenture (as defined below) governing the Notes (as defined below).

General

Incorporation and Registered Office

We were incorporated on April 6, 1998 as a private company with limited liability ( besloten venootschap met beperkte aansprakelijkheid ) under the laws of The Netherlands. On January 11, 2000, we were converted from a B.V. to a limited liability company ( naamloze venootschap ) under the laws of The Netherlands.

Our corporate seat is in Amsterdam, The Netherlands. We are registered with the Trade Register of the Chamber of Commerce in Amsterdam under number 33301892. Our executive offices are located at Tupolevlaan 24, 1119 NX Schiphol-Rijk, The Netherlands. Our telephone number is +31 20 880 7600.

Articles of Association and Dutch Law

Set forth below is a summary of relevant information concerning our share capital and of material provisions of our articles of association (the “Articles”) and applicable Dutch law. This summary does not constitute legal advice regarding those matters and should not be regarded as such.

Corporate Purpose

Pursuant to Article 3 of our Articles, our corporate purpose is:

(a)

to incorporate, to participate in any way whatsoever in, to manage, to supervise businesses and companies;

(b)

to finance businesses and companies;

(c)

to borrow, to lend and to raise funds, including through the issue of bonds, debt instruments or other securities or evidence of indebtedness as well as to enter into agreements in connection with aforementioned activities;

(d)

to render advice and services to businesses and companies with which the Company forms a group and to third parties;

(e)

to grant guarantees, to bind the Company and to pledge its assets for obligations of businesses and companies with which it forms a group and on behalf of third parties; and

(f)

to perform any and all activities of an industrial, financial or commercial nature,

and to do all that is connected therewith or may be conducive thereto, all to be interpreted in the broadest sense.

Issue of Ordinary Shares

Our Articles provide that we may issue ordinary shares, or grant rights to subscribe for ordinary shares, pursuant to a resolution of our general meeting of shareholders upon a proposal of our Board. Our Articles provide that our general meeting of shareholders may, upon a proposal of our Board, designate another corporate body, which can only be our Board, as the competent body to issue ordinary shares, or grant rights to subscribe for ordinary shares. Pursuant to our Articles and Dutch law, the period of designation may not exceed five years, but may be renewed by a resolution of our general meeting of shareholders for periods of up to five years. If not otherwise stated in the resolution approving the designation, such designation is irrevocable. The resolution designating our Board must specify the number of shares which may be issued and, if applicable, any conditions to the issuance.

Our Board is designated as the corporate body competent to issue ordinary shares and to grant rights to subscribe for ordinary shares. This authority is limited to a maximum equal to our authorized share capital from time to time. Our Board’s authority to issue ordinary shares and grant rights to acquire ordinary shares is for a period of five years expiring on January 28, 2016. Our general meeting of shareholders may extend this period at any time, subject to the limitations set out above.

Ordinary shares may not be issued at less than their nominal value and must be fully paid up upon issue.

No resolution of our general meeting of shareholders or our Board is required for an issue of ordinary shares pursuant to the exercise of a previously granted right to subscribe for ordinary shares.

Pre-emptive Rights

Dutch law and our Articles generally give our shareholders pre-emptive rights to subscribe on a pro rata basis for any issue of new ordinary shares or grant of rights to subscribe for ordinary shares. Exceptions to these pre-emptive rights include: (i) the issue of ordinary shares and the grant of rights to subscribe for ordinary shares to our employees, (ii) the issue of ordinary shares and the grant of rights to subscribe for ordinary shares in return for non-cash consideration and (iii) the issue of ordinary shares to persons exercising a previously-granted right to subscribe for ordinary shares.

A shareholder has the legal right to exercise pre-emption rights for at least two weeks after the date of the announcement of the issue or grant. However, our general meeting of shareholders, or our Board if so designated by our general meeting of shareholders, may restrict or exclude pre-emptive rights. A resolution by our general meeting of shareholders to designate another corporate body, which can only be our Board, as the competent authority to exclude or restrict pre-emptive rights requires a proposal by our Board and approval by a majority of at least two-thirds of the valid votes cast at our general meeting of shareholders if less than half of our issued and outstanding share capital is present or represented. A simple majority is sufficient if more than half of our issued and outstanding share capital is present or represented. A resolution by our general meeting of shareholders to designate our Board as the competent authority to exclude or restrict pre-emptive rights must be for a fixed period not exceeding five years and is only possible if our Board is simultaneously designated as the corporate body authorized to issue ordinary shares. If not otherwise stated in the resolution approving designation, such designation is irrevocable. If our general meeting of shareholders has not designated our Board, our general meeting of shareholders itself is the corporate body authorized to restrict or exclude pre-emptive rights upon a proposal by our Board.

Our Board is designated as the corporate body authorized to limit or exclude pre-emptive rights, subject to the limited authority it has to issue ordinary shares and grant rights to subscribe for ordinary shares as set out under “—Issue of Ordinary Shares” above, for a period of ending on January 28, 2016.

Reduction of Share Capital

Our general meeting of shareholders may, subject to Dutch law and our Articles and only upon a proposal of our Board, resolve to reduce our issued share capital by cancellation of ordinary shares or reduction of the nominal value of ordinary shares by amendment of our Articles. A resolution of our general meeting of shareholders to reduce the issued share capital must designate the ordinary shares to which the resolution applies and must make provisions for the implementation of such resolution. A resolution to cancel ordinary shares may only be adopted in relation to ordinary shares or depositary receipts for such shares we hold ourselves. A partial repayment or exemption from the obligation to pay up ordinary shares must be made pro rata, unless all of our shareholders agree otherwise. A resolution at our general meeting of shareholders to reduce our issued share capital requires a majority of at least two-thirds of the votes validly cast at a meeting at which less than half of our issued and outstanding share capital is present or represented. A simple majority is sufficient if more than half of our issued and outstanding share capital is present or represented.

Acquisition of Ordinary Shares

We may acquire our own fully paid up ordinary shares at any time for no consideration, or, subject to certain provisions of Dutch law and our Articles, if (i) our shareholders’ equity minus the payment required to make the acquisition, does not fall below the sum of called-up and paid-up share capital and any statutory reserves we must maintain by Dutch law or our Articles, and (ii) we and our subsidiaries would thereafter not hold ordinary shares or rights of pledge over ordinary shares with an aggregate nominal value exceeding 50% of our issued and outstanding share capital.

Dutch law generally and more specifically, the Dutch Civil Code, imposes minimum capital and other reserve requirements on legal entities as a way of protecting shareholders and creditors and maintaining the capital of a company. Such minimum capital and reserve requirements include, among other things, complying with certain minimum capital requirements when declaring and paying dividends and repurchasing shares in its own capital, maintaining reserves on the granting of legitimate financial assistance loans by a public limited company and maintaining reserves on the re-evaluation of assets.

An acquisition of ordinary shares for a consideration must be authorized by our general meeting of shareholders. Such authorization may be granted for a maximum period of 18 months and must specify the number of ordinary shares that may be acquired, the manner in which ordinary shares may be acquired and the price limits within which ordinary shares may be acquired. Authorization is not required for the acquisition of ordinary shares in order to transfer them to our employees. The actual acquisition may only be effected by a resolution of our Board.

Our shareholders authorized our Board to acquire ordinary shares up to a maximum of ten percent of the ordinary shares outstanding, whether through the stock exchange or by other means, at prices between an amount equal to the nominal value of the ordinary shares and an amount equal to 110% of the market prices of the ordinary shares on the New York Stock Exchange (the market price being the average of the closing price on each of the 30 consecutive days of trading preceding the three trading days prior to the date of acquisition) for a period ending on July 26, 2012.

Any ordinary shares held by us in our own capital may not be voted on or counted for quorum purposes.

Exchange Controls and Other Provisions Relating to Non-Dutch Shareholders

There are no Dutch exchange control restrictions on investments in, or payments on, the ordinary shares. There are no special restrictions in our Articles or Dutch law that limit the right of shareholders who are not citizens or residents of The Netherlands to hold or vote the ordinary shares.

Dividends and Distributions

We may only make distributions to our shareholders in so far as our equity exceeds the sum of our paid-in and called-up share capital plus the reserves we are required to maintain by Dutch law or our proposed Articles. Under our Articles, our Board may determine that a portion of the profits of the current financial year shall be added to our reserves. The remaining profits are at the disposal of our general meeting of shareholders.

We may only make distributions of dividends to our shareholders after the adoption of our statutory annual accounts from which it appears that such distributions are legally permitted. However, our Board may resolve to pay interim dividends on account of the profits of the current financial year if the equity requirement set out above is met, as evidenced by an interim statement of assets and liabilities relating to the condition of such assets and liabilities on a date no earlier than the first day of the third month preceding the month in which the resolution to distribute interim dividends is made public. Our general meeting of shareholders may resolve, upon a proposal to that effect by our Board, to pay distributions at the expense of any of our reserves.

Additionally, if we choose to declare dividends, the payment of cash dividends on our shares is restricted under the terms of the agreements governing our indebtedness.

Dividends and other distributions may be made in cash or, but only at all times with the approval of the Board, in ordinary shares. Dividends and other distributions are due and payable as from the date determined by the corporate body resolving on the distribution. Claims to dividends and other declared distributions lapse after five years from the date that such dividends or distributions became payable and any such amounts not collected within this period revert to us and are allocated to our general reserves.

General Meetings of Shareholders and Voting Rights

Our annual general meeting of shareholders must be held within six months after the end of each of our financial years. It must be held in The Netherlands in Amsterdam, Haarlemmermeer (Schiphol Airport) or Hoofddorp. Our financial year coincides with the calendar year. An extraordinary general meeting of shareholders may be convened whenever our Board or CEO deems such necessary. Shareholders representing at least 10% of our issued and outstanding share capital may, pursuant to Dutch law and our Articles, request that a general meeting of shareholders be convened, specifying the items for discussion. If our Board has not convened a general meeting of shareholders within four weeks of such request such that such meeting can be held within six weeks following such request, the shareholders requesting such meeting are authorized to call such meeting themselves with due observance of the relevant provisions of our Articles.

The notice convening any general meeting of shareholders must include an agenda indicating the items for discussion, or it must state that the shareholders and any holders of depositary receipts for ordinary shares may review such agenda at our main offices in The Netherlands. We will have the notice published by electronic means of communication which is directly and permanently accessible until the meeting and in such other manner as may be required to comply with any applicable rules of the New York Stock Exchange. The explanatory notes to the agenda must contain all facts and circumstances that are relevant for the proposals on the agenda. Such explanatory notes and the agenda will be placed on our website.

Shareholders holding at least 1% of our issued and outstanding share capital or ordinary shares representing a value of at least €50 million may submit agenda proposals for any general meeting of shareholders. Provided we receive such proposals no later than 60 days before the date of the general meeting of shareholders, and provided that such proposal does not, according to our Board, conflict with our vital interests, we will have the proposals included in the notice.

Each of the ordinary shares confers the right to cast one vote. Each shareholder entitled to participate in a general meeting of shareholders, either in person or through a written proxy, is entitled to attend and address the meeting and, to the extent that the voting rights accrue to him, to exercise his voting rights in accordance with our Articles. The voting rights attached to any ordinary shares, or ordinary shares for which depositary receipts have been issued, are suspended as long as they are held in treasury.

Our Board may allow shareholders to, in person or through a person holding a written proxy, participate in a general meeting of shareholders, including to take the floor and, to the extent applicable, to exercise voting rights, through an electronic means of communication. Our Board selects the means of electronic communication and may subject its use to conditions.

To the extent that our Articles or Dutch law do not require a qualified majority, all resolutions of our general meeting of shareholders shall be adopted by a simple majority of the votes cast.

The following resolutions of our general meeting of shareholders may only be adopted upon a proposal by our Board:

(a)

to effect a statutory merger ( juridische fusie ) or demerger ( juridische splitsing );

(b)

to issue ordinary shares or to restrict or exclude pre-emption rights on ordinary shares to the extent the authority to issue has not been delegated to our Board;

(c)

to designate our Board as the corporate body authorized to issue ordinary shares or rights to subscribe for ordinary shares and to restrict or to exclude the pre-emption rights on ordinary shares or rights to subscribe for ordinary shares;

(d)

to reduce our issued share capital;

(e)

to make a whole or partial distribution of reserves;

(f)

to amend our articles of association or change our corporate form; and

(g)

to dissolve us.

Amendment of our Articles of Association

Our general meeting of shareholders may resolve to amend our Articles upon a proposal made by our Board.

Dissolution and Liquidation

Under our Articles, we may be dissolved by a resolution of our general meeting of shareholders upon a proposal of our Board.

In the event of dissolution, our business will be liquidated in accordance with Dutch law and our Articles and the liquidation shall be effected by our Board. During liquidation, the provisions of our Articles will remain in force to the extent possible. Any assets remaining upon completion of the dissolution will be distributed to the holders of ordinary shares in proportion to the aggregate nominal amount of their ordinary shares.

Disclosure of Information

Dutch law contains specific rules intended to prevent insider trading, tipping and market manipulation. We are subject to these rules and accordingly, we have adopted a code of securities dealings in relation to our securities.

Squeeze Out

If a shareholder, alone or together with group companies, (the “Controlling Entity”) holds a total of at least 95% of a company’s issued share capital by nominal value for its own account, Dutch law permits the Controlling Entity to acquire the remaining shares in the controlled entity (the “Controlled Entity”) by initiating proceedings against the holders of the remaining shares. The price to be paid for such shares will be determined by the Enterprise Chamber of the Amsterdam Court of Appeal (the “Enterprise Chamber”). A Controlling Entity that holds less than 95% of the shares in the Controlled Entity, but that in practice controls the Controlled Entity’s general meeting of shareholders, could attempt to obtain full ownership of the business of the Controlled Entity through a legal merger of the Controlled Entity with another company controlled by the Controlling Entity, by subscribing to additional shares in the Controlled Entity (for example, in exchange for a contribution of part of its own business), through another form of reorganization aimed at raising its interest to 95% or through other means.

In addition to the general squeeze-out procedure mentioned above, following a public offer a holder of at least 95% of the outstanding shares and voting rights has the right to require the minority shareholders to sell their shares to it. To the extent there are two or more types of shares the request can only be made with regard to the type of shares of which the shareholder holds at least 95% in aggregate representing at least 95% of the voting rights attached to those shares. Any request to require the minority shareholders to sell their shares must be filed with the Enterprise Chamber within three months after the end of the acceptance period of the public offer. Conversely, in such a case, each minority shareholder has the right to require the holder of at least 95% of the outstanding shares and voting rights to purchase its shares. The minority shareholders must file such claim with the Enterprise Chamber within three months after the end of the acceptance period of the public offer.

Reporting of Insider Transactions

Pursuant to the Dutch Financial Supervision Act, the Directors and any other person who has managerial responsibilities or who has the authority to make decisions affecting our future developments and business prospects or who has regular access to inside information relating, directly or indirectly, to us (each an “Insider”), must notify The Netherlands Authority for the Financial Markets (“AFM”) of all transactions conducted for his own account relating to ordinary shares or securities the value of which is determined by the value of ordinary shares. The Netherlands Authority for the Financial Markets must be notified within five days following the transaction date. Notification may be postponed until the date the value of the transactions amounts to €5,000 or more per calendar year.

In addition, persons designated by the Decree on Market Abuse pursuant to the Dutch Financial Supervision Act ( Besluit Marktmisbruik Wft ) (the “Market Abuse Decree”) who are closely associated with an Insider must notify The Netherlands Authority for the Financial Markets of any transactions conducted for their own account relating to ordinary shares or securities the value of which is determined by the value of the ordinary shares. The Market Abuse Decree designates the following categories of persons: (i) the spouse or any partner considered by national law as equivalent to the spouse, (ii) dependent children, (iii) other relatives who have shared the same household for at least one year prior to the relevant transaction date, and (iv) any legal person, trust or partnership whose managerial responsibilities are discharged by, which is controlled by, which has been incorporated for the benefit of, or whose economic interests are the same as, a person referred to in the previous paragraph or under (i), (ii) or (iii) above.

The AFM keeps a public register of all notifications made pursuant to the Dutch Financial Supervision Act.

Pursuant to the rules against insider trading we have, among other things, further adopted rules governing the holding of, reporting and carrying out of transactions in our securities by the Directors or our employees. Further, we have drawn up a list of those persons working for us who could have access to inside information on a regular or incidental basis and have informed the persons concerned of the rules against insider trading and market manipulation including the sanctions which can be imposed in the event of a violation of those rules.

Non-compliance with the notification obligations under the market abuse obligations laid down in the Dutch Financial Supervision Act may lead to criminal fines, administrative fines, imprisonment or other sanctions.

Comparison of Dutch Corporate Law and U.S. Corporate Law

The following comparison between Dutch corporation law, which applies to us, and Delaware corporation law, the law under which many corporations in the United States are incorporated, discusses additional matters not otherwise described in this annual report.

Duties of directors

The Netherlands

Under Dutch law the board of directors is collectively responsible for the policy and day-to-day management of the Company. The non-executive directors will be assigned the task of supervising the executive directors and providing them with advice. Each director has a duty to the Company to properly perform the duties assigned to him. Furthermore, each board member has a duty to act in the corporate interest of the Company. Under Dutch law, the corporate interest extends to the interests of all corporate stakeholders, such as shareholders, creditors, employees, customers and suppliers. The duty to act in the corporate interest of the Company also applies in the event of a proposed sale or break-up of the Company, whereby the circumstances generally dictate how such duty is to be applied. Any board resolution regarding a significant change in the identity or character of the Company or its business requires shareholders’ approval.

Delaware

The board of directors of a Delaware corporation bears the ultimate responsibility for managing the business and affairs of a corporation. In discharging this function, directors of a Delaware corporation owe fiduciary duties of care and loyalty to the corporation and to its shareholders. Delaware courts have decided that the directors of a Delaware corporation are required to exercise an informed business judgment in the performance of their duties. An informed business judgment means that the directors have informed themselves of all material information reasonably available to them. Delaware courts have also imposed a heightened standard of conduct upon directors of a Delaware corporation who take any action designed to defeat a threatened change in control of the corporation. In addition, under Delaware law, when the board of directors of a Delaware corporation approves the sale or break-up of a corporation, the board of directors may, in certain circumstances, have a duty to obtain the highest value reasonably available to the shareholders.

Director terms

The Netherlands

Under Dutch law a director of a listed company is generally appointed for a maximum term of four years. There is no limit to the number of terms a director may serve.

Delaware

The Delaware General Corporation Law generally provides for a one-year term for directors, but permits directorships to be divided into up to three staggered classes with up to three-year terms, with the terms for each class expiring in different years, if permitted by the certificate of incorporation, an initial bylaw or a bylaw adopted by the shareholders, with exceptions if the board is classified or if the company has cumulative voting.

Director vacancies

The Netherlands

Under Dutch law, new members of the board of directors of a company such as ours are appointed by the general meeting. Our Articles provide that our Board has nomination rights with respect to the appointment of a new member of our Board. If a nomination consists of a list of two or more candidates, it is binding and the appointment to the vacant seat concerned shall be from the persons placed on the binding list of candidates and shall be effected through election. Notwithstanding the foregoing, our general meeting of shareholders may, at all times, by a resolution passed with a two-thirds majority of the votes cast representing more than half of our issued and outstanding capital, resolve that such list of candidates shall not be binding.

Delaware

The Delaware General Corporation Law provides that vacancies and newly created directorships may be filled by a majority of the directors then in office (even though less than a quorum) unless (a) otherwise provided in the certificate of incorporation or by-laws of the corporation or (b) the certificate of incorporation directs that a particular class of stock is to elect such director, in which case any other directors elected by such class, or a sole remaining director elected by such class, will fill such vacancy.

Shareholder proposals

The Netherlands

Pursuant to our Articles, extraordinary shareholders’ meetings will be held as often as our Board or our CEO deems such necessary. Additionally, shareholders and/or persons with depository receipt holder rights representing in the aggregate at least one-tenth of the issued capital of the Company may request the Board to convene a general meeting, specifically stating the business to be discussed. If our Board has not given proper notice of a general meeting within four weeks following receipt of such request such that the meeting can be held within six weeks after receipt of the request, the applicants shall be authorized to convene a meeting themselves. Pursuant to Dutch law, one or more shareholders representing at least 10% of the issued share capital may request the Dutch Courts to order that a general meeting be held.

The agenda for a meeting of shareholders must contain such items as our Board or the person or persons convening the meeting decide, including the time and place of the shareholders’ meeting and the procedure for participating in the shareholders’ meeting by way of a written power of attorney. The agenda shall also include such other items as one or more shareholders, representing at least such part of the issued share capital as required by the laws of the Netherlands (currently, 1% of the issued share capital or shares representing a value of €50 million) may request by providing a substantiated written request or a proposal for a resolution to our Board at least 60 days before the date of the meeting.

Delaware

Delaware law does not specifically grant shareholders the right to bring business before an annual or special meeting.

Shareholder suits

The Netherlands

In the event a third party is liable to a Dutch company, only the company itself can bring a civil action against that party. The individual shareholders do not have the right to bring an action on behalf of the company. Only in the event that the cause for the liability of a third party to the company also constitutes a tortious act directly against a shareholder does that shareholder have an individual right of action against such third party in its own name. The Dutch Civil Code provides for the possibility to initiate such actions collectively. A foundation or an association whose objective is to protect the rights of a group of persons having similar interests can institute a collective action. The collective action itself cannot result in an order for payment of monetary damages but may only result in a declaratory judgment ( verklaring voor recht ). In order to obtain compensation for damages, the foundation or association and the defendant may reach—often on the basis of such declaratory judgment—a settlement. A Dutch court may declare the settlement agreement binding upon all the injured parties with an opt-out choice for an individual injured party. An individual injured party may also itself institute a civil claim for damages.

Delaware

Under the Delaware General Corporation Law, a shareholder may bring a derivative action on behalf of the corporation to enforce the rights of the corporation. An individual also may commence a class action suit on behalf of himself and other similarly situated shareholders where the requirements for maintaining a class action under Delaware law have been met. A person may institute and maintain such a suit only if that person was a shareholder at the time of the transaction which is the subject of the suit. In addition, under Delaware case law, the plaintiff normally must be a shareholder not only at the time of the transaction that is the subject of the suit, but also throughout the duration of the derivative suit. Delaware law also requires that the derivative plaintiff make a demand on the directors of the corporation to assert the corporate claim and such demand has been refused before the suit may be prosecuted by the derivative plaintiff in court, unless such a demand would be futile.

Anti-takeover provisions

The Netherlands

Neither Dutch law nor our Articles specifically prevent business combinations with interested shareholders. Under Dutch law various protective measures are as such possible and admissible, within the boundaries set by Dutch case law and Dutch law.

Delaware

In addition to other aspects of Delaware law governing fiduciary duties of directors during a potential takeover, the Delaware General Corporation Law also contains a business combination statute that protects Delaware companies from hostile takeovers and from actions following the takeover by prohibiting some transactions once an acquirer has gained a significant holding in the corporation.

Section 203 of the Delaware General Corporation Law prohibits “business combinations,” including mergers, sales and leases of assets, issuances of securities and similar transactions by a corporation or a subsidiary with an interested shareholder that beneficially owns 15% or more of a corporation’s voting stock, within three years after the person becomes an interested shareholder, unless:

•

the transaction that will cause the person to become an interested shareholder is approved by the board of directors of the target prior to the transactions;

•

after the completion of the transaction in which the person becomes an interested shareholder, the interested shareholder holds at least 85% of the voting stock of the corporation not including shares owned by persons who are directors and also officers of interested shareholders and shares owned by specified employee benefit plans; or

•

after the person becomes an interested shareholder, the business combination is approved by the board of directors of the corporation and holders of at least 66.67% of the outstanding voting stock, excluding shares held by the interested shareholder.

A Delaware corporation may elect not to be governed by Section 203 by a provision contained in the original certificate of incorporation of the corporation or an amendment to the original certificate of incorporation or to the bylaws of the Company, which amendment must be approved by a majority of the shares entitled to vote and may not be further amended by the board of directors of the corporation. Such an amendment is not effective until twelve months following its adoption.

Removal of directors

The Netherlands

Under Dutch law, the general meeting has the authority to suspend or remove members of the board of directors at any time. Under our Articles, a member of our Board may be suspended or removed by our general meeting of shareholders at any time by a resolution passed with a two-thirds majority of the votes cast representing more than half of the issued and outstanding capital. If permitted under the laws of the Netherlands, a member of our Board may also be suspended by our Board itself. Any suspension may not last longer than three months in the aggregate. If, at the end of that period, no decision has been taken on termination of the suspension, the suspension shall end. Currently, Dutch law does not allow directors to be suspended by the board of directors; however, Dutch law is expected to be amended to facilitate the suspension of directors by the board of directors.

Delaware

Under the Delaware General Corporation Law, any director or the entire board of directors may be removed, with or without cause, by the holders of a majority of the shares then entitled to vote at an election of directors, except (a) unless the certificate of incorporation provides otherwise, in the case of a corporation whose board is classified, shareholders may effect such removal only for cause, or (b) in the case of a corporation having cumulative voting, if less than the entire board is to be removed, no director may be removed without cause if the votes cast against his removal would be sufficient to elect him if then cumulatively voted at an election of the entire board of directors, or, if there are classes of directors, at an election of the class of directors of which he is a part.

Taxation

Certain U.S. Federal Income Tax Considerations

This section describes certain material United States federal income tax consequences of owning our ordinary shares. It applies to a US Holder (as defined below) that holds our ordinary shares as capital assets for tax purposes. This section does not apply to a US Holder that is a member of a special class of holders subject to special rules, including:

•

a financial institution,

•

a dealer in securities,

•

a trader in securities that elects to use a mark-to-market method of accounting for its securities holdings,

•

a real estate investment trust;

•

a regulated investment company;

•

U.S. expatriates;

•

persons who acquired shares pursuant to the exercise of any employee share option or otherwise as compensation;

•

a tax-exempt organization,

•

an insurance company,

•

a person liable for alternative minimum tax,

•

a person that actually or constructively owns 10% or more of our voting stock,

•

a person that owns shares through a partnership or other pass-through entity,

•

a person that holds shares as part of a straddle or a hedging or conversion transaction, or

•

a person whose functional currency is not the US dollar.

This section is based on the Internal Revenue Code of 1986, as amended (the “Code”), its legislative history, existing and proposed regulations, published rulings and court decisions, all as currently in effect. These laws are subject to change, possibly on a retroactive basis.

This section does not describe any tax consequences arising out of the tax laws of any state, local or non-U.S. jurisdiction, any estate or gift tax consequences or the recently enacted Medicare tax on certain “net investment income.” If a partnership, including any entity or arrangement that is treated as a partnership for United States federal income tax purposes, is a beneficial owner of our ordinary shares, the treatment of a partner in the partnership will generally depend on the status of the partner and the activities of the partnership. Partners in such partnerships should consult with their tax advisors.

For purposes of this discussion, a US Holder is a beneficial owner of our ordinary shares that is:

•

a citizen or resident of the United States,

•

a US domestic corporation (or other entity taxable as a US domestic corporation for United States federal income tax purposes),

•

an estate the income of which is subject to United States federal income tax regardless of its source, or

•

a trust, if a United States court can exercise primary supervision over the trust’s administration and one or more United States persons are authorized to control all substantial decisions of the trust.

US Holders should consult their own tax advisor regarding the United States federal, state and local and other tax consequences of owning and disposing of our ordinary shares in their particular circumstances.

Taxation of Dividends

Under the United States federal income tax laws, and subject to the passive foreign investment company, or PFIC, rules discussed below, US Holders will include in gross income the gross amount of any dividend paid by us out of our current or accumulated earnings and profits (as determined for United States federal income tax purposes). The dividend is ordinary income that the US Holder must include in income when the dividend is actually or constructively received. The dividend will not be eligible for the dividends-received deduction generally allowed to United States corporations in respect of dividends received from other United States corporations. The amount of a dividend distribution paid in euros includible in the income of a US Holder will be the US dollar value of the euro payment made, determined at the spot euro/US dollar rate on the date the dividend distribution is includible in the income of the US Holder, regardless of whether the payment is in fact converted into US dollars. Generally, any gain or loss resulting from currency exchange fluctuations during the period from the date the dividend payment is includible in income to the date such payment is converted into US dollars will be treated as ordinary income or loss. Such gain or loss generally will be income or loss from sources within the United States for foreign tax credit limitation purposes. Distributions in excess of current and accumulated earnings and profits, as determined for United States federal income tax purposes, will be treated as a non-taxable return of capital to the extent of the US Holder’s basis in the shares and thereafter as capital gain. We currently do not, and we do not intend to, calculate our earnings and profits under United States federal income tax principles. Therefore, a US Holder should expect that a distribution will generally be reported as a dividend even if that distribution would otherwise be treated as a non-taxable return of capital or as capital gain under the rules described above.

With respect to non-corporate taxpayers for taxable years beginning before January 1, 2013, dividends may be taxed at the lower applicable capital gains rate provided that (1) either (a) our ordinary shares are readily tradable on an established securities market in the United States or (b) we are eligible for the benefits of the “Convention between the United States of America and the Kingdom of the Netherlands for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income,” (2) we are not a PFIC (as discussed below) for either the our taxable year in which the dividend was paid or the preceding taxable year, and (3) certain holding period requirements are met. Common stock is considered for purposes of clause (1) above to be readily tradable on an established securities market if it is listed on the NYSE. US Holders should consult their tax advisors regarding the availability of the lower rate for dividends paid with respect to our ordinary shares.

For foreign tax credit limitation purposes, the dividend will generally constitute foreign source income and will generally be “passive category income” but could, in the case of certain US Holders, constitute “general category income.” If the dividends are taxed as qualified dividend income (as discussed above), the amount of the dividend taken into account for purposes of calculating the foreign tax credit limitation will in general be limited to the gross amount of the dividend, multiplied by the reduced tax rate applicable to qualified dividend income and divided by the highest tax rate normally applicable to dividends.

If Dutch withholding taxes apply to any dividends paid to you with respect to our ordinary shares, the amount of the dividend would include withheld Dutch taxes and, subject to certain conditions and limitations, such Dutch withholding taxes may be eligible for credit against your U.S. federal income tax liability. The rules relating to the determination of the foreign tax credit are complex, and you should consult your tax advisors regarding the availability of a foreign tax credit in your particular circumstances, including the effects of any applicable income tax treaties.

Taxation of Capital Gains

Subject to the PFIC rules discussed below, upon the sale or other disposition of our ordinary shares, a US Holder will recognize capital gain or loss for United States federal income tax purposes equal to the difference between the US Holder’s amount realized and the US Holder’s tax basis in such shares. If a US Holder receives consideration for shares paid in a currency other than US dollars, the US Holder’s amount realized will be the US dollar value of the payment received. In general, the US dollar value of such a payment will be determined on the date of sale or disposition. On the settlement date, a US Holder may recognize US source foreign currency gain or loss (taxable as ordinary income or loss) equal to the difference (if any) between the US dollar value of the amount received based on the exchange rates in effect on the date of sale or other disposition and the settlement date. However, if our ordinary shares are treated as traded on an established securities market and the US Holder is a cash basis taxpayer or an accrual basis taxpayer who has made a special election, the US dollar value of the amount realized in a foreign currency is determined by translating the amount received at the spot rate of exchange on the settlement date of the sale, and no exchange gain or loss would be recognized at that time. Capital gain of a non-corporate US Holder is generally taxed at a reduced rate where the property is held more than one year. The gain or loss will generally be income or loss from sources within the United States for foreign tax credit limitation purposes.

PFIC Rules

We believe that our ordinary shares should not be treated as stock of a PFIC for United States federal income tax purposes for the taxable year that ended on December 31, 2011. However, the application of the PFIC rules is subject to uncertainty in several respects, and we cannot assure you that the United States Internal Revenue Service will not take a contrary position. In addition, PFIC status is a factual determination which cannot be made until the close of the taxable year. Accordingly, there is no guarantee that we will not be a PFIC for any future taxable year. Furthermore, because the total value of our assets for purposes of the asset test generally will be calculated using the market price of our ordinary shares, our PFIC status will depend in large part on the market price of our ordinary shares. Accordingly, fluctuations in the market price of our ordinary shares could render us a PFIC for any year. A non-U.S. corporation is considered a PFIC for any taxable year if either:

•

at least 75% of its gross income is passive income, or

•

at least 50% of the value of its assets (based on an average of the quarterly values of the assets during a taxable year) is attributable to assets that produce or are held for the production of passive income (the “asset test”).

In the PFIC determination, we will be treated as owning its proportionate share of the assets and earning its proportionate share of the income of any other corporation in which it owns, directly or indirectly, 25% or more (by value) of the stock.

If we were to be treated as a PFIC for any year during the US Holder’s holding period, unless a US Holder elects to be taxed annually on a mark-to-market basis with respect to the shares (which election may be made only if our ordinary shares are “marketable stock” within the meaning of Section 1296 of the Code), a US Holder will be subject to special tax rules with respect to any “excess distribution” received and any gain realized from a sale or other disposition (including a pledge) of that holder’s shares. Distributions a US Holder receives in a taxable year that are greater than 125% of the average annual distributions received during the shorter of the three preceding taxable years or the holder’s holding period for the shares will be treated as excess distributions. Under these special tax rules:

•

the excess distribution or gain will be allocated ratably over the US Holder’s holding period for the shares;

•

the amount allocated to the current taxable year, and any taxable year prior to the first taxable year in which we are treated as a PFIC, will be treated as ordinary income; and

the amount allocated to each other year will be subject to tax at the highest tax rate in effect for that year and the interest charge generally applicable to underpayments of tax will be imposed on the resulting tax attributable to each such year.

The tax liability for amounts allocated to years prior to the year of disposition or “excess distribution” cannot be offset by any net operating losses for such years, and gains (but not losses) realized on the sale of the shares cannot be treated as capital, even if the shares are held as capital assets. If we were to be treated as a PFIC for any year during which a US Holder holds the shares, we generally would continue to be treated as a PFIC with respect to that US Holder for all succeeding years during which it owns our ordinary shares. If we were to cease to be treated as a PFIC, however, a US Holder may avoid some of the adverse effects of the PFIC regime by making a deemed sale election with respect to our ordinary shares.

If a US Holder holds shares in any year in which we are a PFIC, that holder will be required to file an annual information report with the Internal Revenue Service.

Information Reporting and Backup Withholding

Dividend payments with respect to our shares and proceeds from the sale, exchange or redemption of our ordinary shares may be subject to information reporting to the United States Internal Revenue Service and possible United States backup withholding. Backup withholding will not apply, however, to a US Holder that furnishes a correct taxpayer identification number and makes any other required certification or that is otherwise exempt from backup withholding. US Holders that are required to establish their exempt status generally must provide such certification on United States Internal Revenue Service Form W-9. US Holders should consult their tax advisors regarding the application of the U.S. information reporting and backup withholding rules.

Backup withholding is not an additional tax. Amounts withheld as backup withholding may be credited against your United States federal income tax liability, and you may obtain a refund of any excess amounts withheld under the backup withholding rules by filing the appropriate claim for refund with the United States Internal Revenue Service and furnishing any required information in a timely manner.

Information with respect to Foreign Financial Assets

U.S. individuals that own “specified foreign financial assets” with an aggregate value in excess of US$50,000 are generally required to file an information report with respect to such assets with their tax returns. “Specified foreign financial assets” include any financial accounts maintained by foreign financial institutions, as well as any of the following, but only if they are not held in accounts maintained by financial institutions: (i) stocks and securities issued by non-U.S. persons, (ii) financial instruments and contracts held for investment that have non-U.S. issuers or counterparties, and (iii) interests in foreign entities. Our shares may be subject to these rules. US Holders that are individuals should consult their tax advisers regarding the application of this requirement to their ownership of the our shares.

Certain Dutch Tax Considerations

Introduction

This section describes the material Dutch tax consequences of the ownership and disposition of our ordinary shares as of the date hereof and is intended as general information only. The following summary does not purport to be a comprehensive description of all Dutch tax considerations that could be relevant for holders of the ordinary shares. This summary is intended as general information only. Each prospective holder should consult a professional tax adviser with respect to the tax consequences of an investment in the ordinary shares. This summary is based on Dutch tax legislation and published case law in force as of the date of this annual report. It does not take into account any developments or amendments thereof after that date, whether or not such developments or amendments have retroactive effect.

For the purpose of this section, “The Netherlands” shall mean the part of the Kingdom of the Netherlands in Europe.

Scope

Regardless of whether or not a holder of ordinary shares is, or is treated as being, a resident of The Netherlands, this summary does not address the Dutch tax consequences for such a holder:

(a)

having a substantial interest ( aanmerkelijk belang ) in our Company (such a substantial interest is generally present if an equity stake, profit stake of at least 5%, or a right to acquire such a equity/profit stake, is held, in each case by reference to our Company’s total issued share capital, or the issued capital of a certain class of shares);

(b)

who is a private individual and may be taxed for the purposes of Dutch income tax ( inkomstenbelasting ) as an entrepreneur ( ondernemer ) having an enterprise ( onderneming ) to which the ordinary shares are attributable, as one who earns income from miscellaneous activities ( resultaat uit overige werkzaamheden ), which include the performance of activities with respect to the ordinary shares that exceed regular, active portfolio management (normaal, actief vermogensbeheer ), or who may otherwise be taxed as one earning taxable income from work and home ( werk en woning ) with respect to benefits derived from the ordinary shares;

(c)

which is a corporate entity, and for the purposes of Dutch corporate income tax ( vennootschapsbelasting ) and Dutch dividend tax ( dividendbelasting ), has, or is deemed to have, a participation ( deelneming ) in our Company (such a participation is generally present in the case of an interest of at least 5% of our Company’s nominal paid-in capital); or

(d)

which is a corporate entity and an exempt investment institution ( vrijgestelde beleggingsinstelling ) or investment institution ( beleggingsinstelling ) for the purposes of Dutch corporate income tax, a pension fund, or otherwise not a taxpayer or exempt for tax purposes.

Dividend tax

Withholding requirement

We are required to withhold 15% Dutch dividend tax in respect of proceeds from the ordinary shares, which include, but is not limited to:

(a)

proceeds in cash or in kind, including deemed and constructive proceeds;

(b)

liquidation proceeds, proceeds on redemption of the ordinary shares and, as a rule, the consideration for the repurchase of ordinary shares by our Company in excess of its average paid-in capital ( gestort kapitaal ) as recognized for Dutch dividend tax purposes, unless a particular statutory exemption applies;

(c)

the par value of the ordinary shares issued to a holder, or an increase in the par value of the ordinary shares, except when the (increase in the) par value of the ordinary shares is funded out of our paid-in capital as recognized for Dutch dividend tax purposes; and

(d)

partial repayments of paid-in capital, if and to the extent there are qualifying profits ( zuivere winst ), unless the general meeting of holders of shares has resolved in advance to make such repayment and provided that the nominal value of the ordinary shares concerned has been reduced by an equal amount by way of an amendment of the articles of association and the capital concerned is recognized as paid-in capital for Dutch dividend tax purposes.

Resident holders

If a holder of ordinary shares is, or is treated as being, a resident of The Netherlands, Dutch dividend tax which is withheld with respect to proceeds from the ordinary shares will generally be creditable for Dutch corporate income tax or Dutch income tax purposes if the holder is the beneficial owner ( uiteindelijk gerechtigde ) of the proceeds concerned. A resident corporate holder of ordinary shares may under certain conditions be entitled to an exemption from Dutch dividend withholding tax.

Non-resident holders

If a private individual holder of ordinary shares is, or is treated as being, a resident of a country other than The Netherlands, such holder is generally not entitled to claim full or partial relief at source, or a refund in whole or in part, of Dutch dividend tax with respect to proceeds from the ordinary shares. A non-resident corporate holder of ordinary shares may under certain conditions be entitled to an exemption from, reduction or refund of Dutch dividend withholding tax under the provisions of a treaty for the avoidance of double taxation between the Netherlands and its country of residence.

Income tax

Resident holders

A holder who is a private individual and a resident, or treated as being, a resident of The Netherlands for the purposes of Dutch income tax and who does not have a substantial interest in our Company nor otherwise is taxed in relation to the ordinary shares as one earning taxable income from work and home, must record the ordinary shares as assets that are held in box 3. Taxable income with regard to the ordinary shares is then determined on the basis of a deemed return on income from savings and investments ( sparen en beleggen ), rather than on the basis of income actually received or gains actually realized. This deemed return is fixed at a rate of 4% of the holder’s yield basis ( rendementsgrondslag ) on January 1 of each year, insofar as the yield basis concerned exceeds a certain threshold. Such yield basis is determined as the fair market value of certain qualifying assets held by the holder of the ordinary shares, less the fair market value of certain qualifying liabilities. The fair market value of the ordinary shares will be included as an asset in the holder’s yield basis. The deemed return of 4% on the holder’s yield basis, being the fair market value of the ordinary shares, is taxed at a rate of 30% (insofar as the yield basis concerned exceeds a certain threshold).

Non-resident holders

A holder who is a private individual and neither a resident, nor treated as being a resident of The Netherlands for the purposes of Dutch income tax, will not be subject to such tax in respect of benefits derived from the ordinary shares.

Corporate income tax

Resident holders or holders having a Dutch permanent establishment

A holder which is a corporate entity and for the purposes of Dutch corporate income tax a resident (or treated as being a resident) of The Netherlands, or a non-resident having (or treated as having) a permanent establishment in The Netherlands, is generally taxed in respect of benefits derived from the ordinary shares at rates of up to 25%.

Non-resident holders

A holder which is a corporate entity and for the purposes of Dutch corporate income tax neither a resident, nor treated as being a resident, of The Netherlands, having no permanent establishment in The Netherlands (and is not treated as having such a permanent establishment), will generally not be subject to such tax in respect of benefits derived from the ordinary shares.

Gift and inheritance tax

Resident holders

Dutch gift tax or inheritance tax ( schenk- of erfbelasting ) will arise in respect of an acquisition (or deemed acquisition) of the ordinary shares by way of a gift by, or on the death of, a holder of ordinary shares who is a resident, or treated as being a resident, of The Netherlands for the purposes of Dutch gift and inheritance tax. A holder is so treated as being a resident of The Netherlands, if one having Dutch nationality has been a resident of The Netherlands during the ten years preceding the relevant gift or death. A holder is further so treated as being a resident of The Netherlands, if one has been a resident of The Netherlands at any time during the twelve months preceding the time of the relevant gift.

Non-resident holders

No Dutch gift tax or inheritance tax will arise in respect of an acquisition (or deemed acquisition) of the ordinary shares by way of a gift by, or on the death of, a holder of ordinary shares who is neither a resident, nor treated as being a resident, of The Netherlands for the purposes of Dutch gift and inheritance tax.

Other taxes

No Dutch turnover tax ( omzetbelasting ) will arise in respect of any payment in consideration for the issue of the ordinary shares, with respect to a distribution of proceeds from the ordinary shares or with respect to a transfer of ordinary shares. Furthermore, no Dutch registration tax, capital tax, transfer tax or stamp duty (nor any other similar tax or duty) will be payable in connection with the issue or acquisition of the ordinary shares.

ITEM 11: QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Interest Rate Risk

Under our credit facilities, interest is based on a floating rate index. The interest expense on the remainder of our outstanding indebtedness is based on a fixed rate.

Foreign Exchange Rate Risk

Our reporting currency for purposes of our financial statements is the euro. However, we also incur revenue and operating costs in non-euro denominated currencies, such as British pounds, Swiss francs, Danish kroner and Swedish krona. We recognize foreign currency gains or losses arising from our operations in the period incurred. As a result, currency fluctuations between the euro and the non-euro currencies in which we do business will cause us to incur foreign currency translation gains and losses. We cannot predict the effects of exchange rate fluctuations upon our future operating results because of the number of currencies involved, the variability of currency exposure and the potential volatility of currency exchange rates. We have determined that the impact of a near-term 10% appreciation or depreciation of non-euro denominated currencies relative to the euro would not have a significant effect on our financial position, results of operations, or cash flows.

We do not maintain any derivative instruments to mitigate the exposure to translation and transaction risk. Our foreign exchange transaction gains and losses are included in our results of operations and were not material for all periods presented. We do not currently engage in foreign exchange hedging transactions to manage the risk of our foreign currency exposure.

Commodity Price Risk

We are a significant user of electricity and have exposure to increases in electricity prices. In recent years, we have seen significant increases in electricity prices. We use independent consultants to monitor price changes in electricity and negotiate fixed-price term agreements with the power supply companies where possible.

Approximately 60% of our customers by revenue pay for electricity on a metered basis while the remainder of our customers pay for power “plugs.” While we are contractually able to recover power cost increases from our customers, some portion of the increased costs may not be recovered. In addition, some portion of the increased costs may be recovered in a delayed fashion based on commercial reasons at the discretion of local management.

ITEM 12: DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES

Not applicable.

PART II

ITEM 13: DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES

Not applicable.

ITEM 14: MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS

Not applicable.

ITEM 15: CONTROLS AND PROCEDURES

Conclusion Regarding the Effectiveness of Disclosure Controls and Procedures

Under the supervision and with the participation of the Chief Executive Officer (CEO) and Chief Financial Officer (CFO), the effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934) have been evaluated as of December 31, 2011. Based upon the evaluation, the CEO and CFO, concluded that as of December 31, 2011, the Company’s disclosure controls and procedures were adequate and effective and designed to ensure that material information relating to the Company is accumulated and communicated to our management, including the CEO and CFO, as appropriate to allow timely decisions regarding required disclosure.

Management’s Report on Internal Control over Financial Reporting

Management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934) and for the assessment of the effectiveness of internal control over financial reporting. Internal control over financial reporting includes maintaining records, that, in reasonable detail, accurately and fairly reflect our transactions; providing reasonable assurance that transactions are recorded as necessary for preparation of our financial statements; providing reasonable assurance that receipts and expenditures of Company assets are made in accordance with management authorization; and providing reasonable assurance that unauthorized acquisition, use or disposition of Company assets that could have material effect on our financial statements would be prevented or detected on a timely basis. The Company’s internal control over financial reporting is a process designed to provide reasonable, but not absolute, assurance regarding the reliability of financial reporting and the preparation of the consolidated financial statements in accordance with generally accepted accounting principles. Because of its inherent limitations, internal control over financial reporting is not intended to provide absolute assurance that a misstatement of our financial statements would be prevented or detected.

In connection with the preparation of the Company’s annual consolidated financial statements, management has undertaken an assessment of the effectiveness of the Company’s internal control over financial reporting as of December 31, 2011, based on criteria established in Internal Control Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (the COSO Framework).

Based on this assessment, management concluded that the Company’s internal control over financial reporting was effective as of December 31, 2011.

Management’s report is not subject to attestation by the Company’s independent registered public accounting firm given its current status as a non-accelerated filer. Therefore, the annual report and Form 20-F do not include an attestation report from the Company’s independent registered public accounting firm regarding internal control over financial reporting.

Changes in Controls and Procedures

There were no changes that occurred during the period covered by this report that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

ITEM 16A: AUDIT COMMITTEE FINANCIAL EXPERT

The Board of Directors has determined that Cees van Luijk is the audit committee financial expert as defined by the SEC and meets the applicable independence requirements of the SEC and the NYSE.

ITEM 16B: CODE OF ETHICS

Our board of directors has adopted a code of ethics on December 20, 2011, which applies to our principal executive officer, principal financial officer, principal accounting officers, controllers and employees. The code is posted on our website at www.interxion.com.

ITEM 16C: PRINCIPAL ACCOUNTANT FEES AND SERVICES

KPMG Accountants N.V. has served as the Company’s principal accountant for the fiscal years ended December 31, 2010 and 2011. Set forth below are the fees for audit and other services rendered by KPMG Accountants N.V. or other KPMG network for the fiscal years ended December 31, 2010 and 2011.


	Year ended December 31,
	2011		2010
	(€’000)

Audit fees		578		441

Audit-related fees		251		1,175

Tax fees		6		7

All other fees		0		10


Total		835		1,633

Audit fees include fees billed for audit services rendered for the Company’s annual consolidated financial statements filed with regulatory organizations. Audit-related fees in the year 2010 include fees paid to KPMG as compensation for professional services related to our initial public offering in 2011, work for which started in 2010.

Tax fees include fees billed for tax compliance.

All other fees consist of fees for all other services not included in any of the other categories noted above.

All of the above fees were pre-approved by the Audit Committee.

Audit Committee’s Policies and Procedures

In accordance with the Securities and Exchange Commission rules regarding auditor independence, the Audit Committee has established Policies and Procedures for Audit and Non-Audit Services Provided by an Independent Auditor. The rules apply to the Company and its consolidated subsidiaries engaging any accounting firms for audit services and the auditor who audits the accounts filed with the Securities and Exchange Commission, or the external auditor, for permissible non-audit services.

When engaging the external auditor for permissible non-audit services (audit-related services, tax services, and all other services), pre-approval is obtained prior to the commencement of the services.

ITEM 16D: EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES

Not applicable.

ITEM 16E: PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS

None.

ITEM 16F: CHANGE IN REGISTRANT’S CERTIFYING ACCOUNTANT

Not applicable.

ITEM 16G: CORPORATE GOVERNANCE

Nominating Committee

Under Section 303A.04 of the NYSE Manual, a domestic listed company must have a nominating/corporate governance committee composed entirely of independent directors. The Company’s Nominating Committee does not meet the independence standard of the NYSE Manual, as one (1) member of that committee is not “independent” as defined under the applicable NYSE Manual standard.

Compensation Committee

Under Section 303A.05 of the NYSE Manual, a domestic listed company must have a compensation committee composed entirely of independent directors. The Company’s Compensation Committee does not meet the independence standard of the NYSE Manual, as one (1) member of that committee is not “independent” as defined under the applicable NYSE Manual standard.

Internal Audit Function

Under Section 303A.07 of the NYSE Manual, a domestic listed company must have an internal audit function. The Company does not have a formal internal audit function, but is planning to implement one in 2012.

PART III

ITEM 17: FINANCIAL STATEMENTS

The Company has responded to Item 18 in lieu of responding to this item.

ITEM 18: FINANCIAL STATEMENTS

Reference is made to pages F-1 through F-51, which are incorporated herein by reference.

ITEM 19: EXHIBITS

The following instruments and documents are included as Exhibits to this annual report.


Exhibit Number		Description of Document

1.1‡		Articles of Association of InterXion Holding N.V., as amended, dated as of January 20, 2012.

1.2‡		Bylaws of InterXion Holding N.V. dated as of January 23, 2012.

2.1*		Indenture dated as of February 12, 2010 among InterXion Holding N.V., InterXion Nederland B.V., InterXion HeadQuarters B.V.; InterXion Carrier Hotel (UK) Ltd and InterXion Deutschland GmbH, The Bank of New York Mellon, London Branch, The Bank of New York Mellon (Luxembourg) S.A. and Barclays Bank PLC.

2.2*		Intercreditor Agreement among InterXion Holding N.V., Barclays Bank PLC, The Bank of New York Mellon, London Branch and others named therein dated February 12, 2010

2.3*		Additional Intercreditor Agreement among InterXion Holding N.V., Barclays Bank PLC, The Bank of New York Mellon, London Branch and others named therein dated November 11, 2010.

2.4.*		Senior Multicurrency Revolving Facility Agreement dated as of February 1, 2010 among InterXion Holding N.V., Barclays Bank PLC, Citigroup Global Markets Limited, ABN AMRO Bank N.V. (as successor to Fortis Bank (Nederland) N.V.), Merrill Lynch International, Credit Suisse AG, London Branch and Jefferies Finance LLC.

2.5*		Amendment Letter to the Senior Multicurrency Revolving Facility Agreement dated November 3, 2010 between InterXion Holding N.V. and Barclays Bank PLC

2.6*		Form of Registration Rights Agreement.

4.1*†		Lease Agreement between InterXion Österreich GmbH and S-Invest Beteiligungsgesellschaft mbH dated January 1, 2000 as amended by the Supplement to the Floridsdorf Technology Park Lease dated November 13, 2007.

4.2*†		Lease Agreement among InterXion Holding N.V., InterXion Belgium N.V. and First Cross Roads dated June 25, 2001.

4.3*†		Lease Agreement between InterXion HeadQuarters B.V. and Keops A/S dated May 1, 2000.

4.4*†		Lease Agreement between InterXion France Sarl and SCI 43 Rue du Landy dated June 29, 2007 as amended by the Amendment to the Lease Agreement dated October 26, 2007.

4.5*†		Lease Agreement between InterXion France Sarl and SCI 43 Rue du Landy dated April 28, 2006.

4.6*†		Lease Agreement between InterXion Holding B.V. and GiP Gewerbe im Park GmbH dated January 29, 1999 as amended by Supplement No. 15 to the Lease Agreement dated November 30, 2009.

4.7*†		Lease Agreement between InterXion France Sarl and ICADE dated December 23, 2008.



4.8*†		Lease Agreement between InterXion Nederland B.V. and VastNed Industrial B.V. dated November 4, 2005.

4.9*†		Lease Agreement between InterXion Nederland B.V. and VA No. 1 (Point of Logistics) B.V. dated May 14, 2007.

4.10*†		Lease Agreement between InterXion Carrier Hotel S.L. and Naves y Urbanas Andalucia S.A. dated March 20, 2000 as amended by the Annex to the Lease Agreement dated March 15, 2006.

4.11*†		Lease Agreement among InterXion Holding N.V., InterXion Carrier Hotel Limited and Eliahou Zeloof, Amira Zeloof, Ofer Zeloof and Oren Zeloof dated February 23, 2000.

4.12*		Deed of Pledge of Shares among InterXion Holding N.V., InterXion Operational B.V. and Barclays Bank PLC dated June 15, 2010.

4.13*†		Lease/Loan Agreement between Alpine Finanz Immobilien AG, InterXion (Schweiz) AG and InterXion Holding N.V. dated March 13, 2009.

4.14‡		Directors Remuneration Policy of InterXion Holding N.V. dated January 20, 2012.

4.15§		InterXion Holding N.V. 2011 International Stock Option and Incentive Master Award Plan dated June 2011.

4.16§		InterXion Holding N.V. 2008 International Stock Option and Incentive Master Award Plan dated January 2008.

4.17*		Shareholders Agreement among InterXion Holding N.V., Chianna Investment N.V., Lamont Finance N.V. and Baker Communications Fund II, L.P.

4.18††		Lease Agreement among InterXion Carrier Hotel Limited and Amira Zeloof, Ofer Zeloof and Oren Zeloof dated November 1, 2011.

4.19††		Lease Agreement among InterXion France Sas and Corpet Louvet Sas dated January 3, 2011.

4.20††		Lease Agreement among InterXion Holding N.V., InterXion España, S.A.U and Chainco Investments Company, S.L. dated October 10, 2011.

4.21		Employment Agreement Managing Director InterXion Holding N.V.

8.1*		Subsidiaries InterXion Holding N.V.

12.1		Certification of Chief Executive Officer

12.2		Certification of Chief Financial Officer

13.1		Certification of Chief Executive Officer

13.2		Certification of Chief Financial Officer

Notes:

*	Previously filed as an exhibit to the InterXion Holding N.V.’s Registration Statement on Form F-1 (File No. 333-171662) filed with the SEC and hereby incorporated by reference to such Registration Statement.

†	Confidential treatment has been received for certain portions which are omitted in the copy of the exhibit filed with the SEC. The omitted information has been filed separately with the SEC pursuant to an application for confidential treatment.

††	The omitted information has been filed separately with the SEC pursuant to an application for confidential treatment.

‡	Previously filed as an exhibit on Form 6-K (File No. 001-35053) filed with the SEC and hereby incorporated by reference.

§	Previously filed as an exhibit to the InterXion Holding N.V.’s Registration Statement on Form S-8 (File No. 119-28329) filed with the SEC and hereby incorporated by reference to such Registration Statement.

100

SIGNATURES

The registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized the undersigned to sign this annual report on its behalf.


		INTERXION HOLDING N.V.

		/s/ David C. Ruberg

		Name:		David C. Ruberg

		Title:		Chief Executive Officer

		Date:		April 27, 2012

101

INDEX TO FINANCIAL STATEMENTS


Audited financial statements of InterXion Holding N.V. as of and for the years ended December 31, 2011, 2010 and 2009

Report of Independent Registered Public Accounting Firm			F-2
Consolidated Income Statement			F-3
Consolidated Statement of Comprehensive Income			F-3
Consolidated Statement of Financial Position			F-4
Consolidated Statement of Changes in Shareholders’ Equity			F-5
Consolidated Statement of Cash Flows			F-7
Notes to the 2011 Consolidated Financial Statements			F-8

F-1

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To: The Board of Directors and Shareholders of InterXion Holding N.V.

We have audited the accompanying consolidated statements of financial position of InterXion Holding N.V. and subsidiaries as of December 31, 2011, 2010 and 2009, and the related consolidated income statements, consolidated statements of comprehensive income, consolidated statements of changes in shareholders’ equity and consolidated statements of cash flows for each of the years in the three-year period ended December 31, 2011. These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of InterXion Holding N.V. and subsidiaries as of December 31, 2011, 2010 and 2009, and the results of their operations and their cash flows for each of the years in the three-year period ended December 31, 2011, in conformity with International Financial Reporting Standards, as issued by the International Accounting Standards Board.

/s/ KPMG ACCOUNTANTS N.V.

Amstelveen, The Netherlands

April 27, 2012

F-2

FINANCIAL STATEMENTS

CONSOLIDATED INCOME STATEMENT


			For the year ended December 31
	Note		2011			2010			2009
			(€’000)
Revenue		5		244,310			208,379			171,668
Cost of sales		5,6		(101,766	)		(91,154	)		(78,548	)

Gross profit				142,544			117,225			93,120
Other income		5		487			425			746
Sales and marketing costs		5,6		(17,680	)		(15,072	)		(11,253	)
General and administrative costs		5,6,9		(67,258	)		(55,892	)		(50,628	)

Operating profit		5		58,093			46,686			31,985
Finance income		7		2,290			582			536
Finance expense		7		(25,074	)		(30,026	)		(6,784	)

Profit before taxation				35,309			17,242			25,737
Income tax (expense) / income		8		(9,737	)		(2,560	)		715

Profit for the year attributable to shareholders				25,572			14,682			26,452


Earnings per share attributable to shareholders post 5:1 reverse stock split at January 28, 2011:
Basic earnings per share: (€)		14		0.40			0.33			0.60
Diluted earnings per share: (€)		14		0.39			0.31			0.57

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME


	For the year ended December 31
	2011		2010		2009
	(€’000)
Profit for the year attributable to shareholders		25,572		14,682		26,452
Foreign currency translation differences		2,253		4,520		1,347
Total other comprehensive income		2,253		4,520		1,347

Tax		200		—		—

Total other comprehensive income, net of tax		2,453		4,520		1,347

Total comprehensive income		28,025		19,202		27,799

Note:—

The accompanying notes form an integral part of these consolidated financial statements.

F-3

CONSOLIDATED STATEMENT OF FINANCIAL POSITION


			As at December 31
	Note		2011			2010			2009
			(€’000)
Non-current assets
Property, plant and equipment		9		477,798			342,420			275,960
Intangible assets		10		12,542			6,005			3,642
Deferred tax assets		8		39,557			39,841			39,585
Other non-current assets		11		3,841			3,709			1,220

				533,738			391,975			320,407

Current assets
Trade and other current assets		11		67,874			55,672			55,610
Cash and cash equivalents		12		142,669			99,115			32,003

				210,543			154,787			87,613

Total assets				744,281			546,762			408,020

Shareholders’ equity
Share capital		13		6,613			4,434			4,434
Share premium		13		466,166			321,078			319,388
Foreign currency translation reserve		13		7,386			4,933			413
Accumulated deficit		13		(149,604	)		(175,176	)		(189,858	)

				330,561			155,269			134,377

Non-current liabilities
Trade payables and other liabilities		15		10,294			7,795			8,227
Deferred tax liability		8		1,742			660			—
Provision for onerous lease contracts		16		10,618			13,260			15,844
Borrowings		17		257,267			257,403			128,678

				279,921			279,118			152,749

Current liabilities
Trade payables and other liabilities		15		127,639			106,038			91,029
Tax liabilities				2,249			868			376
Provision for onerous lease contracts		16		3,108			3,073			3,068
Borrowings		17		803			2,396			26,421

				133,799			112,375			120,894

Total liabilities				413,720			391,493			273,643

Total liabilities and shareholders’ equity				744,281			546,762			408,020

Note:—

The accompanying notes form an integral part of these consolidated financial statements.

F-4

CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY


	Note		Share capital		Share premium			Foreign currency translation reserve		Accumulated deficit			Total equity
			(€’000)
Balance at January 1, 2011				4,434		321,078			4,933		(175,176	)		155,269
Profit for the period				—		—			—		25,572			25,572
Total other comprehensive income				—		—			2,453		—			2,453
Total comprehensive income				—		—			2,453		25,572			28,025
IPO proceeds				1,625		142,487			—		—			144,112
Conversion of Pref. shares				337		(337	)		—		—			—
Liquidation price paid to Pref. shareholders				—		(3,055	)		—		—			(3,055	)
Exercise of options				217		3,257			—		—			3,474
Share-based payments		19		—		2,736			—		—			2,736
Total contribution by and distributions to owners of the Company				2,179		145,088			—		—			147,267

Balance at December 31, 2011				6,613		466,166			7,386		(149,604	)		330,561


Balance at January 1, 2010				4,434		319,388			413		(189,858	)		134,377
Profit for the period				—		—			—		14,682			14,682
Total other comprehensive income				—		—			4,520		—			4,520
Total comprehensive income				—		—			4,520		14,682			19,202
Exercise of options				—		6			—		—			6
Share-based payments		19		—		1,684			—		—			1,684
Total contribution by and distributions to owners of the Company				—		1,690			—		—			1,690

Balance at December 31, 2010				4,434		321,078			4,933		(175,176	)		155,269

Note:—

The accompanying notes form an integral part of these consolidated financial statements.

F-5


Balance at January 1, 2009		4,364	317,806	(934	)	(216,310	)	104,926
Profit for the period		—	—	—		26,452		26,452
Total other comprehensive income		—	—	1,347		—		1,347
Total comprehensive income		—	—	1,347		26,452		27,799
Issue of preference shares		70	632	—		—		702
Share-based payments	19	—	950	—		—		950
Total contribution by and distributions to owners of the Company		70	1,582	—		—		1,652

Balance at December 31, 2009		4,434	319,388	413		(189,858	)	134,377

As no minority shareholders in group equity exist, the group equity is entirely attributable to the parent’s shareholders.

Note:—

The accompanying notes form an integral part of these consolidated financial statements.

F-6

CONSOLIDATED STATEMENT OF CASH FLOWS


			For the years ended December 31
	Note		2011			2010			2009
			(€’000)
Profit for the year				25,572			14,682			26,452
Depreciation, amortization and impairments		9		35,552			31,108			21,960
IPO transaction costs		5		1,725			—			—
Provision for onerous lease contracts		16		(3,125	)		(3,157	)		950
Share-based payments		19		2,736			1,684			950
Abandoned transaction costs		5		—			—			4,841
Net finance expense		7		22,784			29,444			6,248
Income tax expense		8		9,737			2,560			(715	)

				94,981			76,321			60,686

Movements in trade and other current assets				(16,942	)		511			(11,151	)
Movements in trade and other liabilities				12,009			8,476			9,051

Cash generated from operations				90,048			85,308			58,586

Interest and fees paid				(24,472	)		(9,980	)		(7,373	)
Interest received				2,251			390			583
Income tax paid				(3,784	)		(1,339	)		(418	)

Net cash flows from operating activities				64,043			74,379			51,378


*Cash flow from investing activities*
Purchase of property, plant and equipment				(154,559	)		(98,171	)		(99,979	)
Disposal of property, plant and equipment				945			230			104
Purchase of intangible assets				(7,397	)		(2,223	)		(1,074	)

Net cash flows used in investing activities				(161,011	)		(100,164	)		(100,949	)


*Cash flow from financing activities*
Proceeds from exercised options				3,474			6			702
Proceeds from issuance new shares				142,952			—			—
Repayment of ‘Liquidation Price’ to former preferred shareholders				(3,055	)		—			—
Proceeds/(repayment) bank facilities				—			(159,046	)		21,667
Proceeds from Senior Secured Notes and RCF				(645	)		254,276			—
Repayment of other Borrowings				(2,396	)		(2,488	)		(2,605	)

Net cash flows from financing activities				140,330			92,748			19,764
Effect of exchange rate changes on cash				192			149			35

Net movement in cash and cash equivalents				43,554			67,112			(29,772	)
Cash and cash equivalents, beginning of year				99,115			32,003			61,775

Cash and cash equivalents, end of year		12		142,669			99,115			32,003

Note:—

The accompanying notes form an integral part of these consolidated financial statements.

F-7

NOTES TO THE 2011 CONSOLIDATED FINANCIAL STATEMENTS

1	The Company

Interxion Holding N.V. (the “Company”) is domiciled in The Netherlands. The address of the Company’s registered office is Tupolevlaan 24, 1119 NX Schiphol-Rijk, The Netherlands. The consolidated financial statements of the Company for the year ended December 31, 2011 comprise the Company and its subsidiaries (together referred to as the “Group”). The Group is a leading pan-European operator of carrier-neutral Internet data centers.

The financial statements were approved by the Board of Directors on April 27, 2012. The financial statements are subject to adoption by the General Meeting of Shareholders.

2	Basis of preparation

Statement of compliance

The consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (“IFRS”) effective as at December 31, 2011 as issued by the Internal Accounting Standards Board (“IASB”) and IFRS as adopted by the European Union, and also comply with the financial reporting requirements included in Part 9 of Book 2 of the Netherlands Civil Code, as far as applicable.

Basis of measurement

The Group presents its consolidated financial statements in thousands of Euros. They are prepared on a going concern basis and under the historical cost convention except for certain financial instruments which have been measured at fair value. The Company’s functional currency is the Euro.

The accounting policies set out below have been applied consistently by the Group entities and to all periods presented in these consolidated financial statements.

Use of estimates and judgments

Property, plant and equipment depreciation (also see Note 9) — Estimated remaining useful lives and residual values are reviewed annually. The carrying values of property, plant and equipment are also reviewed for impairment where there has been a triggering event by assessing the present value of estimated future cash flows and net realizable value compared with net book value. The calculation of estimated future cash flows and residual values is based on the Company’s best estimates of future prices, output and costs and is therefore subjective.

Costs of site restoration (also see Note 15) — Liabilities in respect of obligations to restore premises to their original condition are estimated at the commencement of the lease and reviewed yearly based on rent period, contracted extension possibilities and possibilities of lease terminations.

Provision for onerous lease contracts (also see Note 16) — A provision is made for the discounted amount of future losses expected to be incurred in respect of unused data center sites over the term of the leases. Where unused sites have been sublet or partly sublet, management has taken account of the contracted rental income to be received over the minimum sublease term, which meets the Group’s revenue recognition criteria in arriving at the amount of future losses.

F-8

Deferred taxation (also see Note 8) — Provision is made for deferred taxation at the rates of tax prevailing at the period-end dates unless future rates have been substantively enacted. Deferred tax assets are recognized where it is probable that they will be recovered based on estimates of future taxable profits for each tax jurisdiction. The actual profitability may be different depending upon local financial performance in each tax jurisdiction.

Functional and presentation currency

These consolidated financial statements are presented in euro, which is the Company’s functional currency. All information presented in euro has been rounded to the nearest thousand, except when stated otherwise.

3	Significant accounting policies

Basis of consolidation

The consolidated financial statements incorporate the financial statements of the Company and all entities in which a direct or indirect controlling interest exists. Subsidiaries are entities that are directly or indirectly controlled by the Group. Control exists when the Group has the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities.

Accounting policies used by subsidiaries for group reporting purposes are identical to the accounting policies of the Group.

Loss of control

On the loss of control, the Group derecognises the assets and liabilities of the subsidiary, any non-controlling interests and the other components of equity related to the subsidiary. Any surplus or deficit arising on the loss of control is recognised in profit or loss.

Transactions eliminated on consolidation

Intercompany balances and transactions, and any unrealized income and expenses arising from intercompany transactions, are eliminated in preparing the consolidated financial statements.

Subsidiaries

With the exception of Stichting Administratiekantoor Management Interxion, all of the subsidiary undertakings of the Group as set out below are wholly owned. Stichting Administratiekantoor is part of the consolidation based on the groups controlling influence.

Interxion HeadQuarters B.V., Amsterdam, the Netherlands;

Interxion Nederland B.V., Amsterdam, the Netherlands;

Interxion Trademarks B.V., Amsterdam, the Netherlands;

Interxion Österreich GmbH, Vienna, Austria;

Interxion Belgium N.V., Brussels, Belgium;

Interxion Denmark ApS, Copenhagen, Denmark;

Interxion France SAS, Paris, France;

Interxion Real Estate II SARL, Paris, France;

Interxion Real Estate III SARL, Paris, France;

F-9

Interxion Deutschland GmbH, Frankfurt, Germany;

Interxion Ireland Ltd, Dublin, Ireland;

Interxion Telecom SRL, Milan, Italy;

Interxion España SAU, Madrid, Spain;

Interxion Sverige AB, Stockholm, Sweden;

Interxion (Schweiz) AG, Zurich, Switzerland;

Interxion Carrier Hotel Ltd., London, United Kingdom;

Interxion Real Estate Holding B.V., Amsterdam, the Netherlands;

Interxion Real Estate I B.V., Amsterdam, the Netherlands;

Interxion Real Estate IV B.V., Amsterdam, the Netherlands;

Interxion Operational B.V., Amsterdam, the Netherlands;

Interxion Datacenter B.V., The Hague, the Netherlands (formerly Centennium Detachering B.V.);

Interxion Consultancy Services B.V., Amsterdam, the Netherlands (dormant);

Interxion Telecom B.V., Amsterdam, the Netherlands (dormant);

Interxion Trading B.V., Amsterdam, the Netherlands (dormant);

Interxion B.V., Amsterdam, the Netherlands (dormant);

Interxion Europe Ltd., London, United Kingdom (dormant);

Interxion Telecom Ltd., London, United Kingdom (dormant);

Stichting Administratiekantoor Management Interxion, Amsterdam, the Netherlands.

Foreign currency

Foreign currency transactions

The individual financial statements of each Group entity are presented in the currency of the primary economic environment in which the entity operates (its functional currency). For the purpose of the consolidated financial statements, the results and the financial position of each entity are expressed in Euros, which is the functional currency of the Company and the presentation currency for the consolidated financial statements.

In preparing the financial statements of the individual entities, transactions in foreign currencies other than the entity’s functional currency are recorded at the rates of exchange prevailing at the dates of the transactions. At each balance sheet date, monetary assets and liabilities denominated in foreign currencies are retranslated at the rates prevailing at the balance sheet date. Non-monetary items that are measured in terms of historical cost in a foreign currency are not retranslated. The income and expenses of foreign operations are translated to Euros at average exchange rates.

Foreign operations

For the purpose of presenting consolidated financial statements, the assets and liabilities of the Group’s foreign operations are expressed in Euros using exchange rates prevailing at the balance sheet date. Income and expense items are translated at average exchange rates for the period. Exchange differences arising, if any, on net investments including receivables from or payables to a foreign operation for which settlement is neither planned nor likely to occur, are recognized directly in the foreign currency translation reserve (FCTR) within equity. When control over a foreign operation is lost, in part or in full, the relevant amount in the FCTR is transferred to profit or loss.

F-10

Borrowing costs

Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that necessarily take a substantial period of time to get ready for their intended use or sale, are added to the cost of those assets, until such time as the assets are substantially ready for their intended use or sale. All other borrowing costs are recognized in profit or loss in the period in which they are incurred.

Financial Instruments

Derivative financial instruments

The Group may enter into derivative financial instruments (interest rate swaps) to manage its exposure to interest risk. Further details of derivative financial instruments are disclosed in Note 18. Derivatives are initially recognized at fair value at the date the derivative contract is entered into and are subsequently re-measured to their fair value at the end of each reporting period. The fair value of interest rate swaps is based on broker quotes. Those quotes are tested for reasonableness by discounting estimated future cash flows based on the terms and maturity of each contract and using market interest rates for a similar instrument at the measurement date.

The resulting gain or loss is recognized in profit or loss immediately.

Non-derivative financial instruments

Non-derivative financial instruments comprise trade and other receivables, cash and cash equivalents, loans and borrowings, and trade and other payables.

Non-derivative financial instruments are recognized initially at fair value, net of any directly attributable transaction costs. Subsequent to initial recognition, non-derivative financial instruments are measured at amortized cost using the effective interest method, less any impairment losses.

The Group derecognises a financial asset when the contractual rights to the cash flows from the asset expire, or it transfers the right to receive the contractual cash flows in a transaction in which substantially all the risk and rewards of ownership of the financial asset are transferred. Any interest in such transferred financial assets that is created or retained by the Group is recognised as a separate asset or liability.

Financial assets and liabilities are offset and the net amount presented in the statement of financial position when, and only when, the Group has a legal right to offset the amounts and intends either to settle on a net basis or to realise the asset and settle the liability simultaneously.

Trade receivables

Trade receivables are recognized initially at fair value and subsequently measured at amortized cost using the effective interest method, less provision for impairment.

A provision for impairment of trade receivables is established when there is objective evidence that the Group will not be able to collect all amounts due according to the original term of the receivables. Significant financial difficulties of the debtor, probability that the debtor will enter bankruptcy or financial reorganization, and default or delinquency in payments are considered indicators that the trade receivable is impaired.

The amount of the provision is the difference between the asset’s carrying amount and the present value of estimated future cash flows discounted at the original effective interest rate. The carrying amount of the asset is reduced through the use of an allowance account, and the amount of the loss is recognized in the income statement.

When a trade receivable is uncollectable, it is written off against the allowance account for trade receivables. Subsequent recoveries of amounts previously written off are credited in the income statement.

F-11

Cash and cash equivalents

Cash and cash equivalents includes cash in hand, deposits held at call with banks and other short-term highly liquid investments with original maturities of three months or less. Cash and cash equivalents, including short-term investments, are valued at face value, which equals its fair value.

Share capital

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of ordinary shares and share options are recognized as a deduction from equity, net of any tax effects.

Preference share capital, no longer applicable since the IPO January 2011, is classified as equity if it is non-redeemable and any dividends are discretionary. Dividends thereon are recognized as distributions within equity upon approval by the Group’s shareholders.

Trade payables

Trade payables are recognized initially at fair value and subsequently measured at amortized cost using the effective interest method.

Property, plant and equipment

Property, plant and equipment are measured at cost less accumulated depreciation and accumulated impairment losses.

Cost includes expenditure that is directly attributable to the acquisition or construction of the asset and comprises purchase cost, together with the incidental costs of installation and commissioning. These costs include external consultancy fees, capitalised borrowing costs, rent and associated costs attributable to bringing the assets to a working condition for their intended used and internal employment costs which are directly and exclusively related to the underlying asset. Where it is probable that the underlying property lease will not be renewed, the cost of self-constructed assets includes the estimated costs of dismantling and removing the items and restoring the site on which they are located.

When parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate items (major components) of property, plant and equipment.

Gains and losses on disposal of an item of property, plant and equipment are determined by comparing the proceeds from disposal with the carrying amount of property, plant and equipment and are recognized within income.

The cost of replacing part of an item of property, plant and equipment is recognized in the carrying amount of the item if it is probable that the future economic benefits embodied within the part will flow to the Group and its cost can be measured reliably. The carrying amount of the replaced part is derecognized. The costs of the day-to-day servicing of property, plant and equipment are recognized in profit or loss as incurred.

Depreciation is calculated from the date an asset becomes available for use and is written off on a straight-line basis over the estimated useful life of each part of an item of property, plant and equipment. Leased assets are depreciated on the same basis as owned assets over the shorter of the lease term and their useful lives. The principal periods used for this purpose are:


Land		Indefinite

Data center equipment		10 – 15 years

Office buildings		10 – 15 years

Office equipment		3 – 5 years

Depreciation methods, useful lives and residual values are reviewed at each reporting date.

F-12

Data center equipment consists of buildings, leasehold improvements and equipment or infrastructure for advanced environmental controls such as ventilation and air conditioning, specialized heating, fire detection and suppression equipment and monitoring equipment. Office buildings consist of office buildings, office leasehold improvements and office equipment consists of furniture, computer equipment and software.

Intangible assets

Intangible assets represent computer software, power grid rights and other intangible assets and are recognized at cost less accumulated amortization and accumulated impairment losses. Other intangible assets principally consist of lease premiums (paid in addition to obtain rental contracts).

Amortization is recognized in profit or loss on a straight-line basis over the estimated useful lives of the intangible asset. Amortization methods, useful lives and residual values are reviewed at each reporting date.

The estimated useful lives are:


Lease premiums		12 years

Power grid rights		10 – 15 years

Computer software		3 – 5 years

Other		3 – 10 years

Impairment of non-financial assets

The carrying amounts of the Group’s non-financial assets, other than deferred tax assets, are reviewed at each reporting date to determine whether there is any indication of impairment. If any such indication exists, then the asset’s recoverable amount is estimated. For intangible assets that have indefinite lives or that are not yet available for use, the recoverable amount is estimated at each reporting date.

The recoverable amount of an asset or cash-generating unit is the greater of either its value in use or its fair value less costs to sell. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. For the purpose of impairment testing, assets are grouped together into the smallest group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or groups of assets (the “cash-generating unit”).

An impairment loss is recognized if the carrying amount of an asset or its cash-generating unit exceeds its estimated recoverable amount. Impairment losses are recognized in profit or loss. Impairment losses recognized in respect of cash-generating units are to reduce the carrying amount of the assets in the unit (group of units) on a pro rata basis.

Impairment losses recognized in prior periods are assessed at each reporting date for any indications that the loss has decreased or no longer exists. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortization, if no impairment loss had been recognized.

Borrowings

Borrowings are recognized initially at fair value, net of transaction costs incurred. Borrowings are subsequently stated at amortized costs; with any difference between the proceeds (net of transaction costs) and the redemption value recognized in the income statement over the period of the borrowings using the effective interest method.

Borrowings are classified as current liabilities unless the Group has an unconditional right to defer settlement of the liability for at least 12 months after the balance sheet date. The Group derecognises a financial liability when its contractual obligations are discharged, cancelled or expired.

F-13

Provisions

A provision is recognized in the statement of financial position when the Group has a present legal or constructive obligation as a result of a past event; it is probable that an outflow of economic benefits will be required to settle the obligation and the amount can be estimated reliably. Provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and, where appropriate, the risks specific to the liability. The discount rate arising on the provision is amortized in future years through interest.

A provision for site restoration is recognized when costs for restoring leasehold premises to their original condition at the end of the lease need to be made.

A provision for onerous lease contracts is recognized when the expected benefits to be derived by the Group from a contract are lower than the unavoidable cost of meeting its obligations under the contract. The provision is measured at the present value of the lower of either the expected cost of terminating the contract or the expected net cost of continuing with the contract. Before a provision is established, the Group recognizes any impairment loss on the assets associated with that contract.

Leases

Leases, where the Group assumes substantially all the risks and rewards of ownership, are classified as finance leases. Upon initial recognition the leased asset is measured at an amount equal to the lower of either its fair value or the present value of the minimum lease payments. Subsequent to initial recognition, the asset is accounted for in accordance with the accounting policy applicable to that asset.

Other leases are operating leases and the leased assets are not recognized on the Group’s statement of financial position. Payments made under operating leases are recognized in profit or loss on a straight-line basis over the term of the lease. Lease incentives received are recognized as an integral part of the total lease expense, over the term of the lease.

Minimum finance lease payments are apportioned between the finance charge and the reduction of the outstanding liability. The finance charge is allocated to each period during the lease term so as to produce a constant periodic rate of interest on the remaining balance of the liability.

At inception of an arrangement, the Group determines whether such an arrangement is or contains a lease. This will be the case if the following two criteria are met:

•

the fulfilment of the arrangement is dependent on the use of a specific asset, or assets; and

•

the arrangement contains the right to use an asset(s).

At inception or on reassessment of the arrangement, the Group separates payments and other consideration required by such an arrangement into those for the lease and those for other elements on the basis of their relative fair values.

Segment reporting

The segments are reported in a manner consistent with internal reporting provided to the chief operating decision maker, identified as the Board of Directors. There are two segments: the first segment being France, Germany, the Netherlands and the United Kingdom and the second segment being Rest of Europe , which comprises Austria, Belgium, Denmark, Ireland, Spain, Sweden and Switzerland. Shared expenses such as corporate management, general and administrative expenses, loans and borrowings and related expenses and income tax assets and liabilities are stated in Corporate and other .

Segment results, assets and liabilities include items directly attributable to a segment as well as those that can be allocated on a reasonable basis. Unallocated items presented as Corporate and other principally comprise provisions for onerous lease contracts and related revenue and expenses; loans and borrowings and related expenses; corporate assets and expenses (primarily the Company’s headquarters); and income tax assets and liabilities.

F-14

Segment capital expenditure is defined as the net cash outflows during the period to acquire property, plant and equipment, and intangible assets other than goodwill.

EBITDA and Adjusted EBITDA, as well as recurring revenue, are additional indicators of our operating performance and are not required by, or presented in accordance with, IFRS. They are not intended as a replacement or alternative for measures such as cash flows from operating activities and operating profit as defined and required under IFRS. EBITDA is defined as operating profit plus depreciation, amortization and impairment of assets. Adjusted EBITDA is defined as EBITDA adjusted to exclude share-based payments, income (charge) attributable to a defined benefit scheme, exceptional and non-recurring items and include share of profits (losses) of non-group companies.

This information, provided to the chief operating decision maker, is disclosed to permit a more complete analysis of our operating performance. Exceptional items are those significant items that are separately disclosed by virtue of their size, nature or incidence to enable a full understanding of the Group’s financial performance. EBITDA and Adjusted EBITDA, as calculated here, may not be comparable to similarly titled measures reported by other companies.

Revenue recognition

Revenues are recognized when it is probable that future economic benefits will flow to the Group and that these benefits, together with their related costs, can be measured reliably. Revenues are measured at the fair value of the consideration received or receivable.

The Group earns colocation revenue as a result of providing data center services to customers at its data centers. Colocation revenues are recognized in profit or loss on a straight-line basis over the term of the customer contract. Incentives granted are recognized as an integral part of the total income, over the term of the customer contract. Customers are usually invoiced quarterly in advance and income is recognized on a straight-line basis over the quarter. Initial set-up fees payable at the beginning of customer contracts are deferred at inception and recognized in profit or loss on a straight-line basis over the initial term of the customer contract. Power revenues are recognised based on customers’ usage.

The Group reviews transactions for separately identifiable components and if necessary applies individual recognition treatment, revenues are allocated to separately identifiable components based on their relative fair values.

Other services revenue relates mainly to managed services and connectivity. Revenue from other services is recognized when the services are rendered.

Certain installation services and equipment sales, which by its nature have a non-recurring character, are accounted for as non-recurring revenues.

Cost of sales

The cost of sales consists mainly of rental costs for the data centers and offices, power costs, maintenance costs relating to the data center equipment, operation and support personnel costs and costs related to installations and other customer requirements. In general, maintenance and repairs are expensed as incurred. In cases where maintenance contracts are in place, the costs are recorded on a straight-line basis over the contractual period.

Sales and marketing costs

The operating expenses related to sales and marketing consist of costs for personnel (including sales commissions), marketing and other costs directly related to the sales process. Costs of advertising and promotion are expensed as incurred.

F-15

Employee benefits

Defined contribution pension plans

A defined contribution pension plan is a post-employment plan under which an entity pays fixed contributions into a separate entity and has no legal or constructive obligation to pay further amounts. Obligations for contributions to defined contribution plans are recognised as an employee benefit expense in the income statement in the periods during which the related services are rendered by employees. Prepaid contributions are recognised as an asset to the extent that a cash refund or a reduction in future payments is available. Contributions to a defined contribution plan that are due more than 12 months after the end of the period in which the employees render the service are discounted to their present value.

Termination benefits

Termination benefits are recognised as an expense when the Group is demonstrably committed, without realistic possibility of withdrawal, to a formal detailed plan to either terminate employment before the normal retirement date, or to provide termination benefits as a result of an offer made to encourage voluntary redundancy. Termination benefits for voluntary redundancy are recognised as an expense if the Group has made an offer of voluntary redundancy, it is probable that the offer will be accepted, and the number of acceptances can be estimated reliably. If benefits are payable more than 12 months after the reporting date, then they are discounted to their present value.

Share-based payments

The share option program allows Group employees to acquire shares (and before the IPO share certificates) of the Group. The fair value at the date of grant to employees of share options is recognized as an employee expense, with a corresponding increase in equity, over the period that the employees become unconditionally entitled to the options. The amount recognized as an expense is adjusted to reflect the actual number of share options that vest except where forfeiture is only due to share prices not achieving the threshold for vesting.

Finance income and expense

Finance expense comprises interest payable on borrowings calculated using the effective interest rate method and foreign exchange gains and losses. Borrowing costs directly attributable to the acquisition or construction of data center assets, which are assets that necessarily take a substantial period of time to get ready for their intended use, are added to the costs of those assets, until such time as the assets are ready for their intended use.

Interest income is recognized in the income statement as it accrues, using the effective interest method. The interest expense component of finance lease payments is recognized in the income statement using the effective interest rate method.

Foreign currency gains and losses are reported on a net basis, as either finance income or expenses, depending on whether the foreign currency movements are in a net gain or a net loss position.

Income tax

Income tax on the profit or loss for the year comprises current and deferred tax. Income tax is recognized in the income statement except to the extent that it relates to items recognized directly in equity, in which case it is recognized in equity.

Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or substantially enacted at the balance sheet date, and any adjustment to tax payable in respect of previous years.

F-16

Deferred tax is recognized using the balance sheet liability method, providing for temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. The following temporary differences are not provided for: the initial recognition of assets or liabilities that affect neither accounting nor taxable profit, and differences relating to investments in subsidiaries to the extent that they will probably not reverse in the foreseeable future. The amount of deferred tax provided is based on the expected manner of realization or settlement of the carrying amount of assets and liabilities, using tax rates enacted or substantively enacted at the balance sheet date that are expected to be applied to temporary differences when they reverse or loss carry forwards when they are utilized.

A deferred tax asset is also recognized for unused tax losses and tax credits. A deferred tax asset is recognized only to the extent that it is probable that future taxable profits will be available against which the asset can be utilized. Deferred tax assets are reduced to the extent that it is no longer probable that the related tax benefit will be realized.

Additional income taxes that arise from the distribution of dividends are recognized at the same time as the liability to pay the related dividend.

In determining the amount of current and deferred tax the Company takes into account the impact of uncertain tax positions and whether additional taxes and interest may be due. The Company believes that its accruals for tax liabilities are adequate for all open tax years based on its assessment of many factors, including interpretations of tax law and prior experience. This assessment relies on estimates and assumptions and may involve a series of judgements about future events. New information may become available that causes the Company to change its judgement regarding the adequacy of existing tax liabilities; such changes to tax liabilities will impact tax expense in the period that such a determination is made.

Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset current tax liabilities and assets, and they relate to taxes levied by the same tax authority on the same taxable entity, or on different tax entities, but they intend to settle current tax liabilities and assets on a net basis of their tax assets and liabilities will be realised simultaneously.

Earnings per share

The Group presents basic and diluted earnings per share (EPS) data for its ordinary shares. Ordinary shares share on an equal basis in profits with preference shares. Basic EPS is calculated by dividing the profit or loss attributable to ordinary and preference shareholders of the Company by the weighted average number of ordinary and preference shares outstanding during the year. Diluted EPS is determined by adjusting the profit or loss attributable to ordinary and preference shareholders and the weighted average number of ordinary and preference shares outstanding for the effects of all dilutive potential ordinary shares, which comprise the share options granted to employees.

F-17

New standards and interpretations not yet adopted

A number of new standards, amendments to standards, and interpretations are not yet effective for the year ended December 31, 2011 and have not been applied in preparing these consolidated financial statements:

Revision to IAS 12 “Income taxes”

Revision to IAS 32, “Financial Instruments: Presentation of Rights Issues”;

IFRS 9, “Financial Instruments”

IFRS 10” Consolidated Financial Statements”

IFRS 11 “Joint arrangements”

IFRS 12”Disclosures of interests in Other entities”

IFRS 13”Fair value measurement”

Revision to IFRIC 14, IAS 19, “The Limit on a Defined Benefit Assets, Minimum Funding Requirements and their Interaction”

The Group has not opted for earlier adoption. Following an internal review, it is not anticipated that the adoption of these new but not yet effective standards and interpretations will have a material financial impact on the financial statements in the period of initial application and subsequent reporting, except for IFRS 9 “Financial Instruments” which becomes mandatory for the Groups 2013’s consolidated financial statements and could change the classification and measurement of financial assets.

4	Financial risk management

Overview

The Group has exposure to the following risks from its use of financial instruments:

Credit risk

Liquidity risk

Market risk

Other price risks

This note presents information about the Group’s exposure to each of the above risks, the Group’s goals, policies and processes for measuring and managing risk, and the Group’s management of capital. Further quantitative disclosures are included throughout these consolidated financial statements.

The Board of Directors has overall responsibility for the oversight of the Group’s risk management framework.

The Company continues developing and evaluating the Group’s risk management policies with a view to identifying and analyzing the risks faced by the Group, to setting appropriate risk limits and controls, and to monitoring risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the Group’s activities. The Group, through its training and management standards and procedures, aims to develop a disciplined and constructive control environment in which all employees understand their roles and obligations.

The Board of Directors oversees how management monitors compliance with the Group’s risk management policies and procedures and reviews the adequacy of the risk management framework in relation to the risks faced by the Group.

F-18

Credit risk

Credit risk is the risk of financial loss to the Group if a customer, bank or other counterparty to a financial instrument fails to meet its contractual obligations. This risk principally arises from the Group’s receivables from customers. The Group’s most significant customer accounts for less than 5% of the revenues for 2011, 2010 and 2009.

Trade and other receivables

The Group’s exposure to credit risk is influenced mainly by the individual characteristics of each customer. The demographics of the Group’s customer base, including the default risk of the industry and the country in which customers operate, has less of an influence on credit risk.

The Group has an established credit policy under which each new customer is analyzed individually for creditworthiness before they commence trading with the Group. If customers are independently rated, these ratings are used. Otherwise, if there is no independent rating, the credit quality of the customer is analyzed taking into account its financial position, past experience and other factors.

The Group’s standard terms require contracted services to be paid in advance of these services being delivered. In the event that a customer fails to pay amounts that are due, the Group has a clearly defined escalation policy that can result in a customer’s access to their equipment being denied or service to the customer being suspended.

In 2011, 93% (2010: 93% and 2009: 94%) of the Group’s revenues were derived from contracts under which customers pay an agreed contracted amount including power on a regular basis (usually monthly or quarterly) or from deferred initial set-up fees paid at the outset of the customer contract.

As a result of the Group’s credit policy and the contracted nature of the revenues, losses have occurred infrequently (see Note 18). The Group establishes an allowance that represents its estimate of potential incurred losses in respect of trade and other receivables. This allowance is entirely composed of a specific loss component relating to individually significant exposures.

Bank counterparties

The Group has certain obligations under the terms of its revolving loan agreement and Senior Secured Notes which limit disposal with surplus cash balances. Term risk is limited to short-term deposits. The Group monitors its cash position, including counterparty and term risk, daily.

Guarantees

Certain of our subsidiaries have granted guarantees to our lending banks in relation to our facilities. The Company grants rent guarantees to landlords of certain of the Group’s property leases (see Note 22).

Liquidity risk

Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due. The Group’s approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Group’s reputation or jeopardizing its future.

The majority of the Group’s revenues and operating costs are contracted, which assists it in monitoring cash flow requirements, which are monitored on a daily and weekly basis. Typically the Group ensures that it has sufficient cash on demand to meet expected normal operational expenses for a period of 60 days, including the servicing of financial obligations; this excludes the potential impact of extreme circumstances that cannot reasonably be predicted, such as natural disasters.

All significant capital expansion projects are subject to formal approval by the Board of Directors, and material expenditure or customer commitments are only made once the management is satisfied that the Group has adequate committed funding to cover the anticipated expenditure (refer to Note 21).

F-19

As at December 31, 2011, the Group listed € 260.0 million 9.5% Senior Secured Notes due 2017. The notes are listed on the Luxembourg Stock Exchange’s Euro MTF Market. Interest on the Senior Secured Notes is payable at the rate of 9.5%, which falls due on February 12 and August 12 each year.

The Group has secured additional € 50 million multicurrency Revolving Credit Facility that is fully undrawn as at December 31, 2011. As at December 31 2011, on the Revolving Credit Facility the interest payable on EUR amounts drawn would be at the rate of EURIBOR plus 400 basis points and for GBP amounts drawn the interest payable would be LIBOR plus 400 basis points.

On January 28, 2011, the Company went public and started trading on the New York Stock Exchange under the ticker symbol INXN. The net proceeds were € 138.6 million, which was used for general corporate purposes including construction of new data centers.

Refer to Borrowing section for more details (Note 17).

Market risk

Currency risk

The Group is exposed to currency risk on sales, purchases and borrowings that are denominated in a currency other than the respective functional currencies of Group entities, primarily the Euro, but also pounds sterling (GBP), Swiss francs (CHF), Danish kroner (DKK) and Swedish kronor (SEK). The currencies in which these transactions are primarily denominated are EUR, GBP, CHF, DKK and SEK.

Historically, the revenues and operating costs of each of the Group’s entities have provided an economic hedge against foreign currency exposure and have not required foreign currency hedging.

It is anticipated that a number of capital expansion projects will be funded in a currency that is not the functional currency of the entity in which the associated expenditure will be incurred. In the event that this occurs and is material to the Group, the Group will seek to implement an appropriate hedging strategy.

The majority of the Group’s borrowings are Euro denominated and the Company believes that the Interest on these borrowings will be serviced from the cash flows generated by the underlying operations of the Group whose functional currency is the Euro. The Group’s investments in subsidiaries are not hedged.

Interest rate risk

Following the issuance of 9.5% Senior Secured Notes in 2010 and the repayment of the old bank facilities, the Group is no longer exposed to significant variable interest rate expense for borrowings. As at December 31, 2011, the interest rate risk is very limited.

Other risks

Price risk

The risk of changes in market circumstances, such as strong unanticipated increases in operational costs, construction costs of new data centers or that customer contracts will churn, will negatively affect the Group’s income. Customers individually have medium-term contracts that require notice prior to termination. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimizing the return.

The Group is a significant user of power and has exposure to increases in power prices. The Group uses independent consultants to monitor price changes in electricity and seeks to negotiate fixed-price term agreements with the power supply companies, not more than for own use, where possible. The risk to the Group is mitigated by the contracted ability to recover power price increases through adjustments in the pricing for power services.

F-20

Capital management

The Group has a capital base comprising its equity, including reserves, senior secured notes and committed debt facilities. The Group monitors its solvency ratio, financial leverage, funds from operations and net debt with reference to multiples of the Group’s last twelve months Adjusted EBITDA levels. The Company’s policy is to maintain a strong capital base and access to capital in order to sustain the future development of the business and maintain shareholders, creditors and customers confidence.

The principal use of capital in the development of the business is through capital expansion projects for the deployment of further equipped space in new and existing data centers. Major capital expansion projects are not started unless the Company has access to adequate capital resources at the start of the project to complete the project, and they are evaluated against target internal rates of return before approval. Capital expansion projects are continually monitored both before and after completion.

There were no changes in the Group’s approach to capital management during the year.

5	Information by segment

Operating segments are to be identified on the basis of internal reports about components of the Group that are regularly reviewed by the chief operating decision maker in order to allocate resources to the segments and to assess their performance. Management monitors the operating results of its business units separately for the purpose of making decisions about performance assessments.

The performance of the operating segments is primarily based on the measures of revenue, EBITDA and Adjusted EBITDA. Other information provided, except as noted below, to the Board of Directors is measured in a manner consistent with that in the financial statements.

F-21

Information by segment 2011

		0000000			0000000			0000000			0000000			0000000
	FR, DE, NL and UK			Rest of Europe			Subtotal			Corporate and other			Total
	(€’000)
Recurring revenue		136,460			91,868			228,328			—			228,328
Non-recurring revenue		10,352			5,630			15,982			—			15,982
Total revenue		146,812			97,498			244,310			—			244,310
Cost of sales		(58,969	)		(37,685	)		(96,654	)		(5,112	)		(101,766	)

Gross profit/(loss)		87,843			59,813			147,656			(5,112	)		142,544
Other income		487			0			487			0			487
Sales and marketing costs		(4,730	)		(3,876	)		(8,606	)		(9,074	)		(17,680	)
Total general and administrative costs		(30,014	)		(17,956	)		(47,970	)		(19,288	)		(67,258	)

Operating profit/(loss)		53,586			37,981			91,567			(33,474	)		58,093
Net finance expense														(22,784	)

Profit before tax														35,309

Total Assets		412,160			181,186			593,346			150,935			744,281
Total Liabilities		97,779			40,774			138,553			275,167			413,720
Capital expenditures, including intangible assets*		(122,880	)		(35,366	)		(158,246	)		(3,710	)		(161,956	)
Depreciation and amortization		(21,289	)		(13,154	)		(34,443	)		(1,892	)		(36,335	)
Impairment reversal		—			783			783			—			783
Adjusted EBITDA		74,774			50,676			125,450			(27,813	)		97,637


Information by segment 2010
	FR, DE, NL and UK			Rest of Europe			Subtotal			Corporate and other			Total
	(€’000)
Recurring revenue		114,689			78,284			192,973			—			192,973
Non-recurring revenues		9,161			6,245			15,406			—			15,406
Total revenue		123,850			84,529			208,379			—			208,379
Cost of sales		(52,861	)		(33,513	)		(86,374	)		(4,780	)		(91,154	)

Gross profit/(loss)		70,989			51,016			122,005			(4,780	)		117,225
Other income		425			—			425			—			425
Sales and marketing costs		(4,859	)		(3,357	)		(8,216	)		(6,856	)		(15,072	)
Total general and administrative costs		(27,297	)		(15,854	)		(43,151	)		(12,741	)		(55,892	)

Operating profit/(loss)		39,258			31,805			71,063			(24,377	)		46,686
Net finance expense														(29,444	)

Profit before tax														17,242

Total Assets		279,735			150,026			429,761			117,001			546,762
Total Liabilities		81,339			35,335			116,674			274,819			391,493
Capital expenditures, including intangible assets*		(59,419	)		(35,709	)		(95,128	)		(5,266	)		(100,394	)
Depreciation and amortization		(18,659	)		(10,972	)		(29,631	)		(1,477	)		(31,108	)
Adjusted EBITDA		58,060			43,010			101,070			(21,867	)		79,203

F-22

Information by segment 2009

		0000000			0000000			0000000			0000000			0000000
	FR, DE, NL and UK			Rest of Europe			Subtotal			Corporate and other			Total
	(€’000)
Recurring revenue		94,088			67,226			161,314			—			161,314
Non-recurring revenue		6,542			3,812			10,354			—			10,354
Total revenue		100,630			71,038			171,668			—			171,668
Cost of sales		(44,615	)		(29,893	)		(74,508	)		(4,040	)		(78,548	)

Gross profit/(loss)		56,015			41,145			97,160			(4,040	)		93,120
Other income		471			275			746			—			746
Sales and marketing costs		(3,987	)		(2,282	)		(6,269	)		(4,984	)		(11,253	)
Total general and administrative costs		(21,629	)		(13,169	)		(34,798	)		(15,830	)		(50,628	)

Operating profit/(loss)		30,870			25,969			56,839			(24,854	)		31,985
Net finance expense														(6,248	)

Profit before tax														25,737

Total Assets		235,575			123,460			359,035			48,985			408,020
Total Liabilities		102,967			45,493			148,460			125,183			273,643
Capital expenditures, including intangible assets*		(55,253	)		(42,584	)		(97,837	)		(3,216	)		(101,053	)
Depreciation and amortization		(12,785	)		(8,289	)		(21,074	)		(886	)		(21,960	)
Adjusted EBITDA		46,509			33,983			80,492			(17,749	)		62,743

Note:

Capital expenditures, including intangible assets, represent payments to acquire property, plant and equipment and intangible assets, as recorded in the consolidated statement of cash flows as “Purchase of property, plant and equipment” and “Purchase of intangible assets” respectively. This definition was amended to include paid intangible assets in comparison to prior year. Comparative figures have been adjusted to reflect this change.

F-23

Reconciliation Adjusted EBITDA

Consolidated

		0000000			0000000			0000000
	2011			2010			2009
	(€’000)
Adjusted EBITDA		97,637			79,203			62,743

Income from subleases on unused data center sites		487			425			471
Net insurance compensation benefit		—			—			275

Exceptional income		487			425			746

Increase in provision onerous lease contracts ⁽¹⁾		(18	)		(150	)		(3,753	)
IPO transaction costs		(1,725	)		—			—
Abandoned transaction costs		—			—			(4,841	)
Share based payments		(2,736	)		(1,684	)		(950	)

Exceptional general and administrative costs		(4,479	)		(1,834	)		(9,544	)

EBITDA ⁽²⁾		93,645			77,794			53,945

Depreciation, amortization and impairment		(35,552	)		(31,108	)		(21,960	)

Operating profit		58,093			46,686			31,985

France, Germany, Netherlands and UK

		0000000			0000000			0000000
	2011			2010			2009
	(€’000)
Adjusted EBITDA		74,774			58,060			46,509

Income from subleases on unused data center sites		487			425			471

Exceptional income		487			425			471

Increase in provision onerous lease contracts ⁽¹⁾		(18	)		(150	)		(1,813	)
Share based payments		(368	)		(418	)		—

Exceptional general and administrative costs		(386	)		(568	)		(1,813	)

EBITDA ⁽²⁾		74,875			57,917			45,167

Depreciation, amortization and impairment		(21,289	)		(18,659	)		(12,785	)

Operating profit		53,586			39,258			32,382

Notes:

(10)	Before deduction of income from subleases on unused data center sites.

(11)	Operating profit plus depreciation, amortization and impairment of assets.

F-24

Rest of Europe

		00000000			00000000			00000000
	2011			2010			2009
	(€’000)
Adjusted EBITDA		50,676			43,010			33,983

Net insurance compensation benefit		—			—			275

Exceptional income		—			—			275

Increase in provision onerous lease contracts ⁽¹⁾		—			—			(1,512	)
Share based payments		(324	)		(233	)		—

Exceptional general and administrative costs		(324	)		(233	)		(1,512	)

EBITDA ⁽²⁾		50,352			42,777			32,746

Depreciation, amortization and impairment		(12,371	)		(10,972	)		(8,289	)

Operating profit		37,981			31,805			24,457

Corporate and other

		00000000			00000000			00000000
	2011			2010			2009
	(€’000)
Adjusted EBITDA		(27,813	)		(21,867	)		(17,749	)

IPO transaction costs		(1,725	)		—			—
Increase in provision onerous lease contracts ⁽¹⁾		—			—			(428	)
Abandoned transaction costs		—			—			(4,841	)
Share based payments		(2,044	)		(1,033	)		(950	)

Exceptional general and administrative costs		(3,769	)		(1,033	)		(6,219	)

EBITDA ⁽²⁾		(31,582	)		(22,900	)		(23,968	)

Depreciation, amortization and impairment		(1,892	)		(1,477	)		(886	)

Operating profit		(33,474	)		(24,377	)		(24,854	)

Notes:

(12)	Before deduction of income from subleases on unused data center sites.

(13)	Operating profit plus depreciation, amortization and impairment of assets.

Exceptional income is recorded as “Other income” in the consolidated income statement. In 2011, the IPO transaction costs represent the write off of the proportion of the IPO costs allocated to the selling shareholders at the Initial Public Offering. In 2009, the net insurance compensation benefit received from our insurance company, as a result of fire damage incurred in 2008, represents the difference between the net book value and the replacement value of the equipment damaged. The increase in the provision for onerous lease contracts in 2009 relates to an unused data center in Germany and an office property in the Netherlands (see Note 16).

F-25

6	Employee benefit expenses

The Group employed on average 347 employees (full-time equivalents) during 2011 (2010: 321 and 2009: 269). Costs incurred in respect of these employees were:

		000,000		000,000		000,000
	2011		2010		2009
	(€’000)
Salaries, commissions and bonuses		26,540		24,588		20,561
Social security charges		4,364		4,037		3,363
Contributions to defined contribution pension plans		1,487		1,437		1,104
Other personnel-related costs		6,155		6,176		4,776
Share-based payments		2,736		1,684		950

		41,282		37,922		30,754

The following income statement line items include employee benefit expenses of:

		000,000		000,000		000,000
	2011		2010		2009
	(€’000)
Costs of sales		15,147		14,419		13,233
Sales and marketing costs		11,352		9,848		5,423
General and administrative costs		14,783		13,655		12,098

		41,282		37,922		30,754

The Group operates a defined contribution scheme for most of its employees. The contributions are made in accordance with the scheme and are expensed in the income statement as incurred.

7	Finance income and expense

		000,000			000,000			000,000
	2011			2010			2009
	(€’000)
Bank and other interest		2,271			582			536
Net foreign currency exchange gain		19			—			—

Finance income		2,290			582			536

Interest expense on senior secured notes, banks and other loans		(23,302	)		(18,155	)		(5,794	)
Interest expense on finance leases		(57	)		(92	)		(102	)
Interest expense on provision for onerous lease contracts		(518	)		(578	)		(708	)
Other financial expenses		(1,197	)		(11,102	)		(99	)
Net foreign currency exchanges loss		—			(99	)		(81	)

Finance expense		(25,074	)		(30,026	)		(6,784	)

Net finance expense		(22,784	)		(29,444	)		(6,248	)

The Company funds the capital expansion programs within operating entities principally through intra-group loans; exchange differences arising, if any, on net investments including receivables from or payable to a foreign operation with a permanent nature, are recognized directly in the foreign currency translation reserve within equity in accordance with IAS 21.

The “Interest expense on provision for onerous lease contracts” relates to the unwinding of the discount rate used to calculate the “Provision for onerous lease contracts”.

F-26

Other financial expenses in 2010 principally consisted of € 10.2 million costs related to the repayment of the Company’s bank borrowings and termination of the hedge contracts of which € 3.5 million was non-cash.

8	Income taxes

Income tax benefit/(expense)

		000,000			000,000			000,000
	2011			2010			2009
	(€’000)
Current taxes		(5,033	)		(1,802	)		(666	)
Deferred taxes		(4,704	)		(758	)		1,381

Total income tax (expense)/benefit		(9,737	)		(2,560	)		715

Reconciliation of effective tax rate

A reconciliation between income taxes calculated at the Dutch statutory tax rate of 25% in 2011 (25.5% in 2010 and 2009) and the actual tax benefit/expense is as follows:

		000,000			000,000			000,000
	2011			2010			2009
	(€’000)
Profit for the year		25,572			14,682			26,452
Income tax (expense)/benefit		(9,737	)		(2,560	)		715

Profit before taxation		35,309			17,242			25,737


Income tax using Company’s domestic tax rate		(8,827	)		(4,397	)		(6,563	)
Effect of tax rates in foreign jurisdictions		(1,300	)		(891	)		(701	)
Change in tax rate and legislation		(325	)		(1,038	)		50
Non-deductible expenses		(1,494	)		(645	)		(523	)
Recognition of previously unrecognized tax losses		2,741			3,532			4,982
Current year results for which no deferred tax asset was recognized		219			849			476
Prior year adjustments included in current year tax		(243	)		—			—
Change in previously unrecognized temporary differences		37			30			2,994
Other		(545	)		—			—

Income tax (expense)/benefit		(9,737	)		(2,560	)		715

F-27

Recognized deferred tax assets/(liabilities)

The movement in recognized deferred tax assets during the year is as follows:


	Property, plant and equipment and Intangibles			Provision onerous contracts			Other			Tax loss carry- forward			Total
	(€’000)
January 1, 2009		545			3,922			1,011			38,620			44,098
Recognized in profit/(loss) for 2009		91			1,761			507			(2,040	)		319

December 31, 2009		636			5,683			1,518			36,580			44,417
Recognized in profit/(loss) for 2010		(340	)		(435	)		3,175			1,440			3,840
Effects of movements in exchange rates		—			—			—			354			354

December 31, 2010		296			5,248			4,693			38,374			48,611
Recognized in profit/(loss) for 2011		14,526			(866	)		(2,635	)		(15,316	)		(4,291	)
Recognized in equity		—			—			—			3,225			3,225
Effects of movements in exchange rates		(74	)		—			(10	)		197			113

December 31, 2011		14,748			4,382			2,048			26,480			47,658

Offset deferred tax liabilities		(5,976	)		—			(1,226	)		(899	)		(8,101	)

Net deferred tax assets/(liabilities)		8,772			4,382			822			25,581			39,557

Accumulated tax losses in the Netherlands available as at December 31, 2010, which were due to expire by December 31, 2011, have been preserved and renewed resulting in a temporary valuation difference for intangible assets.

In 2011 a total of € 3,225,000 in deferred taxes was recognized directly in equity to account for the deferred tax impact of fiscally deductible IPO costs directly recognized in equity.

The movement in recognized deferred tax liabilities during the year is as follows:


	Property, plant and equipment and Intangibles			Provision onerous contracts		Other			Tax loss carry- forward		Total
	(€’000)
January 1, 2009		(3,896	)		—		(1,998	)		—		(5,894	)
Recognized in profit/(loss) for 2009		685			—		377			—		1,062

December 31, 2009		(3,211	)		—		(1,621	)		—		(4,832	)
Recognized in profit/(loss) for 2010		(5,416	)		—		818			—		(4,598	)

December 31, 2010		(8,627	)		—		(803	)		—		(9,430	)
Recognized in profit/(loss) for 2011		(163	)		—		(250	)		—		(413	)

December 31, 2011		(8,790	)		—		(1,053	)		—		(9,843	)

Offset deferred tax assets		5,976			—		1,226			899		8,101

Net deferred tax assets/(liabilities)		(2,814	)		—		173			899		(1,742	)

F-28

The deferred tax assets and liabilities are presented as net amounts per tax jurisdiction as far as the amounts can be offset.

The estimated utilization of carried-forward tax losses in future years is based on management’s forecasts of future profitability by tax jurisdiction.

The following net deferred tax assets have not been recognized:

		000,000		000,000			000,000
	2011		2010			2009
	(€’000)
Deductible temporary differences - net		67		(204	)		(183	)
Tax losses		2,054		5,305			12,532

		2,121		5,101			12,349

The accumulated tax losses expire as follows:

000,000

2011

2010

2009

(€’000)

Within one year

4,204

52,149

5,741

Between 1 and 5 years

10,974

15,047

61,218

After 5 years

7,140

10,055

19,632

Unlimited

77,491

91,282

97,002

99,809

168,533

183,593

The accumulated tax losses expiring within one year include tax losses in Switzerland. The expiration of accumulated tax losses was part of the assessment of the valuation of deferred tax assets.

F-29

9	Property, plant and equipment


	Land		Data center equipment			Office buildings			Office equipment			Assets under construction			Total
	(€’000)
Cost:
As at January 1, 2011		1,388		467,228			7,578			14,020			16,346			506,560
Additions		19,057		43,229			1,732			1,418			103,245			168,681
Exchange differences		—		2,783			103			46			(42	)		2,890
Disposals		—		(6,504	)		(4	)		(63	)		0			(6,571	)
Transfers		—		18,376			—			—			(18,376	)		—

As at December 31, 2011		20,445		525,112			9,409			15,421			101,173			671,560
Accumulated depreciation:
As at January 1, 2011		—		(149,425	)		(3,737	)		(10,978	)		—			(164,140	)
Depreciation		—		(33,340	)		(547	)		(1,315	)		—			(35,202	)
Impairment reversal		—		783			—			—			—			783
Exchange differences		—		(774	)		(28	)		(35	)		—			(837	)
Disposals		—		5,598			0			36			—			5,634

As at December 31, 2011		—		(177,158	)		(4,312	)		(12,292	)		—			(193,762	)

Carrying amount as at December 31, 2011		20,445		347,954			5,097			3,129			101,173			477,798


Cost:
As at January 1, 2010		—		326,345			6,211			12,265			62,165			406,986
Additions		1,388		72,740			1,000			1,221			15,889			92,238
Exchange differences		—		5,667			116			157			1,936			7,876
Disposals		—		(529	)		(10	)		(1	)		—			(540	)
Transfers		—		63,005			261			378			(63,644	)		—

As at December 31, 2010		1,388		467,228			7,578			14,020			16,346			506,560
Accumulated depreciation:
As at January 1, 2010		—		(117,941	)		(3,282	)		(9,803	)		—			(131,026	)
Depreciation		—		(28,916	)		(384	)		(1,038	)		—			(30,338	)
Exchange differences		—		(2,878	)		(71	)		(137	)		—			(3,086	)
Disposals		—		310			—			—			—			310

As at December 31, 2010		—		(149,425	)		(3,737	)		(10,978	)		—			(164,140	)

Carrying amount as at December 31, 2010		1,388		317,803			3,841			3,042			16,346			342,420


Cost:
As at January 1, 2009		—		226,543			5,197			10,237			75,089			317,066
Additions		—		25,414			909			1,653			59,890			87,866
Exchange differences		—		1,399			31			99			1,005			2,534
Disposals		—		(176	)		—			—			—			(176	)
Transfers		—		73,165			74			276			(73,819	)		(304

As at December 31, 2009		—		326,345			6,211			12,265			62,165			406,986
Accumulated depreciation:
As at January 1, 2009		—		(97,021	)		(2,914	)		(8,925	)		—			(108,860	)
Depreciation		—		(20,263	)		(351	)		(809	)		—			(21,423	)
Exchange differences		—		(767	)		(17	)		(97	)		—			(881	)
Disposals		—		44			—			28			—			72
Transfer		—		66			—			—			—			66

As at December 31, 2009		—		(117,941	)		(3,282	)		(9,803	)		—			(131,026	)

Carrying amount as at December 31, 2009		—		208,404			2,929			2,462			62,165			275,960

F-30

The Group leases certain data center equipment under a number of finance lease agreements. At December 31, 2011, the carrying amount of leased equipment classified in data centers was € 1,048,000 (2010: € 1,845,000 and 2009: € 2,112,000).

In 2011, the Group capitalized interest expenses for € 2,577,000 (2010: € 1,987,000 and 2009: € 2,041,000).

In 2011 the Group reversed the impairment of data center assets in Sweden, as recognised in 2007, for an amount of € 783,000 resulting from the improved current profitability and future potential of the Swedish company.

In 2011, the Group purchased land in Paris for a value of € 19,057,000, based on which the Group has added land as a category to the Property, plant and equipment disclosure. The 2010 balances have been adjusted for transparency. Land amounting to € 1,388,000 was previously recognised as part of data center equipment.

Depreciation of property, plant and equipment is disclosed as general and administrative cost in the consolidated income statement.

F-31

10	Intangible assets

The components of intangible assets are as follows:


	Power grid rights			Software			Other			Total
				(€’000)
Cost:
As at January 1, 2011		1,711			4,220			1,835			7,766
Additions		5,653			2,026			—			7,679
Exchange differences		14			—			—			14

As at December 31, 2011		7,378			6,246			1,835			15,459
Amortization:
As at January 1, 2011		(198	)		(980	)		(583	)		(1,761	)
Amortization		(138	)		(840	)		(164	)		(1,142	)
Exchange differences		(14	)		—			—			(14	)

As at December 31, 2011		(350	)		(1,820	)		(747	)		(2,917	)

Carrying amount as at December 31, 2011		7,028			4,426			1,088			12,542


Cost:
As at January 1, 2010		304			2,494			1,835			4,633
Additions		1,407			1,726			0			3,133

As at December 31, 2010		1,711			4,220			1,835			7,766
Amortization:
As at January 1, 2010		(66	)		(454	)		(471	)		(991	)
Amortization		(132	)		(526	)		(112	)		(770	)

As at December 31, 2010		(198	)		(980	)		(583	)		(1,761	)

Carrying amount as at December 31, 2010		1,513			3,240			1,252			6,005


Cost:
As at January 1, 2009		—			1,380			1,809			3,189
Additions		—			1,114			26			1,140
Transfers		304			—			—			304

As at December 31, 2009		304			2,494			1,835			4,633
Amortization:
As at January 1, 2009		—			(73	)		(315	)		(388	)
Amortization		—			(381	)		(156	)		(537	)
Transfers		(66	)		—			—			(66	)

As at December 31, 2009		(66	)		(454	)		(471	)		(991	)

Carrying amount as at December 31, 2009		238			2,040			1,364			3,642

Amortisation of intangible assets is disclosed as general and administrative cost in the consolidated income statement.

F-32

11	Trade and other (non-) current assets


	2011		2010		2009
	(€’000)
Non-current
Rental and other supplier deposits		2,536		1,886		1,220
Deferred financing costs		667		1,281		—
Deferred rent related stamp duties		638		542		—

		3,841		3,709		1,220

Current
Trade receivables—net (Note 18)		43,350		38,370		37,261
Taxes		7,474		219		1,420
Prepaid expenses and other current assets		17,050		17,083		16,929

		67,874		55,672		55,610

The deferred financing costs relate to the costs incurred for the € 50 million Revolving Credit Facility. The costs are amortized over the three-year duration period of the facility agreement.

Prepaid expenses and other current assets principally comprise prepaid insurances, rental and other related operational data center, and construction-related prepayments.

12	Cash and cash equivalents

Cash and cash equivalents include € 4,813,000 (2010: € 4,235,000 and 2009: € 3,874,000) that is restricted and held as collateral to support the issuance of bank guarantees on behalf of a number of subsidiary companies.

13	Shareholders’ equity

Share capital and share premium


	Ordinary shares						2002 Series A preference shares
	2011		2010		2009		2011			2010		2009
	(In thousands of shares, post-reverse stock split)
On issue at January 1		9,546		9,543		8,838		34,808			34,808		34,808
Issue/conversion of shares		56,583		3		705		(34,808	)		—		—

On issue at December 31		66,129		9,546		9,543		—			34,808		34,808

On January 28, 2011, the Company issued 16,250 thousand new shares (post reverse stock split) at the New York Stock Exchange under the ticker symbol INXN. Upon completion of the offering, the Company did a reverse stock split 5:1, which resulted in nominal value of € 0.10 per ordinary shares. The 34,808 thousand Preferred shares were converted into ordinary shares and the liquidation price of € 1.00 (post reverse stock split) per Preferred A share was either paid out in cash or converted in ordinary shares (3.3 million ordinary shares). In 2011, approximately 2.2 million of options (post reverse stock split) have been exercised.

At December 31, 2011, the authorized share capital comprised 200,000,000 (post reverse stock split as at January 28, 2011) ordinary shares at par value of € 0.10. At December 31, 2010 and 2009, prior to the reversed stock split, the authorized share capital amounted to 575,000,000 ordinary shares and 175,000,000 2002 Series A preference shares. All issued shares are fully paid. Prior to the IPO and the reverse stock split, all the shares had a par value of € 0.02.

F-33

The net proceeds of the Initial Public Offering amounted to € 138.6 million, which is used for general corporate purposes including, without limitation, capital expenditures relating to expansion of existing data center and construction of new data center.

Voting

Upon completion of the initial public offering in January 2011, the Company entered into a shareholders’ agreement with affiliates of Baker Capital. For so long as Baker Capital or its affiliates continue to be the owner of shares representing more than 25% of our outstanding ordinary shares, Baker Capital will have the right to designate for nomination a majority of the members of our board of directors, including the right to nominate the chairman of our board of directors. As a result, these shareholders have, and will continue to have, directly or indirectly, the power, among other things, to affect our legal and capital structure and our day-to-day operations, as well as the ability to elect and change our management and to approve other changes to our operation. The interests of Baker Capital and its affiliates could conflict with your interests, particularly if we encounter financial difficulties or are unable to pay our debts when due. Affiliates of Baker Capital also have an interest in pursuing acquisitions, divestitures, financings or other transactions that, in their judgment, could enhance their equity investments, although such transactions might involve risks to you as a holder of ordinary shares. In addition, Baker Capital or its affiliates may, in the future, own businesses that directly compete with ours or do business with us. The concentration of ownership may further have the effect of delaying, preventing or deterring a change of control of our company, could deprive our shareholders of an opportunity to receive a premium for their ordinary shares as part of a sale of our company and might ultimately affect the market price of our ordinary shares.

Prior to the initial public offering in January 2011, the holders of the 2002 Series A preference shares were entitled to vote, together with holders of the Company’s ordinary shares, on all matters submitted to shareholders for vote. Each share equals one vote. In addition to voting privileges, holders of the 2002 Series A preference shares were entitled to certain prior-consent rights against certain actions proposed by the Board of Directors.

Dividends

Prior to the IPO, dividends that are paid from the profits of the Company and, if permitted under Dutch law, as a result of a sale by the Company of shares or assets of the Company or a subsidiary other than pursuant to an IPO, sale or liquidation event shall be distributed in the following priority: first to holders of the 2002 Series A preference shares in an amount equal to the purchase price of the 2002 Series A preference shares (reduced by any dividend previously received on the 2002 Series A preference shares) and second to the extent any residual amount exits thereafter, pro rata amongst all holders of ordinary shares and 2002 Series A preference shares. Upon the completion of an IPO or a sale, the holders of the 2002 Series A preference shares were entitled to receive the 2002 Series A Share Purchase Price of € 0.20 per share (pre-reverse stock split) less any dividends exclusively paid to the holders of the 2002 Series A preference shares in cash or in ordinary shares.

Foreign currency translation reserve

The foreign currency translation reserve comprises of all foreign exchange differences arising from the translation of the financial statements of foreign operations as well as from the translation of intergroup balances with a permanent nature.

F-34

14	Earnings per share

Basic earnings per share

The calculation of basic earnings per share at December 31, 2011, was based on the profit of € 25,572,000 attributable to ordinary shareholders and pre-IPO the preference shareholders (2010: € 14,682,000 and 2009: € 26,452,000) and a weighted average number of ordinary and preference shares outstanding during the year ended December 31, 2011 of 66,052,000 (2010: 44,352,000 and 2009: 43,999,000). Profit is attributable to ordinary and preference shares (pre-IPO) on an equal basis.

Diluted earnings per share

The calculation of diluted earnings per share at December 31, 2011 was based on the profit of € 25,572,000 attributable to ordinary shareholders and pre-IPO the preference shareholders (2010: € 14,682,000 and 2009: € 26,452,000) and a weighted average number of ordinary and preference shares outstanding during the year ended December 31, 2011 of 67,449,000 (2010: 47,707,000 and 2009: 46,792,000) post reverse stock split.

In January 2011, the Company issued new shares at the New York Stock Exchange under the ticker symbol INXN. Upon completion of the offering, the Company did a reverse stock split 5:1, which resulted in nominal value of € 0.10 per ordinary shares. The 5:1 reverse stock split effectuated is presented in the basic earnings per share calculation and the diluted earnings per share calculation.

Profit attributable to ordinary and preference shareholders

2011

2010

2009

(€’000)

Profit attributable to ordinary and preference shareholders (basic)

25,572

14,682

26,452

Profit attributable to ordinary and preference shareholders

25,572

14,682

26,452

Weighted average number of ordinary shares and preference shares


	2011		2010		2009
	(in thousands of shares, post reverse stock split)
Weighted average number of ordinary shares (basic)		61,506		9,544		9,191
Weighted average number of preference shares		2,670		34,808		34,808

Weighted average number of ordinary and preference shares at December 31		64,176		44,352		43,999
Dilution effect of share options on issue		1,720		3,355		2,793

Weighted average number of ordinary and preference shares (diluted) at December 31		65,896		47,707		46,792

F-35

15	Trade payables and other liabilities


	2011		2010		2009
	(€’000)
Non-current
Deferred revenue		4,801		6,093		6,815
Other non-current liabilities		5,493		1,702		1,412

		10,294		7,795		8,227

Current
Trade payables		34,090		20,504		25,032
Tax and social security		4,180		2,725		3,607
Customer deposits		16,942		15,487		12,941
Deferred revenue		38,110		33,152		30,437
Accrued expenses		34,317		34,170		19,012

		127,639		106,038		91,029

Trade payables include € 20,877,000 (2010: € 8,027,000 and 2009 € 15,147,000) accounts payable in respect of purchases of property, plant and equipment.

Accrued expenses are analysed as follows:


	2011		2010		2009
	(€’000)

Data center related costs		7,951		9,243		6,200
Personnel and related costs		7,973		7,895		7,027
Professional services		2,476		1,876		1,315
Customer implementation and related costs		2,237		1,586		678
Financing related costs		9,650		10,236		87
Other		4,030		3,334		3,705

		34,317		34,170		19,012

As at December 31, 2011, the accrued Financing related costs principally relate to interest expenses on the Senior Secured Notes.

F-36

16	Provision for onerous lease contracts

As at December 31, 2011, the provision for onerous lease contracts relates to two unused data center sites in Germany, one in Munich terminating in March 2016 and one in Dusseldorf terminating in August 2016.

The provision is calculated based on the discounted future contracted payments net of any sublease revenues.


	2011			2010			2009
	(€’000)

As at 1 January		16,333			18,912			22,912
Increase in provision		—			—			3,282
Settlement		—			—			(4,950	)
Unwinding of discount		518			578			708
Utilisation of provision		(3,125	)		(3,157	)		(3,040	)

As at December 31		13,726			16,333			18,912

Non-current		10,618			13,260			15,844
Current		3,108			3,073			3,068

		13,726			16,333			18,912

Discounted estimated future losses are calculated using a discount rate based on the 5-year Euro-area government benchmark bond yield prevailing at the balance sheet date.

17	Borrowings


	2011		2010		2009
	(€’000)
Non-current
Senior Secured Notes 9.5%, due 2017		255,560		254,924		—
Bank borrowings		—		—		124,777
Finance lease liabilities		102		336		889
Other loans		1,605		2,143		3,012

		257,267		257,403		128,678
Current
Bank borrowings		—		—		24,168
Finance lease liabilities		235		429		347
Other loans		568		1,967		1,906

		803		2,396		26,421

Total borrowings		258,070		259,799		155,099

The carrying amounts of the Group’s borrowings are principally denominated in Euros. The face value of the Senior Secured Notes as at December 31, 2011 respectively 2010 is € 260,000,000.

Senior Secured Notes and Bank borrowings

In February 2010, the Company issued, at par, € 200,000,000 of 9.5% Senior Secured Notes due 2017 (the “Original Notes”), which are guaranteed by some of its subsidiaries. The notes are listed on the Luxembourg Stock Exchange’s Euro MTF Market. A portion of the proceeds were used to repay in full the Company’s bank borrowings outstanding under the € 180,000,000 bank credit facilities and to pay transaction fees and expenses. On February 18, 2010, the Group closed out its interest-rate swap contracts.

F-37

In 2009, the Company also entered into a new € 60 million revolving credit facility with a syndicate of banks. The revolving credit facility was reduced to € 50 million before year-end 2010. As at December 31, 2011, the revolving credit facility was undrawn.

In November 2010, the Company issued, above par at 106.5, € 60 million 9.50% Senior Secured Notes due 2017 as additional notes (the “Additional Notes”) under the indenture pursuant to which we issued the Original Notes.

The proceeds of the Senior Secured Notes and the former Bank borrowings were used to finance investments in capital expansion projects in order to increase equipped space within new and existing data centers.

The maturity profile of the gross amounts of Senior Secured Notes and bank borrowings is set out below:


	2011		2010		2009
	(€’000)

Within one year		—		—		24,843
Between 1 and 5 years		—		—		127,659
Over 5 years		260,000		260,000		—

		260,000		260,000		152,502

The Group has the following undrawn bank borrowing facilities:


	2011		2010		2009
	(€’000)

Expiring within one year		—		—		27,613
Expiring between 1 and 5 years		50,000		50,000		—

		50,000		50,000		27,613

As at the year-end, the Group was in compliance with all covenants associated with its bank and Senior Secured Notes borrowings.

F-38

Financial lease liabilities

Financial lease liabilities relate to the acquisition of property, plant and equipment with the following repayment schedule:


	2011			2010			2009
	(€’000)
Gross lease liabilities:
Within one year		236			459			526
Between 1 and 5 years		132			351			807

		368			810			1,333
Future interest payments		(31	)		(45	)		(97	)

Present Value of Minimum Lease Payments		337			765			1,236

Other loans

The Company has a loan facility with the landlord of one of its unused data center sites in Germany to allow the Company to invest in improvements to the building to meet the requirements of sub-lessees. The non-current loan bears interest at 6% per annum and is repayable at the end of the lease term. As at December 31, 2011, the balance of the landlord loan was € 1,605,000 (2010: € 1,605,000 and 2009: € 1,605,000).

During 2009, the Company entered into a loan facility with the landlord of its unused data center site in Switzerland to fund the settlement of the lease of that site. The loan has been fully repaid as at December 31, 2011 (2010: € 1,673,000 and 2009: € 3,205,000).

In 2010, the Company entered into a supplier loan amounting to approximately € 800,000, which bears an interest at 7%. As at December 31, 2011, the balance of the supplier loan was € 568,000.

18	Financial instruments

Credit risk

Exposure to credit risk

The carrying amount of financial assets represents the maximum credit exposure. The maximum exposure to credit risk at the reporting date was:


	2011		2010		2009
	(€’000)

Trade receivables		43,350		38,370		37,261
Rental and other supplier deposits		2,536		1,886		1,220
Cash and cash equivalents		142,669		99,115		32,003

		188,555		139,371		70,484

F-39

The maximum exposure to credit risk for trade receivables at the reporting date by geographic region was:


	2011		2010		2009
	(€’000)

UK, France, Germany and the Netherlands		31,336		27,162		26,953
Rest of Europe		12,014		11,208		10,308

		43,350		38,370		37,261

The Group’s most significant customer accounts for less than 5% of the trade receivables carrying amount as at December 31, 2011, as at December 31, 2010, and as at December 31, 2009.

The Group seeks to minimize the risk that this constraint imposes by holding cash as widely as possible across multiple bank institutions. Term risk is limited to deposits of no more than two weeks. The Group monitors its cash position, including counterparty and term risk, daily.

The aging of trade receivables as at the reporting date was:


	2011				2010				2009
	Gross		Allowance		Gross		Allowance		Gross		Allowance
	(€’000)
Not past due		36,533		—		28,129		—		30,031		—
Past due 0-30 days		3,549		—		6,546		—		4,708		—
Past due 31-120 days		3,009		35		3,884		235		2,437		56
Past due 120 days—1 year		609		358		177		150		274		206
More than 1 year		267		224		114		95		113		40

		43,967		617		38,850		480		37,563		302

The movement in the allowance for impairment in respect of trade receivables during the year was as follows:


	2011			2010			2009
	(€’000)
Balance as at January 1		480			302			144
Impairment loss recognized		281			192			176
Write-offs		(144	)		(14	)		(18	)

Balance as at December 31		617			480			302

Based on historic default rates, the Group believes that no impairment allowance is necessary in respect of trade receivables other than those that have been specifically provided for.

F-40

Liquidity risk

The following are the contractual maturities of financial liabilities, including interest payments and excluding the impact of netting agreements.

December 31, 2011

		Contractual		Contractual		Contractual		Contractual		Contractual
	Carrying amount		Contractual cash flows		Less than 1 year		Between 1 - 5 years		More than 5 years
	(€’000)
Financial liabilities
Senior Secured Notes		255,560		395,850		24,700		98,800		272,350
Finance lease liabilities		337		368		263		105		—
Other loans		2,173		2,623		729		1,894		—
Trade and other payables ⁽² ⁾		89,529		89,529		89,529		—		—

		347,599		488,370		115,221		100,799		272,350

December 31, 2010

		Contractual		Contractual		Contractual		Contractual		Contractual
	Carrying amount		Contractual cash flows		Less than 1 year		Between 1 - 5 years		More than 5 years
	(€’000)
Financial liabilities
Senior Secured Notes		254,924		411,110		24,700		98,800		287,610
Finance lease liabilities		765		810		459		351		—
Other loans		4,110		4,759		2,753		385		1,621
Trade and other payables ⁽² ⁾		74,595		74,595		74,595		—		—

		334,394		491,274		102,507		99,536		289,231

December 31, 2009

		Contractual		Contractual		Contractual		Contractual		Contractual
	Carrying amount		Contractual cash flows		Less than 1 year		Between 1 - 5 years		More than 5 years
	(€’000)
Financial liabilities
Bank borrowings ⁽¹⁾		148,945		174,178		35,703		138,465		10
Finance lease liabilities		1,236		1,333		499		834		—
Other loans		4,918		5,029		2,005		1,419		1,605
Trade and other payables ⁽² ⁾		62,004		62,004		60,592		1,412		—

		217,103		242,544		98,799		142,130		1,615

Notes:

(14)	Cash flows for bank borrowings include the estimated cash flows from the interest rate swaps.

(15)	Excludes deferred revenues and rental holidays.

F-41

Market Risk

Exposure to currency risk

The following significant exchange rates applied during the year:


	Average rate						Report date mid-spot rate
	2011		2010		2009		2011		2010		2009
Euro
GBP 1		1.152		1.179		1.122		1.193		1.161		1.117
CHF 1		0.812		0.780		0.662		0.822		0.802		0.674
DKK 1		0.134		0.134		0.134		0.135		0.134		0.134
SEK 1		0.111		0.110		0.094		0.112		0.111		0.098

Sensitivity analysis

A 10% strengthening of the Euro against the following currencies at December 31 would have increased (decreased) equity and profit or loss by approximately the amounts shown below. This analysis assumes that all other variables, in particular interest rates, remain constant and is performed on the same basis for 2010 and 2009.


	Equity			Profit or loss
	(€’000)
December 31, 2011
GBP		(219	)		(561	)
CHF		(1,321	)		71
DKK		(1,279	)		(149	)
SEK		(416	)		(384	)
December 31, 2010
GBP		344			(805	)
CHF		(1,356	)		(88	)
DKK		(1,122	)		(112	)
SEK		(27	)		(26	)
December 31, 2009
GBP		1,100			(358	)
CHF		(1,058	)		(289	)
DKK		(1,007	)		(134	)
SEK		(1	)		10

A 10% weakening of the Euro against the above currencies at December 31 would have had the equal but opposite effect on the above currencies to the amounts shown above, on the basis that all other variables remain constant.

F-42

Interest rate risk

Profile

At the reporting date, the interest rate profile of the Group’s interest-bearing financial instruments was:


	Carrying amount
	2011		2010		2009
	(€’000)
Fixed rate instrument
Senior Secured Notes		255,560		254,924		—
Finance lease liabilities		337		765		1,236
Other loans		2,173		4,110		4,918

		258,070		259,799		6,154

Variable rate instruments
Bank borrowings		—		—		148,945

		258,070		259,799		155,099

In November 2009, the Group entered into an interest rate swap to fix interest rates on variable rates borrowings. The amount hedged via an interest rate swap was € 45.9 million. The hedge is not effective as the hedged financial instrument is extinguished by the Senior Secured Notes issued in 2010. Unrealized hedging results were booked to net finance expenses in the income statement. On February 18, 2010, the Group closed out its interest-rate swap contracts. The below schedule summarizes the open interest swap transactions and their valuation as at December 31.

Fair values of interest rate swaps as at 31 December


	2011		2010		2009
	(€’000)
Interest swaps		—		—		(99	)

Total fair value		—		—		(99	)

Cash flow sensitivity analysis for variable rate instruments

A change of 100 basis points in interest rates payable at the reporting date would have increased (decreased) equity and profit or loss by the amounts shown below. This analysis assumes that all other variables, in particular foreign currency rates, remain constant. The analysis is performed on the same basis for 2010 and 2009.


	Profit or loss					Equity
	100 bp increase			100 bp decrease		100 bp increase			100 bp decrease
	(€’000)
December 31, 2011
Variable rate instruments		—			—		—			—
December 31, 2010
Variable rate instruments		—			—		—			—
December 31, 2009
Variable rate instruments		(1,458	)		1,458		(1,458	)		1,458

F-43

Fair values and hierarchy

Fair values versus carrying amounts

The market price of the Senior Secured Notes as of December 31, 2011 was 108.75. Using this premium the fair value of the Senior Secured Notes would have been approximately € 282.8 million compared to its nominal value of € 260 million. The carrying amounts of other financial assets and liabilities approximate their fair value.

Fair value hierarchy

As at December 31, 2011, there are no liabilities related to financial instruments which are carried at fair value. The company uses three levels of valuation method as defined below:

Level 1:

quoted prices (unadjusted) in active markets for identical assets or liabilities

Level 2:

inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e., as prices) or indirectly (i.e., derived from prices)

Level 3:

inputs for the asset or liability that are not based on observable market data (unobservable inputs).

The Group had no financial instruments carried at fair value at December 31, 2011 (2010: nil and 2009: (99)):


	Level 1		Level 2			Level 3
December 31, 2011
Interest rate swaps		—		—			—
December 31, 2010
Interest rate swaps		—		—			—
December 31, 2009
Interest rate swaps		—		(99	)		—

Capital Management

The Board’s policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence and to sustain future development of the business. The Board of Directors monitors the return on capital.

The Group’s net debt to adjusted equity ratio at the reporting date was as follows:


	2011			2010			2009
	(€’000)
Net Debt
Total liabilities		413,720			391,493			273,643
Less: Cash		(142,669	)		(99,115	)		(32,003	)

		271,051			292,378			241,640
Equity
Total equity		330,561			155,269			134,377


Net debt to adjusted equity ratio		0.82			1.88			1.80

F-44

19	Share-based payments

Summary of outstanding options

Share options to acquire a fixed number of shares are granted to employees and others based on a number of factors. The exercise price is fixed at the date of the grant. The numbers of options listed below are post the reverse stock split 5:1, which was effectuated upon completion of the initial public offering on January 28, 2011.

The terms and conditions of the grants, post reverse stock split, under the 2008 Option Plan with an exercise price, are as follows:


Grant date	Employees entitled	Exercise price in €		Options granted outstanding		Options granted outstanding, vested
		(In thousands)
2003-2005	Key management		2.00		54		54
	Key management		1.00		8		8
	Senior employees		1.00		48		48
	Senior employees		2.00		28		28
2007	Key management		3.50		1,496		1,496
	Key management		4.45		100		100
2008	Senior employees		1.00		10		10
	Senior employees		2.00		1		1
	Senior employees		4.45		239		223
	Senior employees		5.00		71		51
2009	Key management		5.00		100		50
	Senior employees		5.00		56		25
2010	Key management		5.00		40		18
	Senior employees		5.00		168		74
	Key management		6.50		60		19
	Senior employees		6.50		47		18
	Senior employees		7.50		28		8

	Total share options				2,554		2,231

The terms and conditions of the grants, post reverse stock split, under the 2011 Option Plan with an USD exercise price, are as follows:


Grant date	Employees entitled	Exercise price in $		Outstanding		Exercisable
		(In thousands)
2011	Key management (Executive Director)		14.74		600		200
	Non-Executive Directors		13.00-14.74		30		—
	Senior employees		13.00-14.65		706		47

	Total share options				1,336		247

Share options granted before the year 2011, under the 2008 Option Plan, vest over 4 years and can be exercised up to 5 years after the date of grant. In 2010, the exercise periods of some options granted in 2003 and 2005 but not yet exercised were extended to March 31, 2012. Share options granted in the year 2011, under the 2011 Option Plan generally, vest over 4 years and can be exercised up to 8 years after the date of grant. The options granted in 2011 to the Company’s Executive Director, Non-Executive Directors and certain employees have an accelerated vesting term.

F-45

The number and weighted average exercise prices of outstanding share options, post reverse stock split, under the 2008 Option Plan with euro exercise prices are as follows:


	Weighted average exercise price in €						Number of options in thousands
	2011		2010		2009		2011			2010			2009
Outstanding at January 1		2.91		2.65		2.45		4,733			4,366			5,078
Granted		—		5.64		5.00		—			415			197
Exercised		1.61		1.50		1.00		(2,156	)		(4	)		(704	)
Expired		—		1.00		—		—			(6	)		—
Forfeited		5.76		5.62		4.20		(23	)		(38	)		(205	)

Outstanding—December 31		3.94		2.91		2.65		2,554			4,733			4,366
Exercisable—December 31		3.72		2.36		2.05		2,231			3,997			3,453

The number and weighted average exercise prices of outstanding share options, post reverse stock split, under the 2011 Option Plan with US dollar exercise prices are as follows:

Weighted average
exercise price in $

Number of options in
thousands

2011

2010

2009

2011

2010

2009

Outstanding at January 1

—

Granted

13.65

—

1,336

—

Exercised

—

Expired

—

Forfeited

—

Outstanding—December 31

13.65

—

1,336

—

Exercisable—December 31

14.41

—

247

—

The options outstanding at December 31, 2011 have a weighted average remaining contractual life of 3.2 years (2010: 4.3 years and 2009: 3.6 years).

Employee expenses

In 2011, the Company recorded employee expenses of € 2,736,000 related to share-based payments (2010: € 1,684,000 and 2009: € 950,000).

The weighted average fair value at grant date of options granted during the period has been determined using the Black-Scholes valuation model. The following inputs have been used:


	2011			2010			2009
Share price in € at grant date (post reverse stock split)		8.02-9.71			10.20-14.10			6.70 to 8.60
Exercise price in € (post reverse stock split)		9.01 to 10.95			5.00 to 7.50			5.00
Dividend yield		0	%		0	%		0	%
Expected volatility		40	%		35	%		35	%
Risk free interest rate		2.0	%		4.0	%		4.1	%
Expected life weighted average		5.1 years			3.5 years			3.5 years

The significant inputs into the model were:

Expected volatility based on the performance of companies that are considered to be comparable to the Group.

F-46

A risk-free interest rate based on the yield on zero coupon bonds issued by the Netherlands government with a maturity similar to the expected life of the options.

Expected life is considered to be equal to the average of the share option exercise and vesting periods.

20	Financial commitments

Non-cancellable operating lease commitments

At December 31, the Group has future minimum commitments for non-cancellable operating leases with terms in excess of one year as follows:


	2011		2010		2009
	(€’000)
Within 1 year		25,529		23,280		22,717
Between 1 to 5 years		102,741		92,269		84,439
After 5 years		167,428		124,488		75,728

		295,698		240,037		182,884

As at December 31, 2011, of the non-cancellable operating leases an amount of € 13,668,000 relates to the lease contracts, which are provided for as part of the provision for onerous lease contracts.

The total gross operating lease expense for the year 2011 was € 22,000,000 (2010: € 21,082,000 and 2009: € 20,483,000).

Future committed revenues receivable

The Group enters into initial contracts with its customers for periods of at least 1 year and generally between 3 and 5 years resulting in future committed revenues from customers. At December 31, the Group had contracts with customers for future committed revenues receivable as follows:


	2011		2010		2009
	(€’000)
Within 1 year		139,475		154,634		101,235
Between 1 to 5 years		201,620		149,900		96,392
After 5 years		103,934		18,606		16,093

		445,029		323,140		213,720

F-47

Commitments to purchase power

The Group, where possible and for its own use, seeks to purchase power on fixed-price term agreements with local power supply companies within the cities in which it operates. In some cases the Group also commits to purchase certain minimum volumes of power at fixed prices. At December 31, the Group had entered into non-cancellable power purchase commitments as follows:


	2011		2010		2009
	(€’000)
Within 1 year		15,800		13,900		9,800
Between 1 to 5 years		—		14,700		—

		15,800		28,600		9,800

21	Capital commitments

At December 31, 2011, the Group had outstanding capital commitments totalling € 102,000,000 (2010: € 19,855,000 and 2009: € 33,539,000). These commitments are expected to be settled in the following financial year. The increase results from ongoing expansion projects.

22	Contingencies

Guarantees

Certain of our subsidiaries have granted guarantees to our lending banks in relation to our borrowings. The Company has granted rent guarantees to landlords of certain of the Group’s property leases. Financial guarantees granted by the Group’s banks in respect of operating leases amount to € 6,350,000 (2010: € 3,920,000 and 2009: € 3,828,000) and other supplier guarantees amounting to € 1,027,000.

Costs of sites restoration

As at December 31, 2011, the estimated discounted cost relating to the restoration of data center leasehold premises was € 17,000,000 (2010: € 15,400,000 and 2009: € 14,481,000), of which € 701,000 (2010: € 695,000 and 2009: € 633,000) was recognized. Remaining lease terms are over a range of 1 to 23 years and, in accordance with the Group’s accounting policy, amounts have only been provided in the financial statements in respect of premises where it is probable that the lease will not be renewed. The Group expects to exercise its right to renew its leases when they expire and continue to use the sites as data centers. It is therefore not expected that other site restoration liabilities will be incurred.

Other obligations pertaining to the Company, not appearing on the statement of financial position have been disclosed in Note 34 below.

23	Related-party transactions

There are no material transactions with related parties, other than as disclosed below, and all transactions are conducted at arm’s length.

Shareholders Agreement

Upon completion of the Initial Public Offering, the company entered into a shareholders’ agreement with affiliates of Baker Capital. For so long as Baker Capital or its affiliates continue to be the owner of shares representing more than 25% of Interxion’s outstanding ordinary shares, Baker Capital will have the right to designate for nomination a majority of the members of the board of directors, including the right to nominate the chairman of our board of directors

F-48

If Baker Capital or its affiliates continues to be the owner of shares representing less than or equal to 25% but more than 15% of the outstanding ordinary shares, Baker Capital will have the right to designate for nomination three of the seven members of the Board, at least one of whom shall satisfy the criteria for independent directors. For so long as Baker Capital or its affiliates continues to be the owner of shares representing less than or equal to 15% but more than 10% of the outstanding ordinary shares, Baker Capital will have the right to designate for nomination two of the seven members of our Board, none of whom shall be required to be independent. At such time that the ownership of Baker Capital or its affiliates is less than or equal to 10% but more than 5% of the outstanding ordinary shares, Baker Capital will have the right to designate for nomination one of the seven members of our Board, who shall not be required to be independent.

Furthermore, for so long as Baker Capital or its affiliates continues to be the owner of shares representing more than 25% of the outstanding ordinary shares, Baker Capital will have the right, but not the obligation, to nominate the Chairman of our Board.

As long as Baker Capital or its affiliates continues to be the owner of shares representing more than 15% of the outstanding ordinary shares, at least one of Baker Capital’s director nominees shall be appointed to each of our standing committees, provided that such Baker Capital nominees shall meet any independence or other requirements of the applicable listing standards.

As at April 1, 2012, private equity investment funds affiliated with Baker Capital indirectly own 30.88%, on a fully diluted basis, of Interxion’s equity.

Key management compensation

The total compensation of key management is as follows:


	2011		2010		2009
	(€’000)
Short-term employee benefits (salaries and bonuses)		3,406		3,937		3,505
Post-employment benefits		44		88		66
Share-based payments		1,263		635		504
Termination benefits		115		—		83

		4,828		4,660		4,158

Key management’s share-based payment compensation is disclosed in Note 19, and the compensation of the Executive Director and Non-Executive Directors of the Board is disclosed on individual basis in Note 32.

France IX loan

Interxion France is a member and co-founder of the France IX association, founded in 2010, the mission of which is to reinforce Paris as a global peering point by developing a panel of services that meets the various, and current, needs of the market, and by gathering together French and foreign ISPs and internet services, and content providers. To date Interxion France has incurred aggregate cost of € 574,000, which have been recharged to France IX association, receipt of which has been formalised in a loan agreement.

F-49

24	Events subsequent to the balance sheet date

Change in ownership of shares

On Wednesday March 14, 2012, Chianna Investment N.V. requested that Interxion instruct its Transfer Agent, American Stock Transfer & Trust Company, to remove the restrictive legend on the 10,143,599 Interxion shares that Chianna Investment N.V. holds. Baker Capital informed Interxion that it intended to make a pro rata distribution-in-kind of these shares immediately to the partners of Baker Communications Fund (Cayman) LP, Baker Capital holds an additional 20,657,892 Interxion shares through a successor fund, Baker Communications Fund II (Cayman) LP.

This distribution did not have any effect upon the total number of shares outstanding.

F-50

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