Table of Contents WEWORK COMPANIES INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS JUNE 30, 2019 (UNAUDITED) Six Months Ended Six Months Ended June 30, 2018 June 30, 2019 Other Other VIEs (1) (2) (1) (Amounts in thousands) Asia JVs VIEs Asia JVs (2) Consolidated VIE statement of operations information: Net income (loss) $(128,254) — $(169,289) $ (3,337) Consolidated VIE cash flow information: Net cash used in operating activities (42,496) — (76,568) (3,422) Net cash used in investing activities (336,036) — (243,896) (893,477) Net cash provided by financing activities 20,223 — 48,774 889,371 (1) The “Asia JVs” include ChinaCo, JapanCo and PacificCo. The consent of an affiliate of SoftBank Group Capital Limited is required for any dividends to be distributed by the JapanCo and PacificCo consolidated VIEs. As a result, any net assets of JapanCo and PacificCo would be considered restricted net assets to the Company. In addition, certain subsidiaries of ChinaCo are incorporated in China and subject to PRC laws and regulations, as a result, assets may not be freely transferable to the U.S. due to the local laws and restrictions. The net assets of the Asia JVs include preferred stock issued to affiliates of SoftBank and other investors that includes liquidation preferences totaling $1.6 billion as of both December 31, 2018 and June 30, 2019, and are redeemable upon the occurrence of an event that is not solely within the control of the Company. After reducing the net assets of each Asia JV by the liquidation preference associated with the redeemable stock issued, the remaining net assets of each Asia JV is negative. The initial issuance price equals the liquidation preference for each share issued as of December 31, 2018 and June 30, 2019. (2) The “Other VIEs” includes all other consolidated VIEs, other than the Asia JVs discussed separately in (1) and include the 424 Fifth Venture, the Creator Fund and WeWork Waller Creek. (3) Total net assets represents total assets less total liabilities and redeemable stock issued by VIEs after the total assets and total liabilities have both been reduced to remove amounts that eliminate in consolidation. The assets of consolidated VIEs will be used first to settle obligations of the VIE. Remaining assets may then be distributed to the VIEs’ owners, including the Company, subject to the liquidation preferences of certain noncontrolling interest holders and any other preferential distribution provisions contained within the operating agreements of the relevant VIEs. Other than the restrictions relating to the Company’s Asia JVs discussed in (1) above, third-party approval for the distribution of available net assets is not required for the Company’s Other VIEs. Note 8. Acquisitions 2019 Activity In May 2019, the Company acquired 100% of the equity of seven entities collectively known as “Emprenurban” for total consideration of $33.5 million. Emprenurban is a Latin American construction manager, real estate developer, builder and consultant with operations in Argentina, Uruguay, Paraguay, Peru, Colombia, Brazil, Chile and Mexico. The total consideration consisted of $31.5 million in cash paid at closing with an additional $2.0 million of the cash consideration being held back at closing and included in other current liabilities as of June 30, 2019. In April 2019, the Company acquired 100% of the equity of Managed by Q for total consideration of $189.7 million. The total consideration consisted of $107.5 million in cash, $0.2 million in Class A Common Stock options, and $82.0 million in Series AP-3 Preferred Stock. At closing, $18.7 million of cash consideration was held back and included in other current liabilities as of June 30, 2019. Managed by Q was founded in 2013 and offers a workplace management platform that specializes in facilities management services whereby its clients can discover, book, manage and pay for a wide range of services through an online dashboard to keep their office spaces running efficiently. During 2019, the Company acquired 100% of the equity of another company for total cash consideration of $5.7 million. At closing $0.6 million of the cash proceeds were held back and are included in other current liabilities as of June 30, 2019. F-98