Table of Contents WEWORK COMPANIES INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS JUNE 30, 2019 (UNAUDITED) Common Stock and 50,967,800 shares of Class B Common Stock. As of June 30, 2019, there were 1,516,130 shares of Class A Common Stock and 1,530,434 shares of Class B Common Stock and equivalents that remained available for further grants under the 2015 Plan. Stock Options—Stock options outstanding consist primarily of time-based options to purchase Class A or Class B Common Stock, the majority of which vest over a five-year period and have a ten-year contractual term. These awards are subject to the risk of forfeiture until vested by virtue of continued employment or service to the Company and, with respect to certain awards, satisfaction of various performance criteria. The following table summarizes the stock option activity during the six months ended June 30, 2019: Weighted- Weighted- Average Aggregate Average Remaining Intrinsic Number of Exercise Contractual Value Shares Price Life in Years (In thousands) Outstanding, December 31, 2018 35,744,941 $ 14.37 7.1 $ 809,823 (1) Granted 55,830,526 $ 38.32 (2) Exercised (12,405,025) $ 31.91 Forfeited/canceled (1,927,214) $ 27.97 Outstanding, June 30, 2019 77,243,228 $ 28.54 8.5 $ 1,018,070 Exercisable, June 30, 2019 20,377,013 $ 9.03 5.7 $ 666,147 Vested and expected to vest, June 30, 2019 51,729,974 $ 23.85 7.8 $ 924,569 Vested and exercisable, June 30, 2019 19,918,060 $ 9.07 5.7 $ 650,316 (1) Included in options granted are options to purchase 33,034,684 shares of the Company’s Class B common stock, which were granted in March 2019 and will vest monthly over a service period of two to five years once the performance-based vesting conditions are met, including vesting conditions tied to a sale of the Company, an initial public offering and significant increases in market capitalization, and sales of the Company’s outstanding preferred stock at various valuations. The fair value of these options were estimated through the use of the Monte Carlo Model. Also included in the options granted are options to purchase 822,728 shares of the Company’s Class A common stock, which were granted during six months ended June 30, 2019 and will vest upon the satisfaction of specified performance conditions. The fair value of these options were estimated through the use of the Black-Scholes Model. (2) Included in options exercised is an early exercise of 9.4 million shares in connection with a non-recourse note which is considered options outstanding. The weighted-average grant date fair value of options granted during the year ended December 31, 2018 and the six months ended June 30, 2019 were $11.5 and $16.6, respectively. The Company estimates the fair value of stock option awards granted using the Black-Scholes Model and a single option award approach. The assumptions used to value stock options issued during the year ended December 31, 2018 and the six months ended June 30, 2019, were as follows: December 31, June 30, 2018 2019 Fair value of common stock $ 26.45 - 26.75 $ 37.44 - 42.88 Weighted average expected term (years) 6.19 6.41 Weighted average expected volatility 40.0% 40.0% Risk-free interest rate 2.41 - 2.99% 1.98 - 2.70% Dividend yield — — For the six months ended June 30, 2018 and 2019, the Company recorded total stock-based compensation expense of $23.6 million and $45.5 million, respectively, related to stock options awarded to employees and non-employee F-117