Table of Contents WEWORK COMPANIES INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS JUNE 30, 2019 (UNAUDITED) PacificCo During 2017, a consolidated subsidiary of the Company (“PacificCo”) entered into an agreement with an investor for the sale of $500.0 million of Series A-1 Preferred Stock at a price of $10.00 per share and a liquidation preference of $10.00 per share on terms and subject to conditions substantially identical to the terms and conditions of the ChinaCo transaction described above. The initial closing occurred on October 30, 2017 and all of the PacificCo Series A-1 Preferred Stock was issued at that time, however the Company received contributions totaling $200.0 million at the initial closing and an additional $100.0 million during the year ended December 31, 2018. Pursuant to the terms of the agreement an additional $100.0 million is required to be contributed in each of 2019 and 2020. The portion of consolidated equity attributable to PacificCo’s Series A-1 Preferred shareholders are reflected as redeemable noncontrolling interests, within the mezzanine section of the accompanying condensed consolidated balance sheets as of December 31, 2018 and June 30, 2019. As long as the investor remains a shareholder of PacificCo, PacificCo will be the exclusive operator of the Company’s businesses in selected markets in Asia other than those included in the Greater China and Japan territories described above, including but not limited to Singapore, Korea, the Philippines, Malaysia, Thailand, Vietnam and Indonesia. After October 30, 2024, the Company may elect to purchase, at fair value, all PacificCo shares held, other than any interests issued in connection with an equity incentive plan. The Company may elect to pay the buyout consideration in either cash, WeWork shares, or a combination thereof. Consolidated Variable Interest Entities As of June 30, 2019, 424 Fifth Venture, Creator Fund, WeWork Waller Creek, ChinaCo, JapanCo, and PacificCo are the Company’s only consolidated VIEs. The Company is considered to be the primary beneficiary as we have the power to direct the activities of the VIEs that most significantly impact the VIEs’ economic performance and the right to receive benefits that could potentially be significant to the VIEs. As a result, these entities remain consolidated subsidiaries of the Company and the interests owned by the other investors and the net income or loss and comprehensive income or loss attributable to the other investors are reflected as redeemable noncontrolling interests and noncontrolling interests on our condensed consolidated balance sheets, statements of operations, and statements of comprehensive loss, respectively. The following tables include selected consolidated financial information as of December 31, 2018 and June 30, 2019 and for the six months ended June 30, 2018 and 2019 of our consolidated VIEs, as included in our condensed consolidated financial statements and in each case, after intercompany eliminations. December 31, 2018 June 30, 2019 (1) (2) (1) (2) (Amounts in thousands) Asia JVs Other VIEs Asia JVs Other VIEs Consolidated VIE balance sheet information: Cash and cash equivalents $ 813,818 $ 12,210 $ 531,147 $ 4,682 Property and equipment, net 491,801 — 722,840 904,052 Restricted cash 74,846 — 96,656 — Total assets 2,023,329 46,549 5,162,422 963,437 Long-term debt, net 9,795 — 29,048 607,214 Total liabilities 597,685 83 3,801,770 623,274 Redeemable stock issued by VIEs 1,599,157 3,160 1,599,157 6,446 (3) Total net assets (173,513) 43,306 (238,505) 333,717 F-97