Table of Contents WEWORK COMPANIES INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2018 December 31, 2018 Shares Issued (Amounts in thousands, except per Conversion Liquidation Shares and Carrying share amounts) Price per Share Preference Authorized Outstanding Amount Series A $0.46 $ 17,500 38,393 38,393 $ 17,350 Series B 1.85 41,039 22,165 22,165 40,995 Series C 5.36 152,227 29,189 28,404 154,699 Series D-1 16.65 198,800 11,939 11,939 198,541 Series D-2 16.65 156,200 9,381 9,380 155,996 Series E 32.89 433,934 13,194 13,194 433,507 Series F 50.19 690,612 14,942 13,759 675,913 Series G 57.90 2,017,338 34,742 33,114 1,729,997 Acquisition 72.65 102,272 13,900 1,408 90,398 Junior 866.67 1,300 2 2 1,300 Total $ 3,811,222 187,847 171,758 $ 3,498,696 On various dates during the year ended December 31, 2016, the Company issued and sold an aggregate of 13,759,327 shares of its Series F Preferred Stock and approximately 250,000 warrants for the purchase of shares of Class A Common Stock at $0.001 for total net proceeds of $679.9 million (the “Series F Financing”). Approximately $675.9 million of the net proceeds were allocated to the Series F Preferred Stock and the remaining $4.0 million were allocated to the issuance of the warrants, recorded through additional paid-in capital. During the year ended December 31, 2017, the Company issued and sold an aggregate of 32,812,199 shares of its Series G Preferred Stock for net proceeds of $1,697.8 million (“Series G Financing”) and issued a total of 251,968 shares of Series G Preferred Stock in connection with acquisitions. The Series G Financing closed in three tranches during the year ended December 31, 2017. Per the terms of the agreement, if the second closing did not occur on or before June 30, 2017, the investor was required to purchase the shares at a price above fair market value. This legally binding commitment represented a forward option to sell 11.5 million shares of Series G Preferred Stock at a purchase price above its fair market value (“Tranche Right”) as of June 30, 2017. The Tranche Right was able to be legally separated and transferred to a party separate from the holder of the initial Series G Preferred Stock and was considered legally detachable from the Series G Preferred Stock. As such, the instrument was separately exercisable, as the execution of the June 2017 closing did not extinguish or otherwise impact the initial Series G Preferred Stock issued. Both criteria made the Tranche Right a freestanding instrument. Although the Tranche Right was to issue preferred stock rather than an obligation to repurchase the stock, the underlying shares of Series G Preferred Stock are redeemable upon the occurrence of an event outside the Company’s control, and thus the Tranche Right represented an obligation to repurchase shares pursuant to liability accounting. The Company recorded the $94.6 million fair market value of the Tranche Right forward option as an other investment on its balance sheet as of June 30, 2017, with a corresponding increase to income from equity method and other investments during the three months ended June 30, 2017 on the accompanying statement of operations. During the three months ended September 30, 2017, the Tranche Right was redeemed and reduced the carrying value of the Series G Preferred Stock by $94.6 million. During the fourth quarter of 2017, the investor and the Company closed a third tranche of Series G Financing. The agreement allowed the investor to purchase an additional 15.5 million shares of Series G Preferred Stock at a purchase price below the fair market value per share. This was considered a non-arm’s-length transaction as the investor is a significant shareholder of the Company. The third tranche of Series G Financing closed on October 25, F-47