UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
Pursuant to Section 13 OR 15(d)
of The Securities Exchange Act of 1934
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| Item 8.01 | Other Events. |
Commencement of Exchange Offers and Consent Solicitations
WeWork Inc. (“WeWork” or the “Company”) today announced that WeWork Companies LLC (the “Issuer”) and WW Co-Obligor Inc. (the “Co-Obligor” and together with the Issuer, the “Issuers”), each a subsidiary of the Company, have commenced separate offers to exchange (each an “Exchange Offer” and, together, the “Exchange Offers”) any and all of the Issuers’ outstanding 7.875% Senior Notes due 2025 (the “Old 7.875% Notes”) and 5.00% Senior Notes due 2025, Series II (the “Old 5.00% Notes” and together with the Old 7.875% Notes, the “Old Notes”), for either (a) if eligible holders elect to purchase their applicable pro rata portion of $500.0 million in aggregate principal amount of new 15.00% (7.00% Cash/8.00% PIK) First Lien Senior Secured PIK Notes due 2027 issued by the Issuers (the “New First Lien Notes”), at their option, (x) a combination of new 11.00% (5.00% Cash/6.00% PIK) Second Lien Senior Secured PIK Notes due 2027 issued by the Issuers and shares of Class A Common Stock, par value $0.0001 per share (the “Class A Common Stock”), of the Company or (y) shares of Class A Common Stock or (b) if eligible holders do not elect to purchase their applicable pro rata portion of New First Lien Notes, at their option, (x) a combination of new 12.00% Third Lien Senior Secured PIK Notes due 2027 issued by the Issuers and shares of Class A Common Stock or (y) shares of Class A Common Stock, in each case upon the terms and subject to the conditions set forth in a confidential offering memorandum and consent solicitation statement.
In addition, the Issuers are soliciting consents from eligible holders of the Old Notes to adopt certain proposed amendments to the Senior Notes Indenture, dated as of April 30, 2018, governing the Old 7.875% Notes, and the Amended and Restated Senior Notes Indenture, dated as of December 16, 2021, governing the Old 5.00% Notes, to eliminate substantially all of the restrictive covenants contained in such indentures and the Old Notes, eliminate certain events of default, modify covenants regarding mergers and consolidations and modify or eliminate certain other provisions, including certain provisions relating to future guarantors and defeasance (the “Consent Solicitations”), in each case upon the terms and subject to the conditions set forth in a confidential offering memorandum and consent solicitation statement.
A copy of the press release announcing the commencement of the Exchange Offers and Consent Solicitations is attached as Exhibit 99.1 to this Current Report on Form 8-K and incorporated herein by reference.
Draw Notice for Additional Senior Secured Notes
On April 3, 2023, the Issuer sent a draw notice to SoftBank Vision Fund II-2 L.P. (“SVF II”) to issue and sell $50 million in aggregate principal amount of Senior Secured Notes due 2025 (the “Additional Secured Notes”) on or about April 5, 2023 pursuant to that certain Amended and Restated Master Senior Secured Notes Note Purchase Agreement, dated as of October 20, 2021 (as amended, waived or otherwise modified from time to time), by and among the Issuers and SVF II. The Additional Secured Notes will be issued as “Additional Notes” as defined in and pursuant to that certain Senior Secured Notes Indenture, dated as January 3, 2023, by and among the Issuers, the guarantors party thereto and U.S. Bank Trust Company, National Association, as trustee and collateral agent. The Issuer intends to use the proceeds from the issuance and sale of the Additional Secured Notes for general corporate purposes. Following the issuance of the Additional Secured Notes on or about April 5, 2023, $300 million in aggregate principal amount of Senior Secured Notes due 2025 will be outstanding.
| Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits.
| Exhibit Number |
Description | |
| 99.1 | Press Release Announcing the Exchange Offers and Consent Solicitations, dated as of April 3, 2023. | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). | |
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No Offer or Solicitation
This Current Report is not intended to and does not constitute an offer to sell or the solicitation of an offer to subscribe for or buy or an invitation to purchase or subscribe for any securities or the solicitation of any vote, consent or approval in any jurisdiction in connection with the issuance of the New First Lien Notes, the Exchange Offers, the Consent Solicitations or otherwise, nor shall there be any sale, issuance or transfer of securities in any jurisdiction in contravention of applicable law. In particular, this communication is not an offer of securities for sale into the United States. No offer of securities shall be made in the United States absent registration under the Securities Act or pursuant to an exemption from, or in a transaction not subject to, such registration requirements.
Cautionary Note Regarding Forward-Looking Statements
Certain statements made herein may be deemed “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, as amended, including any statements regarding the consummation of the Exchange Offers, Consent Solicitations and other related transactions. These forward-looking statements generally are identified by the words “believe,” “project,” “expect,” “anticipate,” “estimate,” “intend,” “strategy,” “future,” “opportunity,” “plan,” “pipeline,” “may,” “should,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions. Forward-looking statements are predictions, projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties. Although WeWork believes the expectations reflected in any forward-looking statement are based on reasonable assumptions, it can give no assurance that its expectations will be attained, and it is possible that actual results may differ materially from those indicated by these forward-looking statements due to a variety of risks, uncertainties and other factors.
Such factors include, but are not limited to, WeWork’s ability to complete the Exchange Offers, Consent Solicitations and other related transactions on the terms contemplated or at all; WeWork’s ability to satisfy the required conditions for the consummation of the Exchange Offers, Consent Solicitations and other related transactions; WeWork’s ability to otherwise refinance, extend, restructure or repay outstanding debt; its outstanding indebtedness; its current and projected liquidity needs to operate its business and execute its strategy, and related use of cash; its ability to raise capital through equity issuances, asset sales or the incurrence of debt; WeWork’s expectations regarding its ability to continue as a going concern; retail and credit market conditions; higher cost of capital and borrowing costs; impairments; changes in general economic conditions, including as a result of the COVID-19 pandemic, the conflict in Ukraine and disruptions in the banking sector, and the impact of such conditions on WeWork and its customers; WeWork’s expectations regarding its exits of underperforming locations, including the timing of any such exits and ability to retain its members; delays in customers and prospective customers returning to the office and taking occupancy, or changes in the preferences of customers and prospective customers with respect to remote or hybrid working, as a result of the COVID-19 pandemic leading to a parallel delay, or potentially permanent change, in receiving the corresponding revenue; the impact of foreign exchange rates on WeWork’s financial performance; and WeWork’s inability to implement its business plan or meet or exceed its financial projections.
Forward-looking statements speak only as of the date they are made. WeWork discusses these and other risks and uncertainties in its annual and quarterly periodic reports and other documents filed with the SEC. WeWork undertakes no duty or obligation to update or revise these forward-looking statements, whether as a result of new information, future developments, or otherwise, except as required by law.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this Current Report on Form 8-K to be signed on its behalf by the undersigned hereunto duly authorized.
| WEWORK INC. | ||||||
| Date: April 3, 2023 | By: | /s/ Sandeep Mathrani | ||||
| Name: | Sandeep Mathrani | |||||
| Title: | Chief Executive Officer | |||||
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