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February 5 , 2024
E -
EdwardO. Sassower, P.C.
JoshuaA. Sussberg, P.C.
StevenN.Serajeddini, P.C.
CiaraFoster
edward.sassower@kirkland.com
joshua.sussberg@kirkland.com
steven.serajeddini@kirkland.com
ciara.foster@kirkland.com
601 LexingtonAvenue
New York, NY 10022
RE: Inre WeWorkInc., et al. ( “ WeWork or the Company ) , Case No. 23-19865
Ladiesand Gentlemen
:
We represent Adam Neumann , Flow Global Holdings LLC and their affiliates , who are
partnering with well - known capital sources including Dan Loeb's Third Point LLC and others , in
connection with the above -captioned chapter 11 cases .
We write to express our dismay with WeWork's lack of engagement even to provide information
to my clients in what is intended to be a value- maximizing transaction for all stakeholders .
Although my clients have attempted since December 2023 to obtain information necessary for an
offer to purchase the Company or its assets and later to provide debtor- in- possession ( DIP )
financing to support the Company through the bankruptcy process , they still do not have access
to that information . This behavior has jeopardized the ability of the Company to explore
alternatives to the and has failed to maximize value for all stakeholders the goal of any
1
In the Restructuring Support Agreement (“ RSA ) , the Debtors preserved the ability to , among other things ,
consider , respond to , and facilitate any unsolicited Alternative Restructuring Proposals , cooperate with , assist,
participate in, or facilitate any inquiries, proposals , discussions , or negotiation of Alternative Restructuring
(footnote continued )
quinnemanuelurquhart& sullivan,
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bankruptcyprocess. This failure was underscoredby the Company's own advisors in Court
today, wherethey explainedthat WeWork now needsto obtain additional financing and that its
negotiationswith its landlordshave resulted in only seven successful lease amendments.
Readingthe reports of today's proceedings, includingloud dissent from landlords and the official
creditors committee, it is unclear what levelof effort the Companyhas really madeto date to
enhancevalue.
Ina similar vein, as you may know, even before the bankruptcy filing WeWork canceled a
scheduled meeting organized by Mr.Neumann about a substantial equity infusion that would
have helped the Company . Concerned with the state ofthe business and the outlook for the
Company, Mr. Neumann had previously worked to arrange up to $ 1 billion of financing to
stabilize WeWork in October 2022, when just before the meeting (while participants were
literally inthe air traveling ) , the former CEO shut down that process without explanation .
Beginning in December 2023 , my clients have met with the Debtors and have spoken with the
Debtors financial advisor on numerous occasions . Throughout this time , my clients consistently
expressed their sincere interest in purchasing WeWork or its assets out of bankruptcy , and/or
providing the Debtors with DIP financing . My clients retained transaction counsel and
reasonably asked for access to information in order to determine ifthey can provide support to
WeWork in its restructuring efforts , including through the investment of new money . To date ,
the required information has not been produced .
Initially, the Debtors resisted my clients overtures , saying that it would create an adverse
dynamic for negotiations with landlords . After weeks of delay, the Company or its advisors
suggested that my clients propose DIP financing instead of delivering a term sheet to purchase
WeWork or its assets . Working in good- faith reliance on that request, my clients transaction
counsel provided WeWork's advisors with a formal proposal for a $200 million DIP facility ,
along with a mark -up of your standard form non- disclosure agreement ( NDA ) . This was the
very process the Debtors requested my clients to follow , so that the Debtors may consider the
facility while my clients would be granted access to current financial information so as to
continue working on a purchase proposal ( in addition to the DIP) . Even in connection with the
potential DIP, the required information has not been forthcoming.²
Itgoes without saying that my clients , which include shareholders of WeWork , expect the
Company will engage on all serious expressions of interest and consider and assess Alternative
3
Restructuring Proposals . We reiterate my clients request for engagement by WeWork so that
Proposals, and provide access to non-public information concerning any [ Debtor] Party to any Entity and enter
into Confidentiality Agreements or nondisclosure agreements with any Entity. RSA 7.02. The RSA similarly
does not limitthe rights ofthe stakeholder parties thereto to consult with any other party in interest in the
Chapter 11Cases or require any such party to take any action inconsistent with applicable law or their own
fiduciary obligations.
2
Your financial advisor did express concern about one aspect of our revisions to the NDA, which my clients
addressed in a mark- up provided earlier today . There is simply no reason for further delay.
central obligation of a board is to act in an informed manner [which requires ] that reliable information
about the value of alternative transactions be explored ." City Capital Associates v. Interco Inc., 551 A.2d 787, 802
(footnote continued )
2
they can provide the estates and their stakeholders an Alternative RestructuringProposalto
consider.
To that end, my clients stand ready to submit a detailed proposal to purchase the Company or its
assets that has the flexibility to allow other stakeholders , including the RSA parties , to participate
and which would allow for a sharing in the upside by unsecured creditors and participating
landlords . In a hybrid work world where demand for WeWork's product should be greater than
ever, my clients believe that the synergies and management expertise offered by an acquisition
by my clients could significantly exceed the value of the Debtors on a stand - alone basis .
WeWork should at least educate itself about that potential and not preclude itselffrom
maximizing value.
Sincerely
Alex Spiro
: SusheelKirpalani
BenjaminI.Finestone
03 ( Del. Ch. 1988) . And, of course, irrespective of anything else, a debtor in possession has a fiduciary duty to
maximizethe value of the estate. " Inre Blount, 624 B.R. 590 ( Bankr. D.N.J. 2020) .
