Flexible workspace provider WeWork commenced a comprehensive reorganization to strengthen its capital structure and financial performance. The company maintains the support of its key financial stakeholders and has entered into a restructuring support agreement (RSA) with holders representing approximately 92% of its secured notes to drastically reduce the company’s existing funded debt and expedite the restructuring process. During this period, WeWork will further rationalize its commercial office lease portfolio while focusing on business continuity and delivering services to its members, as its global operations are expected to continue as usual.

As part of the reorganization plan, WeWork and certain of its entities filed for protection under Chapter 11 of the U.S. Bankruptcy Code. The company also intends to file recognition proceedings in Canada under Part IV of the Companies’ Creditors Arrangement Act. WeWork’s locations outside of the U.S. and Canada are not part of this process. WeWork’s franchisees around the world are similarly not affected by these proceedings.

As part of the filing, WeWork is requesting the ability to reject the leases of certain locations, which are largely non-operational, and the company said all affected members have received advanced notice.

“It is the WeWork community that makes us successful. Our more than half-million members around the world turn to us for the best-in-class spaces, hospitality and technology that our 2,500 dedicated employees and valued partners provide,” David Tolley, CEO of WeWork, said. “WeWork has a strong foundation, a dynamic business and a bright future.

“Now is the time for us to pull the future forward by aggressively addressing our legacy leases and dramatically improving our balance sheet. We defined a new category of working, and these steps will enable us to remain the global leader in flexible work. I am deeply grateful for the support of our financial stakeholders as we work together to strengthen our capital structure and expedite this process through the restructuring support agreement. We remain committed to investing in our products, services, and world-class team of employees to support our community.”

WeWork is filing with the court a series of customary first day motions to facilitate a transition into the process and to support operations throughout its cases, which it expects to be approved in short order. The company will continue servicing its existing members, vendors, partners and other stakeholders in the ordinary course of business. WeWork expects to have the financial liquidity to execute these proceedings and continue business in the ordinary course.

Kirkland & Ellis and Cole Schotz are serving as legal counsel, PJT Partners is serving as investment banker, Alvarez & Marsal North America is serving as financial and restructuring advisor, Goodmans is serving as Canadian legal counsel, C Street Advisory Group is serving as strategic communications advisor and Epiq Corporate Restructuring is serving as claims and noticing agent to the company. WeWork has retained Hilco Real Estate to assist with lease renegotiations.