WillScot (WSC) 8-K/A Financial Statements and Exhibits

Exhibit 99.2

Modular Space Holdings, Inc. and Subsidiaries

Condensed Consolidated Financial Statements As of June 30, 2018 and September 30, 2017 and for the Three and Nine Months Ended June 30, 2018 and the Three Months Ended June 30, 2017 (Successor) and the Period from March 3, 2017 through June 30, 2017 (Successor) and from October 1, 2016 through March 2, 2017 (Predecessor)

Modular Space Holdings, Inc. and Subsidiaries

Index

	Page(s)
Unaudited Condensed Consolidated Financial Statements
Unaudited Condensed Consolidated Balance Sheets as of June 30, 2018 and September 30, 2017	1
Unaudited Condensed Consolidated Statements of Operations for the three and nine months ended June 30, 2018 and the three months ended June 30, 2017 (Successor) and the period from March 3, 2017 through June 30, 2017 (Successor) and from October 1, 2016 through March 2, 2017 (Predecessor)	2
Unaudited Statements of Comprehensive Income (Loss) for the three and nine months ended June 30, 2018 and the three months ended June 30, 2017 (Successor) and the period from March 3, 2017 through June 30, 2017 (Successor) and from October 1, 2016 through March 2, 2017 (Predecessor)	3
Unaudited Statements of Stockholders’ Equity for the nine months ended June 30, 2018 (Successor) and the period from March 3, 2017 through June 30, 2017 (Successor) and the period from October 1, 2016 through March 2, 2017 (Predecessor)	4
Unaudited Statements of Cash Flows for the nine months ended June 30, 2018 (Successor) and the period from March 3, 2017 through June 30, 2017 (Successor) and the period from October 1, 2016 through March 2, 2017 (Predecessor)	5
Unaudited Notes to the Condensed Consolidated Financial Statements	6–14

Modular Space Holdings, Inc. and Subsidiaries

Unaudited Condensed Consolidated Balance Sheets

As of June 30, 2018 and September 30, 2017

(In thousands except share data)

	Successor
	June 30, 2018		September 30, 2017
Assets
Cash	$	151	$	1,476
Accounts receivable, net of allowance for doubtful accounts of $6,444 and $1,331, respectively	79,053		74,256
Lease receivables, net of allowance for doubtful accounts of $97 and $63 respectively	1,335		2,029
Prepaid expenses and other current assets	14,911		10,964
Total current assets	95,450		88,725
Rental equipment, net (Note 4)	845,298		855,402
Other property and equipment, net (Note 5)	122,975		127,040
Intangible assets, net (Note 6)	12,649		13,144
Other non-current assets	671		1,193
Total assets	$	1,077,043	$	1,085,504
Liabilities and Stockholders’ Equity
Liabilities
Accounts payable	$	8,441	$	12,073
Accrued expenses	39,780		35,111
Advance rents	18,008		11,119
Current portion of term loans (Note 7)	6,726		5,664
Asset based revolver (Note 7)	440,021		454,070
Total current liabilities	512,976		518,037
Term loans (Note 7)	56,426		61,949
Deferred income taxes (Note 9)	45,402		51,273
Total liabilities	614,804		631,259
Commitments and Contingencies (Note 10)
Stockholders’ Equity
Common stock - 60,000,000 shares of $0.01 par value per share authorized and 29,233,375 shares outstanding as of June 30, 2018 and September 30, 2017	292		292
Preferred stock - 1,000,000 shares of $0.01 per value per share authorized, none outstanding	—		—
Additional paid-in capital	446,023		443,472
Warrants	4,970		4,970
Retained earnings	10,532		1,058
Accumulated other comprehensive income	422		4,453
Total stockholders’ equity	462,239		454,245
Total liabilities and stockholders’ equity	$	1,077,043	$	1,085,504

The accompanying notes are an integral part of the Condensed Consolidated Financial Statements.

1

Modular Space Holdings, Inc. and Subsidiaries

Unaudited Condensed Consolidated Statements of Operations

(In thousands except share data)

	Successor				Successor						Predecessor
	Three Months		Three months		Nine Months			Period from			Period from
	Ended		Ended		Ended			March 3,2017 to			October 1,2016 to
	June 30, 2018		June 30, 2017		June 30, 2018			June 30, 2017			March 2, 2017
Revenues
Leasing	$	67,034	$	61,166	$	194,496		$	71,030		$	99,024
Sales of rental equipment
New units	10,819		9,940		29,465			13,691			21,542
Lease units	8,808		6,573		25,389			10,116			11,265
Delivery, installation and site services	34,920		30,886		89,699			42,887			47,920
Total revenues	121,581		108,565		339,049			137,724			179,751
Leasing and sales costs
Cost of rental equipment sold
New units	8,746		7,815		23,424			10,556			17,046
Lease units	6,115		4,734		16,731			7,464			8,865
Delivery, installation and site services	24,499		23,401		65,748			32,282			37,456
Depreciation	12,372		14,060		36,001			17,786			26,288
Maintenance and other	23,496		21,428		65,800			28,137			33,508
Total leasing and sales costs	75,228		71,438		207,704			96,225			123,163
Gross profit	46,353		37,127		131,345			41,499			56,588
Operating and other expenses
Selling, general and administrative	32,490		28,671		98,285			40,104			43,433
Interest, including amortization of deferred financing costs	8,160		7,392		23,554			9,977			39,642
Loss on reorganization items, net	—		—		—			—			97,121
Restructuring and merger costs	2,432		—		4,649			135			18,142
Total operating and other expenses	43,082		36,063		126,488			50,216			198,338
Net income (loss) before income taxes	3,271		1,064		4,857			(8,717		)	(141,750		)
Income tax (benefit) expense	781		—		(4,617		)	(3,834		)	(8,946		)
Net income (loss)	$	2,490	$	1,064	$	9,474		$	(4,883	)	$	(132,804	)

The accompanying notes are an integral part of the Condensed Consolidated Financial Statements.

2

Modular Space Holdings, Inc. and Subsidiaries

Unaudited Condensed Consolidated Statements of Comprehensive Income (Loss)

(In thousands except share data)

	Successor					Successor						Predecessor
	Three Months			Three months		Nine Months		��	Period from			Period from
	Ended			Ended		Ended			March 3,2017 to			October 1,2016 to
	June 30, 2018			June 30, 2017		June 30, 2018			June 30, 2017			March 2, 2017
Net income (loss)	$	2,490		$	1,064	$	9,474		$	(4,883	)	$	(132,804	)
Other comprehensive income (loss)
Cumulative translation adjustment	(1,362		)	80		(4,031		)	(349		)	(633		)
Reclassification of cumulative translation adjustment to net loss realized upon reorganization	—			—		—			—			16,748
Other comprehensive income (loss)	(1,362		)	80		(4,031		)	(349		)	16,115
Total comprehensive income (loss)	$	1,128		$	1,144	$	5,443		$	(5,232	)	$	(116,689	)

The accompanying notes are an integral part of the Condensed Consolidated Financial Statements

3

Modular Space Holdings, Inc. and Subsidiaries

Unaudited Condensed Consolidated Statements of Stockholders’ Equity

(In thousands except share data)

																Retained			Accumulated
	Class A												Additional			Earnings			Other			Total
	Common Stock					Common Stock							Paid-in			(Accumulated			Comprehensive			Stockholders’
	Shares		Amount			Shares		Amount			Warrants		Capital			Deficit)			Income/(Loss)			Equity
Balance at October 1, 2016 (Predecessor)	21,383,894		$	2		3,499,944		$	35		$	—	$	345,905		$	(196,247	)	$	(16,115	)	$	133,580
Stock compensation expense	—		—			—		—			—		1,377			—			—			1,377
Net Loss	—		—			—		—			—		—			(132,804		)	—			(132,804		)
Other Comprehensive Income	—		—			—		—			—		—			—			16,115			16,115
Cancellation of Predecessor equity	(21,383,894	)	(2		)	(3,499,944	)	(35		)	—		(347,282		)	329,051			—			(18,268		)
Balance at March 2, 2017 (Predecessor)	—		—			—		—			—		—			—			—			—
Issuance of Successor common stock and warrants	—		—			29,233,375		292			4,970		442,927			—			—			448,189
Balance at March 2, 2017 (Predecessor)	—		—			29,233,375		292			4,970		442,927			—			—			448,189
Balance at March 3, 2017 (Successor)	—		—			29,233,375		292			4,970		442,927			—			—			448,189
Stock compensation expense	—		—			—		—			—		545			—			—			545
Net Income	—		—			—		—			—		—			1,058			—			1,058
Other Comprehensive Income	—		—			—		—			—		—			—			4,453			4,453
Balance at September 30, 2017 (Successor)	—		—			29,233,375		292			4,970		443,472			1,058			4,453			454,245
Stock compensation expense (Note 8)	—		—			—		—			—		2,551			—			—			2,551
Net Income	—		—			—		—			—		—			9,474			—			9,474
Other Comprehensive Income	—		—			—		—			—		—			—			(4,031		)	(4,031		)
Balance at June 30, 2018 (Successor)	—		$	—		29,233,375		$	292		$	4,970	$	446,023		$	10,532		$	422		$	462,239

The accompanying notes are an integral part of the Condensed Consolidated Financial Statements

4

Modular Space Holdings, Inc. and Subsidiaries

Unaudited Condensed Consolidated Statements of Cash Flows

(In thousands except share data)

	Successor						Predecessor
	Nine Months			Period from			Period from
	Ended			March 3,2017 to			October 1,2016 to
	June 30, 2018			June 30, 2017			March 2, 2017
Cash flows from operating activities
Net income (loss)	$	9,474		$	(4,883	)	$	(132,804	)
Adjustments to reconcile net income (loss) to net cash provided by operating activities
Non-cash interest	—			—			6,824
Provision for doubtful accounts	4,974			777			1,787
Provision for customer credits	1,891			1,454			1,887
Reorganization items	—			—			96,174
Stock-based compensation expense	2,551			—			530
Depreciation and amortization	44,283			20,870			29,707
Gain on sale of rental equipment	(9,005		)	(2,653		)	(2,400		)
Gain on sale of property and equipment	—			(240		)	—
Deferred gain on sale of other property and equipment	—			—			(572		)
Deferred income taxes, net of valuation allowance	(4,617		)	(3,834		)	(8,929		)
Changes in
Accounts receivable	(13,511		)	(930		)	8,996
Prepaid expenses and other assets	(3,473		)	(882		)	344
Deferred gain on sale of property and equipment
Accounts payable and accrued expenses	1,287			(13,138		)	6,733
Advance rents	6,942			6,781			2,382
Net cash provided by operating activities	40,796			3,322			10,659
Cash flows from investing activities
Purchases of rental equipment and other property and equipment	(51,588		)	(23,900		)	(23,666		)
Proceeds from sale of rental equipment	25,031			10,877			11,395
Proceeds from sale of other property and equipment	—			1,474			—
Leasing receivables
Originations	(343		)	(159		)	(1,131		)
Payments received	1,099			774			1,130
Net cash used in investing activities	(25,801		)	(10,934		)	(12,272		)
Cash flows from financing activities
Proceeds from asset based revolver	362,205			152,871			247,217
Payments on asset based revolver	(374,072		)	(166,208		)	(298,819		)
Payments on term loans	(4,461		)	(1,599		)	—
Proceeds from rights offering investment by second lien noteholders	—			—			89,939
Financing costs paid	—			—			(13,892		)
Net cash (used in) provided by financing activities	(16,328		)	(14,936		)	24,445
Effect of exchange rate changes on cash	8			98			(192		)
Net (decrease) increase in cash and cash equivalents	(1,325		)	(22,450		)	22,640
Cash and cash equivalents
Beginning of period	1,476			23,499			859
End of period	$	151		$	1,049		$	23,499
Supplemental disclosures of cash flow information
Cash paid during the period for Interest	$	23,513		$	8,443		$	16,831
Income tax payments, net	435			534			528
Cash paid for reorganization items	—			2,592			947
Non cash activity during the period for Equipment purchases included in accounts payable	940			418			482

The accompanying notes are an integral part of the Condensed Consolidated Financial Statements

5

Modular Space Holdings, Inc. and Subsidiaries

Unaudited Notes to Condensed Consolidated Financial Statements

(In thousands except share data)

1.Basis of Presentation

The unaudited condensed consolidated financial statements of Modular Space Holdings, Inc., a Delaware corporation, and its Subsidiaries (collectively, “ModSpace” or the “Company”) have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information. The unaudited condensed consolidated financial statements do not include all of the information or notes necessary for a complete presentation in accordance with GAAP. Accordingly, these condensed consolidated financial statements should be read in conjunction with the Company’s annual financial statements as of September 30, 2017. The results of operations for the three and nine months ended June 30, 2018 and the three months ended June 30, 2017 (Successor) and the period from March 3, 2017 through June 30, 2017 (Successor) and from October 1, 2016 through March 2, 2017 (Predecessor) are not necessarily indicative of the operating results for the full year.

In the opinion of the Company, the accompanying unaudited condensed consolidated financial statements contain all adjustments, consisting of only normal recurring adjustments, necessary for a fair statement of its financial position as of June 30, 2018, and its results of operations for the three and nine months ended June 30, 2018 and the three months ended June 30, 2017 (Successor) and the period from March 3, 2017 through June 30, 2017 (Successor) and from October 1, 2016 through March 2, 2017 (Predecessor), and cash flows for the nine months ended June 30, 2018 (Successor), and the periods from March 3, 2017 to June 30, 2017 (Successor) and October 1, 2016 to March 2, 2017 (Predecessor). The condensed consolidated balance sheet at September 30, 2017, was derived from audited annual financial statements but does not contain all of the footnote disclosures from the annual financial statements.

Certain prior year amounts have been reclassified to conform to the current period presentation.

Fresh Start Accounting

On December 21, 2016, Modular Space Holdings, Inc. and six of its U.S. subsidiaries (the “Chapter 11 Subsidiaries”) filed voluntary petitions seeking relief under section 1121 (a) of Chapter 11 of Title 11 of the Bankruptcy Code in the U.S. Bankruptcy Court for the District of Delaware under the caption In re Modular Space Holdings, Inc., et al (Case No. 16-12825) (the “Chapter 11 Cases”). In connection with the filing of the Chapter 11 Cases, a recognition proceeding for the Company’s Canadian subsidiary, under Part IV of the Companies’ Creditors Arrangement Act (Canada) was filed in Toronto, Ontario, Canada before the Ontario Superior Court of Justice. The Company and the Chapter 11 Subsidiaries received bankruptcy court confirmation of their joint prepackaged plan of reorganization (the “Plan”) on February 15, 2017, and subsequently emerged from bankruptcy on March 2, 2017 (the “Effective Date”).

Upon the Company’s emergence from Chapter 11 bankruptcy, the Company adopted fresh start accounting, pursuant to FASB ASC 852, “Reorganizations”, and applied fresh start accounting to its financial statements because (i) the holders of existing voting shares of the Company prior to its emergence received less than 50% of the voting shares of the Company outstanding following its emergence from bankruptcy and (ii) the reorganization value of the Company’s assets immediately prior to confirmation of the plan of reorganization was less than the post-petition liabilities and allowed claims. Adopting fresh start accounting results in a new reporting entity for financial reporting purposes with no beginning retained earnings or deficit as of the fresh start reporting

6

Modular Space Holdings, Inc. and Subsidiaries

Unaudited Notes to Condensed Consolidated Financial Statements

(In thousands except share data)

date. The cancellation of all existing shares outstanding on the Effective Date and issuance of new shares of the Successor Company caused a related change of control of the Company under ASC 852. As a result of the application of fresh start accounting, as well as the effects of the implementation of the Plan, the condensed consolidated financial statements as of March 2, 2017 forward are not comparable with the condensed consolidated financial statements prior to that date which were prepared on a historical basis of accounting. References to “Successor” or “Successor Company” relate to the financial position and results of operations of the reorganized Company subsequent to March 2, 2017. References to “Predecessor” or “Predecessor Company” refer to the financial position and results of operations of the Company prior to and including March 2, 2017. As a result of the application of fresh start accounting and the effects of the implementation of the Plan of Reorganization, the financial statements on or after March 3, 2017 are not comparable to the financial statements prior to that date.

The Company elected to apply fresh start accounting effective March 1, 2017, to coincide with the start of its normal monthly accounting period, which resulted in the Company becoming a new entity for financial reporting purposes. The Company evaluated and concluded that events between March 1, 2017 and March 3, 2017 were immaterial and use of an accounting convenience date of March 1, 2017 was appropriate. As such, fresh start accounting is reflected in the accompanying condensed consolidated balance sheet as of September 30, 2017 and related fresh start adjustments are included in the accompanying statement of operations for the Predecessor period from October 1, 2016 through March 2, 2017.

2.Merger Transaction

On June 21, 2018, Modular Space Holdings, Inc., entered into an Agreement and Plan of Merger (the “Merger Agreement”), by and among the Company, WillScot Corporation, a Delaware corporation (“Parent”), Mason Merger Sub, Inc., a Delaware corporation and an indirect, majority-owned subsidiary of Parent (“Merger Sub”), and NANOMA LLC, solely in its capacity as the representative of the Holders (the “Holder Representative”), pursuant to which Merger Sub will be merged with and into the Company, with the Company continuing as the surviving corporation and an indirect, majority-owned subsidiary of Parent (the “Merger”).

WillScot Corporation will indirectly acquire the Company for a purchase price comprising $1,063,750 of cash consideration, 6,458,500 shares of WillScot Corporation Class A common stock and warrants to purchase 10,000,000 shares of WillScot Corporation Class A common stock at an exercise price of $15.50 per share, subject to customary adjustments.

The Company incurred $2.4 million in merger transaction costs for the three and nine months ended June 30, 2018.

7

Modular Space Holdings, Inc. and Subsidiaries

Unaudited Notes to Condensed Consolidated Financial Statements

(In thousands except share data)

3.Operating Lease Receivables

As of June 30, 2018, future minimum rental payments due to the Company under noncancellable operating leases of rental equipment to be received in the remainder of 2018 and the fiscal years thereafter are as follows:

Fiscal year ending September 30,
2018	$	39,896
2019	65,400
2020	22,871
2021	8,615
2022	3,808
Thereafter	1,225
Minimum Operating Lease Receivables	$	141,815

4.Rental Equipment

The components of rental equipment at June 30, 2018 and September 30, 2017 are as follows:

	Successor			Successor
	June 30, 2018			September 30, 2017
Mobile offices and modular structures	$	901,198		$	883,202
Additional lease costs	1,893			1,771
	903,091			884,973
Less: Accumulated depreciation	(57,793		)	(29,571		)
Rental equipment, net	$	845,298		$	855,402

Depreciation expense of rental equipment of $12,372 and $14,060 for the Successor three months ended June 30, 2018 and the Successor three months ended June 30, 2017, respectively, is included in total leasing and sales costs in the condensed consolidated statements of operations.

Depreciation expense of rental equipment of $36,001, $17,786 and $26,288 for the Successor nine months ended June 30, 2018, the Successor period from March 3, 2017 to June 30, 2017 and the Predecessor period from October 1, 2016 to March 2, 2017, respectively, is included in the total leasing and sales costs in the condensed consolidated statements of operations.

Included in depreciation expense is $135 and $208 of accelerated depreciation expense for the Successor three months ended June 30, 2018, and the Successor three months ended June 30, 2017, respectively, in connection with assets that were rebuilt as part of the Company’s refurbishment capabilities.

8

Modular Space Holdings, Inc. and Subsidiaries

Unaudited Notes to Condensed Consolidated Financial Statements

(In thousands except share data)

Included in depreciation expense is $365, $293 and $4,490 of accelerated depreciation expense for the Successor nine months ended June 30, 2018, the Successor period from March 3, 2017 to June 30, 2017 and the Predecessor period from October 1, 2016 to March 2, 2017, respectively, in connection with assets that were rebuilt as part of the Company’s refurbishment capabilities.

5.Other Property and Equipment

The components of other property and equipment at June 30, 2018 and September 30, 2017 are as follows:

	Successor
	June 30, 2018			September 30, 2017
Buildings	$	17,232		$	17,295
Modular Offices and related improvements	7,292			7,355
Leasehold Improvements	20,558			16,966
Computer equipment and software	8,271			7,767
Office Furniture, Fixtures, and Other	3,268			2,335
	56,621			51,718
Less: Accumulated depreciation and amortization	(12,452		)	(4,665		)
	44,169			47,053
Land	78,806			79,987
	$	122,975		$	127,040

Depreciation and amortization expense of other property and equipment of $2,598 and $2,141 for the Successor three months ended June 30, 2018 and the Successor three months ended June 30, 2017, respectively, is included in selling, general and administrative expenses in the condensed consolidated statements of operations.

Depreciation and amortization expense of other property and equipment of $7,787, $2,865 and $3,419 for the Successor nine months ended June 30, 2018, the Successor period from March 3, 2017 to June 30, 2017 and the Predecessor period from October 1, 2016 to March 2, 2017, respectively, is included in selling, general and administrative expenses in the condensed consolidated statements of operations.

9

Modular Space Holdings, Inc. and Subsidiaries

Unaudited Notes to Condensed Consolidated Financial Statements

(In thousands except share data)

6.Other Intangible Assets

The following table reflects the components of other intangible assets as of June 30, 2018 and September 30, 2017:

		Successor				Successor
		June 30, 2018				September 30, 2017
	Remaining	Gross				Gross
	Useful	Carrying		Accumulated		Carrying		Accumulated
	Life (Years)	Amount		Amortization		Amount		Amortization
Trade name / Trademark	Indefinite	$	8,718	$	—	$	8,718	$	—
Leasehold interest	6.6	4,810		879		4,810		384
		$	13,528	$	879	$	13,528	$	384

Amortization expense of other intangible assets of $165 for the Successor three months ended June 30, 2018 and June 30, 2017 is included in selling, general and administrative expenses in the condensed consolidated statements of operations.

Amortization expense of other intangible assets of $495 and $219 for the Successor nine months ended June 30, 2018 and the Successor period from March 3, 2017 to June 30, 2017, respectively, is included in selling, general and administrative expenses in the condensed consolidated statements of operations.

7.Debt

As of June 30, 2018, there was $503,173 of borrowings outstanding under the Credit Agreement, inclusive of $63,152 of term loans as follows:

	Successor
	June 30, 2018			September 30, 2017
Term loans	$	63,152		$	67,613
Less: Current portion of term loans	(6,726		)	(5,664		)
Total long-term debt	$	56,426		$	61,949

Included within the reported asset based revolver balance on the condensed consolidated balance sheet at June 30, 2018 is $8,414 of bank overdrafts that have been reclassified from cash for financial reporting purposes.

10

Modular Space Holdings, Inc. and Subsidiaries

Unaudited Notes to Condensed Consolidated Financial Statements

(In thousands except share data)

Scheduled repayments of the term loans for the remainder of 2018 and the succeeding fiscal years are as follows:

Fiscal year ending September 30,
2018	$	1,416
2019	7,788
2020	9,912
2021	44,036
	$	63,152

There was approximately $101,646 of additional borrowing availability under the Credit Agreement as of June 30, 2018. In addition, letters of credit totaling $4,798, were issued under the Credit Agreement and were outstanding at June 30, 2018.

Borrowings under the Credit Agreement are secured by a first priority lien on, and security interest in, substantially all of the assets of Modular Space Corporation (“MSC”), Resun ModSpace, Inc. (“RMI”) and ModSpace Government Financial Services, Inc. (“MGFS”) including rental equipment, accounts receivable, and other property and equipment. Chippewa has guaranteed all of the obligations of the borrowers and the other guarantors under the New Credit Agreement and such guarantee is secured by a first priority lien on, and security interest in, substantially all of Resun Chippewa, LLC’s (“Chippewa”) assets (which consist of a substantial portion of the Company’s rental equipment and related lease payments due from MSC). Chippewa has not otherwise agreed to guarantee, and its assets are generally not available to support, other liabilities of such borrowers and guarantors. MSC, RMI and MGFS guaranteed all of MFSC’s obligations under the Canadian facility and such guarantees are secured by a first priority lien on, and security interest in, substantially all of the assets of MSC, RMI and MGFS.

Outstanding amounts under the Credit Agreement, including the term loans, bear interest at our option at either: (i) LIBOR or Banker’s Acceptance rate (“BA Rate”) plus a defined margin, or (ii) the Agent (as defined in the Credit Agreement) bank’s prime rate or base rate plus a margin. The applicable margin for each type of loan is based on a leverage-based pricing grid and ranges from 3.75% to 4.50% for LIBOR and BA loans and 3.25% to 4.00% for prime rate or base rate loans at each measurement date. As of June 30, 2018, the applicable margins were 4.25% for LIBOR and BA loans and 3.75% for prime rate or base rate loans. The effective interest rate was 6.19% at June 30, 2018. A fee is payable monthly on the average unused portion of the maximum applicable rollover amount for the preceding month.

Availability of borrowings under the revolving credit facilities pursuant to the Credit Agreement is subject to a borrowing base calculation based upon a valuation of our eligible accounts receivable, and eligible rental equipment/lease fleet, subject to certain availability blocks. The lease fleet is appraised at least twice annually by a third-party appraisal firm. The rental equipment advance rate is the lesser of (a) 80% of the net book value (excluding any fresh start adjustments) of the applicable eligible rental equipment or (b) the percentage obtained by dividing (i) the NOLV Percentage of the Net Orderly Liquidation Value of all Eligible Rental Equipment of U.S. Domiciled Obligors (or of Canadian Domiciled Obligors, in the case of the Rental Equipment Advance Rate applicable to the Canadian Borrowing Base) set forth in the most recent appraisal by (ii) the book value of all eligible rental equipment of U.S. Domiciled Obligors (or of Canadian Domiciled

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Modular Space Holdings, Inc. and Subsidiaries

Unaudited Notes to Condensed Consolidated Financial Statements

(In thousands except share data)

Obligors, in the case of the Rental Equipment Advance Rate applicable to the Canadian Borrowing Base) set forth in such appraisal. The advance rate on eligible accounts receivable is 85%.

In addition, the Credit Agreement requires the maintenance of certain financial covenants, which primarily consist of leverage ratio, fixed charge coverage ratio, and limits on net capital expenditures, negative covenants, and affirmative covenants. The Company was in compliance with all applicable covenants under the New Credit Agreement as of June 30, 2018.

The Company’s borrowings under the New Credit Facility are legally long-term.  However, the Company classifies the ABL facility as current as it includes a sweep feature whereby remittances from the Company’s customers are used to reduce the revolving debt outstanding.

8.Stock Based Compensation

During the Successor nine months ended June 30, 2018, the Company recorded $2,551 of stock based compensation. The Company granted 49,568 Time-Based RSUs in October 2017 to certain members of the Board of Directors. Additionally, the Company granted 24,137 Time-Based RSUs, 29,885 Equity Value-Based RSUs and 14,943 ROIC-based RSU’s in March 2018. There were no RSUs forfeited or expired during the nine months ended June 30, 2018.

The Company has determined that the consummation of a public offering, or change in control is not probable as of the reporting date and therefore, has not recorded compensation expense for the Equity Value Based RSU’s. As of June 30, 2018, total compensation cost related to nonvested Equity Value-Based restricted stock units not yet recognized in expense is $4,764, which will be recognized once the Company determines that the performance conditions are probable to occur.

As of June 30, 2018, total compensation cost related to nonvested time based restricted stock units not yet recognized in expense is $8,315 which is expected to be recognized over a weighted-average period of 2.7 years.

As of June 30, 2018, total compensation cost related to ROIC-based restricted stock units not yet recognized in expense is $2,058 which is expected to be recognized over a weighted-average period of 3.5 years.

9.Income Taxes

The Company’s tax provision and the corresponding effective tax rate are based on expected income, statutory tax rates and tax planning opportunities available in the jurisdictions in which the Company operates. For interim financial reporting the Company estimates the annual tax rate based on projected taxable income for the full year and records a quarterly tax provision in accordance with the anticipated annual rate. As the year progresses, the Company refines the estimates of the year’s taxable income as new information becomes available, including year-to-date financial results. This continual estimation process can result in a change to the Company’s expected effective tax rate for the year. When this occurs, the Company adjusts the income tax provision during the quarter in which the change in estimate occurs so that the year-to-date provision reflects the expected annual tax rate. Significant judgment is required in determining the Company’s effective interim tax rate and in evaluating its tax positions.

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Modular Space Holdings, Inc. and Subsidiaries

Unaudited Notes to Condensed Consolidated Financial Statements

(In thousands except share data)

The Company does not have any uncertain tax positions for which it is reasonably possible that the amount of unrecognized tax benefits will significantly increase or decrease within the next twelve months. The Company recognizes interest and penalties related to unrecognized tax benefits as a component of selling, general and administrative expense. During the Successor three and nine months ended June 30, 2018, the Successor three months ended June 30, 2017 and the period from March 3, 2017 to June 30, 2017 and the Predecessor period from October 1, 2016 to March 2, 2017, interest and penalties accrued were not material.

On December 22, 2017, the Tax Cuts and Jobs Act (the “Act”) was enacted in the United States. The Act represents sweeping changes in U.S. tax law. On December 22, 2017 in response to the Act, the Staff of the U.S. Securities and Exchange Commission issued Staff Accounting Bulletin No. 118 (“SAB No. 118”) to provide guidance to registrants in applying ASC Topic 740 in connection with the Act. SAB No. 118 provides that in the period of enactment, the income tax effects of the ACT may be reported as a provisional amount based on a reasonable estimate (to the extent a reasonable estimate can be determined), which would be subject to adjustment during a “measurement period”. The measurement period begins in the reporting period of the Act’s enactment and ends when a registrant has obtained, prepared, and analyzed the information that was needed in order to complete the accounting requirements under ASC Topic 740. SAB No. 118 also describes supplemental disclosures that should accompany the provisional amounts.

For the Successor nine months ended June 30, 2018, the Company has provisionally recorded an income tax benefit for the impact of the Act. The Company provisionally recognized a decrease to deferred taxes and corresponding income tax benefit in the U.S. of approximately $6,500 based on an estimate of the impact of the Act. In addition, the Company provisionally included in tax expense, the estimated impacts of the Transition Tax which when offset by net operating losses and release of valuation allowance is not material. Adjustments to provisional amounts will be recorded as our analyses are refined.

10.Commitments and Contingencies

The Company leases certain facilities under noncancellable operating leases. Total rent expense under all operating leases was approximately $12,261, $5,450 and $6,704 for the Successor nine months ended June 30, 2018, the Successor period from March 3, 2017 to June 30, 2017 and the Predecessor period from October 1, 2016 to March 2, 2017, respectively.

Total rent expense under all operating leases was approximately $3,906 and $4,155 for the Successor three months ended June 30, 2018 and the Successor three months ended June 30, 2017, respectively.

13

Modular Space Holdings, Inc. and Subsidiaries

Unaudited Notes to Condensed Consolidated Financial Statements

(In thousands except share data)

The future minimum rental commitments under all noncancellable operating leases for the remainder of 2018 and the succeeding fiscal years are as follows:

Fiscal year ending September 30,
2018	$	3,938
2019	14,840
2020	11,365
2021	9,203
2022	8,405
Thereafter	19,508
Total	$	67,259

11.Related Party Transactions

In connection with the Company’s Joint Prepackaged Plan of Reorganization (the “Plan”), Calera Capital has a subordinated management agreement claim contingent upon a Qualifying Liquidity Event (as defined in the Plan), which is capped in the amount of $1,100. The claim is extinguished if no Qualifying Liquidity Event occurs within five years after the Effective Date of the Plan. The Company has determined that a Qualifying Liquidity Event is not probable as of June 30, 2018, and therefore has not recorded any amounts related to the claim.

12.Subsequent Events

As described in Note 2, on June 21, 2018, the Company entered into a merger agreement with WillScot Corporation. The Merger closed on August 15, 2018.

The Company evaluated all events or transactions that occurred after June 30, 2018 through August 20, 2018, the date these consolidated financial statements were available to be issued, and concluded that there were no other subsequent events required to be disclosed in the Company’s consolidated financial statements that have not been previously disclosed elsewhere.

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