MRC Global Inc

Item 1A. Risk Factors

We are affected by risks specific to us as well as factors that affect all businesses operating in a global market. The significant factors known to us that could materially adversely affect our business, financial condition or operating results are described in below under Risks Relating to the Mergers in Part I, Item 2 of this Quarterly Report on Form 10-Q and in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2024 under Risk Factors.

Risks Relating to the Mergers

The Mergers are subject to a number of conditions, which, if not fulfilled, or not fulfilled in a timely manner, may delay completion of the Mergers or result in termination of the Merger Agreement.

Our and DNOWs obligations to consummate the Mergers are subject to the satisfaction (or waiver by all parties, to the extent permissible under applicable laws) of the conditions described in the Merger Agreement. Many of the conditions to completion of the Mergers are not within our or DNOWs control, and neither company cannot predict when, or if, these conditions will be satisfied. If any of these conditions are not satisfied or waived prior to the outside date when either party may terminate the Merger Agreement (the "Outside Date"), it is possible that the Merger Agreement may be terminated. Although the parties have agreed in the Merger Agreement to use reasonable best efforts or commercially reasonable efforts, as the case may be, with respect to certain conditions, and subject to certain limitations, to promptly complete the Mergers, these and other conditions to the completion of the Mergers may fail to be satisfied.

For example, the closing of the Mergers is conditioned upon the expiration or termination of any applicable waiting period, or any extension thereof, under the HSR Act and any applicable waiting period, clearance or affirmative or deemed approval of any governmental entity or other condition with respect to certain non-U.S. antitrust or foreign direct investment approvals having expired or been terminated, or been obtained or satisfied, as applicable. There can be no assurance that the relevant waiting periods will expire or that the relevant authorizations will be obtained. In addition, certain non-U.S. governmental authorities with or from which these authorizations are required have broad discretion in administering the governing regulations. Adverse developments in our or DNOWs regulatory standing or any other factors considered by regulators in granting such approvals, governmental, political or community group inquiries, investigations or opposition, or changes in legislation or the political environment generally could affect whether and when required governmental authorizations are granted.

Satisfying the conditions to and completion of the Mergers may take longer, and could cost more, than we or DNOW expect. We cannot predict whether or when these other conditions will be satisfied. There can be no assurance that regulators will not impose conditions, terms, obligations or restrictions and that such conditions, terms, obligations or restrictions will not have the effect of delaying or preventing the closing of the Mergers or imposing additional material costs on or materially limiting the revenues of the combined company following the Mergers, or otherwise adversely affecting the combined companys businesses and results of operations after completion of the Mergers. Any delay in completing the Mergers may adversely affect the cost savings and other benefits that we and DNOW expect to achieve if the Mergers and the integration of the companies respective businesses are completed within the expected timeframe. There can be no assurance that all required regulatory approvals will be obtained prior to the Outside Date or at all.

37

Our business relationships may be subject to disruption due to uncertainty associated with the Mergers, which could have a material adverse effect on our results of operations, cash flows and financial position prior to the Mergers, and on the combined company following the Mergers.

Parties with which we do business may experience uncertainty associated with the Mergers, including with respect to current or future business relationships with us or the combined company following the Mergers. Our business relationships may be subject to disruption as customers, distributors, suppliers, vendors, landlords, joint venture partners and other business partners may attempt to delay or defer entering into new business relationships, negotiate changes in existing business relationships or consider entering into business relationships with parties other than the combined company following the Mergers. These disruptions could have a material adverse effect on our results of operations, cash flows and financial position, regardless of whether the Mergers are completed, as well as a material and adverse effect on the combined companys ability to realize the expected cost savings and other benefits of the Mergers. The risk, and adverse effect, of any disruption could be exacerbated by a delay in completion of the Mergers or termination of the Merger Agreement.

Failure to complete the Mergers could negatively impact our stock price and have a material adverse effect on our results of operations, cash flows and financial position.

If the Mergers are not completed for any reason, including as a result of failure to obtain all requisite regulatory approvals or if our or DNOWs stockholders fail to approve the applicable requisite proposals, our ongoing businesses may be materially adversely affected and, without realizing any of the benefits of having completed the Mergers, we would be subject to a number of risks, including the following:

If the Mergers are not completed, the risks described above may materialize and they may have a material adverse effect on our results of operations, cash flows, financial position and stock price.

The Merger Agreement subjects us to restrictions on our business activities prior to the Effective Time.

The Merger Agreement obligates us to generally use commercially reasonable efforts to conduct our businesses in the ordinary course, including by using commercially reasonable efforts to preserve substantially intact our present business organization, goodwill and assets and preserve our existing relationships with governmental entities and our significant customers, suppliers and others having significant business dealings with us. These restrictions could prevent us from pursuing certain business opportunities that arise prior to the Effective Time and are outside the ordinary course of business.

The synergies attributable to the Mergers may vary from expectations.

The combined company may fail to realize the anticipated benefits and synergies expected from the Mergers, which could adversely affect the combined companys business, financial condition and results of operations. The success of the Mergers will depend, in significant part, on the combined companys ability to successfully integrate the acquired business, grow the revenue of the combined company and realize the anticipated strategic benefits and synergies from the combination. We and DNOW believe that the combination of the companies will provide operational and financial scale, increasing free cash flow, and enhancing the combined companys corporate rate of return. However, achieving these goals requires, among other things, realization of the targeted cost synergies expected from the Mergers. This growth and the anticipated benefits of the transaction may not be realized fully or at all, or may take longer to realize than expected. Actual operating, technological, strategic and revenue opportunities, if achieved at all, may be less significant than expected or may take longer to achieve than anticipated. If the combined company is not able to achieve these objectives and realize the anticipated benefits and synergies expected from the Mergers within the anticipated timing or at all, the combined companys business, financial condition and results of operations may be adversely affected.

38