Application of the acquisition method of accounting under the provisions of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 805, Business Combinations (“ASC 805”) where the assets acquired and liabilities assumed of MRC Global was recorded by DNOW at their respective fair values as of the closing date;

Preliminary adjustments to conform the financial statement presentation of MRC Global to those of DNOW; and

Adjustments to reflect estimated post-combination impacts, including transaction costs of the mergers, (as defined below in Note 1 — Description of the Mergers below).

For the year ended December 31, 2024, DNOW completed the acquisitions of Whitco Supply, LLC and Trojan Rentals, LLC (collectively, the “Other Acquisitions”). DNOW has included the financial results of the Other Acquisitions in its consolidated financial statements from the date of the Other Acquisitions. The unaudited combined pro forma data has been presented as if the Other Acquisitions occurred on January 1, 2024. This information is based on historical results of operations, adjusted to give effect to pro forma events that are directly attributable to the Other Acquisitions and factually supportable. The pro forma data is for informational purposes only and is not indicative of the results of operations that would have been achieved had the Other Acquisitions occurred at the beginning of fiscal year 2024.

The historical audited consolidated financial statements of DNOW and the related notes included in DNOW’s Annual Report on Form 10-K as of and for the year ended December 31, 2024;

The historical audited consolidated financial statements of MRC Global and the related notes included in MRC Global’s Annual Report on Form 10-K as of and for the year ended December 31, 2024;

The historical unaudited interim consolidated financial statements of DNOW and the related notes included in DNOW’s Quarterly Report on Form 10-Q as of and for the nine months ended September 30, 2025; and

The historical unaudited interim condensed consolidated financial statements of MRC Global and the related notes included in MRC Global’s Quarterly Report on Form 10-Q as of and for the nine months ended September 30, 2025.

Assets

Current assets:

Cash and cash equivalents

Cash

Receivables, net

Accounts receivable, net

Inventories, net

Prepaid and other current assets

Other current assets

Current assets of discontinued operations

Total current assets

Property, plant and equipment, net

Operating lease assets

Deferred income taxes

Goodwill

Goodwill, net

Intangibles, net

Other intangible assets, net

Other assets

Total assets

Liabilities & Stockholders’ Equity

Current liabilities:

Accounts payable

Trade accounts payable

Accrued liabilities

Accrued expenses and other current liabilities

Operating lease liabilities

Current portion of debt obligations

Other current liabilities

Current liabilities of discontinued operations

Total current liabilities

Long-term operating lease liabilities

Long-term debt

Deferred income taxes

Other long-term liabilities

Other liabilities

Total liabilities

Stockholders’ equity:

Preferred stock

Common stock

Treasury stock

Additional paid-in capital

Accumulated deficit

Retained deficit

Accumulated other comprehensive loss

Noncontrolling interest

Total stockholders’ equity

Total liabilities and stockholders’ equity

Revenue

Sales

Operating expenses:

Cost of products

Cost of sales

Warehousing, selling and administrative

Selling, general and administrative expenses

Operating profit

Other income (expense)

Interest expense

Other, net missing

Income before income taxes

Income tax provision

Income tax expense from continuing operations

Loss from discontinued operations, net of tax

Net income (loss)

Less: Net income attributable to a noncontrolling interest

Net income (loss) attributable to DNOW Inc.

Earnings per share attributable to DNOW Inc. stockholders:

Basic

Diluted

Weighted-average common shares outstanding, basic

Weighted-average common shares outstanding, diluted

Revenue

Sales

Operating expenses:

Cost of products

Cost of sales

Warehousing, selling and administrative

Selling, general and administrative expenses

Impairment and other charges

Operating profit

Other income (expense)

Interest expense

Other, net

Income before income taxes

Income tax provision

Income tax expense from continuing operations

Loss from discontinued operations, net of tax

Net income (loss)

Series A preferred stock dividends

Loss on repurchase and retirement of preferred stock

Less: Net income attributable to a noncontrolling interest

Net income (loss) attributable to DNOW Inc.

Earnings per share attributable to DNOW Inc. stockholders:

Basic

Diluted

Weighted-average common shares outstanding, basic

Weighted-average common shares outstanding, diluted

MRC Global common stock as of November 6, 2025

MRC Global RSAs, MRC Global RSUs and MRC Global PSUs to be vested in connection with the Mergers

Exchange ratio

Shares of DNOW common stock issued at closing

Price per share of DNOW common stock⁽¹⁾

Equity consideration for the conversion of MRC Global common stock outstanding

Fair value of replacement MRC Global RSUs and MRC

Global PSUs attributable to the purchase price

Estimated repayment of certain existing indebtedness of MRC Global⁽²⁾

Preliminary Merger Consideration

The equity consideration is based on the closing price of the shares of DNOW common stock on November 5, 2025.

The balance of existing indebtedness of MRC Global is based on the outstanding balance as of September 30, 2025, including accrued interest. The actual repayment amount may be different to reflect the outstanding indebtedness on the Closing Date.

Cash

Accounts receivable, net

Inventories, net

Other current assets

Operating lease assets

Property, plant and equipment, net

Other assets

Other intangible assets, net

Total identifiable assets acquired

Trade accounts payable

Accrued expenses and other current liabilities

Operating lease liabilities

Long-term operating lease liabilities

Deferred income taxes

Other liabilities

Total identifiable liabilities assumed

Goodwill

Total consideration effectively transferred

Represents a reclassification of MRC Global “Cash” to Cash and cash equivalents”.

Represents a reclassification of MRC Global “Accounts receivables, net” to “Receivables, net”.

Represents a reclassification of MRC Global “Other current assets” to “Prepaid and other current assets”.

Represents a reclassification of MRC Global finance lease right-of-use assets balance recorded in “Other assets” to “Property, plant and equipment, net”.

Represents a reclassification of DNOW operating lease right-of-use assets balance from “Other assets” to “Operating lease assets”, as the balance is individually significant.

Represents a reclassification of MRC Global “Goodwill, net” to “Goodwill”.

Represents a reclassification of MRC Global “Other intangible assets, net” to “Intangibles, net”.

Represents a reclassification of MRC Global “Trade accounts payable” to “Accounts payable”.

Represents a reclassification of MRC Global contract liabilities and taxes (non-income) in the amount of $114 million in “Accrued expenses and other current liabilities” to “Accrued liabilities”.

Represents a reclassification of MRC Global income tax payable in “Accrued expenses and other current liabilities” to “Other current liabilities”.

Represents a reclassification of DNOW operating lease liabilities balance in “Accrued liabilities” to “Operating lease liabilities”, as the balance is individually significant.

Represents a reclassification of MRC Global “Other liabilities” to “Other long-term liabilities”.

Represents a reclassification of MRC Global “Retained deficit” to “Accumulated deficit”.

[Reserved]

Represents a reclassification of MRC Global “Sales” to “Revenue”.

Represents a reclassification of MRC Global “Cost of sales” to “Cost of products”, excluding the depreciation expense which is adjusted in 4(q) below.

Represents a reclassification of MRC Global depreciation expense in the amount of $18 million and $21 million, for the nine months ended September 30, 2025 and the year ended December 31, 2024, respectively, from “Cost of sales” to “Warehousing, selling and administrative”.

Represents a reclassification of MRC Global “Selling, general and administrative expenses” to “Warehousing, selling and administrative”.

Represents a reclassification of MRC Global “Interest expense” to “Other income (expense)”.

Represents a reclassification of MRC Global “Other, net” to “Other income (expense)”.

Represents a reclassification of MRC Global “Income tax expense from continuing operations” to “Income tax provision”.

Represents the adjustments to the carrying value of inventories and property, plant and equipment were recorded to the estimated fair value. The calculated value is preliminary and subject to change and could vary materially from the final purchase price assignment.

Represents a net adjustment to goodwill to reflect the balance that would have been recorded if the Mergers occurred on September 30, 2025. The preliminary purchase price to the net tangible and intangible assets based upon their estimated fair values at the closing date of the Mergers. The excess of the purchase price over the estimated fair values of the net assets acquired has been recorded to goodwill as of September 30, 2025. The calculated value is preliminary, subject to change and could vary materially from the final purchase price assignment.

Represents a net adjustment of $289 million to the carrying value of “Intangibles, net” to recognize the estimated fair value of intangible assets acquired. The calculated value is preliminary and subject to change and could vary materially from the final purchase price assignment.

Represents a net adjustment of $12 million for the remeasurement of operating and finance lease right-of-use assets. The calculated value is preliminary and subject to change and could vary materially from the final purchase price assignment.

Represents the identified tax basis differences between the fair value and historical carrying value of the assets acquired, which has been tax effected using a blended statutory tax rate of 25%. This rate may vary from the effective tax rate of the historical and combined businesses. The estimate of deferred tax balances is preliminary and is subject to change based upon certain factors including final determination of the fair value of assets acquired and liabilities assumed and deductible non-recurring items by taxing jurisdiction.

Represents a net adjustment of $27 million to increase other assets to recognize the estimated fair value from the purchase price allocation. The calculated value is preliminary and subject to change and could vary materially from the final purchase price assignment.

Represents the repayment of existing indebtedness of MRC Global with an outstanding balance of approximately $477 million as of September 30, 2025, including the net of discount and issuance costs of approximately $6 million and accrued interest of approximately $1 million. There is no penalty associated with prepayment of MRC Global’s existing indebtedness.

Represents the settlement of the estimated transaction costs to be incurred by DNOW in connection with the Mergers.

The changes to equity associated with the Mergers as of September 30, 2025 are as follows:

(Amounts in millions)

Elimination of MRC Global’s Historical Equity⁽¹⁾

Issuance of DNOW common stock⁽²⁾

Settlement of the accrued and additional estimated DNOW⁽³⁾ transaction costs associated with the Mergers

Estimated repayment of certain existing indebtedness of MRC Global⁽⁴⁾

Elimination of MRC Global’s Historical Goodwill⁽⁵⁾

Represents the elimination of MRC Global’s historical equity balances as of September 30, 2025.

Represents the issuance of 81,374,745 shares of DNOW common stock based on the closing price of $14.56 per share on November 5, 2025, and the fair value of assumed MRC Global awards attributable to pre-combination services.

Represents the adjustment to accumulated deficit for the settlement of the estimated transaction costs to be incurred by DNOW in connection with the Mergers.

Represents the repayment of existing indebtedness of MRC Global with an outstanding balance of approximately $477 million as of September 30, 2025, including accrued interest, that is not being legally assumed in the Mergers.

Represents the elimination of MRC Global’s historical goodwill balance as of September 30, 2025.

Represents the increase to cost of products by the amount related to the inventory fair value step up, which was described in Note 5(a) and expected to be sold within one year.

Represents a net adjustment of $8 million and $9 million for the nine months ended September 30, 2025, and the year ended December 31, 2024, respectively, to (1) reflect the removal of historical amortization expense related to cost of products and (2) recognize amortization expense related to intangible assets.

Represents a net adjustment of ($10) million and ($11) million for the nine months ended September 30, 2025, and the year ended December 31, 2024, respectively, to (1) reflect the removal of historical depreciation expense related to warehousing, selling and administrative and (2) recognize depreciation related to tangible assets.

Represents the recognition of new stock-based compensation expense for the post-combination portion of the cancelled and exchanged MRC Global equity awards.

(Amounts in millions)

Compensation expense for the post-combination portion of the cancelled and converted MRC Global RSUs⁽¹⁾

Compensation expense for the post-combination portion of to the cancelled and converted MRC Global PSUs⁽²⁾

Removal of historical stock-based compensation expense related to the cancelled and converted MRC Global RSUs and PSUs

Net adjustment to warehouse, selling and administrative expense

Represents the recognition of new stock-based compensation expense for the post-combination portion of the cancelled and converted MRC Global RSUs.

Represents the recognition of new stock-based compensation expense for the post-combination portion of the cancelled and converted MRC Global PSUs.

Represents the one-time direct and incremental transaction costs in the amount of $37 million anticipated to be incurred by DNOW prior to, or concurrent with, the Mergers and are reflected in the unaudited pro forma condensed consolidated balance sheet as a direct reduction to the combined entity’s accumulated deficit and are assumed to be cash settled.

Represents the interest expense, in the amount of $9 million and $15 million for the nine months ended September 30, 2025 and the year ended December 31, 2024, respectively, associated with DNOW’s $265 million drawing from its existing senior secured revolving credit facility to pay off MRC Global’s existing indebtedness. Interest expense is calculated using an effective interest rate. The effective interest rate for the senior secured revolving credit facility hereby was 6.3%.

Represents the removal of interest expense associated with MRC Global’s existing indebtedness.

Represents the pro forma effects of the transaction of the Other Acquisitions that were completed during the year ended December 31, 2024. The pro forma is presented as if the acquisitions occurred on January 1, 2024. The tax rate is based on the average blended federal and state rate for the period. The actual tax effect of the 2024 acquisitions will differ from the pro forma adjustments.

Represents an adjustment of $7 million and ($14) million for the nine months ended September 30, 2025, and year ended December 31, 2024, respectively, to reflect the tax effect of the adjustments above at a blended statutory income tax rate of approximately 25%. The effective tax rate of the combined company could be significantly different (either higher or lower) depending on activities following the consummation of the Mergers, including cash needs, the geographical mix of income, and changes in tax law.

Represents the severance pay in the amount of $27 million to record (1) stock-based compensation expense related to MRC Global PSUs and MRC Global RSUs for which the service-based and performance-based vesting conditions are expected to be satisfied in connection with the Mergers, and (2) certain severance to be paid to executives terminated upon change-in-control.

This represents the elimination of MRC Global’s historical income impact from the settlement of preferred shares that are not part of the Mergers.

Pro forma basic earnings per share attributable to holders of DNOW common stock (the “DNOW stockholders”) is calculated using the historical basic weighted average shares of DNOW common stock outstanding, adjusted for the additional shares to be issued to holders of MRC Global common stock and holders of MRC Global equity awards. Pro forma diluted earnings per share attributable to DNOW stockholders is calculated using the historical diluted weighted average shares of DNOW common stock outstanding, adjusted for the additional shares to be issued to holders of MRC Global common stock excluding the DNOW assumed MRC Global RSUs and PSUs as those are not participating securities.

Numerator:

Net income attributable to DNOW

Net income attributable to participating securities

Net income attributable to DNOW stockholders

Denominator:

Historical weighted average shares of DNOW common stock outstanding (basic)

Shares of DNOW common stock to be issued to MRC Global stockholders pursuant to the Merger Agreement⁽¹⁾ Pro forma weighted average shares (basic)

Historical weighted average shares of DNOW common stock outstanding (diluted)

DNOW common stock to be issued to MRC Global stockholders pursuant to the Merger Agreement⁽¹⁾

Pro forma weighted average shares (diluted)

Pro forma earnings per share of DNOW common stock attributable to DNOW stockholders:

Basic

Diluted

Includes the cancellation and exchange of all 85,756,924 issued and outstanding shares of MRC Global common stock (including 764,262 shares underlying MRC Global RSAs, MRC Global RSUs and MRC Global PSUs subjected to accelerated vesting upon change in control) as of November 6, 2025, into an aggregate of 81,374,745 shares of DNOW common stock.

Numerator:

Pro forma net income attributable to DNOW

Net income attributable to participating securities

Net income attributable to DNOW stockholders

Denominator:

Historical weighted average shares of DNOW common stock outstanding (basic)

DNOW common stock to be issued to MRC Global stockholders pursuant to the Merger Agreement⁽¹⁾

Pro forma weighted average shares (basic)

Historical weighted average shares of DNOW common stock outstanding (diluted)

DNOW common stock to be issued to MRC Global stockholders pursuant to the Merger Agreement⁽¹⁾

Pro forma weighted average shares (diluted)

Pro forma earnings per share attributable to DNOW stockholders:

Basic

Diluted

Includes the cancellation and exchange of all 85,756,924 issued and outstanding shares of MRC Global common stock (including 764,262 shares underlying MRC Global RSAs, MRC Global RSUs and MRC Global PSUs subjected to accelerated vesting upon change in control) as of November 6, 2025, into an aggregate of 81,374,745 shares of DNOW common stock.