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We believe there are no changes that constitute material changes from the risk factors previously disclosed in our Annual Report on Form 10-K for the year ended December 31, 2025, filed with the SEC on February 26, 2026, other than as set forth below.
Risks Related to the Proposed QXO Transaction
The QXO Transaction may not be completed within the expected timeframe, or at all, and the failure to complete the QXO Transaction could impact our stock price and our future business and financial results.
There can be no assurance that the QXO Transaction will be completed in the expected timeframe, or at all. The Merger Agreement contains a number of conditions that must be satisfied or waived prior to the completion of the QXO Transaction, including the stockholder approvals. There can be no assurance that all closing conditions will be satisfied (or waived, if applicable). Many of the conditions to completion of the QXO Transaction are not within our control, and we cannot predict when or if these conditions will be satisfied (or waived, as applicable). In addition, either TopBuild or QXO may terminate the Merger Agreement if, subject to certain limitations, the QXO Transaction has not been consummated by January 17, 2027.
If the QXO Transaction is not completed, our ongoing business and financial results may be adversely affected and we will be subject to a number of risks, including the following:
● we have dedicated significant time and resources, financial and otherwise, in planning for the QXO Transaction and the associated integration, of which we would lose the benefit if the QXO Transaction is not completed;
● we are responsible for certain transaction costs relating to the QXO Transaction, whether or not the QXO Transaction is completed;
● while the Merger Agreement is in force, we are subject to certain restrictions on the conduct of our business, including taking any action that would reasonably be expected to have a material negative impact on or material delay to the satisfaction of the conditions in the Merger Agreement required to consummate the QXO Transaction, which restrictions may adversely affect our ability to execute certain of our business strategies; and
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● matters relating to the QXO Transaction (including integration planning) may require substantial commitments of time and resources by our management, whether or not the QXO Transaction is completed, which could otherwise have been devoted to other opportunities that may have been beneficial to us.
In addition, if the QXO Transaction is not completed, we may experience negative reactions from the financial markets and from our customers and employees. We also may be subject to litigation related to any failure to complete the QXO Transaction or to enforcement proceedings commenced against us to perform our obligations under the Merger Agreement. If the QXO Transaction is not completed, some or all of these risks may materialize and may adversely affect our business, financial results and financial condition, as well as the price of our common stock.
The Merger Agreement restricts our ability to pursue alternative transactions and may require us to pay a termination fee under certain circumstances.
The Merger Agreement contains customary non-solicitation provisions that limit our ability to solicit or engage in discussions regarding alternative acquisition proposals, subject to certain fiduciary exceptions. If the Merger Agreement is terminated under certain specified circumstances, including in connection with a competing acquisition proposal, we may be required to pay a termination fee of $600 million in cash to QXO. These provisions could discourage other potential strategic transactions that may be favorable to us and our stockholders.
Securities class action and derivative lawsuits may be brought against us in connection with the QXO Transaction, which could result in substantial costs.
Securities class action lawsuits and derivative lawsuits are often brought against public companies that have entered into acquisition, merger, or other business combination agreements. Even if such a lawsuit is without merit, defending against these claims can result in substantial costs and divert management time and resources. An adverse judgment could result in monetary damages, or disrupt, delay, or terminate the QXO Transaction, which could have a negative impact on our liquidity and financial condition.
The market value of the QXO common stock that TopBuild stockholders will receive in the QXO Transaction may fluctuate materially and may be less than expected.
Because the value of the consideration in the QXO Transaction depends in part on the market price of QXO common stock, which may be volatile and subject to market and other factors outside of our control, there can be no assurance regarding the value that TopBuild stockholders will ultimately receive. The market price of QXO common stock may be affected by factors relating to QXO, the QXO Transaction, the anticipated benefits of the QXO Transaction, the combined company’s future prospects and results of operations, general market and economic conditions, and other factors. As a result, the value of the stock consideration may increase or decrease prior to or following completion of the QXO Transaction.
Uncertainty about the QXO Transaction may adversely affect our relationships with customers, suppliers, employees and other business partners, and may divert management’s attention.
Uncertainty about the timing and completion of the QXO Transaction may disrupt our business and could affect our relationships with customers, suppliers, and other business partners, including as a result of concerns about the combined company’s future strategy, operations, and financial condition. In addition, the pendency of the QXO Transaction may make it more difficult to attract, motivate, and retain key personnel, and could distract management and employees from day-to-day operations as they devote time and attention to matters relating to the QXO Transaction, including integration planning. Any of these factors could adversely affect our business, financial results and financial condition, whether or not the QXO Transaction is completed.
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The combined company may not achieve the anticipated benefits of the QXO Transaction, and TopBuild stockholders may not realize the expected value of the QXO Transaction.
The QXO Transaction is expected to result in benefits to the combined company, including those associated with the combined company’s scale, enhanced capabilities, and other strategic and financial objectives. However, achieving the anticipated benefits will depend on a number of factors, including the combined company’s ability to successfully integrate TopBuild’s business with QXO’s business, retain key personnel, realize anticipated operational and financial synergies and growth opportunities, and execute the combined company’s business plan. These benefits may not be achieved within the expected timeframe, or at all, and the combined company may incur additional or unexpected costs in connection with the QXO Transaction. If the combined company is unable to achieve some or all of the anticipated benefits of the QXO Transaction, the market price of QXO common stock could decline, and TopBuild stockholders could receive less value from the QXO Transaction than expected.