Form 10-Q - Quarterly report [Sections 13 or 15(d)]

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

____________

FORM 10-Q

____________

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended: June 30, 2024

o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 001-38063

QXO, INC.

(Exact name of registrant as specified in its charter)


Delaware (State or other jurisdiction of incorporation)			16-1633636 (IRS Employer Identification No.)

Five American Lane

Greenwich, CT 06831

(Address of principal executive offices)

(888) 998-6000

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.00001 per share	QXO	The Nasdaq Capital Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the past 12 months, and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No o

Indicate by check mark whether the registrant is large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See definition of “large accelerated filer,” accelerated filer” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act:


Large accelerated filer	o	Accelerated filer	o

Non-accelerated filer	x	Smaller Reporting Company	x

		Emerging Growth Company	o

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x

As of August 7, 2024, there were 409,430,195 shares outstanding of the registrant’s common stock.

QXO, INC.

TABLE OF CONTENTS


		Page No.
PART I.	FINANCIAL INFORMATION

Item 1.	Financial Statements (Unaudited):
	Condensed Consolidated Balance Sheets as of June 30, 2024 and December 31, 2023	5
	Condensed Consolidated Statements of Operations for the Three and Six Months Ended June 30, 2024 and 2023	6
	Condensed Consolidated Statements of Stockholders’ Equity for the Three and Six Months Ended June 30, 2024 and 2023	7
	Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2024 and 2023	9
	Notes to Condensed Consolidated Financial Statements	10

Item 2.	Management’s Discussion and Analy sis of Financial Condition and Results of Operations	18
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	21
Item 4.	Controls and Procedures	21

PART II.	OTHER INFORMATION

Item 1.	Legal Proceedings	23
Item 1A.	Risk Factors	23
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	29
Item 3.	D efaults Upon Senior Securities	29
Item 4.	M ine Safety Disclosures	29
Item 5.	Other Information	29
Item 6.	Exhibits	30
	SIGNATURES

PART I – FINANCIAL INFORMATION

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q (this “Quarterly Report”) contains forward-looking statements. Statements that are not historical facts, including statements about beliefs, expectations, targets and goals are forward-looking statements. These statements are based on plans, estimates, expectations and/or goals at the time the statements are made, and readers should not place undue reliance on them. In some cases, readers can identify forward-looking statements by the use of forward-looking terms such as “may,” “will,” “should,” “expect,” “opportunity,” “intend,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” “target,” “goal,” or “continue,” or the negative of these terms or other comparable terms. Forward-looking statements involve inherent risks and uncertainties and readers are cautioned that a number of important factors could cause actual results to differ materially from those contained in any such forward-looking statements. Factors that could cause actual results to differ materially from those described herein include, among others:

•risks associated with potential significant volatility and fluctuations in the market price of the Company’s common stock;

•risks associated with raising additional equity or debt capital from public or private markets to pursue the Company’s business plan, including potentially one or more additional private placements of common stock, and the effects that raising such capital may have on the Company and its business, including the risk of substantial dilution or that the Company’s common stock may experience a substantial decline in trading price;

•the possibility that additional future financings may not be available to the Company on acceptable terms or at all;

•the possibility that an active, liquid trading market for the Company’s common stock may not develop or, if developed, may not be sustained;

•the possibility that the Company’s outstanding warrants and preferred stock may or may not be converted or exercised, and the economic impact on the Company and the holders of common stock of the Company that may result from either such exercise or conversion, including dilution, or the continuance of the preferred stock remaining outstanding, and the impact its terms, including its dividend, may have on the Company and the common stock of the Company;

•uncertainties regarding the Company’s focus, strategic plans and other management actions;

•the risk that the Company is or becomes highly dependent on the continued leadership of Brad Jacobs as chairman and chief executive officer and the possibility that the loss of Mr. Jacobs in these roles could have a material adverse effect on the Company’s business, financial condition and results of operations;

•the possibility that the concentration of ownership by Mr. Jacobs may have the effect of delaying or preventing a change in control of the Company and might affect the market price of shares of the common stock of the Company;

•the risk that Mr. Jacobs’ past performance may not be representative of future results;

•the risk that the Company is unable to attract and retain world-class talent;

•the risk that the failure to consummate any acquisition expeditiously, or at all, could have a material adverse effect on the Company’s business prospects, financial condition, results of operations or the price of the Company’s common stock;

•risks that the Company may not be able to enter into agreements with acquisition targets on attractive terms, or at all, that agreed acquisitions may not be consummated, or, if consummated, that the anticipated benefits thereof may not be realized and that the Company encounter difficulties in integrating and operating such acquired companies, or that matters related to an acquired business (including operating results or liabilities or contingencies) may have a negative effect on the Company or its securities or ability to implement its business strategy, including that any such transaction may be dilutive or have other negative consequences to the Company and its value or the trading prices of its securities;

•risks associated with cybersecurity and technology, including attempts by third parties to defeat the security measures of the Company and its business partners, and the loss of confidential information and other business disruptions;

•the possibility that new investors in any future financing transactions could gain rights, preferences and privileges senior to those of the Company’s existing stockholders;

•the possibility that building products distribution industry demand may soften or shift substantially due to cyclicality or seasonality or dependence on general economic conditions, including inflation or deflation, interest rates, governmental subsidies or incentives, consumer confidence, labor and supply shortages, weather and commodity prices;

•the possibility that regional or global barriers to trade or a global trade war could increase the cost of products in the building products distribution industry, which could adversely impact the competitiveness of such products and the financial results of businesses in the industry;

•risks associated with periodic litigation, regulatory proceedings and enforcement actions, which may adversely affect the Company’s business and financial performance;

•uncertainties regarding general economic, business, competitive, legal, regulatory, tax and geopolitical conditions; and

•other factors, including those set forth in the Company’s filings with the U.S. Securities and Exchange Commission, including its Annual Report on Form 10-K for the fiscal year ended December 31, 2023 and subsequent Quarterly Reports on Form 10-Q.

You should not rely on forward-looking statements as predictions of future events, and you should understand that these statements are not guarantees of performance or results, and our actual results could differ materially from those expressed in the forward-looking statements due to a variety of factors. We have based the forward-looking statements contained in this Quarterly Report primarily on our current assumptions, expectations and projections about future events and trends that we believe may affect our business, financial condition, and results of operations. Moreover, we operate in a very competitive and rapidly changing environment. New risks and uncertainties emerge from time to time, and it is not possible for us to predict all risks and uncertainties that could have an impact on the forward-looking statements contained in this Quarterly Report. The results, events and circumstances reflected in the forward-looking statements may not be achieved or occur, and actual results, events or circumstances could differ materially from those described in the forward-looking statements.

Forward-looking statements herein speak only as of the date each statement is made. The Company undertakes no obligation to update any of these statements in light of new information or future events, except to the extent required by applicable law.

Item 1. Financial Statements (Unaudited)

QXO, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except share and per share data)


ASSETS	June 30, 2024		December 31, 2023
Current assets:	(unaudited)
Cash and cash equivalents	$	971,284	$	6,143
Accounts receivable, net	3,015		2,969
Prepaid expenses and other current assets	5,539		2,684
Total current assets	979,838		11,796
Property and equipment, net	511		503
Operating lease right-of-use assets	380		522
Intangible assets, net	4,486		4,919
Goodwill	1,140		1,140
Deferred tax assets	1,614		1,444
Other non-current assets	216		171
Total assets	$	988,185	$	20,495
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	6,194	$	4,563
Accrued expenses	5,397		2,681
Deferred revenue	3,113		3,161
Long-term debt – current portion	784		702
Finance lease obligations – current portion	141		154
Operating lease liabilities – current portion	217		263
Total current liabilities	15,846		11,524
Long-term debt net of current portion	693		994
Finance lease obligations net of current portion	247		247
Operating lease liabilities net of current portion	164		259
Total liabilities	16,950		13,024
Commitments and contingencies (Note 8)
Stockholders’ equity:
Preferred stock, $0.001 par value; authorized 10,000,000 shares, 1,000,000 and 0 shares issued and outstanding as of June 30, 2024 and December 31, 2023, respectively	498,684		—
Common stock, $0.00001 par value; authorized 2,000,000,000 shares, 664,284 and 664,448 shares issued and outstanding as of June 30, 2024 and December 31, 2023, respectively1	—		—
Additional paid-in capital	474,951		9,419
Accumulated deficit	(2,400)		(1,948)
Total stockholders’ equity	971,235		7,471
Total liabilities and stockholders’ equity	$	988,185	$	20,495

See accompanying notes to the unaudited condensed consolidated financial statements.

1 Amounts have been adjusted to reflect the 8-for-1 Reverse Stock Split effective June 6, 2024. See Note 3 - Equity for additional details.

QXO, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share data)

(Unaudited)


	Three Months Ended				Six Months Ended
	June 30, 2024		June 30, 2023		June 30, 2024		June 30, 2023
Revenue:
Software product, net	$	3,776	$	3,298	$	7,256	$	6,620
Service and other, net	10,764		9,959		21,719		19,765
Total revenue, net	14,540		13,257		28,975		26,385
Cost of revenue:
Product	2,369		2,027		4,568		3,960
Service and other	6,376		6,045		12,955		11,883
Total cost of revenue	8,745		8,072		17,523		15,843
Operating expenses:
Selling, general and administrative expenses	9,835		4,525		15,024		9,305
Depreciation and amortization expenses	261		204		501		411
Total operating expenses	10,096		4,729		15,525		9,716
(Loss) income from operations	(4,301)		456		(4,073)		826
Other income (expense), net:
Interest income (expense), net	3,470		(17)		3,450		(35)
Total other income (expense)	3,470		(17)		3,450		(35)
(Loss) income before taxes	(831)		439		(623)		791
(Benefit) provision for income taxes	(240)		95		(171)		170
Net (loss) income	$	(591)	$	344	$	(452)	$	621
(Loss) earnings per common share – basic and fully diluted	$	(9.93)	$	0.52	$	(9.72)	$	0.95
Weighted average shares outstanding:1
Basic	664		657		664		657
Diluted	664		657		664		657

See accompanying notes to the unaudited condensed consolidated financial statements.

1 Amounts have been adjusted to reflect the 8-for-1 Reverse Stock Split effective June 6, 2024. See Note 3 - Equity for additional details.

QXO, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(in thousands)

(Unaudited)

FOR THE THREE MONTHS ENDED JUNE 30, 2024


	Preferred Stock			Common Stock			Additional Paid-in Capital		Accumulated Deficit		Total Stockholders’ Equity
	Shares	Amount		Shares1	Amount
Balance at April 1, 2024	—	$	—	664	$	—	$	9,419	$	(1,809)	$	7,610
Issuance of Convertible Preferred Stock and Warrants, net of issuance costs	1,000	498,684		—	—		482,977		—		981,661
Cash paid for fractional shares	—	—		—	—		(45)		—		(45)
Common stock dividend	—	—		—	—		(17,400)		—		(17,400)
Net loss	—	—		—	—		—		(591)		(591)
Balance at June 30, 2024	1,000	$	498,684	664	$	—	$	474,951	$	(2,400)	$	971,235

FOR THE THREE MONTHS ENDED JUNE 30, 2023


	Preferred Stock			Common Stock			Additional Paid-in Capital		Accumulated Deficit		Total Stockholders’ Equity
	Shares	Amount		Shares1	Amount
Balance at April 1, 2023	—	$	—	657	$	—	$	10,471	$	(600)	$	9,871
Share-based compensation	—	—		—	—		—		—		—
Net income	—	—		—	—		—		344		344
Balance at June 30, 2023	—	$	—	657	$	—	$	10,471	$	(256)	$	10,215

See accompanying notes to the unaudited condensed consolidated financial statements.

1 Amounts have been adjusted to reflect the 8-for-1 Reverse Stock Split effective June 6, 2024. See Note 3 - Equity for additional details.

QXO, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (CONTINUED)

(in thousands)

(Unaudited)

FOR THE SIX MONTHS ENDED JUNE 30, 2024


	Preferred Stock			Common Stock			Additional Paid-in Capital		Accumulated Deficit		Total Stockholders’ Equity
	Shares	Amount		Shares1	Amount
Balance at January 1, 2024	—	$	—	664	$	—	$	9,419	$	(1,948)	$	7,471
Issuance of Convertible Preferred Stock and Warrants, net of issuance costs	1,000	498,684		—	—		482,977		—		981,661
Cash paid for fractional shares	—	—		—	—		(45)		—		(45)
Common stock dividend	—	—		—	—		(17,400)		—		(17,400)
Net loss	—	—		—	—				(452)		(452)
Balance at June 30, 2024	1,000	$	498,684	664	$	—	$	474,951	$	(2,400)	$	971,235

FOR THE SIX MONTHS ENDED JUNE 30, 2023


	Preferred Stock			Common Stock			Additional Paid-in Capital		Accumulated Deficit		Total Stockholders’ Equity
	Shares	Amount		Shares1	Amount
Balance at January 1, 2023	—	$	—	657	$	—	$	10,430	$	(877)	$	9,553
Share-based compensation	—	—		—	—		41		—		41
Net income	—	—		—	—		—		621		621
Balance at June 30, 2023	—	$	—	657	$	—	$	10,471	$	(256)	$	10,215

See accompanying notes to the unaudited condensed consolidated financial statements.

____________________________________

1 Amounts have been adjusted to reflect the 8-for-1 Reverse Stock Split effective June 6, 2024. See Note 3 - Equity for additional details.

QXO, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(Unaudited)


	Six Months Ended June 30,
	2024		2023
Cash flows from operating activities:
Net (loss) income	$	(452)	$	621
Adjustments to reconcile net (loss) income to net cash used in operating activities:
Deferred income taxes	(171)		220
Depreciation	142		178
Amortization of intangibles	432		324
Non-cash lease expense	140		188
Provision for expected losses	25		(68)
Share-based compensation	—		41
Changes in assets and liabilities:
Accounts receivable	(71)		73
Prepaid expenses and other current assets	(2,855)		(611)
Other assets	(144)		—
Accounts payable	1,631		(452)
Accrued expenses	829		(257)
Deferred revenue	(48)		(393)
Operating lease liabilities	(141)		(188)
Net cash used in operating activities	(683)		(324)
Cash flows from investing activities:
Purchase of property and equipment	(62)		(24)
Net cash used in investing activities	(62)		(24)
Cash flows from financing activities:
Payment of long-term debt	(219)		(422)
Proceeds from issuance of preferred stock and warrants, net of offering costs	983,650		—
Payment of common-stock dividend	(17,400)		—
Cash payment for fractional shares	(45)		—
Payment of finance lease obligations	(100)		(109)
Net cash provided by (used in) financing activities	965,886		(531)
Net increase (decrease) in cash	965,141		(879)
Cash, beginning of period	6,143		8,009
Cash, end of period	$	971,284	$	7,130
Cash paid during period for:
Interest	$	23	$	58
Income taxes	$	—	$	23

See accompanying notes to the unaudited condensed consolidated financial statements.

QXO INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

NOTE 1 – DESCRIPTION OF BUSINESS

QXO, Inc. ("QXO", "we", or the "Company") was formerly known as SilverSun Technologies, Inc. ("SilverSun"). On June 6, 2024, we changed the Company's name from SilverSun to QXO and changed its ticker symbol on the Nasdaq Capital Market from SSNT to QXO, upon completing a $1.0 billion cash investment in SilverSun by Jacobs Private Equity II, LLC ("JPE") and certain minority co-investors. Refer to Note 3 - Equity of the "Notes to Condensed Consolidated Financial Statements" for further details about the investment and related to changes to our capital structure.

QXO is a technology solutions and professional services company that helps businesses manage and monetize their enterprise assets. We do this through our legacy operations, which provide critical software applications, consulting and other professional services, including specialized programming, training, and technical support. Our customers are primarily small and mid-size companies in the manufacturing, distribution and services industries.

Our strategy is to build QXO into a tech-forward leader in the $800 million building products distribution industry with the goal of generating outsized stockholder value through accretive acquisitions and organic growth, including greenfield openings. We are executing our strategy toward a target of tens of billions of dollars in annual revenue in the next decade.

NOTE 2 – BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation and Principles of Consolidation

The accompanying unaudited condensed consolidated financial statements contain all adjustments necessary to state fairly the financial position of the Company as of June 30, 2024, the results of operations for the three and six months ended June 30, 2024 and 2023 and cash flows for the six months ended June 30, 2024 and 2023 in accordance with accounting principles generally accepted in the United States (“GAAP”). These unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) and consequently have been condensed and do not include all disclosures normally made in an Annual Report on Form 10-K. The unaudited condensed consolidated financial statements included herein should be read in conjunction with the consolidated financial statements and notes included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023, filed with the SEC on March 14, 2024. All significant inter-company transactions and accounts have been eliminated in consolidation.

Significant Accounting Policies

Other than policies noted herein, there have been no material changes from the significant accounting policies disclosed in Note 2 of the “Notes to Consolidated Financial Statements” included in the Company's Annual Report on Form 10-K.

Reclassifications

The Company has reclassified certain prior period amounts to conform with the current period presentation in the unaudited condensed consolidated balance sheets related to unbilled services and deferred charges which are now presented within prepaid expenses and other current assets. Additionally, the Company has reclassified certain prior period amounts to conform with the current period presentation in the unaudited condensed consolidated statements of operations related to selling and marketing expenses, general and administrative expenses, and share-based compensation which is now presented within selling, general, and administrative expenses. As further discussed in Note 3 – Equity, all per share amounts and common share amounts have been adjusted on a retroactive basis to reflect the Reverse Stock Split (as defined below).

Use of Estimates

The preparation of unaudited financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the unaudited condensed consolidated financial statements, as well as the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

Cash and Cash Equivalents

The Company considers all highly liquid investments purchased with original maturities of three months or less to be cash equivalents. The Company maintains cash balances across a diversified portfolio of global financial institutions that exceed FDIC insured limits. The Company has not experienced any losses in such accounts.

Prepaid Expenses and Other Current Assets

The following table presents the components of prepaid expenses and other current assets:


	As of
(in thousands)	June 30, 2024		December 31, 2023
Unbilled services	$	585	$	194
Deferred charges	700		736
Prepaid expenses and other current assets	4,254		1,754
Total prepaid expenses and other current assets	$	5,539	$	2,684

Accrued Expenses

The following table presents the components of accrued expenses:


	As of
(in thousands)	June 30, 2024		December 31, 2023
Accrued interest	$	34	$	25
Accrued expenses	5,363		2,656
Total accrued expenses	$	5,397	$	2,681

Interest Income (Expense), net

The following table presents the components of interest income (expense), net:


	Three Months Ending June 30,				Six Months Ending June 30,
(in thousands)	2024		2023		2024		2023
Interest income	$	3,492	$	6	$	3,494	$	9
Interest expense	(22)		(23)		(44)		(44)
Interest income (expense), net	$	3,470	$	(17)	$	3,450	$	(35)

Revenue Recognition

Components of revenue:

The following table presents the components of revenue:


	Three Months Ending June 30,				Six Months Ending June 30,
(in thousands)	2024		2023		2024		2023
Software revenue	$	5,354	$	3,298	$	7,273	$	6,620
Professional consulting revenue	4,807		4,556		9,711		8,893
Maintenance revenue	1,229		1,235		2,802		2,618
Ancillary service revenue	3,150		4,168		9,189		8,254
Total revenue, net	$	14,540	$	13,257	$	28,975	$	26,385

Roll-forward of Allowance for Expected Credit Losses

The following table represents the roll-forward of the allowance for expected credit losses for the six months ended June 30, 2024 and the year ended December 31, 2023:


(in thousands)	June 30, 2024		December 31, 2023
Balance at beginning of period	$	510	$	490
Current period provision for expected losses	25		115
Write-offs	(13)		(95)
Balance at end of period	$	522	$	510

Advertising and Marketing

Advertising and marketing expenses consist of advertising and payroll related expenses for personnel engaged in marketing, business development and selling activities. These costs are expensed as incurred.

Deferred Revenue

Deferred revenue consists of maintenance on proprietary products (contract liabilities), customer telephone support services (contract liabilities) and deposits for future consulting services that will be earned as such services are performed over the contractual or stated period, which generally ranges from three to twelve months. As of June 30, 2024, there were $591,100 in deferred maintenance and support services and $2.5 million in deposits for future consulting services. As of December 31, 2023, there were $943,000 in maintenance and support services, and $2.2 million in deposits for future consulting services.

Financial Instruments

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. To increase the comparability of fair value measures, the following hierarchy prioritizes the inputs to valuation methodologies used to measure fair value:

Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs.

Level 2: Observable prices that are based on inputs not quoted on active markets but corroborated by market data.

Level 3: Unobservable inputs are used when little or no market data is available. The fair value hierarchy gives the lowest priority to Level 3 inputs.

The Company’s current financial assets and liabilities approximate fair value due to their short-term nature and include cash, accounts receivable, accounts payable, and accrued liabilities.

Property and Equipment

Property and equipment is summarized as follows:


	As of
(in thousands)	June 30, 2024		December 31, 2023
Leasehold improvements	$	99	$	166
Equipment, furniture, and fixtures	4,157		3,943
Property and equipment	4,256		4,109
Less: Accumulated depreciation and amortization	(3,745)		(3,606)
Property and equipment, net	$	511	$	503

Depreciation expense related to these assets for the three and six months ended June 30, 2024 was $74,900 and $141,800, respectively, compared with $85,500 and $178,100 for the three and six months ended June 30, 2023, respectively.

Recent Authoritative Pronouncements

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which requires disaggregated information about a reporting entity’s effective tax rate reconciliation, as well as information related to income taxes paid to enhance the transparency and decision usefulness of income tax disclosures. This ASU will be effective beginning with the Company's 2025 annual reporting period. The Company is currently evaluating the timing and impacts of adoption of this ASU.

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosure, which updates the required disclosures to include significant segment expenses that are regularly provided to the chief operating decision maker (CODM) and included within each reported measure of segment profit or loss. ASU 2023-07 requires that a public entity disclose, on an annual and interim basis, an amount for other segment items by reportable segment and a description of its composition. ASU 2023-07 additionally requires that a public entity with a single reportable segment provide all the disclosures required by the amendments in this update and all existing segment disclosures. This ASC is effective for fiscal years beginning after December 15, 2023, and will be effective for interim periods within fiscal years beginning after December 15, 2024. The Company does not believe the adoption of this standard will have a material impact on the Company’s condensed consolidated financial statements.

In July 2023, the FASB issued ASU 2023-03, Presentation of Financial Statements (Topic 205), Income Statement—Reporting Comprehensive Income (Topic 220), Distinguishing Liabilities from Equity (Topic 480), Equity (Topic 505), and Compensation—Stock Compensation (Topic 718): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 120, SEC Staff Announcement at the March 24, 2022 EITF Meeting, and Staff Accounting Bulletin Topic 6.B, Accounting Series Release 280—General

Revision of Regulation S-X: Income or Loss Applicable to Common Stock. This update requires the: i) disclosure and presentation of income or loss related to common stock transactions on the face of the income statement, ii) modification of the existing classification and measurement of redeemable preferred shares and redeemable equity-classified shares, and iii) modification of accounting treatment for stock-based compensation. The FASB has not set an effective date for ASU 2023-03 and early adoption is permitted. The Company is currently evaluating the impact of the provisions of ASU 2023-03 on its consolidated financial statement disclosures.

NOTE 3 – EQUITY

Investment Agreement

On April 14, 2024, the Company entered into the Amended and Restated Investment Agreement (the "Investment Agreement") among the Company, JPE and the other investors party thereto (collectively, the "Investors"), providing for, among other things, an aggregate investment by the Investors of $1.0 billion in cash in the Company. Pursuant to the Investment Agreement, we issued and sold an aggregate of 1,000,000 shares of Convertible Perpetual Preferred Stock, par value $0.001 per share (the "Convertible Preferred Stock"), which are initially convertible into an aggregate of 219,010,074 shares of common stock at an initial conversion price of $4.566 per share and issued and sold warrants exercisable for an aggregate of 219,010,074 shares of common stock (the "Warrants"). Additionally, we amended the Company’s certificate of incorporation to, among other things, effect an 8:1 reverse stock split with respect to the Company’s common stock (the “Reverse Stock Split”). The Investment Agreement and related transactions closed on June 6, 2024 (the "Equity Investment") and generated gross proceeds of approximately $1.0 billion before deducting fees and offering expenses.

Following the closing of the Equity Investment, the Board of Directors of the Company was reconstituted such that: i) the number of seats on the Board was designated by JPE, ii) each of the directors (including Mr. Jacobs) was designated by JPE, iii) each standing committee of the Board was reconstituted in a manner designated by JPE, and iv) Mr. Jacobs was appointed as Chairman of the Board of Directors and Chief Executive Officer of the Company.

Issuance of Convertible Preferred Stock

On June 6, 2024, under the terms of the Investment Agreement, the Company issued 1,000,000 shares of Convertible Perpetual Preferred Stock, par value $0.001 per share (the “Convertible Preferred Stock”). The Convertible Preferred Stock has an initial liquidation preference of $1.0 thousand per share, for an aggregate initial liquidation preference of $1 billion. The Convertible Preferred Stock is convertible at any time, in whole or in part and from time to time, at the option of the holder thereof into a number of shares of common stock equal to the then-applicable liquidation preference divided by the conversion price, which initially is $4.566 per share of common stock (subject to customary anti-dilution adjustments). Shares of Convertible Preferred Stock are initially convertible into an aggregate of 219,010,074 shares of common stock (after giving effect to the Reverse Stock Split). The Convertible Preferred Stock is not redeemable or subject to any required offer to purchase.

The Convertible Preferred Stock ranks, with respect to dividend rights and distribution of assets upon liquidation, winding-up or dissolution, senior to the Company’s common stock. Holders of Convertible Preferred Stock will vote together with the holders of the Company’s common stock on an “as-converted” basis on all matters, except as otherwise required by law. In addition, the approval of holders of at least a majority of the outstanding shares of the Convertible Preferred Stock, voting separately as a single class, will be required for certain matters set forth in the Certificate of Designation for the Convertible Preferred Stock.

Dividends on the Convertible Preferred Stock are payable quarterly, when, as and if declared by the Board of Directors of the Company at the rate per annum of 9% per share on the then-applicable liquidation preference (subject to certain exceptions in the event that the Company pays dividends on shares of its common stock). Subsequent to the close of the quarter ended June 30, 2024, the Company paid $9.8 million of quarterly dividends to holders of Convertible Preferred Stock.

Warrants

The aggregate number of shares of the Company’s common stock subject to the Warrants is 219,010,074 shares. The Warrants are exercisable at the option of the holder at any time until June 6, 2034. The Warrants have an exercise price of $4.566 per share of common stock with respect to 50% of the Warrants, $6.849 per share of common stock with respect to 25% of the Warrants, and $13.698 per share of common stock with respect to the remaining 25% of the Warrants.

Each Warrant may be exercised, in whole or in part, at any time or times on or after the issuance date and on or before the expiration date at the election of the holder (in such holder’s sole discretion) by means of a “cashless exercise” in which the holder will be entitled to receive a number of shares of the Company’s common stock equal to the quotient of the product of the Closing Sale Price (as defined in the Warrant Certificate) of a share of the Company’s common stock on the trading day immediately preceding the date on which the holder elects to exercise its Warrant, less the adjusted exercise price, multiplied by the number of shares of the Company’s common stock issuable upon exercise of such Warrant, divided by the aforementioned Closing Sale Price of a share of the Company’s common stock on the trading day immediately preceding the date on which the holder elects to exercise its Warrant.

Equity Investment Dividend

Reverse Stock Split

On June 6, 2024, as contemplated by the Investment Agreement, the Company effected an 8:1 Reverse Stock Split, which reduced the Company's issued and outstanding share count of common stock from 5,315,581 to 664,284 shares (par value $0.00001 per share). The Company has recast all share and per-share data and amounts to show the effects of the Reverse Stock Split.

Private Placements

On June 13, 2024, the Company entered into purchase agreements with certain institutional and accredited investors to issue and sell in a private placement an aggregate of 340,932,212 shares of our common stock at a price of $9.14 per share, and pre-funded warrants (the "Pre-Funded Warrants") to purchase 42,000,000 shares of our common stock at a price of $9.13999 per Pre-Funded Warrant. Each Pre-Funded Warrant has an exercise price of $0.00001 per share, is exercisable immediately and until the Pre-Funded Warrant is exercised in full. The closing of the issuance and sale of these securities was consummated on July 19, 2024, and generated gross proceeds of approximately $3.5 billion before deducting agent fees and offering expenses.

On July 22, 2024, we entered into additional purchase agreements with certain institutional and accredited investors to issue and sell in a private placement an aggregate of 67,833,699 shares of our common stock at a price of $9.14 per share. The closing of the issuance and sale of these securities was consummated on July 25, 2024, and generated gross proceeds of approximately $620 million, before deducting agent fees and offering expenses.

NOTE 4 – EARNINGS (LOSS) PER COMMON SHARE

The Company’s Convertible Preferred Stock is classified as a participating security in accordance with ASC 260. Basic and diluted earnings (loss) per share is computed using the two-class method, which is an earnings allocation method that determines earnings (loss) per share for common shares and participating securities. Both basic and diluted earnings (loss) per common share are adjusted on a retroactive basis to reflect the Reverse Stock Split as discussed in Note 2 – Basis of Presentation and Significant Accounting Policies.


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
(in thousands, except per share data)
Basic earnings per share computation:
Net (loss) income	$	(591)	$	344	$	(452)	$	621
Less: Convertible Preferred Stock dividends	(6,000)		—		(6,000)		—
Less: Undistributed earnings allocated to participating securities	—		—		—		—
(Loss) income attributable to common shareholders	(6,591)		344		(6,452)		621
Weighted-average common shares outstanding	664		657		664		657
Basic earnings per share	$	(9.93)	$	0.52	$	(9.72)	$	0.95
Diluted earnings per share computation:
(Loss) income attributable to common shareholders per above	$	(6,591)	$	344	$	(6,452)	$	621
Weighted-average common shares outstanding	664		657		664		657
Dilutive potential common shares	—		—		—		—
Total diluted adjusted weighted-average shares	664		657		664		657
Diluted earnings per share	$	(9.93)	$	0.52	$	(9.72)	$	0.95

The following table summarizes securities that, if exercised, would have a dilutive effect on earnings per share.


	Three Months Ended June 30,		Six Months Ended June 30,
	2024	2023	2024	2023
(in thousands)
Stock options	—	20	—	20
Convertible Preferred Stock	219,010	—	219,010	—
Warrants	219,010	—	219,010	—
Total potential dilutive securities not included in earnings per share	438,020	20	438,020	20

NOTE 5 – INTANGIBLE ASSETS

Intangible assets consist of proprietary developed software, intellectual property, and customer lists. Proprietary developed software is carried at cost less accumulated amortization; intellectual property, customer lists and acquired contracts are carried at acquisition date fair value less accumulated amortization.

Intangible assets at June 30, 2024, and December 31, 2023, consisted of the following:


	As of
(in thousands)	June 30, 2024		December 31, 2023
Proprietary developed software	$	390	$	390
Intellectual property, customer lists, and acquired contracts	9,069		9,069
Accumulated amortization	(4,973)		(4,540)
Total intangible assets	$	4,486	$	4,919

Amortization expense related to the above intangible assets for the three and six months ended June 30, 2024 was $228,400 and $432,400, respectively, as compared with $162,000 and $323,900 for the three and six months ended June 30, 2023.

NOTE 6 – LONG-TERM DEBT

The Company’s long-term debt was $1.48 million and $1.70 million, as of June 30, 2024 and December 31, 2023, respectively. The current portion of the Company’s long-term debt was $783,600 and $701,700, as of June 30, 2024 and December 31, 2023, respectively. Subsequent to June 30, 2024, the Company extinguished all of the Company's outstanding debt obligations.

NOTE 7 – LEASES

The Company has entered into lease commitments for equipment that meet the requirements for capitalization. The equipment has been capitalized and is included in property and equipment in the accompanying unaudited condensed consolidated balance sheets. The Company leases space in four different locations and has an equipment lease rental with monthly payments ranging from $3,000 to $10,500 that expire at various dates through September 2026.

On January 3, 2024, the Company extended its office lease for two years ended April 30, 2026. Monthly base rent is $10,300 for the first year and $10,500 for the second year. Accordingly, operating lease right of use assets and operating lease liabilities were recognized for the extension in the amount of $236,900 during the year ended December 31, 2023.

The table below presents the operating and financing lease-related assets and liabilities recorded on the unaudited condensed consolidated balance sheets:


(in thousands)		As of
Leases	Balance Sheet Classification	June 30, 2024		December 31, 2023
Assets
Operating	Operating lease right-of-use assets	$	380	$	522
Financing	Property and equipment, net	246		332
Total lease assets		$	626	$	854
Liabilities
Current:
Finance	Finance lease obligations – current portion	$	141	$	154
Operating	Operating lease liabilities – current portion	217		263
Non-current:
Finance	Finance lease obligations net of current portion	247		247
Operating	Operating lease liabilities net of current portion	164		259
Total lease liabilities		$	769	$	923

Total rent expense under operating leases for the three and six months ended June 30, 2024 was $68,100 and $175,400, respectively, as compared with $103,200 and $213,100 for the three and six months ended June 30, 2023, respectively.

On June 2, 2023, the Company entered into an operating lease to extend the lease for its Arizona location with Exeter 17319 DE, LLC. Accordingly, operating lease right-of-use assets and operating lease liabilities were recognized in the amount of $108,300 during the period ended June 30, 2023.

NOTE 8 – COMMITMENTS AND CONTINGENCIES

Legal Matters

Various legal claims arise from time to time in the normal course of business. In assessing loss contingencies related to legal proceedings that are pending against the Company, or unasserted claims that may result in such proceedings, the Company evaluates the perceived merits of any legal proceedings or unasserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein.

The Company believes that it has adequately accrued for the potential impact of loss contingencies that are probable and reasonably estimable, and does not believe that the ultimate resolution of any matters to which it is presently a party will have a material adverse effect on the Company’s results of operations, financial condition or cash flows. However, the results of these matters cannot be predicted with certainty, and an unfavorable resolution of one or more of these matters could have a material adverse effect on the Company’s financial condition, results of operations or cash flows.

NOTE 9 – ASSET PURCHASE AGREEMENT

On November 13, 2023, SWK Technologies, Inc. acquired the customer list and prepaid time from clients of JCS Computer Resource Corporation ("JCS") pursuant to an Asset Purchase Agreement for cash of $278,500 and a promissory note in the amount of $1.0 million (the “JCS Note”) for a total consideration of $1.3 million. The customer list was recognized as an intangible asset and will be amortized over its estimated useful life. The JCS Note balance was paid in full on July 24, 2024.

NOTE 10 – INCOME TAXES

The Company’s interim (benefit) provision for income taxes is determined based on its annual estimated effective tax rate, applied to the actual year-to-date income, and adjusted for the tax effects of any discrete items. The Company’s effective tax rates for the three and six months ended June 30, 2024 were 28.9% and 27.3%, respectively. The Company’s effective tax rates for the three and six months ended June 30, 2023 were 21.6% and 21.5%, respectively. The Company’s effective tax rates for the three and six months ended June 30, 2024 were higher than the United States federal statutory tax rate of 21%, primarily due to state income taxes. The Company’s effective tax rates for the three and six months ended June 30, 2023 were higher than the United States federal statutory tax rate of 21%, primarily due to state income taxes and miscellaneous permanent items.

NOTE 11 – EQUITY-BASED COMPENSATION

At the special meeting of the Company's stockholders on May 30, 2024, the stockholders approved the QXO, Inc. 2024 Omnibus Incentive Plan (the “2024 Plan”). The 2024 Plan provides for the grant of options intended to qualify as incentive stock options (“ISOs”), nonqualified stock options (“NSOs”), stock appreciation rights (“SARs”), restricted share awards, restricted stock units (“RSUs”),

performance awards, cash incentive awards, deferred share units and other equity-based and equity-related awards, as well as cash-based awards.

Subject to adjustment for changes in capitalization, the maximum aggregate number of shares of common stock that may be delivered pursuant to awards granted under the 2024 Plan shall be equal to 30,000,000 (the “Plan Share Limit”), of which 30,000,000 shares of common stock may be delivered pursuant to ISOs granted under the 2024 Plan (such amount, the “Plan ISO Limit”). The number of shares of common stock covered by the Plan Share Limit shall automatically increase on January 1 of each calendar year commencing with January 1, 2025 and on each January 1 thereafter until the 2024 Plan expiration date in an amount equal to 3% of the sum of: i) the number of shares of common stock outstanding as of December 31 of the preceding calendar year, and ii) the number of shares of common stock into which the Convertible Preferred Stock outstanding on December 31 of the preceding calendar year are convertible.

The Company recorded compensation expense of $0 for both the three and six months ended June 30, 2024, compared with compensation expense of $0 and $41,500 for the three and six months ended June 30, 2023, respectively.

As of June 30, 2024, there were no outstanding grants under the 2024 Plan. As of December 31, 2023, there were no outstanding stock options.

NOTE 12 – RELATED PARTY TRANSACTIONS

Upon the closing of the Equity Investment, pursuant to the execution of the Investment Agreement, the Company reimbursed JPE for certain transactional, market research and employee costs related to establishing the foundation for QXO to move forward. These costs, as defined in the Investment Agreement, equated to a total reimbursement of $15.3 million, which was treated as a reduction of the proceeds received from the Equity Investment.

In connection with the Equity Investment, Mark Meller was terminated as CEO of SilverSun Technologies, Inc. and entered into a new employment agreement to serve as President of SWK Technologies, a wholly-owned subsidiary of QXO. Mr. Meller received a lump-sum payment of $2.8 million in connection with this agreement.

In connection with the private placement that closed on July 25, 2024, certain directors and officers of the Company purchased an aggregate of 262,585 shares of common stock for $2.4 million.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Our unaudited condensed consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). These accounting principles require us to make certain estimates, judgments and assumptions. We believe that the estimates, judgments and assumptions upon which we rely are reasonable based upon information available to us at the time that these estimates, judgments and assumptions are made. These estimates, judgments and assumptions can affect the reported amounts of assets and liabilities as of the date of the unaudited condensed consolidated financial statements as well as the reported amounts of revenues and expenses during the periods presented. Our unaudited condensed consolidated financial statements would be affected to the extent that there are material differences between these estimates and actual results. In many cases, the accounting treatment of a particular transaction is specifically dictated by GAAP and does not require management’s judgment in its application. There are also areas in which management’s judgment in selecting any available alternative would not produce a materially different result. The following discussion should be read in conjunction with our unaudited condensed consolidated financial statements and notes appearing elsewhere in this report.

Overview

QXO, Inc. ("QXO", "we", or the "Company") was formerly known as SilverSun Technologies, Inc. ("SilverSun"). On June 6, 2024, we changed the Company's name from SilverSun to QXO and changed its ticker symbol on the Nasdaq Capital Market from SSNT to QXO, upon completing a $1.0 billion cash investment in SilverSun by Jacobs Private Equity II, LLC ("JPE") and certain minority co-investors. Refer to Note 3 - Equity of the "Notes to the Condensed Consolidated Financial Statements" for further details about the investment and related changes to our capital structure.

QXO is a technology solutions and professional services company that helps businesses manage and monetize their enterprise assets. We do this through our legacy operations, which provide critical software applications, consulting and other professional services, including specialized programming, training and technical support. Our customers are primarily small and mid-sized companies in the manufacturing, distribution and service industries.

Our strategy is to create a tech-forward leader in the $800 billion building products distribution industry with the goal of generating outsized stockholder value through accretive acquisitions and organic growth, including greenfield openings. We are executing our strategy toward a target of tens of billions of dollars of annual revenue in the next decade.

We grow our legacy business with a multi-pronged plan that fosters recurring revenue, customer retention and the steady expansion of our installed customer base, accomplished via sales and acquisitions. As we gain new customers, we help them digitally transform their business with further technologies and third-party software we represent, including application hosting, cybersecurity, warehouse management, human capital management, payment automation, sales tax compliance and many other value-added capabilities. Many of our offerings are billed on a subscription basis, increasing our monthly recurring revenue from new business in tandem with cross-selling. Our model is designed to increase average revenue per customer over the course of the relationship, facilitating our growth without a commensurate increase in costs of sales, and enhancing our profitability profile.

Our legacy business has five core components:

•Enterprise Resource Planning Software

Substantially all our initial sales of ERP financial accounting solutions consist of pre-packaged software and associated services to customers in the United States. We resell Sage, Accumatica, and other ERP software products, and provide related services, including installation, implementation, support, training, and a technical help desk.

•Value-Added Services for ERP

Our consulting and professional services organization shepherds our customer relationships from installation to go-live and forward as needed. A significant portion of our service revenue comes from continuing to work with existing customers as their needs change, with flexible revenue options that include prepaid services, time and materials as utilized and annual support.

•IT Managed Network Services and Business Consulting

We provide comprehensive managed Software-as-a-Service (SaaS) solutions, such as infrastructure-as-a-service, cybersecurity, cloud hosting, business continuity, disaster recovery, data back-up, network maintenance and server applications upgrade services.

•Cybersecurity

Our cybersecurity-as-a-service offering is managed by our security operations center and includes incident response, cybersecurity assessments and hacking simulations. This SaaS offering is particularly valuable to customers in compliance-driven and regulated industries, including financial services, pension administration, insurance and the land and title sector.

•Application Hosting

Our SaaS hosting solutions enable applications to reside securely in a remote cloud infrastructure and be accessed by our customers through the internet, eliminating many of the costs of maintaining business technologies on site.

Our Company has executed this plan successfully to expand into new geographies and create additional revenue and profit streams. This has strengthened our legacy operating platform and expanded our footprint to nearly every U.S. state, with concentrations in Arizona, California, Connecticut, Illinois, New Jersey, New York, North Carolina, Oregon and Washington as of June 30, 2024.

Results of Operations for the Three and Six Months Ended June 30, 2024 and 2023.

The following tables set forth our results of operations for the periods presented and express the relationship of certain line items as a percentage of net sales for those periods. The period-to-period comparison of financial results is not necessarily indicative of future results:


(in thousands, except percentages)	Three Months Ended										Six Months Ended
							% of net revenue										% of net revenue
	June 30, 2024		June 30, 2023		% Change		June 30, 2024		June 30, 2023		June 30, 2024		June 30, 2023		% Change		June 30, 2024		June 30, 2023
Condensed Consolidated Statements of Operations
Revenue:
Software product, net	$	3,776	$	3,298	14.5	%	26.0	%	24.9	%	$	7,256	$	6,620	9.6	%	25.0	%	25.1	%
Service and other, net	10,764		9,959		8.1	%	74.0	%	75.1	%	21,719		19,765		9.9	%	75.0	%	74.9	%
Total revenue, net	14,540		13,257		9.7	%	100.0	%	100.0	%	28,975		26,385		9.8	%	100.0	%	100.0	%
Cost of revenue:
Product	2,369		2,027		16.9	%	16.3	%	15.3	%	4,568		3,960		15.4	%	15.8	%	15.0	%
Service and other	6,376		6,045		5.5	%	43.9	%	45.6	%	12,955		11,883		9.0	%	44.7	%	45.0	%
Total cost of revenue	8,745		8,072		8.3	%	60.2	%	60.9	%	17,523		15,843		10.6	%	60.5	%	60.0	%
Operating expenses:
Selling, general and administrative expenses	9,835		4,525		117.3	%	67.6	%	34.1	%	15,024		9,305		61.5	%	51.9	%	35.3	%
Depreciation and amortization expenses	261		204		27.9	%	1.8	%	1.6	%	501		411		21.9	%	1.7	%	1.6	%
Total operating expenses	10,096		4,729		113.5	%	69.4	%	35.7	%	15,525		9,716		59.8	%	53.6	%	36.9	%
(Loss) income from operations	(4,301)		456		NM		(29.6	%)	3.4	%	(4,073)		826		(593.1	%)	(14.1	%)	3.1	%
Interest income (expense), net	3,470		(17)		NM		23.9	%	(0.1)	%	3,450		(35)		NM		11.9	%	(0.1	%)
(Loss) Income before taxes	(831)		439		(289.3	%)	(5.7	%)	3.3	%	(623)		791		(178.8	%)	(2.2	%)	3.0	%
(Benefit) provision for income taxes	(240)		95		(352.6	%)	(1.7	%)	0.7	%	(171)		170		(200.6	%)	(0.6	%)	0.6	%
Net (loss) income	$	(591)	$	344	(271.8	%)	(4.1	%)	2.6	%	$	(452)	$	621	(172.8	%)	(1.6	%)	2.4	%

NM = Not Meaningful

Revenue, net

Our consolidated net revenue for the second quarter of 2024 increased $1.28 million or 9.7%, compared with the same period in the prior year. Our consolidated net revenue for the first six months of 2024 increased $2.59 million or 9.8% compared with the same period in the prior year. Net revenue increased across our lines of business as we grew our customer base through strategic acquisitions and continued renewals of our subscription-based services. Specifically, software product revenue increased as we expanded our Sage Intacct and Accumatica product lines, and service revenue increased as we expanded our hosting application services and consulting practices.

Cost of revenue

Cost of revenue for the second quarter of 2024 increased $673,000 or 8.3%, compared with the same period in the prior year. As a percentage of revenue, margin expanded to 39.8%, compared with 39.1% for the same period in the prior year. Margin expansion in the period is attributed to improved operational productivity in serving customer demand. For the first six months of 2024, cost of revenue increased $1.68 million or 10.6%, compared with the same period in the prior year. Margin contracted to 39.5%, compared with 40.0% for the same period in the prior year, as we expanded our product offerings in newly acquired lines of business to grow our customer base.

Operating expenses

Selling, general and administrative expenses for the second quarter of 2024 increased $5.31 million or 117.3%, compared with the same period in the prior year. Selling, general and administrative expenses for the first six months of 2024 increased $5.72 million or 61.5%, compared with the same period in the prior year. The year-over-year increases in operating expenses are primarily due to: i) salary expenses associated with the Company's new senior management team put in place to execute our expansive growth plan, and ii) the severance payment contemplated in the Investment Agreement for Mark Meller.

Depreciation and amortization expense for the second quarter of 2024 increased $57,000 or 27.9%, compared with the same period in the prior year. Depreciation and amortization expense for the first six months of 2024 increased $90,000 or 21.9%, compared with the same period in the prior year. The year-over-year increases are attributed to higher amortization expense associated with the acquisition of JCS in 2023.

Interest income (expense), net

Interest income increased $3.49 million for each of the three- and six-month periods ended June 30, 2024, compared with the same periods in the prior year. The increase is attributed to the interest earned on our cash position due to the cash infusion from the Equity Investment.

Non-GAAP Financial Measures

Adjusted EBITDA

To provide investors with additional information regarding our financial results, we have disclosed here and elsewhere in this Quarterly Report Adjusted EBITDA, a non-GAAP financial measure that we calculate as net (loss) income excluding depreciation and amortization; share-based compensation; income tax (benefit) provision; interest (income) expense; transaction costs; severance costs and other items that we do not consider representative of our underlying operations. We have provided a reconciliation below of Adjusted EBITDA to net (loss) income, the most directly comparable GAAP financial measure. Management uses Adjusted EBITDA in making financial, operating and planning decisions and evaluating QXO’s ongoing performance.

We believe that Adjusted EBITDA facilitates analysis of our ongoing business operations because it excludes items that may not be reflective of, or are unrelated to, QXO’s core operating performance, and may assist investors with comparisons to prior periods and assessing trends in our underlying business. Other companies may calculate this non-GAAP financial measure differently, and therefore our measure may not be comparable to similarly titled measures of other companies. This non-GAAP financial measure should only be used as a supplemental measure of our operating performance.

Because of these limitations, you should consider Adjusted EBITDA alongside other financial performance measures, including various cash flow metrics, net income (loss), and our other GAAP results.

The following table presents a reconciliation of net (loss) income to Adjusted EBITDA.


	Three Months Ended				Six Months Ended
(in thousands)	June 30, 2024		June 30, 2023		June 30, 2024		June 30, 2023
Reconciliation of net (loss) income to Adjusted EBITDA
Net (loss) income	$	(591)	$	344	$	(452)	$	621
Add (deduct):
Depreciation and amortization	303		249		574		502
Share-based compensation	—		—		—		41
Interest (income) expense	(3,470)		17		(3,450)		35
(Benefit) provision for income taxes	(240)		95		(171)		170
Transaction costs	23		—		23		—
Severance costs	2,768		—		2,768		—
Adjusted EBITDA	$	(1,207)	$	705	$	(708)	$	1,369

The year-over-year declines in three- and six-month 2024 Adjusted EBITDA were due to higher employee-related costs in the second quarter, reflecting the introduction of a new senior management team to execute the Company's expansive growth plan.

Liquidity and Capital Resources

On June 6, 2024, we closed the Equity Investment under the Investment Agreement that we entered into on April 14, 2024 among the Company, JPE and certain minority investors. Pursuant to the Investment Agreement, we issued and sold an aggregate of 1,000,000 shares of Convertible Perpetual Preferred Stock, par value $0.001 per share (the "Convertible Preferred Stock"), which are initially convertible into an aggregate of 219,010,074 shares of common stock at an initial conversion price of $4.566 per share, and we issued

and sold warrants exercisable for an aggregate of 219,010,074 shares of common stock (the "Warrants"). Upon closing, the Equity Investment generated gross proceeds of $1.0 billion, before deducting agent fees and offering expenses. For more information on the Investment Agreement, refer to Note 3 - Equity.

On June 13, 2024, we entered into purchase agreements with certain institutional and accredited investors to issue and sell in a private placement an aggregate of 340,932,212 shares of our common stock at a price of $9.14 per share, and Pre-Funded Warrants to purchase 42,000,000 shares of our common stock at a price of $9.13999 per Pre-Funded Warrant. Each Pre-Funded Warrant has an exercise price of $0.00001 per share, is exercisable immediately and until the Pre-Funded Warrant is exercised in full. The closing of the issuance and sale of these securities was consummated on July 19, 2024, and generated gross proceeds of approximately $3.5 billion before deducting agent fees and offering expenses.

Under the terms of the Investment Agreement, the Company declared a $17.4 million aggregate cash dividend to its stockholders of record as of the day before the closing of the Equity Investment. The dividend was paid from proceeds received by the Company from the Equity Investment. Under the terms of the Convertible Preferred Stock, dividends are paid quarterly when, as and if declared by the Board of Directors of the Company (the "Board"), at the rate per annum of 9% per share.

The Company's cash balance was $971.3 million as of June 30, 2024 and consisted primarily of cash on deposit with banks and investments in money market funds. Following the close of the private placements, the Company had approximately $5.0 billion of cash on hand and no outstanding debt obligations. We continually evaluate our liquidity requirements in light of our operating needs, growth initiatives and capital resources. We believe that our existing liquidity and sources of capital are sufficient to support our operations over the next 12 months.

Cash used in operating activities

Cash used in operating activities increased by $359,000, compared with the same period in the prior year. The year-over-year increase is attributed to higher personnel costs associated with the execution of the Company's strategy as contemplated in the Investment Agreement.

Cash used in investing activities

Cash used in investing activities increased by $38,000, compared with the same period in the prior year. The year-over-year increase is attributed to IT equipment purchases.

Cash provided by (used) in financing activities

Cash provided by financing activities was $965.9 million, compared with $531,000 of cash used in financing activities in the same period in the prior year. The year-over-year increase is attributed to the Equity Investment of June 6, 2024.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

We do not hold any derivative instruments and do not engage in any hedging activities.

Item 4. Controls and Procedures

Management’s Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in the reports that we file or submit under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required financial disclosure.

As of the end of the period covered by this Quarterly Report, our management, under the supervision and with the participation of our principal executive officer and principal financial officer, evaluated the effectiveness of our disclosure controls and procedures pursuant to Exchange Act Rule 13a-15(e) and 15d-15(e). Based upon this evaluation, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures were effective at a reasonable assurance level as of June 30, 2024.

Change in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting during the six months ended June 30, 2024, that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Limitations on the Effectiveness of Controls

Our disclosure controls and procedures and internal control over financial reporting are designed to provide reasonable assurance of achieving their objectives as specified above. Management does not expect, however, that our disclosure controls and procedures will prevent or detect all error and fraud. Any control system, no matter how well designed and operated, is based on certain assumptions and can provide only reasonable, not absolute, assurance that its objectives will be met. Further, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, within the Company have been detected.

PART II – OTHER INFORMATION

Item 1. Legal Proceedings

We are not currently involved in any litigation that we believe could have a material adverse effect on our financial condition or results of operations. To our knowledge, there is no action, suit, proceeding, inquiry or investigation before or by any court, public board, government agency, self-regulatory organization or body pending or, to the knowledge of the executive officers of our Company and our subsidiaries, threatened against or affecting our Company, its common stock, its subsidiaries, or our Company’s or its subsidiaries’ officers or directors in their capacities as such, in which an adverse decision could have a material adverse effect.

Item 1A. Risk Factors

The following are important factors that could affect our business, financial condition or results of operations and could cause actual results for future periods to differ materially from our anticipated results or other expectations, including those expressed in any forward-looking statements made in this Quarterly Report, our other filings with the SEC or in presentations such as telephone conferences and webcasts open to the public. You should carefully consider the following factors in conjunction with this Quarterly Report, including “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Item 2 – Part I and our condensed consolidated financial statements and related notes in Item 1 – Part I as well as the factors disclosed in Item 1A – Part I of our Annual Report on Form 10-K for the year ended December 31, 2023. The risks and uncertainties described below are not the only ones we face. Additional risks and uncertainties that we are unaware of, or that we currently believe are not material, may also become important factors that adversely affect our business, financial condition or results of operations. If any of the following risks actually occur, or other risks that we are not aware of become material, our business, financial condition, results of operations and future prospects could be materially and adversely affected.

Risks Related to Ownership of our Common Stock

The market price of our common stock may be highly volatile, and you could lose all or a substantial portion of your investment.

The trading price of our common stock may be highly volatile and could be subject to wide fluctuations in response to various factors, some of which are beyond our control and may not be related to our operating performance. Our common stock has a concentrated ownership among our significant stockholders and, as a result, our common stock may be less liquid and have greater stock price volatility than the common stock of companies with broader public ownership.

Since June 13, 2024, when we first sold common stock pursuant to the Purchase Agreements at a price of $9.14 per share, and until we filed our registration statement on Form S-3, the reported closing sale price of our common stock had been highly volatile, ranging from $41.74 to $205.40, in each case substantially higher than the price at which we sold common stock in connection with the private placements pursuant to purchase agreements we entered into on June 13, 2024 and July 22, 2024. While the market prices of our common stock may respond to developments regarding our liquidity, operating performance and prospects, and developments regarding our industry, we believe that historical market prices also reflected market and trading dynamics unrelated to our underlying business, or macro or industry fundamentals, and we do not know if these dynamics will occur again. Under the circumstances, we caution you that investing in our common stock is subject to a high degree of risk.

Our stock price could continue to be subject to wide fluctuations in response to a variety of other factors, which include:

•whether we achieve our anticipated corporate objectives;

•changes in financial or operational estimates or projections;

•termination of lock-up agreements or other restrictions on the ability of our stockholders and other security holders to sell our securities; and

•general economic or political conditions in the United States or elsewhere.

In addition, the stock market in general has experienced extreme price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of the affected companies. Such rapid and substantial price volatility, including any stock run-up, may be unrelated to our actual or expected operating performance and financial condition or prospects, making it difficult for prospective investors to assess the rapidly changing value of our common stock. This volatility may prevent you from being able to sell your shares of common stock at or above the price you paid for them.

Sales of substantial amounts of our common stock in the public markets, or the perception that such sales might occur, could cause the market price of our common stock to decline significantly, even if our business is doing well.

Sales of a substantial number of shares of our common stock in the public market, or the perception that these sales might occur, could depress the market price of our common stock and could impair our ability to raise capital through the sale of additional equity securities. We are unable to predict the effect that sales may have on the prevailing market price of our common stock.

Sales of our common stock by current stockholders may make it more difficult for us to sell equity or equity-related securities in the future at a time and price that we deem reasonable or appropriate, and make it more difficult to sell shares of our common stock. We have filed a registration statement registering 789,549,465 shares of common stock held by, or issuable upon conversion or exercise of securities held by, stockholders party to certain agreements with the Company providing them with registration rights. Substantial sales of securities by these stockholders, or the perception that substantial sales will be made in the public market, could have a material adverse effect on the market price for our common stock.

In addition, pursuant to the Company’s registration rights agreement with JPE and certain other investors party thereto, JPE has certain demand registration rights that may require us to conduct underwritten offerings of shares following the expiration or waiver of a 180-day lockup entered into with the placement agents for the private placements. Any shares of common stock sold in these offerings will be freely tradable. JPE has informed the Company that it does not presently intend to sell or otherwise dispose of the Company’s securities it holds following the expiration of the lockup. In the event such registration rights are exercised and a large number of shares of common stock is sold, such sales could reduce the trading price of our common stock. These sales also could impede our ability to raise future capital.

We have also registered on Form S-8 all shares of common stock that are issuable under our 2024 Omnibus Incentive Compensation Plan. As a consequence, these shares can be freely sold in the public market upon issuance. Any sales of shares by these stockholders could have a negative impact on the trading price of our common stock and result in dilution.

An active, liquid trading market for our common stock may not develop or, if developed, may not be sustained.

There has been limited trading volume of our common stock since we began trading on Nasdaq. An active, liquid trading market for our common stock may not develop or be sustained. The lack of an active market may reduce the market price of our common stock, and you may not be able to sell your shares at an attractive price, or at all. An inactive market may also impair our ability to raise capital by selling shares of our common stock in the future and may impair our ability to enter into strategic collaborations or acquire companies by using our shares of common stock as consideration.

A “short squeeze” due to a sudden increase in demand for shares of our common stock that largely exceeds supply could lead to extreme price volatility in shares of our common stock.

Investors may purchase shares of our common stock to hedge existing exposure or to speculate on the price of our common stock. Speculation on the price of our common stock may involve long and short exposures. To the extent aggregate short exposure exceeds the number of shares of our common stock available for purchase on the open market, investors with short exposure may have to pay a premium to repurchase shares of our common stock for delivery to lenders of our common stock. Those repurchases may, in turn, dramatically increase the price of shares of our common stock until additional shares of our common stock are available for trading or borrowing. This is often referred to as a “short squeeze.” A large proportion of our common stock may be traded by short sellers, which may increase the likelihood that our common stock will be the target of a short squeeze. Investors that purchase shares of our common stock during a short squeeze may lose a significant portion of their investment. Investors that purchase in anticipation of a short squeeze that is never realized may also lose a significant portion of their investment.

If too few securities or industry analysts publish research, or publish inaccurate or unfavorable research, about our business, the price of our common stock and our trading volume could decline.

The trading market for our common stock will depend in part on the research and reports that securities or industry analysts publish about us or our business. If too few securities or industry analysts commence coverage of our Company, the trading price for our common stock would likely be negatively affected. Furthermore, if one or more of the analysts who cover us downgrade us or publish inaccurate or unfavorable research about our business, the price of our common stock would likely decline. If one or more of these analysts cease coverage of our company or fail to publish reports on us regularly, demand for our common stock could decrease, which might cause the price of our common stock and trading volume to decline.

We currently do not intend to pay dividends on our common stock in the foreseeable future. As a result, your ability to achieve a return on your investment may depend on appreciation in the market price of our common stock.

Although we have previously declared and paid cash dividends on our common stock, we currently intend to retain all available funds and any future earnings for use in the operation of our business and do not anticipate paying any dividends on our common stock in the foreseeable future. Any determination to pay dividends in the future will be at the discretion of our Board. Accordingly, investors must for the foreseeable future rely on sales of their common stock after price appreciation, which may never occur, as the only way to realize any future gains on their investments.

Raising additional equity capital from public or private markets to pursue our business plan may cause our existing holders of common stock to experience substantial dilution or their shares to have a significant decline in trading price.

We may raise additional equity capital from public or private markets to pursue our business plan for acquisitions. Any future significant issuances of common stock could result in dilution to our existing holders of common stock. Moreover, any significant issuances of common stock or securities convertible into, or exercisable or exchangeable for, our common stock could result in a substantial decline in the trading price of our common stock. In particular, in June and July 2024 we did, and in the future we may, issue additional shares of common stock at a significant discount from the current trading price of our common stock. As a result, our common stockholders would experience immediate dilution upon the purchase of any shares of our common stock sold at such a discount. In addition, the perception that new issuances of our securities could occur could adversely affect the market price of our common stock.

If we are unable to arrange additional future financing on acceptable terms, our ability to pursue potential acquisition opportunities or fund our working capital needs could be limited.

We intend to finance acquisitions in part through additional equity and debt financings. Because the timing and size of acquisitions cannot be readily predicted, we may need to be able to obtain funding on relatively short notice to benefit fully from attractive

acquisition opportunities. In addition, the Company will need to fund its ongoing working capital, capital expenditures and other financing requirements through cash flows from operations and new sources of financing. The sale of additional shares of any class of equity will be subject to market conditions and investor demand for such shares at prices that may not be in the best interest of our stockholders. The sale of additional equity securities could also result in dilution to our stockholders. The incurrence of indebtedness would result in increased debt service obligations and could require us to agree to operating and financial covenants that would restrict our operations. Financing may not be available in amounts or on terms acceptable to us, if at all. Such inability to obtain additional financing when needed could have a material adverse effect on our business, results of operations, cash flow, financial condition and prospects.

New investors in future financing transactions could gain rights, preferences and privileges senior to those of the Company’s existing stockholders.

We expect that significant additional capital may be needed in the future to support our business growth. To the extent we raise additional capital by issuing common stock, convertible securities or other equity securities, investors may be materially diluted by subsequent sales. Such sales may also result in substantial dilution to our existing stockholders, and new investors could gain rights, preferences and privileges senior to the holders of our common stock.

Participants in the June and July 2024 private placements purchased securities in the Company at a price below the current trading price of such securities, and may experience a positive rate of return based on the current trading price. Future investors in our Company may not experience a similar rate of return.

Pursuant to private placements, certain institutional and accredited investors acquired shares of our common stock at a purchase price of $9.14 per share and Pre-Funded Warrants to purchase shares of our common stock at a purchase price of $9.13999 per Pre-Funded Warrant. Furthermore, certain investors purchased Convertible Preferred Stock that is convertible into shares of our common stock at an initial conversion price of $4.566. Because the current market price of our common stock as of the date of this Quarterly Report is higher than the effective purchase price such investors paid for their securities, there may be a higher likelihood that such investors will sell their shares in the near term. Public investors who purchased our common stock on Nasdaq may not experience a similar rate of return due to differences in the purchase prices they have paid and the purchase prices paid by such investors.

The concentration of ownership by Mr. Jacobs and director designation rights may have the effect of delaying or preventing a change in control of the Company and could affect the market price of shares of our common stock.

Our Chairman and Chief Executive Officer, Brad Jacobs, beneficially owns or controls approximately 31.4% of the voting power of our capital stock (including the voting power attributable to our preferred stock). This concentration of ownership and voting power allows Mr. Jacobs to exert significant influence over our decisions, including matters requiring approval by our stockholders (such as, subject to certain limitations, the election of directors and the approval of mergers or other extraordinary transactions), regardless of whether or not other stockholders believe that the transaction is in their own best interests.

In addition, under our Fifth Amended and Restated Certificate of Incorporation (the “Charter”), JPE, which is controlled by Mr. Jacobs, is currently entitled to designate a majority of persons to the Board in connection with each meeting of stockholders at which directors are to be elected because the Investors (as defined below) beneficially own or control approximately 49.2% of the voting power of our capital stock when calculated on a fully-diluted, as-converted basis, assuming the exercise of the Company Warrants. JPE currently holds 900,000 shares of Convertible Preferred Stock and 197,109,065 Warrants, which may be converted or exchanged into an aggregate of 394,218,132 shares of common stock. So long as the Investors party to the Investment Agreement collectively own or control (together with their affiliates) Convertible Preferred Stock, shares of common stock or other voting securities, or Warrants exercisable for such securities, representing, in the aggregate, at least 45% of the total voting power of the capital stock of the Company, calculated on a fully-diluted, as-converted basis, JPE will continue to be entitled to designate a majority of persons to our Board. JPE’s right to designate persons to the Board will generally decrease proportionally together with a decrease in the Investors’ ownership or control (together with affiliates) of Convertible Preferred Stock, shares of common stock or other voting securities, or Warrants exercisable for such securities, calculated on a fully diluted, as-converted basis. Accordingly, Mr. Jacobs may be able to exercise significant influence over our business policies and affairs.

Such concentration of voting power and designation rights could also have the effect of delaying, deterring or precluding a change of control or other business combination that might otherwise be beneficial to our stockholders, could deprive our stockholders of an opportunity to receive a premium for their common stock as part of a sale of our company and might ultimately affect the market price of our common stock.

Anti-takeover provisions contained in our Charter and amended and restated bylaws, as well as provisions of Delaware law, could impair a takeover attempt.

Our Charter and amended and restated bylaws contain, and the General Corporation Law of the State of Delaware (the “DGCL”) contains, provisions which could have the effect of rendering more difficult, delaying, or preventing an acquisition deemed undesirable by our Board. These provisions provide for the following:

•the right of JPE to designate a majority of our Board;

•the ability of our remaining directors to fill vacancies on our Board;

•limitations on stockholders’ ability to call a special stockholder meeting or act by written consent;

•rules regarding how stockholders may present proposals or nominate directors for election at stockholder meetings;

•the right of our Board to issue preferred stock without stockholder approval; and

•the limitation of liability of, and provision of indemnification to, our directors and officers.

These provisions, alone or together, could delay or prevent hostile takeovers and changes in control or changes in our management. In addition, we are subject to Section 203 of the DGCL, which could have the effect of delaying or preventing a change of control that you may favor. Section 203 provides that, subject to limited exceptions, persons that acquire, or are affiliated with persons that acquire, more than 15% of the outstanding voting stock of a Delaware corporation may not engage in a business combination with that corporation, including by merger, consolidation or acquisitions of additional shares, for a three-year period following the date on which that person or any of its affiliates becomes the holder of more than 15% of the corporation’s outstanding voting stock.

Any provision of our Charter, our amended and restated bylaws, or the DGCL that has the effect of delaying or deterring a change in control could limit the opportunity for our stockholders to receive a premium for their shares of our common stock, and could also affect the price that some investors are willing to pay for our common stock.

Our Charter provides that certain courts in the State of Delaware or the federal district courts of the United States for certain types of lawsuits is the sole and exclusive forum for substantially all disputes between us and our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers or employees.

Our Charter provides that, unless we consent in writing to the selection of an alternative forum, a state court located within the State of Delaware is the sole and exclusive forum for: i) any derivative action or proceeding brought on our behalf, ii) any action asserting a claim for or based on a breach of a fiduciary duty owed by any of our directors, officers or employees to us or our stockholders, including a claim alleging the aiding and abetting of such a breach of fiduciary duty, iii) any action asserting a claim against us or any of our directors, officers or employees arising pursuant to any provision of the DGCL or of our Charter or our amended and restated bylaws (as either may be amended and/or restated from time to time), iv) any action asserting a claim related to or involving us that is governed by the internal affairs doctrine, or v) any action asserting an “internal corporate claim” as defined under the DGCL. The exclusive forum provision does not apply to claims arising under the Securities Act of 1933, as amended (the “Securities Act”), the Exchange Act or other federal securities laws for which there is exclusive federal or concurrent federal and state jurisdiction. Unless we consent in writing to the selection of an alternative forum, the federal district courts of the United States shall be the exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act, the Exchange Act or such other federal securities laws.

Any person or entity purchasing or otherwise acquiring any interest in shares of our capital stock will be deemed to have notice of and, to the fullest extent permitted by law, to have consented to the provisions of our Charter described above. Although we believe this exclusive forum provision benefits us by providing increased consistency in the application of Delaware law and federal securities laws in the types of lawsuits to which each applies, the choice of forum provision may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our directors, officers, other employees or stockholders, which may discourage such lawsuits against us and our directors, officers, other employees or stockholders. However, the enforceability of similar forum provisions in other companies’ certificates of incorporation has been challenged in legal proceedings. If a court were to find the exclusive choice of forum provision contained in our Charter to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions, which could materially adversely affect our business, financial condition and results of operations.

Risks Related to our Management

We are highly dependent on the continued leadership of Brad Jacobs as Chairman and Chief Executive Officer. The possibility of the loss of Mr. Jacobs in these roles could have a material adverse effect on the Company’s business, financial condition and results of operations.

We are highly dependent on the leadership of Brad Jacobs as Chairman and Chief Executive Officer and we have benefited substantially from his leadership and performance. Our ability to successfully implement our business strategy depends to a significant extent on the continued service and performance of Mr. Jacobs. The loss of Mr. Jacobs’ services could impair our ability to execute our business plan and could, therefore, have a material adverse effect on our business, financial condition and results of operations.

The past performance by Brad Jacobs or our management team may not be indicative of future performance or results.

Past performance by Brad Jacobs or our management team, including transactions in which they have participated and businesses with which they have been associated, may not be representative of our future performance or the returns the Company will generate going forward. Our financial condition and results of operations may be influenced by numerous factors, some of which are beyond our control. You should not rely on the historical record of Mr. Jacobs or our management team as indicative of the future performance of an investment of our Company.

Our success depends upon the retention of our senior management as well as our ability to attract and retain key talent.

Our continued success depends, in part, on the efforts and abilities of our senior management team and other key employees. While certain of our executive officers and key employees are subject to long-term compensatory arrangements, there can be no assurance that we will be able to retain all key members of our senior management. Difficulties in hiring or retaining key executive or other employee talent, or the unexpected loss of experienced employees, could have an adverse impact on our business, financial condition or results of operations.

Risks Related to Acquisitions

The failure to consummate acquisitions expeditiously, or at all, could have a material adverse effect on our business prospects, financial condition, results of operations or the price of our common stock.

Acquisitions are an important component of our business strategy, as we intend to operate a company focused on building products distribution, but currently do not have any operations in this sector. Acquisition opportunities are likely to arise from time to time, and any such acquisition could be significant. The evaluation of each specific acquisition target business and the negotiation, drafting and execution of relevant transaction agreements and other ancillary documents, disclosure documents and other instruments, requires substantial management time and attention, as well as costs related to fees payable to counsel, accountants and other third parties. Our ability to consummate an acquisition is dependent on a number of factors and conditions that require time, attention and collaboration across multiple parties, including receipt of all necessary regulatory approvals of the contemplated transaction.

Certain acquisition opportunities may not result in the consummation of a transaction. When an identified transaction is not consummated, we are not able to recover the cost spent pursuing such transaction, which reduces the amount of capital available for other identified targets. Failure to complete an acquisition could adversely affect our business as we could be required to pay a termination fee under certain circumstances or be subject to litigation, and our stock price may also suffer as the failure to consummate such an acquisition may result in negative perception in the investment community. Additionally, we may not be able to identify or execute alternative arrangements on favorable terms, if at all. If we fail to consummate and integrate our acquisitions in a timely and cost-effective manner, our business, financial condition and results of operations could be adversely affected.

We may not be able to successfully integrate the businesses that we acquire and fail to realize the anticipated benefits and our business could be negatively affected from unexpected or contingent liabilities.

We may not be able to successfully integrate operations that we acquire, including their personnel, financial systems, distribution or operating procedures. The integration process may entail significant costs and delays. The integration of operations and personnel may place a significant burden on management and other internal resources. The attention of our management may be directed towards integration considerations and may be diverted from our day-to-day operations, and matters related to the integration may require commitments of time and resources that could otherwise have been devoted to other opportunities that might have been beneficial to us and our business. Our failure to integrate the operations of companies successfully could adversely affect our business, financial condition, results of operations and prospects. In addition, we may fail to identify material problems or liabilities during due diligence review of acquisition targets prior to acquisition, and acquire entities with unknown or contingent liabilities, costs and problems. Further, we may significantly increase our leverage in connection with an acquisition, which could increase our future debt service obligations and limit our flexibility to pursue additional strategic acquisitions. As a result, any acquisitions may not provide the anticipated benefits and our business, financial condition and results of operations could be adversely affected.

We face competition for businesses that fit our acquisition strategy and, therefore, we may have to acquire targets at sub-optimal prices or, alternatively, forego certain acquisition opportunities.

Our acquisition strategy is focused on the acquisition of businesses in the building products distribution industry. In pursuing such acquisitions, we may face competition from other potential purchasers. Although the pool of potential purchasers for such businesses is typically small, those potential purchasers can be aggressive in their approach to acquiring such businesses. Furthermore, we may need to use third-party financing in order to fund some or all of these potential acquisitions, thereby increasing our acquisition costs. To the extent that other potential purchasers do not need to obtain third-party financing or are able to obtain such financing on more favorable terms, they may be in a position to be more aggressive with their acquisition proposals. As a result, in order to be competitive, our acquisition proposals may need to be aggressively priced, including at price levels that exceed what we originally determined to be achievable. Alternatively, we may determine that we cannot pursue on a cost-effective basis what would otherwise be an attractive acquisition opportunity.

Risks Related to Our Industry

Our industry is highly fragmented and competitive. If we are unable to compete effectively, our net sales and operating results may be reduced.

The building products distribution industry is highly fragmented and competitive, and the barriers to entry for local competitors are relatively low. Competitive factors in our industry include pricing, availability of products, service, delivery capabilities, customer relationships, geographic coverage, and breadth of product offerings. Also, financial stability is important to suppliers and customers in choosing distributors for their products, and it affects the favorability of the terms on which we would be able to obtain our products from suppliers and sell products to our customers.

Some of our competitors may be part of larger companies, and, therefore, may have access to greater financial and other resources than those to which we have access. We may not be able to maintain our costs at a level sufficiently low for us to compete effectively. If we are unable to compete effectively, any future net sales and net income may be reduced.

Our industry is highly cyclical, and prolonged periods of weak demand or excess supply may reduce our net sales and/or margins, which may cause us to incur losses or reduce our net income.

The building products distribution industry is subject to cyclical market pressures and market prices of building products historically have been volatile and cyclical. Prices of building products are determined by overall supply and demand in the market and we have

limited ability to control the timing and amount of pricing changes. Demand for building products is driven mainly by factors outside of our control, such as general economic and political conditions, interest rates, governmental subsidies and incentives, availability of mortgage financing, inflation, the construction, repair and remodeling markets, industrial markets, housing supply, weather conditions, commodity prices and population growth. The supply of building products fluctuates based on available manufacturing capacity, and excess capacity in the industry can result in significant declines in market prices for those products. To the extent that prices and volumes experience a sustained or sharp decline, any future net sales and margins likely would decline as well. If we have meaningful fixed costs, a decrease in sales and margin generally would have a significant adverse impact on our financial condition, operating results, and cash flows.

Regional or global barriers to trade or a global trade war could increase the cost of products in the building products distribution industry, which could adversely impact the competitiveness of such products and the financial results of businesses in the industry.

The state of relationships between other countries and the United States with respect to trade policies, government relations and tariffs may impact our business. The U.S. government has and continues to make significant changes in U.S. trade policy and has taken certain actions that could negatively impact U.S. trade, including imposing tariffs on certain goods imported into the United States. There is concern that the imposition of tariffs by the United States could result in the adoption of tariffs or retaliatory measures by other countries, leading to a global trade war. Such tariffs or sanctions could raise the cost and reduce the supply of building materials and components. Our success in markets we may chose to enter in the future depends substantially on our ability to source local materials on terms that are favorable to us. In the event of a global trade war or regional dispute, local suppliers may choose to allocate their resources to local players in their markets and provide us with less favorable terms. Building products shortages and price increases for building products could cause distribution delays and increase our costs, which in turn could reduce our competitiveness and impact our ability to do business with certain counterparties.

General geopolitical instability and the responses to it, such as the possibility of sanctions, trade restrictions and changes in tariffs, including tariffs imposed by the United States and China, and the possibility of additional tariffs, non-tariff barriers or other trade restrictions between the United States and other countries where we might in the future distribute or sell products, could adversely impact our business. If we fail to anticipate and manage any of these dynamics successfully, our business, financial condition and results of operations could be adversely affected.

General Risks

We may be subject to periodic litigation, regulatory proceedings and enforcement actions, which may adversely affect our business and financial performance.

From time to time, we are involved in lawsuits, regulatory proceedings and enforcement actions, brought or threatened against us in the ordinary course of business. Our business is subject to the risk of claims involving current and former employees, affiliates, suppliers, competitors, stockholders, government regulatory agencies or others through private actions, class actions, whistleblower claims, administrative proceedings, antitrust enforcement, regulatory actions or other proceedings.

Due to the inherent uncertainties of litigation, it is often difficult to accurately predict the ultimate outcome of any such actions or proceedings. The outcome of litigation, particularly class action lawsuits and regulatory actions, is often difficult to assess or quantify, as plaintiffs may seek injunctive relief or recovery of very large or indeterminate amounts in these types of lawsuits, and the magnitude of the potential loss may remain unknown for substantial periods of time. In addition, plaintiffs in many types of actions may seek punitive damages, civil penalties, consequential damages or other losses, or injunctive or declaratory relief. These proceedings or actions could result in substantial cost and may require us to devote substantial resources to defend ourselves and distract our management from the operation of our business. While we maintain insurance for certain potential liabilities, such insurance does not cover all types and amounts of potential liabilities and is subject to various exclusions as well as caps on amounts recoverable. We may therefore incur significant expenses defending any such suit or government charge and may be required to pay amounts or otherwise change our operations in ways that could adversely affect our results of operations and financial condition.

The price of our common stock has fluctuated significantly in the past and may be highly volatile, with extreme price and volume fluctuations. Sales of a substantial number of shares of our common stock by holders of registrable securities, or the perception that sales will be made in the public market, could depress the market price of our common stock and result in further volatility. As a result of such volatility in the market price of our common stock, we may in the future become the subject of securities class action litigation, which could result in substantial costs and distract management’s attention and resources.

We could be affected by cyberattacks or breaches of our information systems, any of which could have a material adverse effect on our business.

We may be subject to cybersecurity attacks and other intentional hacking. Any failure to identify and address such defects or errors or prevent a cyberattack could result in service interruptions, operational difficulties, loss of revenues or market share, liability to our customers or others, the diversion of corporate resources, harm to our reputation or increased service and maintenance costs. Addressing such issues could prove to be impossible or very costly and responding to the resulting claims or liability could similarly involve substantial cost. Also, due to recent advances in technology and well-known efforts on the part of computer hackers and cyber-terrorists to breach data security of companies, we face risks associated with potential failure to adequately protect critical corporate, customer and employee data, which, if released, could adversely impact our customer relationships, our reputation, and violate privacy laws. Recently, regulatory and enforcement focus on data protection has heightened in the United States. Failure to comply with applicable data protection regulations or other data protection standards may expose us to litigation, fines, sanctions or other penalties, which could harm our business, our reputation, results of operations and financial condition.

A failure of our information technology infrastructure, information systems, networks or processes may materially adversely affect our business.

The efficient operation of our business depends on our information technology systems. We rely on our information technology systems to effectively manage our sales and marketing, financial, legal and compliance functions, communications and other business processes. We also rely on third parties and virtualized infrastructure to operate our information technology systems. Despite significant testing for risk management, external and internal risks, such as malware, insecure coding, “Acts of God,” data leakage and human error pose a direct threat to the stability or effectiveness of our information technology systems and operations. The failure of our information technology systems to perform as we anticipate could adversely affect our business through transaction errors, billing and invoicing errors, internal recordkeeping and reporting errors and processing inefficiencies. Any such failure could result in harm to our reputation and have an ongoing adverse impact on our business, results of operations and financial condition, including after the underlying failures have been remedied. Further, the delay or failure to implement information system upgrades and new systems effectively could disrupt our business, distract management’s focus and attention from our business operations, and increase our implementation and operating costs, any of which could negatively impact our operations and operating results.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Not applicable.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

None.

Item 5. Other Information

None.

Item 6. Exhibits


2.1			Amended and Restated Investment Agreement, dated April 14, 2024, by and among QXO, Inc. and Jacobs Private Equity II, LLC (on behalf of itself and on behalf of each of the other Investors) (incorporated herein by reference to Exhibit 2.1 to the Company’s Form 8-K Current Report filed with the SEC on April 15, 2024).
3.1			Fifth Amended and Restated Certificate of Incorporation of the Company, dated June 6, 2024 (incorporated herein by reference to Exhibit 3.1 to the Company’s Form 8-K Current Report filed with the SEC on June 6, 2024).
3.2			Certificate of Amendment to the Fifth Amended and Restated Certificate of Incorporation of the Company, dated June 6, 2024 (incorporated herein by reference to Exhibit 3.2 to the Company’s Form 8-K Current Report filed with the SEC on June 6, 2024).
3.3			Amended and Restated Bylaws of the Company (incorporated herein by reference to Exhibit 3.3 to the Company’s Form 8-K Current Report filed with the SEC on June 6, 2024).
4.1			Certificate of Designation of the Convertible Perpetual Preferred Stock of QXO, Inc. (incorporated herein by reference to Exhibit 4.1 to the Company’s Form 8-K Current Report filed with the SEC on June 6, 2024).
4.2			Form of Warrant Certificate (incorporated herein by reference to Exhibit 4.2 to the Company’s Form 8-K Current Report filed with the SEC on June 6, 2024).
4.3			Form of Warrant Certificate (incorporated herein by reference to Exhibit 4.3 to the Company’s Form 8-K Current Report filed with the SEC on June 6, 2024).
4.4			Form of Warrant Certificate (incorporated herein by reference to Exhibit 4.4 to the Company’s Form 8-K Current Report filed with the SEC on June 6, 2024).
4.5			Form of Pre-Funded Warrant (incorporated herein by reference to Exhibit 4.1 to the Company’s Form 8-K Current Report filed with the SEC on June 14, 2024).
10.1			Stockholders Agreement, dated as of June 6, 2024, by and among the Company, the Other Investors and JPE (incorporated herein by reference to Exhibit 10.1 to the Company’s Form 8-K Current Report filed with the SEC on June 6, 2024).
10.2			Registration Rights Agreement, dated as of June 6, 2024, by and among the Company, Jacobs Private Equity II, LLC and the other investors (incorporated herein by reference to Exhibit 10.2 to the Company’s Form 8-K Current Report filed with the SEC on June 6, 2024).
10.3			Employment Agreement, dated as of June 5, 2024, by and between Brad Jacobs and the Company (incorporated herein by reference to Exhibit 10.3 to the Company’s Form 8-K Current Report filed with the SEC on June 6, 2024).
10.4			Form of Purchase Agreement, dated as of June 13, 2024, by and between QXO, Inc. and the Investors signatory thereto (incorporated herein by reference to Exhibit 10.1 to the Company’s Form 8-K Current Report filed with the SEC on June 14, 2024).
10.5			Form of Purchase Agreement, dated as of July 22, 2024, by and between QXO, Inc. and the Investors signatory thereto (incorporated herein by reference to Exhibit 10.1 to the Company’s Form 8-K Current Report filed with the SEC on July 22, 2024).
10.6			Amended and Restated Meller Letter Agreement, dated April 14, 2024, by and between QXO, Inc. and Mark Meller (incorporated herein by reference to Exhibit 10.1 to the Company’s Form 8-K Current Report filed with the SEC on April 15, 2024).
10.7			Meller Offer Letter, dated April 14, 2024, by and between QXO, Inc. and Mark Meller (incorporated herein by reference to Exhibit 10.2 to the Company’s Form 8-K Current Report filed with the SEC on April 15, 2024).
10.8			QXO, Inc. 2024 Omnibus Incentive Compensation Plan (incorporated herein by reference to Exhibit 10.1 to the Company’s Form 8-K Current Report filed with the SEC on June 5, 2024).
10.9			QXO, Inc. Severance Plan.*
10.10			Offer Letter, dated June 14, 2024, by and between QXO, Inc. and Sean Smith.*
10.11			Form of Restricted Stock Units Award.*
31.1			Certification by the Principal Executive Officer of Registrant pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (Rule 13a-14(a) or Rule 15d-14(a) ).*
31.2			Certification by the Principal Financial Officer of Registrant pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (Rule 13a-14(a) or Rule 15d-14(a) ).*
32.1			Certification by the Principal Executive Officer pursuant to 18 U.S.C. 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*
32.2			Certification by the Principal Financial Officer pursuant to 18 U.S.C. 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*
101			INS Inline XBRL Instance Document
101			SCH Inline XBRL Taxonomy Extension Schema
101			CAL Inline XBRL Taxonomy Extension Calculation Linkbase
101			DEF Inline XBRL Taxonomy Extension Definition Linkbase
101			LAB Inline XBRL Taxonomy Extension Label Linkbase
101			PRE Inline XBRL Taxonomy Extension Presentation Linkbase
104			Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

* Filed herewith

SIGNATURES

Pursuant to the requirements of Section 13 or 15 (d) of the Securities Exchange Act of 1934, the registrant has duly caused this report on Form 10-Q to be signed on its behalf by the undersigned thereunto duly authorized.

QXO, INC.


Dated: August 14, 2024	By:	/s/ Brad Jacobs
		Brad Jacobs Chief Executive Officer
		(Principal Executive Officer)

Dated: August 14, 2024	By:	/s/ Ihsan Essaid
		Ihsan Essaid Chief Financial Officer
		(Principal Financial Officer)

Exhibit 10.9

QXO, INC.
SEVERANCE PLAN

SECTION 1
PURPOSE OF THE PLAN

The Compensation and Talent Committee (the “Committee”) of the Board of Directors (the “Board”) of QXO, Inc. (the “Company”) desires to provide financial assistance to select executives upon certain terminations of employment in accordance with the terms and conditions of the QXO, Inc. Severance Plan (this “Plan”).

The Committee also recognizes that the possibility of a Change of Control (as defined in Section 2.5) of the Company, and the uncertainty it could create, may result in the loss or distraction of executives of the Company to the detriment of the Company and its shareholders. The Committee considers the avoidance of such loss and distraction to be essential to protecting and enhancing the best interests of the Company and its shareholders. The Committee also believes that when a Change of Control is perceived as imminent, or is occurring, the Committee should be able to receive and rely on disinterested service from executives regarding the best interests of the Company and its shareholders without concern that employees might be distracted or concerned by the personal uncertainties and risks created by the perception of an imminent or occurring Change of Control.

Therefore, in order to fulfill the above purposes, the Plan was adopted by the Committee and shall become effective on the Effective Date (as defined in Section 2.13).

SECTION 2
DEFINITIONS

Certain capitalized terms used herein have the definitions given to such terms in the first place in which they are used. As used herein, the following capitalized words and phrases shall have the following respective meanings:

2.1“Affiliate” means any entity controlled by, controlling or under common control with the Company.

2.2“Annual Base Salary” means the annual base salary paid or payable, including any base salary that is subject to deferral, to the Participant by the Company or any of the Affiliates at the rate in effect immediately prior to the Date of Termination or, if the Date of Termination is during a Change of Control Period, the rate in effect (or required to be in effect before any diminution that is a basis of the Participant’s termination for Good Reason) immediately prior to the Change of Control, or, if higher, immediately prior to the Date of Termination.

2.3“Benefit Continuation Period” means (a) in the event of a Qualifying Non-CIC Termination, a period of six (6) months following the Date of Termination and (b) in

the event of a Qualifying CIC Termination, a period of twelve (12) months following the Date of Termination.

2.4“Cause” shall means (a) the Participant’s dereliction of duties or gross negligence or failure to perform the Participant’s duties or refusal to follow any lawful directive of the officer to whom the Participant reports; (b) the Participant’s abuse of or dependency on alcohol or drugs (illicit or otherwise) that adversely affects his performance of duties for the Company or an Affiliate; (c) the Participant’s commission of any fraud, embezzlement, theft or dishonesty or any deliberate misappropriation of money or other assets of the Company or an Affiliate; (d) the Participant’s breach of any fiduciary duties of the Company or any Affiliate; (e) any act, or failure to act, by the Participant in bad faith to the detriment of the Company or an Affiliate; (f) the Participant’s failure to cooperate in good faith with a governmental or internal investigation of the Company or an Affiliate or any of its directors, managers, officers or employees, if the Company requests the Participant’s cooperation; (g) the Participant’s failure to follow Company policies, including the Company’s code of conduct and/or code of business ethics, as may be in effect from time to time; or (h) the Participant’s conviction of, or plea of nolo contendere to, a felony or any serious crime; provided that in cases set forth in clauses (a) through (g) where a cure is possible (as determined by the Plan Administrator in its discretion), the Participant shall first be provided with a 15-day cure period.

2.5“Change of Control” shall have the meaning given to such term in the QXO, Inc. 2024 Omnibus Incentive Compensation Plan as in effect from time to time.

2.6“Change of Control Period” means the period commencing on, and including, the date of a Change of Control and ending on, and including, the second anniversary of the date of such Change of Control.

2.7“Code” means the Internal Revenue Code of 1986, as amended from time to time.

2.8“Committee” means the Compensation and Talent Committee of the Board.

2.9“Company” means QXO, Inc. and any successor(s) thereto or, if applicable, the ultimate parent of any such successor.

2.10“Date of Termination” means the date of receipt of a Notice of Termination from the Company or the Participant, as applicable, or any later date specified in the Notice of Termination (subject to the notice and cure periods in the definitions of Good Reason). If the Participant’s employment is terminated by reason of death, the Date of Termination shall be the date of death of the Participant. If the Participant’s employment is terminated by reason of Disability, the Date of Termination shall be the date on which the Participant becomes eligible for benefits under the Company’s (or as, relevant, any Affiliate’s) long-term disability plan. Notwithstanding the foregoing, in no event shall the Date of Termination of any U.S. Taxpayer Participant occur until such U.S.

Taxpayer Participant experiences a “separation from service” within the meaning of Section 409A of the Code, and the date on which such separation from service takes place shall be the “Date of Termination.”

2.11“Disability” shall have the meaning given to such term in the Company’s (or as, relevant, any Affiliate’s) long-term disability plan applicable to the Participant.

2.12“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.

2.13“Effective Date” means June 6, 2024.

2.14“Good Reason” means the occurrence of any of the following events or circumstances during a Change of Control Period and without the Participant’s prior written consent:

(a)A reduction of the Participant’s Annual Base Salary from that in effect immediately prior to the Change of Control (or if higher, that in effect at any time thereafter);

(b)A reduction in the Participant’s target annual cash bonus opportunity from that in effect immediately prior to the Change of Control (or, if higher, that in effect at any time thereafter);

(c)A material, adverse change in the Participant’s title, reporting relationship, authority, duties, or responsibilities from those in effect immediately prior to the Change of Control;

(d)A relocation of the Participant’s principal place of employment to a location that is more than 50 miles from the location of the Participant’s principal place of employment immediately prior to the Change of Control; or

(e)The failure of the Company to obtain an agreement from any successor to the Company to assume and agree to perform the obligations under this Plan with respect to the Participant.

In order to invoke a termination for Good Reason, the Participant shall provide written notice to the Company of the existence of one or more of the conditions described in clauses (a) through (e) within 90 days of the initial existence of such condition, describing in reasonable detail such condition, and the Company shall have 30 days following receipt of such written notice (the “Cure Period”) during which it may remedy the condition. In the event that the Company fails to remedy the condition constituting Good Reason during the applicable Cure Period, the “separation from service” (within the meaning of Section 409A of the Code) of any U.S. Taxpayer Participant, or, for any Non-U.S. Participant, their termination of employment, must occur, if at all, within 30 days following the earlier of (i) the end of the Cure Period, or (ii) the date the Company provides written notice to the Participant that it does not intend to cure

such condition. The Participant’s mental or physical incapacity following (but not before) the occurrence of an event described above in clauses (a) through (e) shall not affect the Participant’s ability to terminate employment for Good Reason and the Participant’s death following delivery of a Notice of Termination for Good Reason shall not affect the Participant’s estate’s entitlement to the severance payments and benefits provided hereunder upon a termination of employment for Good Reason.

2.15“Multiple” means two (2).

2.16“Non-U.S. Participant” means any Participant other than a U.S. Taxpayer Participant.

2.17“Notice of Termination” means a written notice delivered to the other party that (a) indicates the specific termination provision in this Plan relied upon, (b) to the extent applicable, sets forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Participant’s employment under the provision so indicated, and (c) if the Date of Termination is other than the date of receipt of such notice, specifies the Date of Termination (which Date of Termination shall be: (i) for any U.S. Taxpayer Participant, not more than 30 days after the giving of such notice or 60 days in the case of a termination for Good Reason); or (ii) for any Non-U.S. Participant, no later than the expiry of their contractual notice period. Any termination by the Company for Cause or by the Participant for Good Reason shall be communicated by a Notice of Termination to the other party hereto given in accordance with Section 10.6 of this Plan. The failure by the Participant or the Company to set forth in the Notice of Termination any fact or circumstance that contributes to a showing of Good Reason or Cause shall not waive any right of the Participant or the Company, respectively, hereunder or preclude the Participant or the Company, respectively, from asserting such fact or circumstance in enforcing the Participant’s or the Company’s respective rights hereunder. For the avoidance of doubt, any notice served under the Plan will not affect the Company’s or any Affiliate’s ability to exercise any of its rights in relation to termination or notice under the relevant Participant’s contract of employment.

2.18“Participant” means (a) unless the Committee affirmatively determines otherwise and notifies the executive officer in writing of such determination, each executive officer of the Company (other than the Chief Executive Officer of the Company, who shall not be eligible unless the Committee affirmatively determines otherwise and notifies the CEO in writing of such determination), and (b) any other key employee employed by the Company or any Affiliate who is selected by the Plan Administrator for participation in the Plan and notified of the same in writing.

2.19“Plan” means this QXO, Inc. Severance Plan.

2.20“Plan Administrator” shall have the meaning given to such term in Section 7.1.

2.21“Qualifying CIC Termination” means any termination of a Participant’s employment, during a Change of Control Period (a) by the Participant for Good Reason or (b) by the Company or, as relevant, any Affiliate other than for Cause, death or Disability.

2.22“Qualifying Non-CIC Termination” means any termination of a Participant’s employment (a) by the Company or as relevant any Affiliate other than for Cause, death or Disability and (b) that is not a Qualifying CIC Termination.

2.23 “Salary Continuation Period” means the period of twelve (12) months immediately following the Date of Termination.

2.24“Target Annual Bonus” means the Participant’s target annual cash bonus in effect immediately prior to the Date of Termination or if the Date of Termination is during a Change of Control Period, the Participant’s target annual cash bonus in effect (or required to be in effect before any diminution that is a basis of the Participant’s termination for Good Reason) immediately prior to the Change of Control, or, if higher, immediately prior to the Date of Termination.

2.25“U.S. Taxpayer Participant” means any Participant whose compensation income is subject to taxation in the United States of America.

SECTION 3
SEPARATION BENEFITS

3.1Qualifying Non-CIC Termination. If a Participant experiences a Qualifying Non-CIC Termination, the Company shall pay or provide to the Participant the following payments and benefits at the time or times set forth below, subject to Section 9 and subject to Section 3.3:

(a)a lump sum payment in cash payable within 30 days following the Date of Termination, equal to the sum of (i) the Participant’s accrued but unpaid Annual Base Salary through the Date of Termination, (ii) any cash incentive payment relating to a performance period that was completed prior to the Date of Termination (the amount of which will be determined by the Plan Administrator), (iii) any accrued and unused vacation pay or other paid time off, and (iv) subject to any expenses policy in force from time to time, any business expenses incurred by the Participant that are unreimbursed as of the Date of Termination, in each case, to the extent not theretofore paid (the sum of the amounts described in clauses (i), (ii), (iii) and (iv) shall be hereinafter referred to as the “Accrued Obligations”); provided that, for any U.S. Taxpayer Participant, notwithstanding the foregoing, in the case of clauses (i) and (ii), if such U.S. Taxpayer Participant has made an irrevocable election under any deferred compensation arrangement subject to Section 409A of the Code to defer any portion of the Annual Base Salary or annual incentive payment described in clause (i) or (ii) above, then for all purposes of this Section 3 (including, without limitation, Section 3.1(a) and 3.2(a)), such deferral election, and the terms of the applicable arrangement, shall apply to the same portion of the amount described in such clauses (i) or (ii), and such portion shall not be

considered as part of the “Accrued Obligations” but shall instead be an “Other Benefit” (as defined below);

(b)a lump sum payment payable in cash equal to the product of (i) the Target Annual Bonus and (ii) a fraction, the numerator of which is the number of days in the fiscal year in which the Date of Termination occurs from the first day of such fiscal year to and including the Date of Termination, and the denominator of which is the total number of days in such fiscal year, reduced by any cash incentive payment that the Participant has been paid or to which the Participant is otherwise entitled, in each case, for the same period of service (the “Prorated Bonus”), which shall be subject to any applicable deferral election on the same basis as set forth in the proviso to Section 3.1(a);]

(c)continuation of Annual Base Salary for the Salary Continuation Period paid to the Participant ratably over the Salary Continuation Period;

(d)at the option of the Company, either (i) for the Benefit Continuation Period, healthcare benefit coverage to the Participant (and the Participant’s dependents who were covered by healthcare benefit coverage (including medical and dental) pursuant to a plan sponsored by the Company or an Affiliate as of immediately prior to the Date of Termination, if any (the “eligible dependents”)), with the requirement for the Participant (or the eligible dependents) to pay a monthly premium at the active employee rate for such healthcare benefit coverage as if the Participant had continued employment with the Company during the Benefit Continuation Period; provided that, for any U.S. Taxpayer Participant, the receipt of such heath care benefit shall be conditioned upon the Participant making a timely election to receive COBRA coverage provided to former employees under Section 4980B of the Code and continuing such coverage during the Benefit Continuation Period so long as it is available or (ii) a cash lump sum payment equal to the amount of the employer contribution, based on the rates and coverage elections in effect at the Date of Termination, that would have been provided towards healthcare benefit coverage for the Participant and the Participant’s eligible dependents during the Benefit Continuation Period had the Participant remained employed with the Company or as relevant Affiliate during such period (the “Healthcare Benefit”); and

(e)to the extent not theretofore paid or provided, any other amounts or benefits required to be paid or provided or which the Participant is eligible to receive under any plan, program, policy or practice or contract or agreement of the Company and its Affiliates, including amounts credited to the Participant’s account under any deferred compensation plan, payable pursuant to the terms of such plan, program, policy or practice (such other amounts and benefits shall be hereinafter referred to as the “Other Benefits”).

3.2Qualifying CIC Termination. If a Participant experiences a Qualifying CIC Termination, the Company shall pay or provide to the Participant the following payments and benefits at the time or times set forth below, subject to Section 9 and subject to Section 3.3:

(a)a lump sum payment in cash payable within 30 days following the Date of Termination equal to the Accrued Obligations;

(b)the Prorated Bonus, which shall be subject to any applicable deferral election on the same basis as set forth in the proviso to Section 3.1(a);

(c)a lump sum payment in cash equal to the product of (i) the Multiple and (ii) the sum of (A) the Participant’s Annual Base Salary and (B) the Target Annual Bonus;

(d)the Healthcare Benefit; and

(e)Other Benefits payable pursuant to the terms of such plan, program, policy or practice or contract or agreement.

3.3Release Requirement; Payment Timing.

(a)All payments and benefits contemplated by Section 3.1 and Section 3.2 (other than the Accrued Obligations and the Other Benefits) are expressly conditioned on the Participant’s execution of a general release of claims and settlement agreement in the form delivered to the Participant by the Company or its applicable Affiliate (provided that any general release of claims and settlement agreement shall not contain any new or additional restrictive covenant requirements in connection with a Qualifying CIC Termination) on or within ten (10) days after the Date of Termination and such agreement becoming effective and irrevocable in accordance with its terms no later than the seventieth (70th) day following the Date of Termination (collectively, the “Release Requirement”). The cash payments contemplated by this Section 3 (other than the Accrued Obligations and the Other Benefits) shall be paid, if due under the terms of this Plan, as follows: (i) with respect to the payment contemplated by Section 3.1(c), over the Salary Continuation Period in accordance with the Company’s (or its relevant Affiliate’s) regularly scheduled payroll dates and commencing not later than the second regularly scheduled payroll date following the satisfaction of the Release Requirement, with any installments that would have been made during the period from the Date of Termination to the date of satisfaction of the Release Requirement based on regularly scheduled payroll dates accumulated and paid on the date that such installments commence, (ii) with respect to the payments contemplated by Section 3.1(b) and, if applicable, Section 3.1(d), as promptly as practicable following the satisfaction of the Release Requirement, and (iii) with respect to the payments contemplated by Sections 3.2(b) and 3.2(c) and, if applicable, Section 3.2(d), within five business days following the satisfaction of the Release Requirement, and in the case of both of clauses (ii) and clause (iii), in no event later than two and one half months following the end of the calendar year in which the Date of Termination occurs.

(b)For any U.S. Taxpayer Participant, notwithstanding anything to the contrary in this Section 3, with respect to any payment or benefit payable pursuant to Section 3.2 that constitutes nonqualified deferred compensation within the meaning of

Section 409A of the Code, if the applicable Change of Control does not constitute an event described in Section 409A(a)(2)(v) of the Code and the regulations thereunder, then solely to the extent necessary to avoid the application of additional taxes and penalties on such payment or benefit under Section 409A of the Code, such payment or benefit shall be paid or provided on the same schedule that would have applied to such payment or benefit in connection with a Qualifying Non-CIC Termination.

SECTION 4
GOLDEN PARACHUTE EXCISE TAX

4.1The provisions of this Section 4 shall apply to U.S. Taxpayer Participants only.

4.2If a Participant has a Qualifying CIC Termination, anything in this Plan to the contrary notwithstanding, in the event the Accounting Firm (as defined below) shall determine that receipt of all Payments (as defined below) would subject the Participant to the excise tax under Section 4999 of the Code (the “Excise Tax”), the Accounting Firm shall determine whether to reduce any of the Payments so that the Parachute Value (as defined below) of all Payments, in the aggregate, equals the Safe Harbor Amount (as defined below). The Payments shall be so reduced only if the Accounting Firm determines that the Participant would have a greater Net After-Tax Receipt (as defined below) of aggregate Payments if the Payments were so reduced. If the Accounting Firm determines that the Participant would not have a greater Net After-Tax Receipt of aggregate Payments if the Payments were so reduced, the Participant shall receive all Payments to which the Participant is entitled.

4.3If the Accounting Firm determines that aggregate Payments should be reduced so that the Parachute Value of all Payments, in the aggregate, equals the Safe Harbor Amount, the Company shall promptly give the Participant notice to that effect and a copy of the detailed calculation thereof. All determinations made by the Accounting Firm under this Section 4 shall be binding upon the Company and the Participant and shall be made as soon as reasonably practicable and in no event later than 15 days following the Date of Termination. The reduction of the Payments, if applicable, shall be made by reducing the Payments that have a Parachute Value in the order determined by the Plan Administrator, provided that such reduction will be made in a manner that is intended to comply with Section 409A to the extent applicable. All reasonable fees and expenses of the Accounting Firm shall be borne solely by the Company.

4.4To the extent requested by the Participant, the Company shall cooperate with the Participant in good faith in valuing, and the Accounting Firm shall take into account the value of, services provided or to be provided by the Participant (including, without limitation, the Participant’s agreeing to refrain from performing services pursuant to a covenant not to compete or similar covenant, before, on or after the date of a change in ownership or control of the Company (within the meaning of Q&A-2(b) of the final regulations under Section 280G of the Code)), such that payments in respect of such services may be considered reasonable compensation within the meaning of Q&A-9 and

Q&A-40 to Q&A-44 of the final regulations under Section 280G of the Code and/or exempt from the definition of the term “parachute payment” within the meaning of Q&A-2(a) of the final regulations under Section 280G of the Code in accordance with Q&A-5(a) of the final regulations under Section 280G of the Code.

4.5The following terms shall have the following meanings for purposes of this Section 4:

(a)“Accounting Firm” shall mean a nationally recognized certified public accounting firm or other professional organization that is a certified public accounting firm recognized as an expert in determinations and calculations for purposes of Section 280G of the Code that is selected by the Company prior to a Change of Control for purposes of making the applicable determinations hereunder, which firm shall not, without the Participant’s consent, be a firm serving as accountant or auditor for the individual, entity or group effecting the Change of Control.

(b)“Net After-Tax Receipt” shall mean the present value (as determined in accordance with Sections 280G(b)(2)(A)(ii) and 280G(d)(4) of the Code) of a Payment net of all taxes imposed on the Participant with respect thereto under Sections 1 and 4999 of the Code and under applicable state and local laws, determined by applying the highest marginal rate under Section 1 of the Code and under state and local laws which applied to the Participant’s taxable income for the immediately preceding taxable year, or such other rate(s) as the Accounting Firm determines to be likely to apply to the Participant in the relevant tax year(s).

(c)“Parachute Value” of a Payment shall mean the present value as of the date of the Change of Control for purposes of Section 280G of the Code of the portion of such Payment that constitutes a “parachute payment” under Section 280G(b)(2) of the Code, as determined by the Accounting Firm for purposes of determining whether and to what extent the Excise Tax under Section 4999 of the Code will apply to such Payment.

(d)“Payment” shall mean any payment, benefit or distribution in the nature of compensation (within the meaning of Section 280G(b)(2) of the Code) to or for the benefit of the Participant, whether paid, payable or provided pursuant to this Plan or otherwise.

(e)“Safe Harbor Amount” shall mean the maximum Parachute Value of all Payments that the Participant can receive without any Payments being subject to the Excise Tax.

4.6The provisions of this Section 4 shall survive the expiration of this Plan.

SECTION 5
NONDUPLICATION; LEGAL FEES; NON-EXCLUSIVITY OF RIGHTS

5.1 Nonduplication. The amount of any payment under Section
3.1(b) and 3.1(c), in the case of a Qualifying Non-CIC Termination, or Section 3.2(b) and 3.2(c), in the case of a Qualifying CIC Termination, will be offset and reduced (but not below zero) by the full amount and/or value of any severance benefits, compensation and benefits provided during any notice period, pay in lieu of notice, mandated termination indemnities, restrictive covenant payments, or similar benefits that the Participant may separately be entitled to receive from the Company or any Affiliate based on any employment agreement, confidential information protection agreement (solely with respect to payments under the confidential information protection agreement that are payable within, or with respect to, the one-year period commencing on the Date of Termination) or other contractual obligation (whether individual or union/works council) or statutory scheme. In addition, the Plan Administrator may determine that (a) any payment owed under Section 3.1(c) (after application of the offset contemplated by the immediately preceding sentence) and/or (b) solely in the case of a Qualifying Non-CIC Termination, any payments owed under the confidential information protection agreement that are payable within, or with respect to, the one-year period commencing on the Date of Termination, shall be reduced (but not below zero) by the amount of any income that you earn from any other work, whether as an employee or as an independent contractor, during the one year period commencing on the Date of Termination. If a U.S. Taxpayer Participant’s employment is terminated because of a plant shut-down or mass layoff or other event to which the Worker Adjustment and Retraining Notification Act of 1988 or similar state law (collectively, “WARN”) applies, then the amount of the severance payment under Section 3.1(c) or 3.2(c), as applicable, of this Plan to which the Participant is entitled shall be reduced, dollar for dollar, by the amount of any pay provided to the Participant in lieu of the notice required by WARN, and the Benefits Continuation Period shall be reduced for any period of benefits continuation or pay in lieu thereof provided to Participant due to the application of WARN.

5.2Legal Fees. Solely during the Change of Control Period, the Company agrees to pay as incurred (within 10 business days following the Company’s receipt of an invoice from the Participant), to the full extent permitted by law, all legal fees and expenses that the Participant may reasonably incur as a result of any contest by the Company, the Participant or others of the validity or enforceability of, or liability under, any provision of this Plan or any guarantee of performance thereof (including as a result of any contest (regardless of the outcome) by the Participant about the amount of any payment pursuant to this Plan), plus, in each case, interest on any delayed payment to which the Participant is ultimately determined to be entitled at the applicable federal rate provided for in Section 7872(f)(2)(A) of the Code (“Interest”) based on the rate in effect for the month in which such legal fees and expenses were incurred.

SECTION 6
AMENDMENT AND TERMINATION

The Plan may be terminated or amended in any respect or any person removed from the Plan as a Participant by resolution adopted by the Board or the Committee; provided that, in connection with or in anticipation of a Change of Control, this Plan may not be terminated or amended in any manner that would adversely affect the rights of Participants in connection with a Qualifying CIC Termination and no person may be removed as a Participant from the Plan; provided, further, that following a Change of Control, this Plan shall continue in full force and effect and shall not terminate, expire or be amended until after all Participants who become entitled to any payments or benefits hereunder in connection with a Qualifying CIC Termination shall have received such payments and benefits in full pursuant to Section 3.

SECTION 7
PLAN ADMINISTRATION

7.1General. The Committee is responsible for the general administration and management of this Plan (the Committee or its delegate acting in such capacity, the “Plan Administrator”) and shall have all powers and duties necessary to fulfill its responsibilities, including, but not limited to, the discretion to interpret and apply the provisions of this Plan and to determine all questions relating to eligibility for benefits under this Plan, to interpret or construe ambiguous, unclear, or implied (but omitted) terms in any fashion it deems to be appropriate, and to make any findings of fact needed in the administration of this Plan. Unless otherwise determined by the Committee at any time, the responsibilities, power and authority of the Plan Administrator under the Plan with respect to each Participant who is not an “officer” within the meaning of Rule 16a-1(f) under the Securities Exchange Act of 1934, as amended are hereby delegated to each of the Chief Executive Officer and the Chief Human Resources Officer, jointly and severally; provided that each of the Chief Executive Officer and the Chief Human Resource Officer may not make any determination regarding his or her own participation in the Plan. All decisions, interpretations and other actions of the Plan Administrator shall be final, conclusive and binding on all parties who have an interest in this Plan. Following a Change of Control, the validity of any such interpretation, construction, decision, or finding of fact shall be given de novo review if challenged in court, by arbitration, or in any other forum, and such de novo standard shall apply notwithstanding the grant of full discretion hereunder to the Plan Administrator or characterization of any such decision by the Plan Administrator as final or binding on any party.

7.2ERISA Plan. This Plan (a) shall be considered to be an unfunded plan maintained by the Company primarily for the purpose of providing deferred compensation for a select group of management or highly compensated employees (a “top-hat plan”), and (b) shall be administered in a manner that complies with the provisions of ERISA that are applicable to top-hat plans.

7.3Claims Procedure.

(a)Initial Claims. A Participant who believes that such Participant is entitled to a payment under this Plan that has not been received may submit a written claim for benefits under this Plan within sixty (60) days after the Participant’s Date of Termination. If the Participant’s claim is denied, in whole or in part, such Participant will be furnished with written notice of the denial within ninety (90) days after the Plan Administrator’s receipt of the Participant’s written claim, unless special circumstances require an extension of time for processing the claim, in which case the decision period may be extended by up to an additional ninety (90) days. If such an extension of time is necessary, written notice of the extension will be furnished to the Participant before the termination of the initial ninety (90)-day period and will describe the circumstances requiring the extension and the date by which a decision is expected to be rendered. Written notice of the denial of the Participant’s claim will contain the following information:

(i)the reason or reasons for the denial of the Participant’s claim;

(ii)references to the Plan provisions on which the denial of the Participant’s claim was based;

(iii)a description of any additional information or material required by the Plan Administrator to reconsider the Participant’s claim (to the extent applicable) and an explanation of why such material or information is necessary; and

(iv)a description of this Plan’s review procedures and time limits applicable to such procedures, including a statement of the Participant’s right to bring a civil action under Section 502(a) of ERISA following a benefit claim denial on review.

(b)Appeal of Denied Claims. If the Participant’s claim is denied, the Participant (or the Participant’s authorized representative) may file a request for review of the claim in writing with the Plan Administrator. This request for review must be filed no later than sixty (60) days after the Participant has received written notification of the denial.

(i)Such request for review may include any comments, documents, records and other information relating to the Participant’s claim for benefits.

(ii)The Participant has the right to be provided with, upon request and free of charge, reasonable access to and copies of all pertinent documents, records and other information that is relevant to the Participant’s claim for benefits.

(iii)The review of the denied claim will take into account all comments, documents, records and other information that the Participant submitted relating to the Participant’s claim, without regard to whether such

information was submitted or considered in the initial denial of the Participant’s claim.

(c)Plan Administrator’s Response to Appeal. The Plan Administrator will notify the Participant of its decision within sixty (60) days after the Plan Administrator’s receipt of the Participant’s written claim for review; provided that the Plan Administrator may extend the review period by up to sixty (60) additional days, if the Plan Administrator notifies the Participant in writing of the need for an extension (and the reason therefor) before the end of the initial sixty (60)-day period. If the Plan Administrator makes an adverse decision on appeal, the Plan Administrator shall communicate its decision in a writing that includes:

(i)the reason or reasons for the denial of the Participant’s appeal;

(ii)reference to the Plan provisions on which the denial of the Participant’s appeal is based;

(iii)a statement that the Participant is entitled to receive, upon request and free of charge, reasonable access to, and copies of, this Plan and all documents, records and other information relevant to the Participant’s claim for benefits; and

(iv)a statement describing the Participant’s right to bring an action under Section 502(a) of ERISA.

(d)Exhaustion of Administrative Remedies. Prior to a Change of Control, the exhaustion of these claims procedures is mandatory for resolving every claim and dispute arising under this Plan. As to such claims and disputes:

(i)no claimant shall be permitted to commence any arbitration or legal action to recover benefits or to enforce or clarify rights under this Plan or under any provision of law until these claims procedures have been exhausted in their entirety;

(ii)failure to submit a claim, appeal or any required information by the applicable deadline under these claims procedures shall result in forfeiture of the benefits being claimed; and

(iii)no legal action or arbitration may be commenced by the Participant later than one year subsequent to the date of the written response of the Plan Administrator to a Participant’s request for review pursuant to Section 7.3(c).

7.4Indemnification. To the extent permitted by law, the Company shall indemnify the Plan Administrator, whether the Committee or the Chief Executive Officer or Chief Human Resources Officer, from all claims for liability, loss, or damage (including

the payment of expenses in connection with defense against such claims) arising from any act or failure to act in connection with this Plan.

SECTION 8
SUCCESSORS; ASSIGNMENT

8.1Successors. The Company shall require any corporation, entity, individual or other person who is the successor (whether direct or indirect by purchase, merger, consolidation, reorganization or otherwise) to all or substantially all the business and/or assets of the Company to expressly assume and agree to perform, by a written agreement in form and in substance satisfactory to the Company, all of the obligations of the Company under this Plan. As used in this Plan, the term “Company” shall mean the Company as hereinbefore defined and any successor to its business and/or assets as aforesaid which assumes and agrees to perform this Plan by operation of law, written agreement or otherwise.

8.2Assignment of Rights. It is a condition of this Plan, and all rights of each person eligible to receive benefits under this Plan shall be subject hereto, that no right or interest of any such person in this Plan shall be assignable or transferable in whole or in part, except by will or the laws of descent and distribution or other operation of law, including, but not by way of limitation, lawful execution, levy, garnishment, attachment, pledge, bankruptcy, alimony, child support or qualified domestic relations order.

SECTION 9
SECTION 409A OF THE CODE

9.1The provisions of this Section 9 shall apply to U.S. Taxpayer Participants only.

9.2General. The obligations under this Plan are intended to comply with the requirements of Section 409A of the Code or an exemption or exclusion therefrom and shall in all respects be administered in accordance with Section 409A of the Code. Any payments that qualify for the “short-term deferral” exception, the separation pay exception or another exception under Section 409A of the Code shall be paid under the applicable exception to the maximum extent possible. For purposes of nonqualified deferred compensation under Section 409A of the Code, each payment of compensation under this Plan shall be treated as a separate payment of compensation. All payments to be made upon a termination of employment under this Plan may only be made upon a “separation from service” under Section 409A of the Code to the extent necessary in order to avoid the imposition of penalty taxes on a Participant pursuant to Section 409A of the Code. In no event may a Participant, directly or indirectly, designate the calendar year of any payment under this Plan.

9.3Reimbursements and In-Kind Benefits. Notwithstanding anything to the contrary in this Plan, all reimbursements and in-kind benefits provided under this Plan that are subject to Section 409A of the Code shall be made in accordance with the requirements

of Section 409A of the Code, including without limitation, where applicable, the requirement that (i) in no event shall the Company’s obligations to make such reimbursements or to provide such in-kind benefits apply later than the Participant’s remaining lifetime (or if longer, through the 20th anniversary of the Effective Date); (ii) the amount of expenses eligible for reimbursement, or in-kind benefits provided, during a calendar year may not affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other calendar year; (iii) the reimbursement of any eligible fees and expenses shall be made no later than the last day of the calendar year following the year in which the applicable fees and expenses were incurred; provided that the Participant shall have submitted an invoice for such fees and expenses at least 10 days before the end of the calendar year next following the calendar year in which such fees and expenses were incurred; and (iv) the right to reimbursement or in-kind benefits is not subject to liquidation or exchange for another benefit.

9.4Delay of Payments. Notwithstanding any other provision of this Plan to the contrary, if a Participant is considered a “specified employee” for purposes of Section 409A of the Code (as determined in accordance with the methodology established by the Company as in effect on the Date of Termination), any payment or benefit that constitutes nonqualified deferred compensation within the meaning of Section 409A of the Code that is otherwise due to be paid to such Participant under this Agreement during the six-month period immediately following such Participant’s separation from service (as determined in accordance with Section 409A of the Code) on account of such Participant’s separation from service shall be accumulated and paid to such Participant with Interest (based on the rate in effect for the month in which the Participant’s separation from service occurs) on the first business day of the seventh month following the Participant’s separation from service (the “Delayed Payment Date”), to the extent necessary to avoid penalty taxes or accelerated taxation pursuant to Section 409A of the Code. If such Participant dies during the postponement period, the amounts and entitlements delayed on account of Section 409A of the Code shall be paid to the personal representative of his or her estate on the first to occur of the Delayed Payment Date or 30 calendar days after the date of such Participant’s death.

SECTION 10
MISCELLANEOUS

10.1Controlling Law. To the extent not preempted by ERISA, this Plan shall be governed by and construed in accordance with the laws of the State of Delaware, without giving effect to any choice of law or conflicting provision or rule (whether of the State of Delaware or any other jurisdiction) that would cause the laws of any jurisdiction other than the State of Delaware to be applied. In furtherance of the foregoing, the internal laws of the State of Delaware will control the interpretation and construction of this Agreement, even if under such jurisdiction’s choice of law or conflict of law analysis, the substantive law of some other jurisdiction would ordinarily apply.

10.2Withholding. The Company may withhold from any amount payable or benefit provided under this Plan such federal, state, local, foreign and other taxes and/ or social security payments as are required to be withheld pursuant to any applicable law or regulation.

10.3Gender and Plurals. Wherever used in this Plan document, words in the masculine gender shall include masculine or feminine gender, and, unless the context otherwise requires, words in the singular shall include the plural, and words in the plural shall include the singular.

10.4Plan Controls. In the event of any inconsistency between this Plan document, on the one hand, and any other communication regarding this Plan or any offer letter or other agreement between a Participant and the Company or any of its Affiliates, this Plan document controls. The captions in this Plan are not part of the provisions hereof and shall have no force or effect.

10.5Not an Employment Contract. Neither this Plan nor any action taken with respect to it shall confer upon any person the right to continued employment with the Company or any Affiliate.

10.6Notices.

(a)Any notice required to be delivered to the Company by a Participant hereunder shall be properly delivered to the Company when personally delivered to, or actually received through the U.S. mail or electronic mail (e-mail) (so long as confirmation of receipt of e-mail is requested or received) by:

QXO, Inc.

Five American Lane,

Greenwich, CT 06831
Attention: Chief Legal Officer
E-mail: The e-mail address provided to Participants for this purpose, if any.

(b)Any notice required to be delivered to the Participant by the Company hereunder shall be properly delivered to the Participant when the Company delivers such notice by e-mail (so long as confirmation of receipt of e-mail is requested or received), personally or by placing said notice in the U.S. mail registered or certified mail, return receipt requested, postage prepaid to that person’s last known address as reflected on the books and records of the Company.

10.7Severability. If any provision of this Plan is held invalid or unenforceable, its invalidity or unenforceability shall not affect any other provisions of this Plan, and this Plan shall be construed and enforced as if such provision had not been included in this Plan.


Five American Lane Greenwich, CT 06831			Exhibit 10.10

June 6, 2024

Sean Smith

Delivered via email to sean.smith@jpe.com

Hello Sean,

On behalf of QXO, Inc. (the “Company”), I am happy to offer you the position of Interim Chief Financial Officer (“Interim CFO”) and Chief Accounting Officer. I know I speak for the rest of our team when I say how pleased we are to make you this offer.

In your role as the Interim CFO, you will report directly to the Company’s Chief Executive Officer, Brad Jacobs, and you will retain such title until a Chief Financial Officer begins employment with the Company. On such date, you will continue your role as the Chief Accounting Officer and become Deputy CFO of the Company. In this capacity, you will report directly to the Company’s Chief Financial Officer, and you will be based out of our Greenwich, CT office, beginning on June 6, 2024.

Your salary and compensation

We’d like to offer you the following compensation package:

•Base Salary: Your initial annual base salary will be $475,000, less all applicable withholdings and deductions, and pro-rated for any partial period worked.

•Annual Incentive: You will be eligible to participate in the Company’s annual incentive program. Your initial target annual incentive opportunity is 100% of your base salary. Your actual incentive payment, if any, for each fiscal year will be determined based on the level of achievement of applicable performance goals established by the Compensation and Talent Committee of the Board of Directors of the Company (the “Committee”). Annual incentive awards will be determined in the discretion of the Committee and will be reflective of your individual performance and contributions, Company and/or business unit performance, as applicable, and the scope and expectations of your position/role in the Company and/or your business unit. As an at will employee, annual incentives are subject to change at the sole discretion of the Company. Your annual incentive for fiscal year 2024 will not be prorated based on your start date.

•Initial Long-Term Incentive: You will be eligible for an initial long-term incentive award in the form of time-based restricted stock units (“RSUs”) relating to 1,040,298 shares of the Company’s common stock (the “Initial RSU Award”), subject to approval by the Committee as part of its overall review of equity grants to be issued under the QXO, Inc. 2024 Omnibus Incentive Compensation Plan. The Initial RSU Award is expected to be granted following your start date, on a date selected by the Committee that is no later than 120 days following the date of this offer letter, subject to your continued

employment with the Company through the grant date. The Initial RSU Award will vest over five years, with the first year covering 15% of the RSUs, each of the second and third years covering 17.5% of the RSUs, the fourth year covering 25% of the RSUs, and the fifth year covering 25% of the RSUs, and the Initial RSU Award will be subject to the terms and conditions of the QXO, Inc. 2024 Omnibus Incentive Compensation Plan and the applicable award agreement thereunder.

Your benefits

At QXO, we are committed to hiring the best talent. That is why we offer a competitive benefits package. Additional details related to our benefits package will follow in the coming weeks.

Severance benefits

You will be eligible for severance payments and other benefits upon certain qualifying employment termination events, subject to the terms and conditions of the QXO, Inc. Severance Plan, as in effect from time to time (the “Severance Plan”).

Legal considerations

In your work for the Company, you are expected not to use or disclose any confidential information, including trade secrets, of any former employer or other person to whom you have a confidentiality obligation. You are expected to use only generally known information which is used by persons with training and experience comparable to your own, which is common in the industry or otherwise legally in the public domain, or which is otherwise provided or developed by the Company. As a condition of your continued employment, you are expected to abide by the Company’s rules and policies as may be published from time to time.

During our discussions about your proposed job duties, you assured us that you would be able to perform those duties within the guidelines just described.

You confirm that you have carefully reviewed your files (including emails, computer files and hard copies, whether personal or business) and deleted, and not retained copies of, any files prepared, generated or used during any prior employment that could contain confidential information or trade secrets of your current or former employer. You agree not to bring onto Company premises any unpublished documents or property belonging to any former employer or other person to whom you owe a confidentiality obligation.

Your employment with the Company will be “at-will.” This means that either you or the Company may terminate the employment relationship at any time and for any reason, with or without cause or advance notice. In the event of your resignation, you will give the Company at least 30 days’ advance notice, which may be waived by the Company in its sole discretion and without payment to you.

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Confidential Information Protection Agreement

Your acceptance of this offer and commencement of employment with the Company is contingent upon your acceptance of the Company’s Confidential Information Protection Agreement (“CIPA”), which prohibits unauthorized use or disclosure of the Company’s confidential and proprietary information and includes certain restrictive covenants, including non-competition and non-solicitation provisions.

Pre-Hire Screening and Work Authorization

This employment offer is contingent on the satisfactory conclusion of an appropriate background check and a pre-employment drug screen as applicable. Although your employment at the Company may begin prior to the completion of the background check or drug screen at the Company’s discretion, your continued employment remains subject to the satisfactory completion of the background check and drug screen. As required by law, this offer is subject to satisfactory proof of your right to work in the United States.

Entire Offer

This letter, along with the CIPA and Severance Plan, contains the entire agreement and understanding between you and the Company regarding the employment relationship and supersedes any prior or contemporaneous agreements, understandings, communications, offers, representations, warranties, or commitments by or on behalf of the Company (oral or written). Neither this offer letter nor any other written materials issued by the Company constitutes a contract between you and the Company for employment, express or implied, for any specific duration.

Taking the next step

As you know, the Company has generated tremendous momentum, thanks to the efforts of our people. With you on our team, we are sure to continue along this trajectory and move forward to greater success. Please make sure you have read the offer letter completely, including all enclosures. Then sign and return the offer letter and CIPA by e-mail to Josephine.berisha@qxo.com within five (5) business days of the same being sent to you. This offer will terminate if it is not accepted, signed, and returned by that date, unless otherwise mutually agreed between the parties.

If you have any questions, please reach out to me at Josephine.berisha@qxo.com.

[Signature Page Follows.]

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Best regards,

/s/ Josephine Berisha

Josephine Berisha
Chief Human Resources Officer

Enclosures: Confidential Information Protection Agreement; Severance Plan

ACCEPTED AND AGREED:

/s/ Sean Smith

__________________________

Sean Smith


[Offer Letter Signature Page]

CONFIDENTIAL INFORMATION PROTECTION AGREEMENT

In this CONFIDENTIAL INFORMATION PROTECTION AGREEMENT (the “Agreement”), the terms “we,” “us,” “our,” and the “Company” mean, collectively, QXO, Inc., together with its subsidiaries and controlled affiliates. “You,” “your,” “me” and “Employee” mean the specific individual whose signature appears on the last page of this Agreement. To help explain the obligations created under this Agreement, we use certain capitalized terms (e.g., “Confidential Information,” “Cause,” etc.), which are defined throughout the Agreement and, in some cases, in alphabetical order in Section 18 below.

Background Information

This Agreement is a condition of your employment by the Company. You acknowledge that we are employing you and providing you with substantial compensation in a new position with the Company in consideration for your execution and delivery of this Agreement.

Agreement

In consideration of the Company’s obligations under this Agreement, your employment with the Company and our providing you with substantial compensation, you and the Company agree as follows:

1Confidentiality Covenant. You agree to use our “Confidential Information” (as that term is defined in Section 18) only for our benefit. You agree that, other than as required to perform your duties for us, you will not at any time use, disclose, download or copy our Confidential Information (including but not limited to personal email or storage media) or assist any other person or entity to do so. Notwithstanding anything in this Agreement to the contrary, nothing contained herein is intended to, or shall be interpreted in a manner that does, prohibit, limit or restrict you from exercising any legally protected whistleblower rights (including pursuant to Rule 21F under the Securities Exchange Act of 1934, as amended).

2Return of Company Property When Requested. You agree to promptly return to us when we request, but in any event by your “Termination Date” (as that term is defined in Section 18), all of our Confidential Information and all other Company property (tangible or intangible) in your possession or control (e.g., all documents, data, recordings, smartphones, computers and other business equipment, inclusive of all information stored in electronic form), obtained or prepared by or for or utilized by you in the course of your employment, all of which you acknowledge and agree is and shall remain our sole and exclusive property. You further agree not to tamper with, alter, delete or destroy any Company property, documents, records or data contained in any location, including but not limited to any information contained on any Company-owned computer or electronic device, system, database, server, portal or network. In this regard, you agree not to re-set, wipe or return to their default settings Company-owned electronic devices, absent our prior written consent. In addition, you agree not to access or attempt to access any electronic device, system, database, server, portal or network of the Company after your Termination Date. You further agree, when requested or by your Termination Date, to conduct a diligent search of all of the electronic documents and information, electronic devices (including, without limitation, computers, hard drives, flash drives, and mobile devices), remote and virtual storage and file systems, emails and email accounts, voicemails, text messages, instant messaging conversations and systems, and any other devices, facilities, systems, accounts, or media that have electronic data storage or saving capabilities, in your possession, custody, or control, for any copies or iterations of Confidential Information, and immediately inform the Company of any copies or iterations of Confidential Information you locate pursuant to such search, and follow Company directives with respect to remitting such information or documents to the Company and remediating the same. If you breach this Section 2, then pursuant to Section 14, your employment shall, at the Company’s election, be terminated for Cause or be deemed to have been terminated for Cause retroactive to the Termination Date. You also acknowledge that any breach of this Section 2 may cause the Company to seek an

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adverse inference against you in the event of litigation, and you agree that such breach shall be considered material and entitle the Company to equitable and monetary relief, including its attorneys’ fees and costs pursuant to Section 17.

3Ownership of Intellectual Property. Except as otherwise provided by applicable law, you agree that all “Work Product” (as that term is defined in Section 18) created in whole or in part by you while employed by us is our exclusive property, and that you will promptly, fully and effectively communicate all Work Product to us. Accordingly, you agree that all Work Product eligible for any form of copyright protection made or contributed to in whole or in part by you within the scope of your employment while so employed shall be deemed a “work made for hire” under the copyright laws and shall be owned by us, and that the Company may sell, use, copy, reproduce, display, perform or alter as it sees fit, without any further right or claim by or remuneration to you. To that end, you hereby now (and upon our request, in the future you will) assign, transfer and convey to us, all of your “Proprietary Rights” (as that term is defined in Section 18) in all Work Product for our exclusive ownership and use, together with all rights to sue and recover for past and future infringement or misappropriation thereof. In addition, at our request, at all times while you are employed by us and at all times thereafter, you agree to promptly and fully assist us in effecting the foregoing assignment, including but not limited to the further acts of executing any and all documents necessary for us to secure for ourselves such Proprietary Rights in all such Work Product. The foregoing provisions, however, do not apply to any invention (a) for which none of our equipment, supplies, facilities or trade secret information were used, and (b) developed entirely on your own time, unless the invention relates to our businesses or any actual or demonstrably anticipated research or development, or results from any work performed by you for us.

4Covenants During Employment. While employed by the Company, you agree not to compete with the Company anywhere in the world. Specifically, while employed by the Company, you may not: (a) enter into or engage in a “Competing Business” (as defined in Section 7 below); (b) solicit customers, potential customers, business or other business opportunities, or attempt to do so, for any Competing Business; (c) sell or attempt to sell any products or services that compete with the “Business” (as defined in Section 7 below); (d) divert, entice or take away any customers, potential customers or other business opportunities of the Company or attempt to do so; or (e) promote or assist, financially or otherwise, any person or entity engaged in a Competing Business.

5Post-Employment Covenant Not to Hire the Company’s Employees and Others. During your employment and during the Restricted Period (as defined on Exhibit A), you agree not to solicit for hiring, hire or interfere with (or try to hire or interfere with or solicit for hiring) (or help any other person or party to solicit for hiring, to hire or to interfere with) our relationship with (a) any of our employees; or (b) any person who at any time during the twelve (12) months prior to such solicitation, hiring or interference was an employee of the Company. This undertaking on your part for our benefit is called your “Non-Interference Covenant.”

6Post-Employment Covenant Not to Solicit the Company’s Restricted Customers. During your employment and during the Restricted Period, you hereby agree not to, directly or indirectly, (a) discontinue or reduce the extent of the relationship between the Company Entities and the individuals, partnerships, corporations, professional associations or other business organizations that have a business relationship with any Company Entity and about which business relationship you were aware (collectively, “Associated Third Parties”), or to obtain or seek products or services the same as or similar to those offered by the Company Entities from any source not affiliated with the Company Entities; and (b) solicit, assist in the solicitation of, or accept any business from any Associated Third Parties in relation to a product or service that competes with the products and/or services offered by the Company Entities This undertaking on your part for our benefit is called your “Non-Solicit Covenant.”

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7Post-Employment Covenant Not to Compete with Us.

aDuration and Geographic Scope. During your employment and during the Non-Compete Period (as defined on Exhibit A), you are not allowed to compete with us in the “Restricted Territory” (geographic area) described below. This undertaking on your part for our benefit is called your “Non-Compete Covenant.”

bYour Non-Compete Covenant to Us. You agree that you will not, during your employment and during the Non-Compete Period, within the Restricted Territory, directly or indirectly (whether or not for compensation) become employed by, engage in business with, serve as an agent or consultant to, become an employee, partner, member, principal, stockholder or other owner (other than a holder of less than 1% of the outstanding voting shares of any publicly held company) of any Competing Business. For purposes of this Agreement, “Competing Business” shall mean any individual, corporation, limited liability company, partnership, unincorporated organization, trust, joint venture or other entity that (i) engages or is planning to engage in any business or businesses in which the Company Entities are actively engaged in or planning to engage in during your employment (to the extent you were aware of such plans), including, but not limited to, any line of business involved in building and construction products distribution (collectively, the “Business”) or (ii) engages in mergers and acquisition activities related to the Business, including, without limitation, researching, analyzing and evaluating companies for investment in or acquisition of, for itself or clients. Such “Competing Business” definition shall include, but shall not be limited to, each of the following private equity firms and affiliates, including, without limitation, their portfolio companies: American Securities, LLC; Bain Capital; Blackstone; Clayton, Dubilier & Rice, LLC; Court Square Capital Partners; CVC; KKR; Leonard Green & Partners; and Platinum Equity, as well as each of the following building and construction products distribution companies and their affiliates: Builders FirstSource; Core & Main; Ferguson; Home Depot; Lowe’s; and Watsco.

cYour Restricted Territory. You agree that your “Restricted Territory” means any State of the United States and any other country in which the Company or any Company Entity does business, or in which the Company or any Company Entity has actively planned to engage in business, in each case, during your employment.

dYour Non-Compete Payments if We Terminate You Without Cause. If we terminate your employment without “Cause” (as that term is defined in Section 18 below), then we will make “Non-Compete Payments” to you in an amount calculated as set forth in subsection (f) below.

eTermination of the Restricted Period. We have the right, at our discretion, to waive your Non-Compete Covenant and/or terminate or reduce the Non-Compete Period, whether in whole or in part. Upon providing you notice to that effect, no Non-Compete Payments will be due with respect to any period subject to this waiver or reduction.

fAmount and Timing of Non-Compete Payments During the Restricted Period. If we terminate your employment without Cause and do not elect to waive your Non-Compete Covenant or to terminate or reduce your Non-Compete Period, we will pay you each month during the Restricted Period an amount equal to the monthly amount of your base salary at the time of your Termination Date in accordance with our payroll procedures on our normal payroll dates. In the event we waive or reduce the Non-Compete Period, we will make a payment equal to your monthly base salary for the duration of the revised Non-Compete Period. (For example, if we reduce the Non-Compete Period to three (3) months, we will pay you your base salary for three (3) months in accordance with our normal payroll procedures during that period.).

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gAdditional Non-Compete Payments and Extension of Your Restricted Period. We have the right, at our discretion, to extend the Non-Compete Period during one or more Extended Non-Compete Periods (as defined in Exhibit A). If the Company elects to extend the Non-Compete Period, you agree that, during any Extended Non-Compete Period, you shall be bound by the restrictions set forth in Section 7(b) in the same manner applicable during the Non-Compete Period. If we exercise this option to extend the Non-Compete Period, we will pay you “Additional Non-Compete Payments” consisting of, for each month of the relevant extension period, an amount equal to the sum of (i) one-twelfth of your annual base salary as of the Termination Date and (ii) one-twelfth of your target annual bonus as of your Termination Date. Payments will be made in accordance with our payroll procedures on our normal payroll dates.

iYou shall deliver a written notice to the Company not more than one hundred twenty (120) days, and not less than one hundred (100) days, prior to the expiration of the Non-Compete Period or Extended Non-Compete Period, as applicable, specifying the date that such expiration will occur.

iiIf the Company elects to extend the Non-Compete Period or any Extended Non-Compete Period, it will notify you in writing of such fact not later than the ninetieth (90th) day prior to the commencement of the applicable Extended Non-Compete Period.

iiiThe Company may terminate or reduce the duration of any Extended Non-Compete Period. Upon providing you notice to that effect, no Additional Non-Compete Payments will be due with respect to any period subject to this reduction.

ivBy signing this Agreement, you agree to accept and abide by the Company’s elections. Notwithstanding any provision of this Agreement to the contrary, the right of the Company to extend the Non-Compete Period hereunder shall lapse upon a Change of Control (as defined in the QXO, Inc. 2024 Omnibus Incentive Compensation Plan).

hConsequences of Your Breach of Your Non-Compete Covenant. We reserve the right to use any remedies available to us in law or in equity to enforce our rights under this Agreement, generally, and your Non-Interference Covenant, Non-Compete Covenant, Non-Solicit Covenant and other covenants to us set forth in this Agreement, specifically. You also agree that if you breach your Non-Compete Covenant to us, you will repay us all of the Non-Compete Payments we have made to you.

iCoordination with Other Benefits. If we elect to enforce your Non-Compete Covenant, in whole or in part, and you are eligible for any other cash severance benefit under any other policy, plan or agreement, such other cash severance benefit shall be reduced (but not below zero) by the amount of the Non-Compete Payments.

jConditions to Severance. Any monies we pay you under this Agreement, will be subject to (i) your execution of a general release of claims and settlement agreement in the form delivered to you by the Company or its applicable Affiliate (provided that any general release of claims and settlement agreement shall not contain any new or additional restrictive covenant requirements if the Termination Date occurs on or within two years following a Change of Control) on or within ten (10) days after the Termination Date and such agreement becoming effective and irrevocable in accordance with its terms no later than the seventieth (70th) day following the Termination Date (collectively, the “Release Requirement”) and (ii) you incurring a “Separation from Service” (within the meaning of Section 409A(a)(2)(A)(i) of the Internal Revenue Code of 1986, as amended (the “Code”) and

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Treasury Regulation Section 1.409A-1(h)) (a “Separation from Service”) from the Company. Payment of the Non-Compete Payments, if due, will commence not later than the second regularly scheduled payroll date following satisfaction of the Release Requirement, with any installments that would have been made during the period from the Termination Date to the date of satisfaction of the Release Requirement based on regularly scheduled payroll dates accumulated and paid on the date that such installments commence. In the event that the Company determines it cannot make a payment to you during the six (6)-month period following your Separation from Service because you are a “specified employee” within the meaning of Code Section 409A and making a payment to you during such six (6)-month period would result in the application of tax penalties under Code Section 409A, the Company will pay you a lump-sum amount equal to the cumulative amount that would have otherwise been paid to you during such period (without interest) on the first business day following the end of the six (6)-month period (or such earlier date upon which such amount can be paid without resulting in the application of tax penalties under Code Section 409A). For purposes of Code Section 409A, each installment payment provided under this Agreement will be treated as a separate payment. In addition, you will not be entitled to severance or Non-Compete Payments in connection with your termination of employment with the Company if you are offered employment by any successor to all or any portion of our Business.

8Refraining from Disparaging Us. While employed by us and thereafter, you agree never to disparage, malign or impugn us or any of our officers, directors and employees; provided, however, that nothing herein shall prohibit you from exercising any rights under Section 7 of the National Labor Relations Act, providing truthful testimony, or from initiating, participating in or cooperating with an investigation or proceeding conducted by any local, state or federal governmental agency. In addition, nothing herein shall be construed to waive or limit your right to receive an award for information provided to the Securities and Exchange Commission.

9Cooperating After Employment Ends. While employed by us and thereafter, you agree to fully cooperate with us in connection with any investigation, suit, action or proceeding in which you may have relevant information or testimony, including but not limited to providing testimony at depositions or trial, which cooperation and appearance you fully agree to without the necessity of a subpoena or court order. If your assistance is required after your employment has ended, we will reimburse you for your reasonable, out-of-pocket travel expenses and accommodate your personal and business schedule to the extent practicable.

10Giving Notice to a New Employer and to Us. You agree that during the Restricted Period, you will provide any new employer written notice of each of the restrictions to which you are subject under this Agreement (e.g., your Non-Interference Covenant, your Non-Solicit Covenant and your Non-Compete Covenant) before you accept an offer of employment and concurrently provide to us a copy of each such written notice. You shall also provide the Company with fourteen (14) days advance notice prior to becoming employed by any person or entity or engaging in any business of any type or form, regardless of whether or not the prospective employer or business is engaged in a Competing Business.

11Prohibited Use of Confidential Information of Your Prior Employers. It is vital to us that you not disclose to us or use any information or materials that might constitute a former employer’s confidential information. Accordingly, you (a) agree not to disclose or use any former employer’s confidential information in any form unless you first obtained the prior written consent of that former employer and (b) represent to us that you searched for and deleted any emails, documents or files prepared, generated, obtained or used by you that contain any such confidential information of a prior employer.

12Authority to Enter into this Agreement; No Conflicts. You represent that you have the right to enter into this Agreement, that doing so is not and does not conflict with or breach any

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obligations you may have under any agreement you have or any court order, and that your signature on this Agreement makes a valid and binding obligation, fully enforceable in accordance with its terms.

13Prior Restrictive Covenant Agreements to Which You Are Bound. You represent to us that you: (a) have provided us true, correct and complete copies of any agreement to which you are subject containing non-competition, non-solicitation or similar restrictions or covenants in favor of any prior employer or other party; and (b) are free to enter into this Agreement and be employed by us in accordance with the terms of this Agreement without breaching or violating any such prior agreements.

14Employee Acknowledgments Regarding Termination for Cause. You acknowledge that your breach of your representations, covenants and agreements set forth in Sections 1 through 13 hereof is grounds for immediate termination for Cause by us. You agree that if, subsequent to the Termination Date, we determine that we could have terminated your employment for Cause, or we discover a breach of any provision herein, your employment shall, at our election, be deemed to have been terminated for Cause retroactive to the Termination Date.

15Employment At-Will. You are employed at-will. Nothing in this Agreement changes your at-will employment status or confers any right with respect to continuation of employment, and nothing in this Agreement interferes in any way with the Parties’ right to terminate the employment relationship at any time, with or without Cause or advance notice.

16Governing Law; Arbitration and Consent to Jurisdiction.

aGoverning Law. This Agreement shall be governed by and construed in accordance with its express terms, and otherwise in accordance with the laws of the State of Delaware without reference to its principles of conflicts of law.

bArbitration. Any claims you wish to make arising out of or relating to this Agreement, the breach thereof, your employment with us, or the termination of that employment will be resolved by binding arbitration before a single arbitrator in the State of Delaware, or at another location as mutually agreed upon by the parties, administered by the American Arbitration Association (“AAA”) in accordance with its Employment Arbitration Rules, and judgment on the award rendered by the arbitrator may be entered in any court having jurisdiction thereof. This provision does not apply to claims that, under law, may not be subject to a pre-dispute arbitration agreement. Notwithstanding anything to the contrary under the Rules of the AAA or the general grant of authority to the arbitrator contained herein, the arbitrator shall have no jurisdiction or authority to compel any class or collective claim, to consolidate different arbitration proceedings or to join any other party to any arbitration between you and the Company. The arbitrator shall, for all such claims you wish to file, have the exclusive authority to determine the applicability, interpretation and enforceability of this Agreement, but shall have no jurisdiction or authority to compel any class or collective claim or to join any other party to an arbitration between us.

cConsent to Jurisdiction. You hereby irrevocably consent and submit to the jurisdiction of any state or federal court located in the State of Delaware, including without limitation to decide any and all claims brought by the Company alleging a violation or enforceability of Sections 1, 2, 3, 5, 6, 7 or 8 hereof, as well as any claims relating to misappropriation of trade secrets. In that regard, you waive any objection you now or hereafter have to personal jurisdiction or to the laying of venue of any such suit, action or proceeding brought in the State of Delaware, including any claims relating to the alleged inconvenience of such forum, and agree that you will not attempt to deny or defeat such personal jurisdiction by motion or other request to any such court. You also agree that, notwithstanding Section 16(b) above, if you bring an action in court against the Company or its agents, officers or directors, including in aid of any arbitration proceeding or to challenge arbitrability, you will do so exclusively in the state or federal

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courts located in the State of Delaware, provided that nothing herein shall waive the Company’s right to demand that you comply with Section 16(b). You also agree that the Company has the right to bring a legal action against you in a state or federal court where you live or that has jurisdiction over you. You further agree that, to the fullest extent permitted by applicable law, a final and non-appealable judgment in any suit, action or proceeding brought in any court described in this Section 16(c) shall be conclusive and binding upon you and may be enforced in any other jurisdiction.

dWaiver of Class and Collective Actions. The parties to this Agreement waive the right to participate in any class or collective action against the other party. The parties understand and agree that they will not consolidate their claims with the claims of any other individual or entity, will not seek class or collective action treatment for any claim that they may have and will not participate in any class or collective action against each other or anyone affiliated with a party.

17Remedies; Injunctions for Breaches of this Agreement. All of the Company’s rights and remedies may be exercised alternatively or cumulatively to the fullest extent permitted by law. You acknowledge that in addition to the acknowledgements you made in Sections 5, 6, 7 and 8 of this Agreement, you have considered each of the other restrictive covenants set forth in this Agreement and stipulate that those covenants are likewise reasonable and necessary to protect us and our Confidential Information, business strategies, employee and customer relationships and goodwill, now existing or to be developed in the future. You hereby: (a) agree to comply with all of the restrictive covenants; (b) waive any right to contest the reasonableness, validity, scope or enforceability of any of the restrictive covenants, or any other claim or defense related thereto; (c) agree that a breach constitutes irreparable harm and that injunctive relief would be the only practical remedy in the event of your breach; and (d) agree that the Company, without having to post bond, shall be entitled to injunctive relief against any breach by you of a restrictive covenant, provided that the foregoing shall not prejudice our rights to require you to account for and pay over to us any compensation, profits or gains derived by you related to the breach, and you agree to be so responsible for such an accounting. You further agree that if you violate your Non-Interference Covenant, your Non-Compete Covenant, and/or your Non-Solicit Covenant set forth in Sections 5, 6, 7 and 8 of this Agreement, respectively, the post-employment restricted time period therein shall not include any period(s) of violation or period(s) of time required for litigation to enforce the covenants therein. It is the parties’ mutual intent that the Company is entitled to the full period applicable to such covenants free of competition and/or litigation to enforce the provisions thereof. Any tolled period due to breach of Sections 5, 6, 7 and 8 of this Agreement or litigation shall not be subject to Non-Compete Payments. If the Company brings a legal action to enforce this Agreement or obtain monetary damages for breach of this Agreement, the Company shall have the right to recover attorneys’ fees and costs it incurs as a result of any action brought in good faith.

18Definitions. This Agreement uses the following defined terms:

“Additional Non-Compete Payments” shall have the meaning set forth in Section 7(g) of this Agreement.

“Agreement” shall mean this Confidential Information Protection Agreement.

“Cause” shall mean (a) your dereliction of duties or gross negligence or failure to perform your duties or refusal to follow any lawful directive of the officer to whom you report; (b) your abuse of or dependency on alcohol or drugs (illicit or otherwise) that adversely affects your performance of duties for any Company Entity; (c) your commission of any fraud, embezzlement, theft or dishonesty or any deliberate misappropriation of money or other assets of any Company Entity; (d) your breach of any fiduciary duties of any Company Entity; (e) any act, or failure to act, by you in bad faith to the detriment of any Company Entity; (f) your failure to cooperate in good faith with a governmental or internal investigation of any Company entity or

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any of its directors, managers, officers or employees, if the Company requests your cooperation; (g) your failure to follow Company policies, including the Company’s code of conduct and/or ethics policy, as may be in effect from time to time; or (h) your conviction of, or plea of nolo contendere to, a felony or any serious crime; provided that in cases set forth in clauses (a) through (g) where a cure is possible (as determined by the Company in its discretion), you shall first be provided with a 15‑day cure period.

“Company Entity” means the Company and each entity controlled by, controlling or under common control with the Company.

“Confidential Information” means all information, written, digital (whether generated or stored on magnetic, digital, photographic or other media) or oral, not generally known to the public and from which we derive a commercial or competitive advantage, or which is proprietary to us, concerning our business, operations, products, services, customer information, merger and acquisition targets and strategies, pricing strategies, operating processes, business methods and procedures, information technology and information-gathering techniques and methods, business plans, financial affairs and all other accumulated data, listings or similar recorded matter useful in the businesses of the Company, including by way of illustration and not limitation:

· information about the business, affairs or operation of the Company developed by you or which is furnished or made available to you by us during your employment;

· information about the business, operations and assets of companies considered for acquisition, merger, sale, disposition, or similar transaction by JPE, and information concerning JPE’s evaluation and analysis thereof;

· operating instructions, training manuals, procedures and similar information;

· information about customers, vendors and others with whom we do business (e.g., customer or vendor lists, pricing, contracts and activity records);

· information regarding the skills and compensation of employees or contractors of the Company;

· information about sales and marketing (e.g., plans and strategies);

· information about any other third parties we have a business relationship with or to whom we owe a duty of confidentiality; and

· all notes, observations, data, analyses, compilations, forecasts, studies or other documents prepared by you that contain or reflect any Confidential Information.

However, the Company expressly acknowledges and agrees that the term “Confidential Information” excludes information that: (a) is in the public domain or otherwise generally known to the trade; (b) is disclosed to third parties without restriction other than by reason of your breach of your confidentiality obligations under this Agreement; (c) you learn of after the termination of your employment from any other party not then under an obligation of confidentiality to us; or (d) comprises contact information that is readily ascertainable from sources other than the Company.

“Non-Compete Covenant” shall have the meaning set forth in Section 7 of this Agreement.

“Non-Compete Payments” shall have the meaning set forth in Sections 7(d) and 7(f) of this Agreement.

“Non-Interference Covenant” shall have the meaning set forth in Section 5 of this Agreement.

“Non-Solicit Covenant” shall have the meaning set forth in Section 6 of this Agreement.

“Proprietary Rights” means all right, title and interest regarding all inventions, ideas, improvements, designs, processes, trademarks, service marks, trade names, trade secrets, trade dress, data, discoveries, Work Product, and any other proprietary assets or rights.

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“Restricted Period” shall have the meaning set forth in Section 7(a) of this Agreement.

“Restricted Territory” shall have the meaning set forth in Section 7(c) of this Agreement.

“Separation from Service” shall have the meaning set forth in Section 7(j) of this Agreement.

“Termination Date” means the date your employment with the Company ends, whether voluntarily or involuntarily and whether with or without Cause.

“Work Product” means all works of authorship, research, discoveries, inventions and innovations (whether or not reduced to practice or documented), improvements, developments, methods, designs, analyses, drawings, reports and all similar or related information (whether patentable or un-patentable, and whether or not reduced to writing), trade secrets and Confidential Information, copyrightable works, and similar and related information (in whatever form or medium). As examples, this definition applies to anything to do with the Company’s actual or anticipated business, research and development or existing or future products or services. It applies to the results from any work performed by you for us. It also applies to anything conceived, developed, made or contributed to in whole or in part by you while employed by us.

1.Other Agreements.

a.Notices. Except as otherwise provided, we can give you notice at your last known principal residence listed on our records. You, in turn, may give us notice to QXO, Inc., 5 American Lane, Greenwich, CT 06831, Attention: Legal Department. Either you or the Company may provide another address for notice by written notice to the other. Notice is deemed given as follows: (i) when delivered personally; (ii) four (4) days after it is mailed by registered or certified mail, postage prepaid, return receipt requested or (iii) one (1) day after it is sent by overnight courier service via UPS or FedEx.

b.Amendment; No Waiver. You and we agree that (i) this Agreement may not be amended except in writing signed by both you and us; (ii) the application of any provision of this Agreement may be waived only by a written instrument specifically identifying the provision whose application is being waived and signed by you and us and (iii) no waiver by either you or us of a breach by the other shall be a waiver of any preceding or succeeding breach, and no waiver by you or us of any right under this Agreement shall be construed as a waiver of any other right.

c.Entire Agreement; Interpretation. You and we expressly acknowledge and agree that this Agreement constitutes the entire agreement between you and the Company with respect to the subject matter hereof, and there are no oral agreements between you and us pertaining to the subject matter hereof.

d.Your due diligence. You acknowledge that: (i) you have had a full opportunity to read and understand this Agreement and consult with such attorneys, accountants, business advisors, and other consultants as you deem necessary or advisable and (ii) this Agreement shall not be construed against one party or the other in the event of any ambiguity.

e.Survival. The provisions of this Agreement shall survive termination of your employment regardless of the reason, and our assignment thereof to any successor-in-interest or other assignee.

f.Severability. If any provision of this Agreement or its application is held invalid, such invalidation shall not affect other provisions or applications hereof which can be given effect without the invalid provisions or applications; and, so that this objective may be achieved, the provisions hereof are declared to be severable and subject to blue-pencilling by a court of competent jurisdiction. In the event of a final, non-reviewable, non-appealable determination that any covenant of yours set forth in this Agreement (whether

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in whole or in part) is void or constitutes an unreasonable restriction against you, such provision shall not be rendered void but shall be deemed to be modified to the minimum extent necessary to make such provision enforceable for the longest duration and the greatest scope as may constitute a reasonable restriction under the circumstances.

g.Counterparts. This Agreement may be executed in multiple originals. Signatures delivered by facsimile or electronic means (including by “pdf”) shall be deemed effective for all purposes.

h.Headings. The Section and subsection headings in this Agreement are for convenience only and shall not affect the meaning of any provision.

i.Withholding. All payments to be made hereunder shall be reduced by applicable federal, state and local withholding taxes.

* * * * *

This Agreement is executed on the date shown below and shall be effective as of such date.

QXO, INC., for itself and its subsidiaries and affiliates

By: /s/ Josephine Berisha

Name: Josephine Berisha

Title: Chief Human Resources Officer

By:

Employee Signature

Employee Name (Print)

Date

Exhibit A

Applicable Restriction Periods


Defined Term			Definition
Restricted Period			The period of four (4) years after your Termination Date.

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Non-Compete Period			The period of one (1) year after your Termination Date.
Extended Non-Compete Periods			Up to two (2) additional sequential periods of one (1) year each, with the first such period commencing immediately following the end of the Non-Compete Period.

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Exhibit 10.11

RESTRICTED STOCK UNIT AWARD AGREEMENT UNDER THE QXO, INC. 2024 OMNIBUS INCENTIVE COMPENSATION PLAN, dated as of [DATE] (the “Grant Date”) between QXO, INC., a Delaware corporation (the “Company” or “QXO”), and [NAME].

This Restricted Stock Unit Award Agreement (this “Award Agreement”) sets forth the terms and conditions of an award of [#] restricted stock units (this “Award”) that are subject to the terms and conditions specified herein (each such restricted stock unit, an “RSU”) and that are granted to you under the QXO, Inc. 2024 Omnibus Incentive Compensation Plan (the “Plan”). This Award provides you with the opportunity to earn Shares, subject to the terms of this Award Agreement.

You must affirmatively acknowledge and accept this Award Agreement within 120 days following the Grant Date. A failure to acknowledge and accept this Award Agreement within such 120 day period may result in forfeiture of this Award, effective as of the 121st day following the Grant Date.

THIS AWARD IS SUBJECT TO ALL TERMS AND CONDITIONS OF THE PLAN INCLUDING THE PLAN RULES, AND THIS AWARD AGREEMENT, INCLUDING THE DISPUTE RESOLUTION PROVISIONS SET FORTH IN SECTION 9 OF THIS AWARD AGREEMENT. BY ACCEPTING THIS AWARD, YOU SHALL HAVE CONFIRMED YOUR ACCEPTANCE OF THE TERMS AND CONDITIONS OF THIS AWARD AGREEMENT.

SECTION 1.The Plan. This Award is made pursuant to the Plan, all the terms of which are hereby incorporated in this Award Agreement. In the event of any conflict between the terms of the Plan and the terms of this Award Agreement, the terms of the Plan shall govern.

SECTION 2.Definitions. Capitalized terms used in this Award Agreement that are not defined in this Award Agreement have the meanings as used or defined in the Plan. As used in this Award Agreement, the following terms have the meanings set forth below:

“Business Day” means a day that is not a Saturday, a Sunday or a day on which banking institutions are legally permitted to be closed in the City of New York.

“Cause” has the meaning given to such term in the Plan; provided that if, at the applicable time, you are party to an Employment Agreement or you are a participant in the Severance Plan, then Cause has the meaning given to such term in the Employment Agreement or the Severance Plan, as applicable.

“Disability” has the meaning given to such term in the Company’s (or as, relevant, any Affiliate’s) long-term disability plan applicable to you; provided that if, at the applicable time, you are party to an Employment Agreement or you are a participant in the

Severance Plan, then Disability has the meaning given to such term in the Employment Agreement or the Severance Plan, as applicable.

“Employment Agreement” means any individual employment agreement between you and the Company or any of its Subsidiaries, as in effect from time to time.

“Good Reason” if, at the applicable time, you are party to an Employment Agreement or a participant in the Severance Plan, has the meaning given to such term in your Employment Agreement or the Severance Plan, as applicable. If, at the applicable time, you are not party to an Employment Agreement and you are not a participant in the Severance Plan, then the term Good Reason shall not apply to you.

“Scheduled Vesting Date” shall have the meaning given to such term in Section 3(a) of this Award Agreement.

“Section 409A” means Section 409A of the Code, and the regulations and other interpretive guidance promulgated thereunder, as in effect from time to time.

“Severance Plan” means the QXO, Inc. Severance Plan, as in effect from time to time.

SECTION 3.Vesting and Settlement.

(a)Regularly Scheduled Vesting. Except as otherwise provided in this Award Agreement, the RSUs will become vested in part on each of the dates set forth below (each, a “Scheduled Vesting Date”), subject to your continued employment with the Company or an Affiliate through the applicable Scheduled Vesting Date.

[The percentage of the total number of RSUs originally granted pursuant to the Award that will become vested on each Scheduled Vesting Date is as follows:

i.December 31, 2025: 15%;

ii.December 31, 2026: 17.5%;

iii.December 31, 2027: 17.5%;

iv.December 31, 2028: 25%; and

v.December 31, 2029: 25%.]

[The percentage of the total number of RSUs originally granted pursuant to the Award that will become vested on each Scheduled Vesting Date is as follows:

i.December 31, 2026: 50%; and

ii.December 31, 2027: 50%.]

[The percentage of the total number of RSUs originally granted pursuant to the Award that will become vested on each Scheduled Vesting Date is as follows:

i.December 31, 2025: 33%;

ii.December 31, 2026: 33%; and

iii.December 31, 2027: 34% .]

(b)Termination of Employment. Notwithstanding anything to the contrary in this Award Agreement or the Plan but subject to Section 3(c) and subject to any more favorable provisions regarding treatment on termination of employment set forth in your Employment Agreement, if applicable, all unvested RSUs will be forfeited upon your termination of employment for any reason prior to the last Scheduled Vesting Date, except that:

i.Death. If your employment terminates by reason of your death, all outstanding and unvested RSUs shall immediately vest in full.

ii.Disability, Involuntary Not for Cause Termination or Resignation for Good Reason (other than During the Two-Year Period Immediately Following a Change of Control). If your employment is terminated by reason of your Disability, your employment is involuntarily terminated by the Company without Cause or you resign for Good Reason as defined in your Employment Agreement, if applicable, (A) a prorated portion of the outstanding and unvested RSUs that are scheduled to vest on the next Scheduled Vesting Date immediately following the date of your termination of employment will immediately vest, with such prorated portion equal to the total number of such RSUs multiplied by a fraction, the numerator of which is the total number of days from and excluding the Scheduled Vesting Date immediately preceding your termination of employment (or, if no Scheduled Vesting Date has occurred prior to your termination of employment, from and including the Grant Date) to and including the date of your termination of employment and the denominator of which is the total number of days from and excluding such immediately preceding Scheduled Vesting Date (or, if applicable, the Grant Date) to and including such next Scheduled Vesting Date, and (B) the remainder of the outstanding unvested RSUs shall be forfeited. (By way of illustration, if your employment is involuntarily terminated by the Company without Cause on the date that 219 days after the first Scheduled Vesting Date, then 60% (219 / 365) of the outstanding and unvested RSUs that were scheduled to vest on the second Scheduled Vesting Date shall vest immediately and the remainder of the unvested RSUs shall be forfeited.)

(c)Change of Control. Upon a Change of Control that occurs prior to the last Scheduled Vesting Date, if you remain employed at the time of such Change of Control, then all outstanding and unvested RSUs (including any RSUs replaced with a Replacement Award in compliance with Section 8(b) of the Plan) shall remain outstanding and unvested, and shall

continue to vest in accordance with the time-based vesting conditions set forth in Section 3(a). The treatment of the RSUs or Replaced Award on your termination of employment shall be as set forth in Section 3(b), except that during the two years immediately following the date of a Change of Control, if your employment is terminated by reason of your death, Disability, by the Company without Cause, or due to your resignation for Good Reason (if applicable), all outstanding and unvested RSUs (or the Replacement Award, to the extent outstanding and unvested, if applicable) shall immediately vest. Or, if such RSUs are not replaced in compliance with Section 8(b) of the Plan, all outstanding and unvested RSUs shall vest immediately upon the completion of the Change of Control.

(d)Settlement of Award. If RSUs vest pursuant to the foregoing provisions of this Section 3, then as soon as administratively practicable, and in any event within thirty (30) days after any RSUs become vested, the Company shall deliver to you or your legal representative one Share for each vested RSU.

SECTION 4.No Rights as a Stockholder. You shall not have any rights or privileges of a stockholder with respect to the RSUs subject to this Award Agreement unless and until Shares are actually issued in settlement of this Award.

SECTION 5.Non-Transferability of RSUs. Unless otherwise provided by the Committee in its discretion, RSUs may not be sold, assigned, alienated, transferred, pledged, attached or otherwise encumbered except as provided in Section 9(a) of the Plan. Any purported sale, assignment, alienation, transfer, pledge, attachment or other encumbrance of RSUs in violation of the provisions of this Section 5 and Section 9(a) of the Plan shall be void.

SECTION 6.Withholding; Consents.

(a)Withholding. The delivery of Shares pursuant to Section 3 of this Award Agreement is conditioned on satisfaction of any applicable withholding taxes in accordance with this Section 6(a) and Section 9(d) of the Plan. No later than the date as of which an amount first becomes includible in your gross income for Federal, state, local or foreign income tax purposes with respect to any RSUs, you shall pay to the Company, or make arrangements satisfactory to the Company regarding the payment of, any Federal, state, local and foreign taxes that are required by applicable laws and regulations to be withheld with respect to such amount. In the event that there is withholding tax liability in connection with the settlement of the RSUs, unless otherwise determined by the Committee, such withholding tax liability shall be satisfied by the Company withholding from the number of Shares you would be entitled to receive upon settlement of the RSUs a number of Shares having a Fair Market Value (which shall either have the meaning set forth in the Plan or shall have such other meaning as determined by the Company in accordance with applicable withholding requirements) equal to such withholding tax liability.

(b)Consents. Your rights in respect of the RSUs are conditioned on the receipt to the full satisfaction of the Committee of any required consents that the Committee may determine to be necessary or advisable (including your consent to the Company’s supplying to

any third-party recordkeeper of the Plan such personal information as the Committee deems advisable to administer the Plan).

SECTION 7.Successors and Assigns of the Company. The terms and conditions of this Award Agreement shall be binding upon, and shall inure to the benefit of, the Company and its successors and assigns.

SECTION 8.Committee Discretion. The Committee shall have full and plenary discretion with respect to any actions to be taken or determinations to be made in connection with this Award Agreement, and its determinations shall be final, binding and conclusive.

SECTION 9.Arbitration and Consent to Jurisdiction. The provisions of the Employment Agreement or Confidential Information Protection Agreement between you and the Company relating to arbitration and consent to jurisdiction shall apply to this Award Agreement as if set forth herein, mutatis mutandis. If you are not party to an Employment Agreement or Confidential Information Protection Agreement with the Company, then any claims you wish to make arising out of or relating to this Agreement will be resolved by binding arbitration before a single arbitrator in the State of Delaware, or at another location as mutually agreed upon by the parties, administered by the American Arbitration Association (“AAA”) in accordance with its Employment Arbitration Rules, and judgment on the award rendered by the arbitrator may be entered in any court having jurisdiction thereof. This provision does not apply to claims that, under law, may not be subject to a pre-dispute arbitration agreement. Notwithstanding anything to the contrary under the Rules of the AAA or the general grant of authority to the arbitrator contained herein, the arbitrator shall have no jurisdiction or authority to compel any class or collective claim, to consolidate different arbitration proceedings or to join any other party to any arbitration between you and the Company. The arbitrator shall, for all such claims you wish to file, have the exclusive authority to determine the applicability, interpretation and enforceability of this Agreement, but shall have no jurisdiction or authority to compel any class or collective claim or to join any other party to an arbitration between you and the Company.

SECTION 10.Notice. Except as otherwise provided, the Company may give you notice at your last known principal residence listed on the Company’s records. You, in turn, may give the Company notice to QXO, Inc., Five American Lane, Greenwich, CT 06831, Attention: Chief Legal Officer. Either you or the Company may provide another address for notice by written notice to the other. Notice is deemed given as follows: (a) when delivered personally; (b) four (4) days after it is mailed by registered or certified mail, postage prepaid, return receipt requested or (b) one (1) day after it is sent by overnight courier service via UPS or FedEx.

SECTION 11.Governing Law. The validity, construction and effect of this Award Agreement in all respects shall be determined in accordance with the laws of the State of Delaware, without giving effect to the conflict of law principles thereof.

SECTION 12.Headings and Construction. Headings are given to the Sections and subsections of this Award Agreement solely as a convenience to facilitate reference. Such headings shall not be deemed in any way material or relevant to the construction or interpretation

of this Award Agreement or any provision thereof. Whenever the words “include,” “includes” or “including” are used in this Award Agreement, they shall be deemed to be followed by the words “but not limited to”. The term “or” is not exclusive.

SECTION 13.Amendment of this Award Agreement. The Committee may waive any conditions or rights under, amend any terms of, or alter, suspend, discontinue, cancel or terminate this Award Agreement prospectively or retroactively; provided, however, that, except as set forth in Section 14(c) of this Award Agreement, any such waiver, amendment, alteration, suspension, discontinuance, cancelation or termination that would materially and adversely impair your rights under this Award Agreement shall not to that extent be effective without your consent (it being understood, notwithstanding the foregoing proviso, that this Award Agreement and the RSUs shall be subject to the provisions of Section 7(c) of the Plan).

SECTION 14.Section 409A.

(a)It is intended that the provisions of this Award Agreement comply with Section 409A or an applicable exemption thereunder, and all provisions of this Award Agreement shall be construed and interpreted in a manner consistent with such intention.

(b)If, at the time of your separation from service (within the meaning of Section 409A), (i) you are a specified employee (within the meaning of Section 409A and using the identification methodology selected by the Company from time to time) and (ii) the Company shall make a good faith determination that an amount payable hereunder constitutes deferred compensation (within the meaning of Section 409A) the payment of which is required to be delayed pursuant to the six-month delay rule set forth in Section 409A in order to avoid taxes or penalties under Section 409A, then the Company shall not pay such amount on the otherwise scheduled payment date but shall instead pay it, without interest (except as otherwise provided in your Employment Agreement), on the first Business Day after such six-month period. For purposes of Section 409A, each payment hereunder will be deemed to be a separate payment as permitted under Treasury Regulations Section 1.409A-2(b)(2)(iii).

(c)Notwithstanding any provision of this Award Agreement to the contrary, in light of the uncertainty with respect to the proper application of Section 409A, the Company reserves the right to make amendments to this Award Agreement as the Company deems necessary or desirable to avoid the imposition of taxes or penalties under Section 409A. In any case, you shall be solely responsible and liable for the satisfaction of all taxes and penalties that may be imposed on you or for your account in connection with this Award Agreement (including any taxes and penalties under Section 409A), and neither the Company nor any of its Affiliates shall have any obligation to indemnify or otherwise hold you harmless from any or all of such taxes or penalties.

SECTION 15.Counterparts. This Award Agreement may be signed in counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument. You and the Company hereby acknowledge and

agree that signatures delivered by facsimile or electronic means (including by “pdf”) shall be deemed effective for all purposes.

SECTION 16.[Lock-Up. All Shares received on settlement of the Award (net of applicable tax withholding) shall be subject to a lock-up from the date hereof until [December 31, 2029][December 31, 2027] on sales, offers, pledges, contracts to sell, grants of any option, right or warrant to purchase, or other transfers or dispositions, whether directly or indirectly; provided, however, that such lock-up may be waived in the sole discretion of the Committee and shall not apply after a Change in Control or after your death.]

SECTION 17.Securities Trade Monitoring Policy. Unless otherwise elected by the Committee, you are required to maintain a securities brokerage account with the Company’s preferred broker in order to receive any Shares issuable under this Award, in accordance with the Company securities trade monitoring policy (the “Trade Monitoring Policy” ). Any Shares issued to you pursuant to this Award Agreement shall be deposited in your account with the Company’s preferred broker in accordance with the terms set forth herein. You hereby acknowledge that you have reviewed, and agree to comply with, the terms of the Trade Monitoring Policy, and that this Award, and the value of any Shares issued pursuant to this Award Agreement, shall be subject to forfeiture or recoupment by the Company, as applicable, in the event of your noncompliance with the Trade Monitoring Policy, as it may be in effect from time to time.

SECTION 18.Recoupment of Award. You acknowledge and agree that in accordance with Section 9(n) of the Plan, the Company may recoup all or any portion of this Award in accordance with any compensation recovery policy maintained by the Company, as in effect from time to time, including any such policy mandated by applicable law or Applicable Exchange rules. This Section 18 and Section 9(n) of the Plan shall not be the Company’s exclusive remedy with respect to such matters.

SECTION 19.Imposition of Other Requirements. The Company reserves the right to impose other requirements on your participation in the Plan, on this Award and on any Shares acquired upon settlement of this Award, to the extent the Company determines it is necessary or advisable for legal or administrative reasons, and to require you to sign any additional agreements or undertakings that may be necessary to accomplish the foregoing.

IN WITNESS WHEREOF, the parties have duly executed this Award Agreement as of the date first written above.


QXO, INC. By /s/ Josephine Berisha Name: Josephine Berisha Title: Chief Human Resources Officer


[NAME OF GRANTEE]

Exhibit 31.1

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 302 OF

THE SARBANES-OXLEY ACT OF 2002

I, Brad Jacobs, certify that:

1.I have reviewed this Form 10-Q of QXO, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.Along with the Principal Financial Officer, I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13-a-15(f) and 15d-15(f)) for the registrant and have:

a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b)Any fraud, whether or not material, that involved management or other employees who have a significant role in the registrant’s internal control over financial reporting.


Dated: August 14, 2024	By:	/s/ Brad Jacobs
		Brad Jacobs Chief Executive Officer

Exhibit 31.2

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 302 OF

THE SARBANES-OXLEY ACT OF 2002

I, Ihsan Essaid, certify that:

1.I have reviewed this Form 10-Q of QXO, Inc.;

4.Along with the Principal Executive Officer, I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13-a-15(f) and 15d-15(f)) for the registrant and have:

b)Any fraud, whether or not material, that involved management or other employees who have a significant role in the registrant’s internal control over financial reporting.


Dated: August 14, 2024	By:	/s/ Ihsan Essaid
		Ihsan Essaid Chief Financial Officer

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906 OF

THE SARBANES-OXLEY ACT OF 2002

In connection with this Quarterly Report of QXO, Inc. (the “Company”), on Form 10-Q for the quarter ended June 30, 2024, as filed with the U.S. Securities and Exchange Commission on the date hereof, I, Brad Jacobs, Chief Executive Officer of the Company, certify to the best of my knowledge, pursuant to 18 U.S.C. Sec. 1350, as adopted pursuant to Sec. 906 of the Sarbanes-Oxley Act of 2002, that:

(1)Such Quarterly Report on Form 10-Q for the quarter ended June 30, 2024 fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)The information contained in such Quarterly Report on Form 10-Q for the quarter ended June 30, 2024 fairly presents, in all material respects, the financial condition and results of operations of the Company.


Dated: August 14, 2024	By:	/s/ Brad Jacobs
		Brad Jacobs Chief Executive Officer

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906 OF

THE SARBANES-OXLEY ACT OF 2002

In connection with this Quarterly Report of QXO, Inc. (the “Company”), on Form 10-Q for the quarter ended June 30, 2024, as filed with the U.S. Securities and Exchange Commission on the date hereof, I, Ihsan Essaid, Chief Financial Officer of the Company, certify to the best of my knowledge, pursuant to 18 U.S.C. Sec. 1350, as adopted pursuant to Sec. 906 of the Sarbanes-Oxley Act of 2002, that:

(1)Such Quarterly Report on Form 10-Q for the quarter ended June 30, 2024 fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and


Dated: August 14, 2024	By:	/s/ Ihsan Essaid
		Ihsan Essaid Chief Financial Officer

Cover - shares	6 Months Ended
Cover - shares	Jun. 30, 2024	Aug. 07, 2024
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jun. 30, 2024
Document Transition Report	false
Entity File Number	001-38063
Registrant Name	QXO, INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	16-1633636
Entity Address, Address Line One	Five American Lane
Entity Address, City or Town	Greenwich
Entity Address, State or Province	CT
Entity Address, Postal Zip Code	06831
City Area Code	888
Local Phone Number	998-6000
Title of 12(b) Security	Common Stock, par value $0.00001 per share
Trading Symbol	QXO
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Central Index Key	0001236275
Amendment Flag	false
Document Fiscal Year Focus	2024
Document Fiscal Period Focus	Q2
Current Fiscal Year End Date	--12-31
Entity Common Stock, Shares Outstanding		409,430,195

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($)

Jun. 30, 2024

Dec. 31, 2023

Current assets:

Cash and cash equivalents

$ 971,284,000

$ 6,143,000

Accounts receivable, net

3,015,000

2,969,000

Prepaid expenses and other current assets

5,539,000

2,684,000

Total current assets

979,838,000

11,796,000

Property and equipment, net

511,000

503,000

Operating lease right-of-use assets

380,000

522,000

Intangible assets, net

4,486,000

4,919,000

Goodwill

1,140,000

Deferred tax assets

1,614,000

1,444,000

Other non-current assets

216,000

171,000

Total assets

988,185,000

20,495,000

Current liabilities:

Accounts payable

6,194,000

4,563,000

Accrued expenses

5,397,000

2,681,000

Deferred revenue

3,113,000

3,161,000

Long-term debt – current portion

783,600

701,700

Finance lease obligations – current portion

141,000

154,000

Operating lease liabilities – current portion

217,000

263,000

Total current liabilities

15,846,000

11,524,000

Long-term debt net of current portion

693,000

994,000

Finance lease obligations net of current portion

247,000

Operating lease liabilities net of current portion

164,000

259,000

Liabilities

16,950,000

13,024,000

Commitments and contingencies (Note 8)

Stockholders’ equity:

Preferred stock, $0.001 par value; authorized 10,000,000 shares, 1,000,000 and 0 shares issued and outstanding as of June 30, 2024 and December 31, 2023, respectively

498,684,000

Common stock, $0.00001 par value; authorized 2,000,000,000 shares, 664,284 and 664,448 shares issued and outstanding as of June 30, 2024 and December 31, 2023, respectively

^[1]

Additional paid-in capital

474,951,000

9,419,000

Accumulated deficit

(2,400,000)

(1,948,000)

Total stockholders’ equity

971,235,000

7,471,000

Total liabilities and stockholders’ equity

$ 988,185,000

$ 20,495,000

[1]	Amounts have been adjusted to reflect the 8-for-1 Reverse Stock Split effective June 6, 2024. See Note 3 - Equity for additional details.

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical)	Jun. 30, 2024 $ / shares shares	Dec. 31, 2023 $ / shares shares
Statement of Financial Position [Abstract]
Preferred stock, par value (in dollars per share) \| $ / shares	$ 0.001	$ 0.001
Preferred stock, authorized (in shares)	10,000,000	10,000,000
Preferred stock, issued (in shares)	1,000,000	0
Preferred stock, outstanding (in shares)	1,000,000	0
Common stock, par value (in dollars per share) \| $ / shares	$ 0.00001	$ 0.00001
Common stock, authorized (in shares)	2,000,000,000	2,000,000,000
Common stock, issued (in shares)	664,284	664,448
Common stock, outstanding (in shares)	664,284	664,448

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($)
$ in Thousands

3 Months Ended

6 Months Ended

Jun. 30, 2024

Jun. 30, 2023

Jun. 30, 2024

Jun. 30, 2023

Revenue:

Total revenue, net

$ 14,540

$ 13,257

$ 28,975

$ 26,385

Cost of revenue:

Total cost of revenue

8,745

8,072

17,523

15,843

Operating expenses:

Selling, general and administrative expenses

9,835

4,525

15,024

9,305

Depreciation and amortization expenses

261

204

501

411

Total operating expenses

10,096

4,729

15,525

9,716

(Loss) income from operations

(4,301)

456

(4,073)

826

Other income (expense), net:

Interest income (expense), net

3,470

(17)

3,450

(35)

Total other income (expense)

3,470

(17)

3,450

(35)

(Loss) income before taxes

(831)

439

(623)

791

(Benefit) provision for income taxes

(240)

(171)

170

Net (loss) income

$ (591)

$ 344

$ (452)

$ 621

Earnings (loss) per common share – basic (in dollar per shares)

$ (9.93)

$ 0.52

$ (9.72)

$ 0.95

Earnings (loss) per common share – fully diluted (in dollar per shares)

$ (9.93)

$ 0.52

$ (9.72)

$ 0.95

Weighted average shares outstanding:

Weighted average number of shares outstanding, basic (in shares)

^[1]

664,000

657,000

664,000

657,000

Weighted average number of shares outstanding, diluted (in shares)

^[1]

664,000

657,000

664,000

657,000

Software product, net

Revenue:

Total revenue, net

$ 3,776

$ 3,298

$ 7,256

$ 6,620

Cost of revenue:

Total cost of revenue

2,369

2,027

4,568

3,960

Service and other, net

Revenue:

Total revenue, net

10,764

9,959

21,719

19,765

Cost of revenue:

Total cost of revenue

$ 6,376

$ 6,045

$ 12,955

$ 11,883

[1]	Amounts have been adjusted to reflect the 8-for-1 Reverse Stock Split effective June 6, 2024. See Note 3 - Equity for additional details.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical)	Jun. 06, 2024
Income Statement [Abstract]
Reverse stock split conversion ratio	0.125

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY - USD ($)
$ in Thousands

Total

Preferred Stock

Common Stock

Additional Paid-in Capital

Retained Earnings

Shares outstanding, beginning balance at Dec. 31, 2022

657,000

^[1]

Beginning balance at Dec. 31, 2022

$ 9,553

$ 0

$ 10,430

$ (877)

Increase (Decrease) in Stockholders' Equity [Roll Forward]

Share-based compensation

Net loss

621

Ending balance at Jun. 30, 2023

10,215

$ 0

10,471

(256)

Shares outstanding, ending balance at Jun. 30, 2023

657,000

^[2]

Shares outstanding, beginning balance at Mar. 31, 2023

657,000

^[2]

Beginning balance at Mar. 31, 2023

9,871

$ 0

10,471

(600)

Increase (Decrease) in Stockholders' Equity [Roll Forward]

Share-based compensation

Net loss

344

Ending balance at Jun. 30, 2023

10,215

$ 0

10,471

(256)

Shares outstanding, ending balance at Jun. 30, 2023

657,000

^[2]

Shares outstanding, beginning balance at Dec. 31, 2023

664,000

^[1]

Beginning balance at Dec. 31, 2023

7,471

$ 0

9,419

(1,948)

Increase (Decrease) in Stockholders' Equity [Roll Forward]

Issuance of Convertible Preferred Stock and Warrants, net of issuance costs (in shares)

1,000,000

Issuance of Convertible Preferred Stock and Warrants, net of issuance costs

981,661

$ 498,684

482,977

Cash paid for fractional shares

(45)

Common stock dividend

(17,400)

Net loss

(452)

Ending balance at Jun. 30, 2024

971,235

$ 498,684

$ 0

474,951

(2,400)

Shares outstanding, ending balance at Jun. 30, 2024

1,000,000

664,000

^[2]

Shares outstanding, beginning balance at Mar. 31, 2024

664,000

^[2]

Beginning balance at Mar. 31, 2024

7,610

$ 0

9,419

(1,809)

Increase (Decrease) in Stockholders' Equity [Roll Forward]

Issuance of Convertible Preferred Stock and Warrants, net of issuance costs (in shares)

1,000,000

Issuance of Convertible Preferred Stock and Warrants, net of issuance costs

981,661

$ 498,684

482,977

Cash paid for fractional shares

(45)

Common stock dividend

(17,400)

Net loss

(591)

Ending balance at Jun. 30, 2024

$ 971,235

$ 498,684

$ 0

$ 474,951

$ (2,400)

Shares outstanding, ending balance at Jun. 30, 2024

1,000,000

664,000

^[2]

[1]	Amounts have been adjusted to reflect the 8-for-1 Reverse Stock Split effective June 6, 2024. See Note 3 - Equity for additional details.
[2]	Amounts have been adjusted to reflect the 8-for-1 Reverse Stock Split effective June 6, 2024. See Note 3 - Equity for additional details.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (Parenthetical)	Jun. 06, 2024
Statement of Stockholders' Equity [Abstract]
Reverse stock split conversion ratio	0.125

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023	Dec. 31, 2023
Cash flows from operating activities:
Net loss	$ (591,000)	$ 344,000	$ (452,000)	$ 621,000
Adjustments to reconcile net (loss) income to net cash used in operating activities:
Deferred income taxes			(171,000)	220,000
Depreciation	74,900	85,500	141,800	178,100
Amortization of intangibles	228,400	162,000	432,400	323,900
Non-cash lease expense			140,000	188,000
Provision for expected losses			25,000	(68,000)	$ 115,000
Share-based compensation			0	41,000
Changes in assets and liabilities:
Accounts receivable			(71,000)	73,000
Prepaid expenses and other current assets			(2,855,000)	(611,000)
Other assets			(144,000)	0
Accounts payable			1,631,000	(452,000)
Accrued expenses			829,000	(257,000)
Deferred revenue			(48,000)	(393,000)
Operating lease liabilities			(141,000)	(188,000)
Net cash used in operating activities			(683,000)	(324,000)
Cash flows from investing activities:
Purchase of property and equipment			(62,000)	(24,000)
Net cash used in investing activities			(62,000)	(24,000)
Cash flows from financing activities:
Payment of long-term debt			(219,000)	(422,000)
Proceeds from issuance of preferred stock and warrants, net of offering costs			983,650,000	0
Payment of common-stock dividend			(17,400,000)	0
Cash payment for fractional shares			(45,000)	0
Payment of finance lease obligations			(100,000)	(109,000)
Net cash provided by (used in) financing activities			965,886,000	(531,000)
Net increase (decrease) in cash			965,141,000	(879,000)
Cash, beginning of period	$ 971,284,000	$ 7,130,000	971,284,000	7,130,000	6,143,000
Cash, end of period			6,143,000	8,009,000	$ 8,009,000
Cash paid during period for:
Interest			23,000	58,000
Income taxes			$ 0	$ 23,000

DESCRIPTION OF BUSINESS	6 Months Ended
DESCRIPTION OF BUSINESS	Jun. 30, 2024
Organization, Consolidation and Presentation of Financial Statements [Abstract]
DESCRIPTION OF BUSINESS	DESCRIPTION OF BUSINESS QXO, Inc. ("QXO", "we", or the "Company") was formerly known as SilverSun Technologies, Inc. ("SilverSun"). On June 6, 2024, we changed the Company's name from SilverSun to QXO and changed its ticker symbol on the Nasdaq Capital Market from SSNT to QXO, upon completing a $1.0 billion cash investment in SilverSun by Jacobs Private Equity II, LLC ("JPE") and certain minority co-investors. Refer to Note 3 - Equity of the "Notes to Condensed Consolidated Financial Statements" for further details about the investment and related to changes to our capital structure. QXO is a technology solutions and professional services company that helps businesses manage and monetize their enterprise assets. We do this through our legacy operations, which provide critical software applications, consulting and other professional services, including specialized programming, training, and technical support. Our customers are primarily small and mid-size companies in the manufacturing, distribution and services industries. Our strategy is to build QXO into a tech-forward leader in the $800 million building products distribution industry with the goal of generating outsized stockholder value through accretive acquisitions and organic growth, including greenfield openings. We are executing our strategy toward a target of tens of billions of dollars in annual revenue in the next decade.

BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES

6 Months Ended

Jun. 30, 2024

Accounting Policies [Abstract]

BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation and Principles of Consolidation

Significant Accounting Policies

Reclassifications

Use of Estimates

Cash and Cash Equivalents

Prepaid Expenses and Other Current Assets

The following table presents the components of prepaid expenses and other current assets:


	As of
(in thousands)	June 30, 2024		December 31, 2023
Unbilled services	$	585	$	194
Deferred charges	700		736
Prepaid expenses and other current assets	4,254		1,754
Total prepaid expenses and other current assets	$	5,539	$	2,684

Accrued Expenses

The following table presents the components of accrued expenses:


	As of
(in thousands)	June 30, 2024		December 31, 2023
Accrued interest	$	34	$	25
Accrued expenses	5,363		2,656
Total accrued expenses	$	5,397	$	2,681

Interest Income (Expense), net

The following table presents the components of interest income (expense), net:


	Three Months Ending June 30,				Six Months Ending June 30,
(in thousands)	2024		2023		2024		2023
Interest income	$	3,492	$	6	$	3,494	$	9
Interest expense	(22)		(23)		(44)		(44)
Interest income (expense), net	$	3,470	$	(17)	$	3,450	$	(35)

Revenue Recognition

Components of revenue:

The following table presents the components of revenue:


	Three Months Ending June 30,				Six Months Ending June 30,
(in thousands)	2024		2023		2024		2023
Software revenue	$	5,354	$	3,298	$	7,273	$	6,620
Professional consulting revenue	4,807		4,556		9,711		8,893
Maintenance revenue	1,229		1,235		2,802		2,618
Ancillary service revenue	3,150		4,168		9,189		8,254
Total revenue, net	$	14,540	$	13,257	$	28,975	$	26,385

Roll-forward of Allowance for Expected Credit Losses

The following table represents the roll-forward of the allowance for expected credit losses for the six months ended June 30, 2024 and the year ended December 31, 2023:


(in thousands)	June 30, 2024		December 31, 2023
Balance at beginning of period	$	510	$	490
Current period provision for expected losses	25		115
Write-offs	(13)		(95)
Balance at end of period	$	522	$	510

Advertising and Marketing

Deferred Revenue

Financial Instruments

Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs.

Level 2: Observable prices that are based on inputs not quoted on active markets but corroborated by market data.

Level 3: Unobservable inputs are used when little or no market data is available. The fair value hierarchy gives the lowest priority to Level 3 inputs.

The Company’s current financial assets and liabilities approximate fair value due to their short-term nature and include cash, accounts receivable, accounts payable, and accrued liabilities.

Property and Equipment

Property and equipment is summarized as follows:


	As of
(in thousands)	June 30, 2024		December 31, 2023
Leasehold improvements	$	99	$	166
Equipment, furniture, and fixtures	4,157		3,943
Property and equipment	4,256		4,109
Less: Accumulated depreciation and amortization	(3,745)		(3,606)
Property and equipment, net	$	511	$	503

Recent Authoritative Pronouncements

EQUITY	6 Months Ended
EQUITY	Jun. 30, 2024
Equity [Abstract]
EQUITY	EQUITY Investment Agreement On April 14, 2024, the Company entered into the Amended and Restated Investment Agreement (the "Investment Agreement") among the Company, JPE and the other investors party thereto (collectively, the "Investors"), providing for, among other things, an aggregate investment by the Investors of $1.0 billion in cash in the Company. Pursuant to the Investment Agreement, we issued and sold an aggregate of 1,000,000 shares of Convertible Perpetual Preferred Stock, par value $0.001 per share (the "Convertible Preferred Stock"), which are initially convertible into an aggregate of 219,010,074 shares of common stock at an initial conversion price of $4.566 per share and issued and sold warrants exercisable for an aggregate of 219,010,074 shares of common stock (the "Warrants"). Additionally, we amended the Company’s certificate of incorporation to, among other things, effect an 8:1 reverse stock split with respect to the Company’s common stock (the “Reverse Stock Split”). The Investment Agreement and related transactions closed on June 6, 2024 (the "Equity Investment") and generated gross proceeds of approximately $1.0 billion before deducting fees and offering expenses. Following the closing of the Equity Investment, the Board of Directors of the Company was reconstituted such that: i) the number of seats on the Board was designated by JPE, ii) each of the directors (including Mr. Jacobs) was designated by JPE, iii) each standing committee of the Board was reconstituted in a manner designated by JPE, and iv) Mr. Jacobs was appointed as Chairman of the Board of Directors and Chief Executive Officer of the Company. Issuance of Convertible Preferred Stock On June 6, 2024, under the terms of the Investment Agreement, the Company issued 1,000,000 shares of Convertible Perpetual Preferred Stock, par value $0.001 per share (the “Convertible Preferred Stock”). The Convertible Preferred Stock has an initial liquidation preference of $1.0 thousand per share, for an aggregate initial liquidation preference of $1 billion. The Convertible Preferred Stock is convertible at any time, in whole or in part and from time to time, at the option of the holder thereof into a number of shares of common stock equal to the then-applicable liquidation preference divided by the conversion price, which initially is $4.566 per share of common stock (subject to customary anti-dilution adjustments). Shares of Convertible Preferred Stock are initially convertible into an aggregate of 219,010,074 shares of common stock (after giving effect to the Reverse Stock Split). The Convertible Preferred Stock is not redeemable or subject to any required offer to purchase. The Convertible Preferred Stock ranks, with respect to dividend rights and distribution of assets upon liquidation, winding-up or dissolution, senior to the Company’s common stock. Holders of Convertible Preferred Stock will vote together with the holders of the Company’s common stock on an “as-converted” basis on all matters, except as otherwise required by law. In addition, the approval of holders of at least a majority of the outstanding shares of the Convertible Preferred Stock, voting separately as a single class, will be required for certain matters set forth in the Certificate of Designation for the Convertible Preferred Stock. Dividends on the Convertible Preferred Stock are payable quarterly, when, as and if declared by the Board of Directors of the Company at the rate per annum of 9% per share on the then-applicable liquidation preference (subject to certain exceptions in the event that the Company pays dividends on shares of its common stock). Subsequent to the close of the quarter ended June 30, 2024, the Company paid $9.8 million of quarterly dividends to holders of Convertible Preferred Stock. Warrants The aggregate number of shares of the Company’s common stock subject to the Warrants is 219,010,074 shares. The Warrants are exercisable at the option of the holder at any time until June 6, 2034. The Warrants have an exercise price of $4.566 per share of common stock with respect to 50% of the Warrants, $6.849 per share of common stock with respect to 25% of the Warrants, and $13.698 per share of common stock with respect to the remaining 25% of the Warrants. Each Warrant may be exercised, in whole or in part, at any time or times on or after the issuance date and on or before the expiration date at the election of the holder (in such holder’s sole discretion) by means of a “cashless exercise” in which the holder will be entitled to receive a number of shares of the Company’s common stock equal to the quotient of the product of the Closing Sale Price (as defined in the Warrant Certificate) of a share of the Company’s common stock on the trading day immediately preceding the date on which the holder elects to exercise its Warrant, less the adjusted exercise price, multiplied by the number of shares of the Company’s common stock issuable upon exercise of such Warrant, divided by the aforementioned Closing Sale Price of a share of the Company’s common stock on the trading day immediately preceding the date on which the holder elects to exercise its Warrant. Equity Investment Dividend Under the terms of the Investment Agreement, the Company declared a $17.4 million aggregate cash dividend to its stockholders of record as of the day before the closing of the Equity Investment. The dividend was paid on June 12, 2024 from proceeds received by the Company from the Equity Investment. Reverse Stock Split On June 6, 2024, as contemplated by the Investment Agreement, the Company effected an 8:1 Reverse Stock Split, which reduced the Company's issued and outstanding share count of common stock from 5,315,581 to 664,284 shares (par value $0.00001 per share). The Company has recast all share and per-share data and amounts to show the effects of the Reverse Stock Split. Private Placements On June 13, 2024, the Company entered into purchase agreements with certain institutional and accredited investors to issue and sell in a private placement an aggregate of 340,932,212 shares of our common stock at a price of $9.14 per share, and pre-funded warrants (the "Pre-Funded Warrants") to purchase 42,000,000 shares of our common stock at a price of $9.13999 per Pre-Funded Warrant. Each Pre-Funded Warrant has an exercise price of $0.00001 per share, is exercisable immediately and until the Pre-Funded Warrant is exercised in full. The closing of the issuance and sale of these securities was consummated on July 19, 2024, and generated gross proceeds of approximately $3.5 billion before deducting agent fees and offering expenses. On July 22, 2024, we entered into additional purchase agreements with certain institutional and accredited investors to issue and sell in a private placement an aggregate of 67,833,699 shares of our common stock at a price of $9.14 per share. The closing of the issuance and sale of these securities was consummated on July 25, 2024, and generated gross proceeds of approximately $620 million, before deducting agent fees and offering expenses.

EARNINGS (LOSS) PER COMMON SHARE

6 Months Ended

Jun. 30, 2024

Earnings Per Share [Abstract]

EARNINGS (LOSS) PER COMMON SHARE


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
(in thousands, except per share data)
Basic earnings per share computation:
Net (loss) income	$	(591)	$	344	$	(452)	$	621
Less: Convertible Preferred Stock dividends	(6,000)		—		(6,000)		—
Less: Undistributed earnings allocated to participating securities	—		—		—		—
(Loss) income attributable to common shareholders	(6,591)		344		(6,452)		621
Weighted-average common shares outstanding	664		657		664		657
Basic earnings per share	$	(9.93)	$	0.52	$	(9.72)	$	0.95
Diluted earnings per share computation:
(Loss) income attributable to common shareholders per above	$	(6,591)	$	344	$	(6,452)	$	621
Weighted-average common shares outstanding	664		657		664		657
Dilutive potential common shares	—		—		—		—
Total diluted adjusted weighted-average shares	664		657		664		657
Diluted earnings per share	$	(9.93)	$	0.52	$	(9.72)	$	0.95

The following table summarizes securities that, if exercised, would have a dilutive effect on earnings per share.


	Three Months Ended June 30,		Six Months Ended June 30,
	2024	2023	2024	2023
(in thousands)
Stock options	—	20	—	20
Convertible Preferred Stock	219,010	—	219,010	—
Warrants	219,010	—	219,010	—
Total potential dilutive securities not included in earnings per share	438,020	20	438,020	20

INTANGIBLE ASSETS

6 Months Ended

Jun. 30, 2024

Intangible Assets, Net (Excluding Goodwill) [Abstract]

INTANGIBLE ASSETS

Intangible assets at June 30, 2024, and December 31, 2023, consisted of the following:


	As of
(in thousands)	June 30, 2024		December 31, 2023
Proprietary developed software	$	390	$	390
Intellectual property, customer lists, and acquired contracts	9,069		9,069
Accumulated amortization	(4,973)		(4,540)
Total intangible assets	$	4,486	$	4,919

LONG TERM DEBT	6 Months Ended
LONG TERM DEBT	Jun. 30, 2024
Debt Disclosure [Abstract]
LONG TERM DEBT	LONG-TERM DEBTThe Company’s long-term debt was $1.48 million and $1.70 million, as of June 30, 2024 and December 31, 2023, respectively. The current portion of the Company’s long-term debt was $783,600 and $701,700, as of June 30, 2024 and December 31, 2023, respectively. Subsequent to June 30, 2024, the Company extinguished all of the Company's outstanding debt obligations.

LEASES

6 Months Ended

Jun. 30, 2024

Leases [Abstract]

LEASES

The table below presents the operating and financing lease-related assets and liabilities recorded on the unaudited condensed consolidated balance sheets:


(in thousands)		As of
Leases	Balance Sheet Classification	June 30, 2024		December 31, 2023
Assets
Operating	Operating lease right-of-use assets	$	380	$	522
Financing	Property and equipment, net	246		332
Total lease assets		$	626	$	854
Liabilities
Current:
Finance	Finance lease obligations – current portion	$	141	$	154
Operating	Operating lease liabilities – current portion	217		263
Non-current:
Finance	Finance lease obligations net of current portion	247		247
Operating	Operating lease liabilities net of current portion	164		259
Total lease liabilities		$	769	$	923

LEASES

The table below presents the operating and financing lease-related assets and liabilities recorded on the unaudited condensed consolidated balance sheets:


(in thousands)		As of
Leases	Balance Sheet Classification	June 30, 2024		December 31, 2023
Assets
Operating	Operating lease right-of-use assets	$	380	$	522
Financing	Property and equipment, net	246		332
Total lease assets		$	626	$	854
Liabilities
Current:
Finance	Finance lease obligations – current portion	$	141	$	154
Operating	Operating lease liabilities – current portion	217		263
Non-current:
Finance	Finance lease obligations net of current portion	247		247
Operating	Operating lease liabilities net of current portion	164		259
Total lease liabilities		$	769	$	923

COMMITMENTS AND CONTINGENCIES	6 Months Ended
COMMITMENTS AND CONTINGENCIES	Jun. 30, 2024
Commitments and Contingencies Disclosure [Abstract]
COMMITMENTS AND CONTINGENCIES	COMMITMENTS AND CONTINGENCIES Legal Matters Various legal claims arise from time to time in the normal course of business. In assessing loss contingencies related to legal proceedings that are pending against the Company, or unasserted claims that may result in such proceedings, the Company evaluates the perceived merits of any legal proceedings or unasserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein. The Company believes that it has adequately accrued for the potential impact of loss contingencies that are probable and reasonably estimable, and does not believe that the ultimate resolution of any matters to which it is presently a party will have a material adverse effect on the Company’s results of operations, financial condition or cash flows. However, the results of these matters cannot be predicted with certainty, and an unfavorable resolution of one or more of these matters could have a material adverse effect on the Company’s financial condition, results of operations or cash flows.

ASSET PURCHASE AGREEMENT	6 Months Ended
ASSET PURCHASE AGREEMENT	Jun. 30, 2024
Asset Acquisition [Abstract]
ASSET PURCHASE AGREEMENT	ASSET PURCHASE AGREEMENT On November 13, 2023, SWK Technologies, Inc. acquired the customer list and prepaid time from clients of JCS Computer Resource Corporation ("JCS") pursuant to an Asset Purchase Agreement for cash of $278,500 and a promissory note in the amount of $1.0 million (the “JCS Note”) for a total consideration of $1.3 million. The customer list was recognized as an intangible asset and will be amortized over its estimated useful life. The JCS Note balance was paid in full on July 24, 2024.

INCOME TAXES	6 Months Ended
INCOME TAXES	Jun. 30, 2024
Income Tax Disclosure [Abstract]
INCOME TAXES	INCOME TAXESThe Company’s interim (benefit) provision for income taxes is determined based on its annual estimated effective tax rate, applied to the actual year-to-date income, and adjusted for the tax effects of any discrete items. The Company’s effective tax rates for the three and six months ended June 30, 2024 were 28.9% and 27.3%, respectively. The Company’s effective tax rates for the three and six months ended June 30, 2023 were 21.6% and 21.5%, respectively. The Company’s effective tax rates for the three and six months ended June 30, 2024 were higher than the United States federal statutory tax rate of 21%, primarily due to state income taxes. The Company’s effective tax rates for the three and six months ended June 30, 2023 were higher than the United States federal statutory tax rate of 21%, primarily due to state income taxes and miscellaneous permanent items.

EQUITY-BASED COMPENSATION	6 Months Ended
EQUITY-BASED COMPENSATION	Jun. 30, 2024
Share-Based Payment Arrangement [Abstract]
EQUITY-BASED COMPENSATION	EQUITY-BASED COMPENSATION At the special meeting of the Company's stockholders on May 30, 2024, the stockholders approved the QXO, Inc. 2024 Omnibus Incentive Plan (the “2024 Plan”). The 2024 Plan provides for the grant of options intended to qualify as incentive stock options (“ISOs”), nonqualified stock options (“NSOs”), stock appreciation rights (“SARs”), restricted share awards, restricted stock units (“RSUs”), performance awards, cash incentive awards, deferred share units and other equity-based and equity-related awards, as well as cash-based awards. Subject to adjustment for changes in capitalization, the maximum aggregate number of shares of common stock that may be delivered pursuant to awards granted under the 2024 Plan shall be equal to 30,000,000 (the “Plan Share Limit”), of which 30,000,000 shares of common stock may be delivered pursuant to ISOs granted under the 2024 Plan (such amount, the “Plan ISO Limit”). The number of shares of common stock covered by the Plan Share Limit shall automatically increase on January 1 of each calendar year commencing with January 1, 2025 and on each January 1 thereafter until the 2024 Plan expiration date in an amount equal to 3% of the sum of: i) the number of shares of common stock outstanding as of December 31 of the preceding calendar year, and ii) the number of shares of common stock into which the Convertible Preferred Stock outstanding on December 31 of the preceding calendar year are convertible. The Company recorded compensation expense of $0 for both the three and six months ended June 30, 2024, compared with compensation expense of $0 and $41,500 for the three and six months ended June 30, 2023, respectively. As of June 30, 2024, there were no outstanding grants under the 2024 Plan. As of December 31, 2023, there were no outstanding stock options.

RELATED PARTY TRANSACTIONS	6 Months Ended
RELATED PARTY TRANSACTIONS	Jun. 30, 2024
Related Party Transactions [Abstract]
RELATED PARTY TRANSACTIONS	RELATED PARTY TRANSACTIONS Upon the closing of the Equity Investment, pursuant to the execution of the Investment Agreement, the Company reimbursed JPE for certain transactional, market research and employee costs related to establishing the foundation for QXO to move forward. These costs, as defined in the Investment Agreement, equated to a total reimbursement of $15.3 million, which was treated as a reduction of the proceeds received from the Equity Investment. In connection with the Equity Investment, Mark Meller was terminated as CEO of SilverSun Technologies, Inc. and entered into a new employment agreement to serve as President of SWK Technologies, a wholly-owned subsidiary of QXO. Mr. Meller received a lump-sum payment of $2.8 million in connection with this agreement. In connection with the private placement that closed on July 25, 2024, certain directors and officers of the Company purchased an aggregate of 262,585 shares of common stock for $2.4 million.

BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Policies)	6 Months Ended
	Jun. 30, 2024
Accounting Policies [Abstract]
Basis of Presentation and Principles of Consolidation	Basis of Presentation and Principles of Consolidation The accompanying unaudited condensed consolidated financial statements contain all adjustments necessary to state fairly the financial position of the Company as of June 30, 2024, the results of operations for the three and six months ended June 30, 2024 and 2023 and cash flows for the six months ended June 30, 2024 and 2023 in accordance with accounting principles generally accepted in the United States (“GAAP”). These unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) and consequently have been condensed and do not include all disclosures normally made in an Annual Report on Form 10-K. The unaudited condensed consolidated financial statements included herein should be read in conjunction with the consolidated financial statements and notes included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023, filed with the SEC on March 14, 2024. All significant inter-company transactions and accounts have been eliminated in consolidation.
Reclassifications	Reclassifications The Company has reclassified certain prior period amounts to conform with the current period presentation in the unaudited condensed consolidated balance sheets related to unbilled services and deferred charges which are now presented within prepaid expenses and other current assets. Additionally, the Company has reclassified certain prior period amounts to conform with the current period presentation in the unaudited condensed consolidated statements of operations related to selling and marketing expenses, general and administrative expenses, and share-based compensation which is now presented within selling, general, and administrative expenses. As further discussed in Note 3 – Equity, all per share amounts and common share amounts have been adjusted on a retroactive basis to reflect the Reverse Stock Split (as defined below).
Use of Estimates	Use of Estimates The preparation of unaudited financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the unaudited condensed consolidated financial statements, as well as the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.
Cash and Cash Equivalents	Cash and Cash Equivalents The Company considers all highly liquid investments purchased with original maturities of three months or less to be cash equivalents. The Company maintains cash balances across a diversified portfolio of global financial institutions that exceed FDIC insured limits. The Company has not experienced any losses in such accounts.
Advertising and Marketing	Advertising and Marketing Advertising and marketing expenses consist of advertising and payroll related expenses for personnel engaged in marketing, business development and selling activities. These costs are expensed as incurred.
Deferred Revenues	Deferred Revenue Deferred revenue consists of maintenance on proprietary products (contract liabilities), customer telephone support services (contract liabilities) and deposits for future consulting services that will be earned as such services are performed over the contractual or stated period, which generally ranges from three to twelve months.
Financial Instruments	Financial Instruments Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. To increase the comparability of fair value measures, the following hierarchy prioritizes the inputs to valuation methodologies used to measure fair value: Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs. Level 2: Observable prices that are based on inputs not quoted on active markets but corroborated by market data. Level 3: Unobservable inputs are used when little or no market data is available. The fair value hierarchy gives the lowest priority to Level 3 inputs. The Company’s current financial assets and liabilities approximate fair value due to their short-term nature and include cash, accounts receivable, accounts payable, and accrued liabilities.
Recent Authoritative Pronouncements	Recent Authoritative Pronouncements In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which requires disaggregated information about a reporting entity’s effective tax rate reconciliation, as well as information related to income taxes paid to enhance the transparency and decision usefulness of income tax disclosures. This ASU will be effective beginning with the Company's 2025 annual reporting period. The Company is currently evaluating the timing and impacts of adoption of this ASU. In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosure, which updates the required disclosures to include significant segment expenses that are regularly provided to the chief operating decision maker (CODM) and included within each reported measure of segment profit or loss. ASU 2023-07 requires that a public entity disclose, on an annual and interim basis, an amount for other segment items by reportable segment and a description of its composition. ASU 2023-07 additionally requires that a public entity with a single reportable segment provide all the disclosures required by the amendments in this update and all existing segment disclosures. This ASC is effective for fiscal years beginning after December 15, 2023, and will be effective for interim periods within fiscal years beginning after December 15, 2024. The Company does not believe the adoption of this standard will have a material impact on the Company’s condensed consolidated financial statements. In July 2023, the FASB issued ASU 2023-03, Presentation of Financial Statements (Topic 205), Income Statement—Reporting Comprehensive Income (Topic 220), Distinguishing Liabilities from Equity (Topic 480), Equity (Topic 505), and Compensation—Stock Compensation (Topic 718): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 120, SEC Staff Announcement at the March 24, 2022 EITF Meeting, and Staff Accounting Bulletin Topic 6.B, Accounting Series Release 280—General Revision of Regulation S-X: Income or Loss Applicable to Common Stock. This update requires the: i) disclosure and presentation of income or loss related to common stock transactions on the face of the income statement, ii) modification of the existing classification and measurement of redeemable preferred shares and redeemable equity-classified shares, and iii) modification of accounting treatment for stock-based compensation. The FASB has not set an effective date for ASU 2023-03 and early adoption is permitted. The Company is currently evaluating the impact of the provisions of ASU 2023-03 on its consolidated financial statement disclosures.

BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Tables)

6 Months Ended

Jun. 30, 2024

Accounting Policies [Abstract]

Schedule of Other Current Assets

The following table presents the components of prepaid expenses and other current assets:


	As of
(in thousands)	June 30, 2024		December 31, 2023
Unbilled services	$	585	$	194
Deferred charges	700		736
Prepaid expenses and other current assets	4,254		1,754
Total prepaid expenses and other current assets	$	5,539	$	2,684

Schedule of Accrued Liabilities

The following table presents the components of accrued expenses:


	As of
(in thousands)	June 30, 2024		December 31, 2023
Accrued interest	$	34	$	25
Accrued expenses	5,363		2,656
Total accrued expenses	$	5,397	$	2,681

Interest and Other Income

The following table presents the components of interest income (expense), net:


	Three Months Ending June 30,				Six Months Ending June 30,
(in thousands)	2024		2023		2024		2023
Interest income	$	3,492	$	6	$	3,494	$	9
Interest expense	(22)		(23)		(44)		(44)
Interest income (expense), net	$	3,470	$	(17)	$	3,450	$	(35)

Disaggregation of Revenue

The following table presents the components of revenue:


	Three Months Ending June 30,				Six Months Ending June 30,
(in thousands)	2024		2023		2024		2023
Software revenue	$	5,354	$	3,298	$	7,273	$	6,620
Professional consulting revenue	4,807		4,556		9,711		8,893
Maintenance revenue	1,229		1,235		2,802		2,618
Ancillary service revenue	3,150		4,168		9,189		8,254
Total revenue, net	$	14,540	$	13,257	$	28,975	$	26,385

Accounts Receivable, Allowance for Credit Loss

The following table represents the roll-forward of the allowance for expected credit losses for the six months ended June 30, 2024 and the year ended December 31, 2023:


(in thousands)	June 30, 2024		December 31, 2023
Balance at beginning of period	$	510	$	490
Current period provision for expected losses	25		115
Write-offs	(13)		(95)
Balance at end of period	$	522	$	510

Property, Plant and Equipment

Property and equipment is summarized as follows:


	As of
(in thousands)	June 30, 2024		December 31, 2023
Leasehold improvements	$	99	$	166
Equipment, furniture, and fixtures	4,157		3,943
Property and equipment	4,256		4,109
Less: Accumulated depreciation and amortization	(3,745)		(3,606)
Property and equipment, net	$	511	$	503

EARNINGS (LOSS) PER COMMON SHARE (Tables)

6 Months Ended

Jun. 30, 2024

Earnings Per Share [Abstract]

Schedule of Earnings Per Share, Basic and Diluted


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
(in thousands, except per share data)
Basic earnings per share computation:
Net (loss) income	$	(591)	$	344	$	(452)	$	621
Less: Convertible Preferred Stock dividends	(6,000)		—		(6,000)		—
Less: Undistributed earnings allocated to participating securities	—		—		—		—
(Loss) income attributable to common shareholders	(6,591)		344		(6,452)		621
Weighted-average common shares outstanding	664		657		664		657
Basic earnings per share	$	(9.93)	$	0.52	$	(9.72)	$	0.95
Diluted earnings per share computation:
(Loss) income attributable to common shareholders per above	$	(6,591)	$	344	$	(6,452)	$	621
Weighted-average common shares outstanding	664		657		664		657
Dilutive potential common shares	—		—		—		—
Total diluted adjusted weighted-average shares	664		657		664		657
Diluted earnings per share	$	(9.93)	$	0.52	$	(9.72)	$	0.95

Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share

The following table summarizes securities that, if exercised, would have a dilutive effect on earnings per share.


	Three Months Ended June 30,		Six Months Ended June 30,
	2024	2023	2024	2023
(in thousands)
Stock options	—	20	—	20
Convertible Preferred Stock	219,010	—	219,010	—
Warrants	219,010	—	219,010	—
Total potential dilutive securities not included in earnings per share	438,020	20	438,020	20

INTANGIBLE ASSETS (Tables)

6 Months Ended

Jun. 30, 2024

Intangible Assets, Net (Excluding Goodwill) [Abstract]

Schedule of Finite-Lived Intangible Assets

Intangible assets at June 30, 2024, and December 31, 2023, consisted of the following:


	As of
(in thousands)	June 30, 2024		December 31, 2023
Proprietary developed software	$	390	$	390
Intellectual property, customer lists, and acquired contracts	9,069		9,069
Accumulated amortization	(4,973)		(4,540)
Total intangible assets	$	4,486	$	4,919

LEASES (Tables)

6 Months Ended

Jun. 30, 2024

Leases [Abstract]

Assets And Liabilities, Lessee

The table below presents the operating and financing lease-related assets and liabilities recorded on the unaudited condensed consolidated balance sheets:


(in thousands)		As of
Leases	Balance Sheet Classification	June 30, 2024		December 31, 2023
Assets
Operating	Operating lease right-of-use assets	$	380	$	522
Financing	Property and equipment, net	246		332
Total lease assets		$	626	$	854
Liabilities
Current:
Finance	Finance lease obligations – current portion	$	141	$	154
Operating	Operating lease liabilities – current portion	217		263
Non-current:
Finance	Finance lease obligations net of current portion	247		247
Operating	Operating lease liabilities net of current portion	164		259
Total lease liabilities		$	769	$	923

DESCRIPTION OF BUSINESS (Details) $ in Billions	2 Months Ended
DESCRIPTION OF BUSINESS (Details) $ in Billions	Jun. 06, 2024 USD ($)
Public stock offering
Capital Unit [Line Items]
Consideration received on transaction	$ 1.0

BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES - Prepaid expenses and other current assets (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Accounting Policies [Abstract]
Unbilled services	$ 585	$ 194
Deferred charges	700	736
Prepaid expenses and other current assets	4,254	1,754
Total prepaid expenses and other current assets	$ 5,539	$ 2,684

BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES - Accrued Expenses (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Accounting Policies [Abstract]
Accrued interest	$ 34	$ 25
Accrued expenses	5,363	2,656
Accrued expenses	$ 5,397	$ 2,681

BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES - Interest income and expense (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Accounting Policies [Abstract]
Interest income	$ 3,492	$ 6	$ 3,494	$ 9
Interest expense	(22)	(23)	(44)	(44)
Interest income (expense), net	$ 3,470	$ (17)	$ 3,450	$ (35)

BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES - Components of revenue (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Revenues from External Customers and Long-Lived Assets [Line Items]
Total revenue, net	$ 14,540	$ 13,257	$ 28,975	$ 26,385
Software revenue
Revenues from External Customers and Long-Lived Assets [Line Items]
Total revenue, net	5,354	3,298	7,273	6,620
Professional consulting revenue
Revenues from External Customers and Long-Lived Assets [Line Items]
Total revenue, net	4,807	4,556	9,711	8,893
Maintenance revenue
Revenues from External Customers and Long-Lived Assets [Line Items]
Total revenue, net	1,229	1,235	2,802	2,618
Ancillary service revenue
Revenues from External Customers and Long-Lived Assets [Line Items]
Total revenue, net	$ 3,150	$ 4,168	$ 9,189	$ 8,254

BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES - Allowance for expected credit losses (Details) - USD ($) $ in Thousands	6 Months Ended		12 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Dec. 31, 2023
Accounts Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period	$ 510	$ 490	$ 490
Provision for expected losses	25	$ (68)	115
Write-offs	(13)		(95)
Balance at end of period	$ 522		$ 510

BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES - Narrative (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023	Dec. 31, 2023
Revenues from External Customers and Long-Lived Assets [Line Items]
Depreciation	$ 74,900	$ 85,500	$ 141,800	$ 178,100
Maintenance revenue
Revenues from External Customers and Long-Lived Assets [Line Items]
Contract with customer, liability	591,100		591,100		$ 943,000,000
Professional consulting revenue
Revenues from External Customers and Long-Lived Assets [Line Items]
Contract with customer, liability	$ 2,500,000		$ 2,500,000		$ 2,200,000

BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES - Property plant and equipment (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Property, Plant and Equipment [Line Items]
Property and equipment	$ 4,256	$ 4,109
Less: Accumulated depreciation and amortization	(3,745)	(3,606)
Property and equipment, net	511	503
Leasehold improvements
Property, Plant and Equipment [Line Items]
Property and equipment	99	166
Equipment, furniture, and fixtures
Property, Plant and Equipment [Line Items]
Property and equipment	$ 4,157	$ 3,943

EQUITY (Details) $ / shares in Units, $ in Millions						1 Months Ended	2 Months Ended
EQUITY (Details) $ / shares in Units, $ in Millions	Jul. 25, 2024 USD ($)	Jul. 22, 2024 $ / shares shares	Jul. 19, 2024 USD ($)	Jun. 13, 2024 $ / shares shares	Jun. 06, 2024 USD ($) $ / shares shares	Aug. 14, 2024 USD ($)	Jun. 06, 2024 USD ($) $ / shares shares	Jun. 30, 2024 $ / shares shares	Jun. 05, 2024 shares	Dec. 31, 2023 $ / shares shares	Dec. 03, 2023 USD ($)
Capital Unit [Line Items]
Preferred stock, par value (in dollars per share)					$ 0.001		$ 0.001	$ 0.001		$ 0.001
Convertible preferred stock, shares issued upon conversion (in shares) \| shares					219,010,074		219,010,074
Preferred stock, conversion price (USD per share)					$ 4.566		$ 4.566
Securities called by warrants (in shares) \| shares					219,010,074		219,010,074	219,010,074
Preferred stock, liquidation preference (USD per share)					$ 1,000.0		$ 1,000.0
Preferred stock, liquidation preference, value \| $					$ 1,000.0		$ 1,000.0
Preferred stock, dividend rate					9.00%
Dividends payable \| $											$ 17.4
Reverse stock split conversion ratio					0.125
Common stock, par value (in dollars per share)					$ 0.00001		$ 0.00001	$ 0.00001		$ 0.00001
Common stock, outstanding (in shares) \| shares					664,284		664,284	664,284	5,315,581	664,448
Common stock, issued (in shares) \| shares					664,284		664,284	664,284	5,315,581	664,448
Convertible Preferred Stock
Capital Unit [Line Items]
Stock issued during period (in shares) \| shares					1,000,000
Warrants exercise price one
Capital Unit [Line Items]
Exercise price of warrants (in USD per share)								$ 4.566
Temporary equity, percentage of warrants authorized								50.00%
Warrants exercise price two
Capital Unit [Line Items]
Exercise price of warrants (in USD per share)								$ 6.849
Temporary equity, percentage of warrants authorized								25.00%
Warrants exercise price three
Capital Unit [Line Items]
Exercise price of warrants (in USD per share)								$ 13.698
Temporary equity, percentage of warrants authorized								25.00%
Subsequent event
Capital Unit [Line Items]
Dividends, preferred stock \| $						$ 9.8
Public stock offering
Capital Unit [Line Items]
Consideration received on transaction \| $							$ 1,000.0
Shares issued in transaction (in shares) \| shares							1,000,000
Private placement
Capital Unit [Line Items]
Shares issued in transaction (in shares) \| shares				340,932,212
Sale of stock, price per share (in USD per share)				$ 9.14
Private placement \| Pre-funded warrants
Capital Unit [Line Items]
Securities called by warrants (in shares) \| shares				42,000,000
Exercise price of warrants (in USD per share)				$ 0.00001
Price of warrants (in USD per share)				$ 9.13999
Private placement \| Subsequent event
Capital Unit [Line Items]
Consideration received on transaction \| $	$ 620.0		$ 3,500.0
Shares issued in transaction (in shares) \| shares		67,833,699
Sale of stock, price per share (in USD per share)		$ 9.14

EARNINGS (LOSS) PER COMMON SHARE - Schedule of Earnings Per Share, Basic and Diluted (Details) - USD ($)
$ / shares in Units, $ in Thousands

3 Months Ended

6 Months Ended

Jun. 30, 2024

Jun. 30, 2023

Jun. 30, 2024

Jun. 30, 2023

Basic earnings per share computation:

Net loss

$ (591)

$ 344

$ (452)

$ 621

Less: Convertible Preferred Stock dividends

(6,000)

Less: Undistributed earnings allocated to participating securities

(Loss) income attributable to common shareholders

$ (6,591)

$ 344

$ (6,452)

$ 621

Weighted-average common shares outstanding (in shares)

^[1]

664,000

657,000

664,000

657,000

Basic earnings per share (in USD per share)

$ (9.93)

$ 0.52

$ (9.72)

$ 0.95

Diluted earnings per share computation:

(Loss) income attributable to common shareholders per above

$ (6,591)

$ 344

$ (6,452)

$ 621

Weighted-average common shares outstanding (in shares)

^[1]

664,000

657,000

664,000

657,000

Dilutive potential common shares (in shares)

Total diluted adjusted weighted-average shares (in shares)

^[1]

664,000

657,000

664,000

657,000

Diluted earnings per share (in USD per share)

$ (9.93)

$ 0.52

$ (9.72)

$ 0.95

[1]	Amounts have been adjusted to reflect the 8-for-1 Reverse Stock Split effective June 6, 2024. See Note 3 - Equity for additional details.

EARNINGS (LOSS) PER COMMON SHARE - Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share (Details) - shares	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total potential dilutive securities not included in earnings per share (in shares)	438,020,000	20,000	438,020,000	20,000
Stock options
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total potential dilutive securities not included in earnings per share (in shares)	0	20,000	0	20,000
Convertible Preferred Stock
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total potential dilutive securities not included in earnings per share (in shares)	219,010,000	0	219,010,000	0
Warrants
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total potential dilutive securities not included in earnings per share (in shares)	219,010,000	0	219,010,000	0

INTANGIBLE ASSETS - Schedule of Finite-Lived Intangible Assets (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Finite-Lived Intangible Assets [Line Items]
Accumulated amortization	$ (4,973)	$ (4,540)
Total intangible assets	4,486	4,919
Proprietary developed software
Finite-Lived Intangible Assets [Line Items]
Intangible assets, gross	390	390
Intellectual property, customer lists, and acquired contracts
Finite-Lived Intangible Assets [Line Items]
Intangible assets, gross	$ 9,069	$ 9,069

INTANGIBLE ASSETS - Narrative (Details) - USD ($)	3 Months Ended		6 Months Ended
INTANGIBLE ASSETS - Narrative (Details) - USD ($)	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Intangible Assets, Net (Excluding Goodwill) [Abstract]
Amortization of intangibles	$ 228,400	$ 162,000	$ 432,400	$ 323,900

LONG TERM DEBT (Details) - USD ($)	Jun. 30, 2024	Dec. 31, 2023
Debt Disclosure [Abstract]
Long-term debt	$ 1,480,000	$ 1,700,000
Long-term debt – current portion	$ 783,600	$ 701,700

LEASES (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
ASSETS
Operating	$ 380	$ 522
Financing	246	332
Total lease assets	626	854
Liabilities
Finance	141	154
Operating	217	263
Finance	247	247
Operating	164	259
Total lease liabilities	$ 769	$ 923

LEASES - Narrative (Details)		3 Months Ended		6 Months Ended		12 Months Ended
LEASES - Narrative (Details)	Jan. 03, 2024 USD ($)	Jun. 30, 2024 USD ($) leasedSpace	Jun. 30, 2023 USD ($)	Jun. 30, 2024 USD ($) leasedSpace	Jun. 30, 2023 USD ($)	Dec. 31, 2023 USD ($)
Operating Leased Assets [Line Items]
Number of leased spaces \| leasedSpace		4		4
Right-of-use asset obtained in exchange for operating lease liability					$ 108,300	$ 236,900
Operating lease right-of-use assets		$ 380,000		$ 380,000		$ 522,000
Operating lease, expense		$ 68,100	$ 103,200	175,400	$ 213,100
Building
Operating Leased Assets [Line Items]
Lessee, operating lease, renewal term	2 years
First year \| Building
Operating Leased Assets [Line Items]
Operating leases, monthly rental payments	$ 10,300
Second year \| Building
Operating Leased Assets [Line Items]
Operating leases, monthly rental payments	$ 10,500
Minimum
Operating Leased Assets [Line Items]
Operating leases, monthly rental payments				3,000
Maximum
Operating Leased Assets [Line Items]
Operating leases, monthly rental payments				$ 10,500

ASSET PURCHASE AGREEMENT (Details)	Nov. 13, 2023 USD ($)
Asset Acquisition [Abstract]
Payments to acquire productive assets	$ 278,500
Asset acquisition, consideration transferred, other assets	1,000,000.0
Asset acquisition, consideration transferred	$ 1,300,000

INCOME TAXES (Details)	3 Months Ended		6 Months Ended
INCOME TAXES (Details)	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Income Tax Disclosure [Abstract]
Effective income tax rate	28.90%	21.60%	27.30%	21.50%

EQUITY-BASED COMPENSATION (Details)	3 Months Ended		6 Months Ended
EQUITY-BASED COMPENSATION (Details)	Jun. 30, 2024 USD ($) shares	Jun. 30, 2023 USD ($)	Jun. 30, 2024 USD ($) shares	Jun. 30, 2023 USD ($)	May 30, 2024 shares	Dec. 31, 2023 shares
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Share-based compensation arrangement by share-based payment award, number of additional shares authorized, percentage of increase (in percentage)					0.03
Share-based payment arrangement, expense \| $	$ 0	$ 0	$ 0	$ 41,500
Share-based compensation arrangement by share-based payment award, options, outstanding (in shares)	0		0			0
Plan Share Limit
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Share-based compensation arrangement by share-based payment award, number of shares authorized (in shares)					30,000,000
Plan ISO Limit
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Share-based compensation arrangement by share-based payment award, number of shares authorized (in shares)					30,000,000

RELATED PARTY TRANSACTIONS (Details) - USD ($) $ in Millions	Jul. 25, 2024	Jul. 22, 2024	Jul. 19, 2024	Jun. 13, 2024	Apr. 14, 2024
Private placement
Related Party Transaction [Line Items]
Shares issued in transaction (in shares)				340,932,212
Subsequent event \| Private placement
Related Party Transaction [Line Items]
Shares issued in transaction (in shares)		67,833,699
Consideration received on transaction	$ 620.0		$ 3,500.0
Subsequent event \| Private placement \| Director
Related Party Transaction [Line Items]
Shares issued in transaction (in shares)	262,585
Consideration received on transaction	$ 2.4
Cost reimbursement
Related Party Transaction [Line Items]
Amounts of related party transaction					$ 15.3
Employee agreement incentive pay
Related Party Transaction [Line Items]
Amounts of related party transaction					$ 2.8

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