Company: LGN
Filing Date: 2025-02-14
Form Type: DRS
Source: 0000950123-25-002471
Chunk: 122

Company: Legence Corp.
Filing Date: 2025-02-14
Form: DRS
Chunk 122
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 if they are selected to provide the system for the                                         
 client. The fee is typically earned and paid when the client enters into a binding contract with the project developer and permits to begin construction have been issued. If a contract is not signed or permits are not issued, Black Bear is typically 
 not owed a fee from the project developer. In the fourth quarter of 2023, a project developer who had been selected for a large number of projects by Black Bear’s clients offered to immediately pay Black Bear all of the fees that Black Bear          
 would earn in the future if all of the projects received permits, provided that Black Bear would agree to discount the fee amounts. Black Bear agreed to discount the fee amounts and recorded                                                            |

83

Confidential Treatment Requested by Legence Corp. Pursuant to 17 C.F.R. Section 200.83

| significantly higher revenues than would be typical in a quarter. Given the unique nature of the transaction, we consider it to be non-recurring in nature. 
 This adjustment is to eliminate the approximately $7.4 million profit we recorded from the transaction.                                                     |

| (6) | Refer to Note 17 in the Notes to the Consolidated Financial Statements, for details on the nature of the 
 settlement.                                                                                              |

Liquidity and Capital Resources Overview As of December 31, 2023, our primary sources of liquidity included cash and cash equivalents of $88.9 million, $84.8 million available to be borrowed under the Revolving Credit Facility and cash flows from operations. Following the completion of this offering, we expect our primary sources of liquidity to be cash flows from operations, borrowings incurred under our Revolving Credit Facility or proceeds from offerings of debt or equity securities. Access to additional liquidity, such as an increase in the capacity under our existing Revolving Credit Facility or a new financing arrangement, will be subject to our credit ratings and future financial position. To date, our primary uses of capital have included funding working capital, capital expenditures for equipment used in our business, acquisitions and refinancing or repayment of debt and associated interest. Although we cannot provide any assurance that our cash flows from operations will be sufficient to fund our operations or that additional capital will be available to us on acceptable terms, or at all, we believe our primary sources of liquidity are sufficient to fund our ongoing working capital, investing and financing requirements for at least the next twelve months and beyond. In the event that we require additional capital, we may seek to raise funds at any time through equity