Company: LGN
Filing Date: 2025-09-02
Form Type: S-1/A
Source: 0001193125-25-193346
Chunk: 110

Company: Legence Corp.
Filing Date: 2025-09-02
Form: S-1/A
Chunk 110
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) approximately 54% of the economic interest in Legence Holdings and will control the management of Legence Holdings as the managing member. Immediately following the completion of the Corporate Reorganization, the ownership 
 percentage held by Legence (including through the Pubco Subsidiaries) and by noncontrolling interests will be approximately 38% and 62%, respectively.                                                                                             |

Represents an adjustment to equity reflecting (i) the par value for Class A Common Stock and Class B Common Stock, (ii) $103.8 million of noncontrolling interests related to the 62% economic interest held by the Existing Owners and (iii) reclassification of LGN Unit Holders’ interest of $339.5 million to additional paid-in capital.

| c) | Prior to the completion of the Offering Transactions, we will enter into a Tax Receivable Agreement with                                                                                                                                                 
 certain of our Existing Owners that provides for the payment by us to the TRA Members of 85% of the realized benefits, if any, as a result of increases in our share of existing tax basis and adjustments to the tax basis of the assets of Legence     
 Holdings as a result of sales or exchanges of LGN Units, and our utilization of certain tax attributes of the Blocker Entities and certain other tax benefits related to entering into the Tax Receivable Agreement, including tax benefits attributable 
 to payments under the Tax Receivable Agreement. Due to the uncertainty in the amount and timing of future redemptions or exchanges of LGN Units by the LGN Unit Holders, the unaudited pro forma consolidated financial information assumes that no      
 redemptions or exchanges of LGN Units have occurred and, therefore, no increases in tax basis in Legence Holdings’ assets or other tax benefits that may be realized thereunder have been assumed in the unaudited pro forma consolidated financial      
 information. The Tax Receivable Agreement will be accounted for as a contingent liability, with amounts accrued when considered probable and reasonably estimable. The following are the Tax Receivable Agreement adjustments:                           |

| (1) | We will record a deferred tax asset of $27.0 million (or $33.6 million if the underwriters exercise                                                                                                                                          
 in full their option to purchase additional shares of Class A Common Stock and after giving effect to the application of the net proceeds therefrom). To the extent we estimate that we will not realize the full benefit represented by the 
 deferred tax assets, based on an analysis of expected future earnings, we will reduce deferred tax assets with a