Company: LGN
Filing Date: 2025-12-09
Form Type: S-1
Source: 0001193125-25-312729
Chunk: 283

Company: Legence Corp.
Filing Date: 2025-12-09
Form: S-1
Chunk 283
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 under the income approach, using interest rate indices, risk premiums, and adjustments for the size and subordination of the instrument (Level 3 measurement). The carrying value of the remaining notes payable and finance lease liabilities approximates fair value as of September 30, 2025 and December 31, 2024. Note 9 - Derivatives I nterest Rate Swaps:The Company has multiple interest rate swap agreements designated as cash flow hedges. The Company utilizes these interest rate swap agreements to reduce exposure to fluctuations in variable interest rates for future interest payments on its term loan. The total notional amount is $785.0 million and $815.0 million as of September 30, 2025 and December 31, 2024, respectively. Failure of the interest rate swap counterparties to make payments may result in the loss of any potential benefit to the Company under the interest rate swap agreements. The Company mitigates risk of non-performanceby counterparties by dealing with highly rated counterparties. The Company does not use financial instruments for trading or speculative purposes. Additional information regarding the fair value of the Company’s interest rate swaps can be found in “Note 8—Fair Value Measurements”. F-31

Legence Corp. Notes to Condensed Consolidated Financial Statements - (Continued) (Unaudited) The fair value of derivative instruments is presented on the Condensed Consolidated Balance Sheets, as follows (in thousands):

|                                               |     |                                           | Balance Sheet Location |   | September 30, 
          2025 |     |   | December 31, 
         2024 |
|:----------------------------------------------|:----|:------------------------------------------|:-----------------------|:--|--------------:|:----|:--|-------------:|
| Derivatives designated as hedging instruments |     |                                           |                        |   |               |     |   |              |
| Interest rate swap asset (short-term)         |     | Prepaid expenses and other current assets |                        | $ |         1,172 |     | $ |        5,861 |
| Interest rate swap asset (long-term)          |     | Other assets                              |                        | $ |             — |     | $ |        3,387 |
| Interest rate swap liability (short-term)     |     | Accrued and other current liabilities     |                        | $ |           500 |     | $ |            — |
| Interest rate swap liability (long-term)      |     |