Company: LGN
Filing Date: 2025-11-03
Form Type: DRS
Source: 0001193125-25-262782
Chunk: 97

Company: Legence Corp.
Filing Date: 2025-11-03
Form: DRS
Chunk 97
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 completed in less than one year. The majority of our contracts are
fixed-price.

Cost of Revenue

Cost of revenue primarily consists of direct costs including labor, material and equipment, as well as overhead costs including project
management, facilities, IT, vehicles and various third-party expenses, such as insurance, rentals and subcontractor costs.

Selling, General and Administrative

Selling, general and administrative expenses primarily consist of personnel costs, including wages, payroll tax,
benefits and incentive compensation, as well as the costs of our real estate and IT services, integration costs for acquisitions after the acquisition date and various third-party professional fees.

61

Confidential Treatment Requested by Legence Corp.

Pursuant to 17 C.F.R. Section 200.83

Acquisition-Related Costs

Acquisition-related costs are costs we incur to effect a business combination, such as legal and professional fees.

Changes in the Fair Value of Contingent Consideration Liabilities

Contingent consideration liabilities are related to business acquisitions as further described in “Note 4—Acquisitions” of
the Notes to Consolidated Financial Statements. Changes in the fair value of contingent consideration liabilities are recorded to Changes in the fair value of contingent consideration liabilities on the Company’s Consolidated Statements of
Operations. As of June 30, 2025 and December 31, 2024, there were no outstanding contingent consideration liabilities, though future business acquisitions may result in future contingent consideration liabilities.

Depreciation and Amortization

Depreciation and amortization expenses primarily consist of depreciation on property or equipment such as vehicles, computer equipment,
leasehold improvements, tools and other equipment. The amortization of our intangible assets includes tradenames, customer relationships, contract backlog, and right of use assets of our finance leases.

Goodwill Impairment

Goodwill
impairment includes the expense recorded in a reporting period for impairment when we determine that the carrying value of goodwill exceeds its fair value. We conduct our annual goodwill impairment testing at the beginning of our fourth quarter each
year.

Equity in Earnings of Joint Venture

Equity in earnings of joint venture reflects our share of joint venture income or loss, as well as any impairment loss. Distributions received
from the joint venture investment are accounted for under the cumulative earnings approach, which compares our cumulative distributions received from the joint venture against our cumulative equity in earnings of joint venture.

Interest Expense, Net of Capitalized Interest

Interest expense includes interest on the indebtedness, amortization of deferred