Company: LGN
Filing Date: 2025-12-09
Form Type: S-1
Source: 0001193125-25-312729
Chunk: 329

Company: Legence Corp.
Filing Date: 2025-12-09
Form: S-1
Chunk 329
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ated Variable Interest Entities In connection with the AMA acquisition in 2024, the Company has various contractual relationships with two professional corporations (“PCs”) that provide engineering and design services in New York and California. The Company does not own any equity interest in the PCs but provides most of the administrative functions, personnel and other resources required for the PCs to fulfill contracts with their customers. The Company receives fees from the PCs for these services. The Company is the primary beneficiary of the PCs. As such, the Company consolidates the PCs within the Consolidated Financial Statements. F-75

The table below shows the carrying amounts and classification of the PCs’ assets and liabilities included in the Company’s Consolidated Balance Sheet, excluding intercompany balances (in thousands):

|                                       |     | December 31, 
 2024         |        |
|:--------------------------------------|:----|:-------------|-------:|
| Cash                                  |     | $            | 11,391 |
| Accounts receivable, net              |     |              | 25,744 |
| Contract assets, net                  |     |              |  2,475 |
| Total current assets                  |     |              | 39,610 |
| Other assets                          |     |              |    467 |
| Total assets                          |     | $            | 40,077 |
| Accrued and other current liabilities |     | $            |  1,448 |
| Contract liabilities                  |     |              |  4,471 |
| Total liabilities                     |     | $            |  5,919 |

The assets of the PCs can only be used to settle their own obligations. The Company and the PCs have a promissory note agreement that allows each PC to borrow up to $1.0 million from the Company; however, no amounts have been borrowed. The Company’s Consolidated Balance Sheets, Consolidated Statements of Operations and Consolidated Statements of Cash Flows, net of intercompany eliminations, are impacted by the performance of the PCs. The Company’s Consolidated Financial Statements show noncontrolling interests, which represent the equity owned by the PCs’ owner. Equity Method Investments The Company has investments in, and transactions with, a number of unconsolidated joint ventures. The investments and earnings are immaterial. In addition, the Company recognized $5.7 million of related-party revenue from subcontracts with these joint ventures during the year ended December 31, 2024. Note 7—Property and Equipment, net Property