Company: LGN
Filing Date: 2025-02-14
Form Type: DRS
Source: 0000950123-25-002471
Chunk: 134

Company: Legence Corp.
Filing Date: 2025-02-14
Form: DRS
Chunk 134
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ursuant to 17 C.F.R. Section 200.83

Under the provisions of ASC 740-10 Income Taxes, the
Company evaluates uncertain tax positions by reviewing against applicable tax law all positions taken by the Company with respect to tax years for which the statute of limitations is still open. ASC 740-10
provides that a tax benefit from an uncertain tax position may be recognized when it is more likely than not that the position will be sustained upon examination, including resolutions of any related appeals or litigation processes, based on the
technical merits.

Refer to Notes 2 and 14 of the Notes to Consolidated Financial Statements for further information, including the
identification and measurement of deferred tax assets and liabilities, the measurement of valuation allowances on deferred tax assets, gross unrecognized tax benefits and other additional acquired tax attributes.

Acquisitions and Valuation of Intangible Assets

We assign purchase consideration to the assets acquired and liabilities assumed as of their acquisition dates based on their fair value. We
record our acquisitions under the acquisition method of accounting, and the total purchase price is allocated to the acquired net tangible and identifiable intangible assets based on their fair values as of the acquisition dates. Determining the
fair value of certain long-lived assets, specifically intangible assets, requires judgment and often involves the use of significant estimates and assumptions.

The estimated fair value of identified intangible assets are Level 3 fair value measurements and are determined using discounted cash
flow techniques. Fair value is estimated using a multi-period excess earnings method for customer relationships and backlog and a relief from royalty method for trade names. The significant assumptions used in estimating fair value of customer
relationships and backlog include i) the estimated life the asset will contribute to cash flows, such as remaining contractual terms, (ii) revenue growth rates and EBITDA margins, (iii) attrition rate of customers, and (iv) the
estimated discount rates that reflect the level of risk associated with receiving future cash flows. The significant assumptions used in estimating fair value of trade names include discount rates and estimated royalties that would be paid to
license a comparable asset. The royalty rates used in this method are based on published comparable market royalty transactions.

Refer to
Notes 2 and 4 of the Notes to Consolidated Financial Statements for further information on valuation methods, inputs and assumptions.

Recent Accounting Pronouncements

See Note 2 of Notes to Consolidated Financial Statements included elsewhere in this prospectus for more
information regarding recent accounting pronouncements.

Quantitative and Qualitative Disclosures about Market