Company: LGN
Filing Date: 2025-02-14
Form Type: DRS
Source: 0000950123-25-002471
Chunk: 235

Company: Legence Corp.
Filing Date: 2025-02-14
Form: DRS
Chunk 235
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Confidential Treatment Requested by Legence Corp.

Pursuant to 17 C.F.R. Section 200.83

Legence Holdings LLC and Subsidiaries

Notes to Consolidated Financial Statements

Note 1—Nature of Operations

Legence Holdings LLC
and its subsidiaries (“Legence” or the “Company”) are a leading provider of engineering, installation and maintenance services for mission-critical systems in buildings. The Company focuses on high-growth sectors that have
technically demanding buildings, including technology, life sciences, healthcare and education. Legence specializes in designing, fabricating and installing complex heating, ventilation and air conditioning (“HVAC”), process piping and
other mechanical, electrical and plumbing (“MEP”) systems for new facilities and upgrading HVAC, lighting and building controls in existing facilities to make them more energy efficient and sustainable. Services are primarily provided on a
fixed price basis.

The Company was formed as a single-member limited liability company under the laws of the State of Delaware on October 30, 2020.
Legence is a wholly-owned subsidiary of Legence Intermediate LLC (“Member”) which is a wholly-owned subsidiary of Legence Parent LLC (“Parent”). The powers of Legence will be exercised by the authority of Parent, as the
Company’s ultimate parent. Parent has designated certain individuals as officers of the Company.

Note 2—Summary of Significant Accounting Policies

The Consolidated Financial Statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S.
GAAP”).

Principles of Consolidation

The
Consolidated Financial Statements include the accounts of Legence and its wholly owned subsidiaries. All intercompany accounts and transactions have been eliminated.

Business Combinations

Business combinations are recorded
in accordance with Accounting Standards Codification (“ASC”) Topic 805, Business Combinations(“ASC 805”). Under the acquisition method of accounting, the consideration transferred by the acquirer is assigned to the
identifiable assets acquired and liabilities assumed as of their acquisition date fair values. Determining the fair value of certain assets and liabilities assumed is judgmental in nature and often involves the use of significant estimates and
assumptions. ASC 805 provides certain recognition and measurement exceptions such as leases, contract assets and contract liabilities, and income taxes, which are accounted for under ASC 842, ASC 606 and ASC 740, respectively. Goodwill represents
the excess of the consideration transferred over the fair value of identifiable assets and liabilities acquired. Bargain purchase gains represent the excess