Company: LGN
Filing Date: 2025-09-02
Form Type: S-1/A
Source: 0001193125-25-193346
Chunk: 349

Company: Legence Corp.
Filing Date: 2025-09-02
Form: S-1/A
Chunk 349
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 to customary
affirmative covenants, contains a financial covenant that requires the Consolidated First Lien Net Leverage Ratio to be less than 8.50 to 1.00. The Net Leverage Ratio is only tested if as of the last day of a Test Period (generally quarterly) the
amount of loans and/or letters of credit outstanding under the revolving line of credit is greater than 35% of the facility size. Since August 5, 2021, the facility size has been $90.0 million and the Net Leverage Ratio has not been
required to be tested, therefore, the Company is in compliance with the financial covenant as of June 30, 2025.

Notes payable

As part of the consideration transferred to acquire certain companies, the Company issued notes payable to former owners of acquired companies. The former
owners are considered related parties when they are employees or Parent interests holders. The Company can prepay these notes without penalty.

The
Company issued a promissory note payable in connection with a 2022 acquisition. As of June 30, 2025 and December 31, 2024, the outstanding balance was $10.3 million and $10.0 million, respectively and the carrying value was
$9.7 million and $9.3 million, respectively, recorded in Long-term debt, net of current portion on the Condensed Consolidated Balance Sheets. The stated interest rate is 5.50%. All principal and interest are due at the earlier of the end
of the 5-year term in 2027 or upon a sale event as defined in the note agreement.

The Company issued promissory
notes payable in connection with a 2023 acquisition and a 2022 acquisition, and the holders of the promissory notes were related parties as of June 30, 2025 and December 31, 2024. As of

F-79

Legence Holdings LLC and Subsidiaries Notes to Condensed Consolidated Financial Statements—(Continued) (Unaudited) June 30, 2025 and December 31, 2024, the outstanding balance was $13.0 million and $14.6 million, respectively, and the carrying value was $11.9 million and $13.4 million, respectively. As of June 30, 2025, $11.9 million was recorded in Long-term debt, net of current portion on the Condensed Consolidated Balance Sheet