Company: LGN
Filing Date: 2025-04-30
Form Type: DRS/A
Source: 0000950123-25-003868
Chunk: 152

Company: Legence Corp.
Filing Date: 2025-04-30
Form: DRS/A
Chunk 152
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 names. The significant

100

Confidential Treatment Requested by Legence Corp.

Pursuant to 17 C.F.R. Section 200.83

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 “Note 2—Summary of Significant Accounting Policies” and “Note 4—Acquisitions” in the Notes to
Consolidated Financial Statements for further information on valuation methods, inputs and assumptions.

Recent Accounting Pronouncements

See “Note 2—Summary of Significant Accounting Policies” in the Notes to Consolidated Financial Statements included elsewhere
in this prospectus for more information regarding recent accounting pronouncements.

Quantitative and Qualitative Disclosures about Market Risk

In the normal course of business, we are exposed to financial risks such as changes in interest rates and inflation risk associated
with our input costs. We utilize derivative instruments, classified as cash flow hedges, to manage interest rate exposures on our floating rate debt.

Interest Rate Risk

Our
exposure to market risk for changes in interest rates relates primarily to our long-term debt. The interest expense associated with our long-term debt will vary with market rates. We seek to mitigate this risk with an appropriate amount of fixed
rate debt obligations through interest rate derivative contracts that fix the interest rate on the respective floating rate debt obligations. Without taking into consideration the effect of our interest rate swap agreements, based upon our
outstanding principal amount of floating rate debt of $1,590.4 million as of December 31, 2024, an increase in the current interest rate levels of 1% would result in an increase in our annual interest expense of $15.9 million.

Inflation Risk

While
inflation pressures have recently and relatively subsided, rising or consistently high rates of inflation, including as a result of geopolitical tensions and trade wars, have the potential to increase costs of labor and other inputs for our
services. We have experienced, and may experience in the future, higher than expected inflation,