Company: LGN
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0002052568-25-000018
Chunk: 85

Company: Legence Corp.
Filing Date: 2025-11-14
Form: 10-Q
Item: Part I, Item 8
Chunk 85
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 Accrued compensation and benefits on the Condensed Consolidated Balance Sheets as of September 30, 2025 and December 31, 2024, respectively.SuretyAs a requirement under certain contracts, various Legence subsidiaries procure performance and payment bonds through surety underwriters. As a condition for having surety companies write bonds on Legence subsidiaries' behalf, Legence enters into indemnification agreements with the surety companies. Total outstanding bonds were approximately $461.4 million and $384.2 million as of September 30, 2025, and December 31, 2024, respectively.Customer GuaranteesAs part of its normal course of business, the Company offers guaranteed energy savings to customers under certain contracts. As of September 30, 2025 and December 31, 2024, total guarantees were $312.6 million and $308.2 million, respectively. Historically, the Company has not incurred material losses in connection with these guarantees. Further, management is not aware of any changes in the ability of the Company to meet these guarantees and does not expect to incur significant losses related to these guarantees in the foreseeable future.Letters of CreditAs discussed in “Note 7—Debt”, the standby letters of credit are secured through the revolving line of credit. As of both September 30, 2025 and December 31, 2024, the Company had $5.2 million in standby letters of credit primarily related to the deductibles of insurance policies.Tax Receivable AgreementAmounts payable under the TRA are accounted for in accordance with ASC Topic 450, Contingencies. Refer to "Note 14—Tax Receivable Agreement" for additional information.

Note 19 - Other Financial Information

38

Legence Corp.Notes to Condensed Consolidated Financial Statements - (Continued)(Unaudited)

Accounts receivable, net consists of the following (in thousands):September 30, 2025December 31, 2024Contracts receivable, net$583,834 $441,109 Accounts receivable—other4,5997,501Accounts receivable, net$588,433 $448,610 Prepaid expenses and other current assets consists of the following (in thousands):September 30, 2025December 31, 2024Prepaid expenses$22,179 $18,909 Inventories10,912 10,247 Deferred contract costs4,775 3,489