# EDGAR Filing Document

**Accession Number:** 0002052568
**File Stem:** 0001193125-26-114802
**Filing Date:** 2026-3
**Character Count:** 142005
**Document Hash:** 0d7aa43432ebd22c35e10710931caf8b
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001193125-26-114802.hdr.sgml**: 20260319

**ACCESSION NUMBER**: 0001193125-26-114802

**CONFORMED SUBMISSION TYPE**: 8-K/A

**PUBLIC DOCUMENT COUNT**: 17

**CONFORMED PERIOD OF REPORT**: 20260102

**ITEM INFORMATION**: Financial Statements and Exhibits

**FILED AS OF DATE**: 20260319

**DATE AS OF CHANGE**: 20260318

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** Legence Corp.
- **CENTRAL INDEX KEY:** 0002052568
- **STANDARD INDUSTRIAL CLASSIFICATION:** CONSTRUCTION SPECIAL TRADE CONTRACTORS [1700]
- **ORGANIZATION NAME:** 05 Real Estate & Construction
- **EIN:** 000000000
- **STATE OF INCORPORATION:** DE
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 8-K/A
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-42838
- **FILM NUMBER:** 26772015

**BUSINESS ADDRESS:**
- **STREET 1:** 1601 LAS PLUMAS AVENUE
- **CITY:** SAN JOSE
- **STATE:** CA
- **ZIP:** 95133
- **BUSINESS PHONE:** 408-347-3500

**MAIL ADDRESS:**
- **STREET 1:** 1601 LAS PLUMAS AVENUE
- **CITY:** SAN JOSE
- **STATE:** CA
- **ZIP:** 95133

?xml version='1.0' encoding='ASCII'? 8-K/A

### UNITED STATES

### SECURITIES AND EXCHANGE COMMISSION

#### Washington, D.C. 20549

### FORM 8-K/A

#### (Amendment No. 1)

#### CURRENT REPORT

#### Pursuant to Section 13 or 15(d)

#### of the Securities Exchange Act of 1934

#### Date of Report (Date of earliest event reported): January 2, 2026

## Legence Corp.

#### (Exact name of registrant as specified in its charter)

---

| | | |
|:---|:---|:---|
| **Delaware** | **001-42838** | **33-2905250** |
| **(State or other jurisdiction**<br> **of incorporation)** | **(Commission**<br> **File Number)** | **(I.R.S. Employer**<br> **Identification No.)** |
| **1601 Las Plumas Avenue** | **1601 Las Plumas Avenue** |  |
| **San Jose, CA** | **San Jose, CA** | **95133** |
| **(Address of principal executive offices)** | **(Address of principal executive offices)** | **(Zip Code)** |

---

#### Registrant's telephone number, including area code: (833) 534-3623
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

---

| | |
|:---|:---|
| **Title of each class** | **Name of each exchange**<br> **on which registered** |
| Class A common stock, par value $0.01 per share LGN | The Nasdaq Stock Market LLC |

---

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

------

#### Introductory Note
As previously disclosed in the Current Report on Form 8-K filed by Legence Corp. (the "Company") with the Securities and Exchange Commission on January 2, 2026 (the "Initial Form 8-K"), on January 2, 2026, the Company and its wholly owned subsidiary, Legence Subsidiary Holdings, LLC, consummated the previously announced acquisition of 100% of the equity interests of The Bowers Group, Inc. ("Bowers").

This Amendment No. 1 to the Initial Form 8-K (this "Amendment") is being filed solely to amend the Initial Form 8-K to include the financial statements of a business acquired required by Item 9.01(a) of Form 8-K and the pro forma financial information required by Item 9.01(b) of Form 8-K. Except for the foregoing, this Amendment does not modify or update any other disclosure contained in the Initial Form 8-K.

---

| | |
|:---|:---|
| **Item 9.01** | **Financial Statements and Exhibits.**  |

---

*(a) Financial statements of businesses or funds acquired.* 

The audited consolidated financial statements of Bowers and subsidiaries as of and for the year ended September 30, 2025, and the notes related thereto, are filed herewith and attached hereto as Exhibit 99.1, and are incorporated herein by reference.

*(b) Pro forma financial information.* 

The unaudited pro forma condensed combined balance sheet of the Company and subsidiaries as of September 30, 2025 and the unaudited pro forma condensed combined statements of operations of the Company and subsidiaries for the nine months ended September 30, 2025 and the year ended December 31, 2024, and the notes related thereto, are filed herewith and attached hereto as Exhibit 99.2, and are incorporated herein by reference.

*(d) Exhibits.* 

---

| | |
|:---|:---|
| **Exhibit**<br> **No.** | **Description** |
| 23.1 | [Consent of Lanigan Ryan, P.C. (independent auditor for Bowers).](d122671dex231.htm) |
| 99.1 | [Audited consolidated financial statements of Bowers and subsidiaries as of and for the year ended September 30, 2025, and the notes related thereto.](d122671dex991.htm) |
| 99.2 | [Unaudited pro forma condensed combined balance sheet of the Company and subsidiaries as of September 30, 2025 and unaudited pro forma condensed combined statements of operations of the Company and subsidiaries for the nine months ended September 30, 2025 and the year ended December 31, 2024, and the notes related thereto.](d122671dex992.htm) |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). |

---

------

#### SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

---

| | | |
|:---|:---|:---|
|  | **LEGENCE CORP.** | **LEGENCE CORP.** |
| Dated: March 18, 2026 | By: | /s/ Stephen Butz |
|  | Name: | Stephen Butz |
|  | Title: | Chief Financial Officer |

---

## Exhibit 23.1

**Exhibit 23.1** 

**CONSENT OF INDEPENDENT AUDITORS** 

We consent to the incorporation by reference in this Current Report on Form 8-K/A and the Registration Statements on Form S-8 (Nos. 333-294093 and 333-290277) of Legence Corp. of our report dated December 19, 2025, with respect to the consolidated financial statements of The Bowers Group, Inc. and subsidiaries appearing in this Current Report on Form 8-K/A of Legence Corp.

---

| |
|:---|
|  /s/ Lanigan Ryan, PC |
|  Gaithersburg, Maryland |
|  March 18, 2026 |

---

## Exhibit 99.1

**Exhibit 99.1** 

**THE BOWERS GROUP, INC.** 

**AND SUBSIDIARIES** 

**CONSOLIDATED FINANCIAL STATEMENTS** 

**Years Ended September 30, 2025 and 2024** 

------

**TABLE OF CONTENTS**

---

| | | |
|:---|:---|:---|
|  | Page | Page |
|  INDEPENDENT AUDITORS' REPORT |  | 1 -2 |
|  CONSOLIDATED FINANCIAL STATEMENTS |  |  |
|  Consolidated balance sheets |  | 3 - 4 |
|  Consolidated statements of income |  | 5 |
|  Consolidated statements of retained earnings |  | 6 |
|  Consolidated statements of cash flows |  | 7 |
|  Notes to consolidated financial statements |  | 8 - 23 |

---

------

![LOGO](g122671g83y73.jpg)

**INDEPENDENT AUDITORS' REPORT** 

To the Board of Directors

The Bowers Group, Inc. and Subsidiaries

Beltsville, Maryland

**Opinion** 

We have audited the accompanying consolidated financial statements of The Bowers Group, Inc. and Subsidiaries, which comprise the consolidated balance sheets as of September 30, 2025 and 2024, and the related consolidated statements of income, retained earnings, and cash flows for the years then ended, and the related notes to the consolidated financial statements.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of The Bowers Group, Inc. and Subsidiaries, as of September 30, 2025 and 2024, and the results of their operations and their cash flows for the years then ended in accordance with accounting principles generally accepted in the United States of America.

**Basis for Opinion** 

We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Our responsibilities under those standards are further described in the *Auditors' Responsibilities for the Audit of the Financial Statements* section of our report. We are required to be independent of The Bowers Group, Inc. and Subsidiaries, and to meet our other ethical responsibilities in accordance with the relevant ethical requirements relating to our audits. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

**Responsibilities of Management for the Financial Statements** 

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about The Bowers Group, Inc. and Subsidiaries' ability to continue as a going concern within one year after the date that the consolidated financial statements are available to be issued.

Phone: 301.258.8900 ● Fax: 301.258.1020 ● LaniganRyan.com

9841 Washingtonian Boulevard Suite 300 Gaithersburg, MD 20878

![LOGO](g122671g06z82.jpg)

------

**Auditors' Responsibilities for the Audit of the Financial Statements** 

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors' report that includes our opinion. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with generally accepted auditing standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements, including omissions, are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the consolidated financial statements.

In performing an audit in accordance with generally accepted auditing standards, we:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Exercise professional judgment and maintain professional skepticism throughout the audit.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or
error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of The Bowers Group, Inc. and Subsidiaries internal control. Accordingly, no such opinion is expressed.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting
estimates made by management, as well as evaluate the overall presentation of the financial statements.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise
substantial doubt about The Bowers Group, Inc. and Subsidiaries ability to continue as a going concern for a reasonable period of time.

We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control related matters that we identified during the audit.

![LOGO](g122671g73k65.jpg)

Gaithersburg, Maryland

December 19, 2025

------

**THE BOWERS GROUP, INC. AND SUBSIDIARIES** 

CONSOLIDATED BALANCE SHEETS

September 30, 2025 and 2024

---

| | | |
|:---|:---|:---|
|  | 2025 | 2024 |
|  **ASSETS** |  |  |
|  **CURRENT ASSETS** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Cash and cash equivalents | $56985828 | $65015816 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Contract receivables | 147362294 | 77964997 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Contract assets: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Costs and estimated earnings in excess of billings on uncompleted contracts | 24304075 | 9969396 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Conditional retention | 23029144 | 14572437 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Inventories, at lower of cost (weighted average) or market | 2674502 | 2538841 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Prepaid expenses | 1110191 | 1069540 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; **Total current assets** | **255466034** | **171131027** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Property and equipment, net | 6735138 | 6343572 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Right-of-use assets | 17035822 | 16908938 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Equipment deposits | 640288 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Tax deposit | 4474516 | 3923886 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deposits | 121467 | 125913 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Cash surrender value of officers' life insurance | 796778 | 629347 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; **Total assets** | $**285270043** | $**199062683** |

---

*The Notes to Consolidated Financial Statements are an integral part of these statements.* 

------

**THE BOWERS GROUP, INC. AND SUBSIDIARIES** 

CONSOLIDATED BALANCE SHEETS

September 30, 2025 and 2024

---

| | | |
|:---|:---|:---|
|  | 2025 | 2024 |
|  **LIABILITIES AND STOCKHOLDERS' EQUITY** |  |  |
|  **CURRENT LIABILITIES** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Current maturities of operating leases liability | $3700809 | $2517411 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Accounts payable | 60820183 | 31743052 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Retentions payable | 10034746 | 7939250 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Contract liabilities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Billings in excess of costs and estimated earnings on uncompleted contracts | 124013029 | 72451827 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Less: conditional retention | (44270093) | (27286358) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Accrued liabilities | 22684417 | 20656056 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Income taxes payable | 1130000 | 163552 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; **Total current liabilities** | **178113091** | **108184790** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Operating leases liability, less current maturities | 13923467 | 14791359 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; **Total liabilities** | **192036558** | **122976149** |
|  **STOCKHOLDERS' EQUITY** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Common stock, $1 par value; 100,000 shares authorized |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Voting - 9,100 shares issued and outstanding | 9100 | 9100 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Nonvoting - 32,112 shares issued and outstanding | 32112 | 32112 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Additional paid-in capital | 3375729 | 3375729 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Retained earnings | 89816544 | 72669593 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; **Total stockholders' equity** | **93233485** | **76086534** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; **Total liabilities and stockholders' equity** | $**285270043** | $**199062683** |

---

*The Notes to Consolidated Financial Statements are an integral part of these statements.* 

------

**THE BOWERS GROUP, INC. AND SUBSIDIARIES** 

CONSOLIDATED STATEMENTS OF INCOME

Years Ended September 30, 2025 and 2024

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | 2025 | 2025 | 2024 | 2024 |
|  | Amount | Percent | Amount | Percent |
|  Earned revenue | $766995789 | 100.0% | $554791720 | 100.0% |
|  Cost of earned revenue | 625574304 | 81.6 | 449202899 | 81.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; **Gross profit** | **141421485** | **18.4** | **105588821** | **19.0** |
|  General and administrative expenses | 71051500 | 9.3 | 57528708 | 10.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; **Operating income** | **70369985** | **9.2** | **48060113** | **8.7** |
|  Other income (expense) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest income | 2473767 | 0.3 | 2697615 | 0.5 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest expense | (7083) | 0.0 | (216021) | 0.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other income | 31436 | 0.0 | 47973 | 0.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; **Income before taxes** | **72868105** | **9.5** | **50589680** | **9.1** |
|  Income tax expense | 4250019 | 0.6 | 2216300 | 0.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; **Net income** | $**68618086** | **8.9%** | $**48373380** | **8.7%** |

---

*The Notes to Consolidated Financial Statements are an integral part of these statements.* 

------

**THE BOWERS GROUP, INC. AND SUBSIDIARIES** 

CONSOLIDATED STATEMENTS OF RETAINED EARNINGS

Years Ended September 30, 2025 and 2024

---

| | | |
|:---|:---|:---|
|  | 2025 | 2024 |
|  **Balance, beginning of year** | $72669593 | $68128456 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net income | 68618086 | 48373380 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Dividends paid | (51471135) | (43832243) |
|  **Balance, end of year** | $**89816544** | $**72669593** |

---

*The Notes to Consolidated Financial Statements are an integral part of these statements.* 

------

**THE BOWERS GROUP, INC. AND SUBSIDIARIES** 

CONSOLIDATED STATEMENTS OF CASH FLOWS

Years Ended September 30, 2025 and 2024

---

| | | |
|:---|:---|:---|
|  | 2025 | 2024 |
|  **Cash flows from operating activities:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net income | $68618086 | $48373380 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Adjustments to reconcile net income to net cash provided by operating activities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Depreciation and amortization | 1735768 | 1549599 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Credit loss expense | 77257 | 97124 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gain on sale of property and equipment | (12739) | (34028) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net non-cash operating lease adjustments | 188622 | 199422 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(Increase) decrease in assets: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Contract receivables | (69474554) | 17525929 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other receivables |  | 50000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Inventories | (135661) | (201724) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Contract assets | (22791386) | 5001645 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Prepaid expenses | (40651) | (192663) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other assets | 4446 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Tax deposit | (550630) | (2219491) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Cash surrender value of officers' life insurance | (167431) | (143834) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Increase (decrease) in liabilities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Accounts payable and retentions payable | 31172627 | (7522073) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Accrued liabilities | 2028361 | 1981175 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Contract liabilities | 34577467 | 19374353 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Income taxes payable | 966448 | (1926010) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; **Net cash provided by operating activities** | **46196030** | **81912804** |
|  **Cash flows from investing activities:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Proceeds from sale of property and equipment | 12739 | 60788 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deposits placed on property and equipment | (640288) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Purchases of property and equipment | (2127334) | (3074522) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; **Net cash used in investing activities** | **(2754883)** | **(3013734)** |
|  **Cash flows from financing activities:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Principal payments on long-term debt |  | (4833333) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Dividends paid | (51471135) | (43832243) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; **Net cash used in financing activities** | **(51471135)** | **(48665576)** |
|  Net increase (decrease) in cash and cash equivalents | (8029988) | 30233494 |
|  Cash and cash equivalents at beginning of year | 65015816 | 34782322 |
|  **Cash and cash equivalents at end of year** | $**56985828** | $**65015816** |

---

*The Notes to Consolidated Financial Statements are an integral part of these statements.* 

------

**THE BOWERS GROUP, INC. AND SUBSIDIARIES** 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Years Ended September 30, 2025 and 2024

---

| | |
|:---|:---|
| **Note 1.** | **Summary of Significant Accounting Policies**  |

---

*Principles of Consolidation and Nature of Operation* - The accompanying consolidated financial statements include the accounts of The Bowers Group, Inc. and its wholly owned subsidiaries, W.E. Bowers & Associates, Inc., W.E. Bowers, Inc. and The Bowers Automotive Group, LLC (Collectively, the Company). All significant intercompany transactions and balances have been eliminated in consolidation.

The Company constructs and maintains heating, air conditioning, and plumbing systems. Substantially all activity is located in the Washington, DC Metropolitan area. Certain aspects of the work are generally subcontracted out, including balancing and control work, and mechanical insulation work. The work is performed under fixed-price, gross maximum price, and time and material contracts with durations of typically less than three years.

W.E. Bowers & Associates, Inc. concentrates on larger construction and renovation contracts, whereas W.E. Bowers, Inc. concentrates on smaller construction contracts as well as service and maintenance work. The Bowers Automotive Group, LLC's primary purpose is to service the Company's automotive equipment. Approximately 95% of the Company's revenue is derived from construction contracts and 5% is derived from service and maintenance work.

**Revenue Recognition** 

The Company recognizes revenue in a five-step model for recognizing revenue from contracts with customers as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. Identify the contract

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Identify performance obligations

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. Determine the transaction price

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. Allocate the transaction price

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. Recognize revenue 

*Contract Combination -* To determine proper revenue recognition, the Company evaluates whether two or more contracts should be combined and accounted for as a single performance obligation and whether a combined or single contract should be accounted for as more than one performance obligation. This evaluation requires significant judgment, and the decision to combine contracts or separate a combined or single contract into multiple performance obligations could change the amount of revenue and profit recorded in a given period.

*Performance Obligations -* A performance obligation is a promise in a contract to transfer a distinct good or service to the customer and is the unit of account in recognizing revenue from contracts with customers. A contract's transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied.

------

**THE BOWERS GROUP, INC. AND SUBSIDIARIES** 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Years Ended September 30, 2025 and 2024

---

| | |
|:---|:---|
| **Note 1.** | **Summary of Significant Accounting Policies** (continued)  |

---

**Revenue Recognition** (continued)

*Transaction Price and Variable Consideration -* The nature of the Company's contracts gives rise to several types of variable consideration, including claims and unpriced change orders; awards and incentive fees; and liquidated damages and penalties. The Company recognizes revenue for variable consideration when it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur. The Company estimates the amount of revenue to be recognized on variable consideration using the expected value or the most likely amount method, whichever is expected to better predict the amount.

Estimates of variable consideration and determination of whether to include estimated amounts in the transaction price are based largely on assessment of legal enforceability, the Company's performance, and all information (historical, current, and forecasted) that is reasonably available to the Company.

*Contract Estimates -* Due to the nature of the Company's performance obligations, the estimation of total revenue and cost at completion is subject to many variables and requires significant judgment. Management must make assumptions and estimates regarding labor productivity and availability, the complexity of the work to be performed, the cost and availability of materials, the performance of subcontractors, and the availability and timing of funding from the customer, among other variables. As a significant change in one or more of these estimates could affect the profitability of contracts, the Company reviews and updates contract-related estimates regularly through a review process in which management reviews the progress and execution of performance obligations and the estimated cost at completion.

As part of this process, management reviews information including, but not limited to, any outstanding key contract matters, progress toward completion and the related program schedule and the related changes in estimates of revenue and costs.

The Company recognizes adjustments in estimated profit on contracts under the cumulative catch-up method. Under this method, the impact of the adjustment on profit recorded to date is recognized in the period the adjustment is identified. Revenue and profit in future periods of contract performance is recognized using the adjusted estimate. If at any time the contract estimates indicate an anticipated loss on a contract, the projected loss is recognized in full, including the reversal of any previously recognized profit, in the period it is identified and recognized as an accrued loss on uncompleted contracts on the balance sheets.

*Contract Modifications -* Contracts are often modified due to changes in contract specifications and requirements. The Company considers contract modifications to exist when the modification either creates new or changes the existing enforceable rights and obligations. Most contract modifications are for goods or services that are not distinct from existing contracts due to the significant integration provided in the context of the contract; thus, these are accounted for as if they were part of the original contract. The effect of a contract modification on the transaction price, and the Company's measure of progress for the performance obligation to which it relates, is recognized as an adjustment to revenue (either as an increase or a reduction) on a cumulative catch-up basis.

------

**THE BOWERS GROUP, INC. AND SUBSIDIARIES** 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Years Ended September 30, 2025 and 2024

---

| | |
|:---|:---|
| **Note 1.** | **Summary of Significant Accounting Policies** (continued)  |

---

**Revenue Recognition** (continued)

*Contract Modifications* (continued) *-* The Company accounts for contract modifications as a separate contract when the modification results in the promise to deliver additional goods or services that are distinct and the increase in price of the contract is for the same amount as the stand-alone selling price of the additional goods or services included in the modification.

*Construction Contracts -* The Company recognizes revenue on construction contracts over time; as performance obligations are satisfied, due to the continuous transfer of control to the customer. The customer typically controls the work in process, as evidenced either by contractual termination clauses or by the Company's right to payment for work performed to date plus a reasonable profit to deliver products or services that do not have an alternative use to the Company. The Company's construction contracts are generally accounted for as a single performance obligation, since the Company is providing a significant service of integrating components into a single project.

The Company recognizes revenue using a cost-based input method, by which the Company uses actual costs incurred relative to total estimated contract costs to determine, as a percentage, progress toward contract completion. This percentage is applied to the transaction price to determine the amount of revenue to recognize. Costs that do not depict progress toward satisfaction of the performance obligation are included in contract costs with revenue recognized to the extent of such costs without any profit and include items such as uninstalled materials and re-work. The Company believes the cost-based input method is the most faithful depiction of performance, because it directly measures the value of the services transferred to the customer.

Because the Company almost always acts as a principal in their contracts, the Company recognizes revenue gross. The Company is considered the principal because the Company controls the contractually specified goods and services before they are transferred to the customer.

*Service Contracts -* For service contracts (including maintenance contracts) where the Company has the right to consideration from the customer in an amount that corresponds directly with the value received by the customer based on performance to date, revenue is recognized when services are performed and contractually billable. For all other types of service contracts, revenue is recognized over time generally using the cost-to-cost method (e.g., costs incurred to date relative to total estimated costs at completion) to measure progress because it best depicts the transfer of value to the customer.

*Cost and Expense Recognition -* Contract costs include all direct materials, subcontract costs, direct labor costs and those indirect costs related to contract performance, such as indirect labor, payroll taxes, fringe benefits, equipment rental and insurance. Indirect costs are allocated to contracts based on direct labor.

------

**THE BOWERS GROUP, INC. AND SUBSIDIARIES** 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Years Ended September 30, 2025 and 2024

---

| | |
|:---|:---|
| **Note 1.** | **Summary of Significant Accounting Policies** (continued)  |

---

**Other significant accounting policies are as follows:** 

*Use of Estimates in Consolidated Financial Statements* - The preparation of consolidated financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. It is reasonably possible that changes may occur in the near term that would affect management's estimates with respect to the percentage of completion.

*Operating Cycle* - The length of the Company's contracts varies but is typically less than three years. Assets and liabilities related to long-term contracts are included in current assets and current liabilities in the accompanying consolidated balance sheets, as they will be liquidated in the normal course of contract completion.

*Cash and Cash Equivalents* - The Company considers all highly liquid investments with a maturity of three months or less as of the date of acquisition to be cash equivalents.

*Contracts Receivable* - Contracts receivable include billed and unbilled amounts for services provided to customers for which the Company has an unconditional right to payment. Billed and unbilled amounts for which payment is contingent on anything other than the passage of time are included in contract assets and contract liabilities.

The Company's construction contracts may include retention provisions. Retention represents amounts withheld from billings by customers until work is substantially complete (or until certain milestones are reached, or both) to ensure that obligations are satisfied under the contract. When payment of the retention is contingent upon the Company fulfilling its obligations under the contract it does not meet the criteria to be included in contracts receivable and remains in contract assets and contract liabilities. Retention for which the Company has an unconditional right to payment that is only subject to the passage of time are included in contracts receivable.

The Company typically does not include extended payment terms in its contracts with customers. Construction contracts where the Company performs as a subcontractor may contain "pay when paid" or "pay if paid" provisions that allow the general contractor to hold payment until they have received payment from the owner related to the work performed. Because these provisions do not impose any additional obligations on the Company (i.e., there are no conditions remaining to fulfill to receive payment), the Company considers receivables billed under these provisions to be subject only to the passage of time.

------

**THE BOWERS GROUP, INC. AND SUBSIDIARIES** 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Years Ended September 30, 2025 and 2024

---

| | |
|:---|:---|
| **Note 1.** | **Summary of Significant Accounting Policies** (continued)  |

---

*Contracts Receivable* (continued) - The Company recognizes an allowance for losses on contracts receivable in an amount equal to the current expected credit losses. The estimation of the allowance is based on an analysis of historical loss experience, current receivables aging, and management's assessment of current conditions, as well as an assessment of specific identifiable customer accounts considered at risk or uncollectible. The Company has elected a practical expedient to assume that current conditions as of the balance sheet date do not change for the remaining life of the asset. The Company assesses collectability by pooling receivables where similar characteristics exist and evaluates receivables individually when specific customer balances no longer share those risk characteristics and are considered at risk or uncollectible. The expense associated with the allowance for expected credit losses is recognized in general and administrative expenses.

*Contract Assets and Contract Liabilities* – The timing of when the Company bills their customers on long-term construction contracts is generally dependent upon agreed-upon contractual terms, which may include milestone billings based on the completion of certain phases of the work, or when services are provided. When as a result of contingencies, billings cannot occur until after the related revenue has been recognized, the result is in unbilled revenue, which is included in contract assets. Additionally, the Company may receive advances or deposits from customers before revenue is recognized, resulting in deferred revenue, which is included in contract liabilities. 

Retention for which the Company has an unconditional right to payment that is only subject to the passage of time are classified as contracts receivable. Retention subject to conditions other than the passage of time do not meet the definition of a receivable and are therefore included in contract assets and contract liabilities, as determined on a contract-by-contract basis.

Contract assets represent revenues recognized in excess of amounts paid or payable (contract receivables) to the Company on uncompleted contracts. Contract liabilities represent the Company's obligation to perform on uncompleted contracts with customers for which the Company has received payment or for which contract receivables are outstanding. The beginning of the year contract assets for 2024 and 2023 were $24,541,833 and $29,543,478, respectively. The beginning of the year contract liabilities for 2024 and 2023 were $(45,165,469) and $(25,791,116), respectively.

*Reclassification of Prior Year Contract Assets and Contract Liabilities* - As noted above, contract assets and contract liabilities are presented on a contract-by-contract basis. In previous years all conditional retention receivable were reported as contract assets, rather than being netted with contract liabilities related to the specific contract. The prior year contract assets and contract liabilities have been reclassified to present contract assets and contract liabilities on a contract-by-contract basis. 

*Leases* - A lease contract conveys the right to use an underlying asset for a period of time in exchange for consideration. At inception, the Company determines whether a contract contains a lease by determining if there is an identified asset and if the contract conveys the right to control the use of the identified asset over a period of time in exchange for consideration.

------

**THE BOWERS GROUP, INC. AND SUBSIDIARIES** 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Years Ended September 30, 2025 and 2024

---

| | |
|:---|:---|
| **Note 1.** | **Summary of Significant Accounting Policies** (continued)  |

---

*Leases* (continued) - At lease commencement, the Company measures and records a lease liability equal to the present value of the remaining lease payments, generally using the risk-free rate determined using a period comparable with that of the lease term for all asset classes.

On the lease commencement date, the Company records a right-of-use asset consisting of the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the amount of the initial measurement of the lease liability;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• any lease payments made at or before the commencement date, minus any lease incentives received; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• any initial direct costs incurred.

The Company assesses the lease options for individual leases and generally considers the base term to be the term of lease contracts. The Company has elected to combine lease and non-lease components for all asset classes. A policy to not recognize the right-of-use assets and lease liabilities for short-term leases has been adopted. The leases are further described in Note 7.

*Warranties -* For construction contracts, the Company provides a two-year warranty covering defects in workmanship and a two-year warranty covering installed materials when the latter are not covered by manufacturer warranties. The Company provides a one-year warranty on labor and materials on repair and maintenance contracts, excluding leak repairs, for which no warranty is provided. A reserve for warranty costs is estimated and recorded based upon the historical level of warranty claims and management's estimate of future costs. The Company has not accrued any amount for estimated future warranty costs as of both September 30, 2025 and 2024.

*Depreciation and Amortization* - Property and equipment are recorded at cost and depreciated over their estimated useful lives of from three to ten years using the straight-line method. Leasehold improvements are amortized over their remaining expected lease terms. Depreciation and amortization expense was $1,735,768 and $1,549,599 for the years ended September 30, 2025 and 2024, respectively.

*Advertising Costs* - The Company expenses advertising costs as they are incurred. Advertising expense for the years ended September 30, 2025 and 2024 was $180,046 and $48,536, respectively.

*Self Insurance* - The Company's workers' compensation policies are structured as Incurred Loss Deductible policies, whereby the Company self-insures for claim losses up to pre-determined limits. The Company also pays the insurance carrier an administrative fee for processing and settling the claims.

The Company funds actual losses (up to the pre-determined limits) as they are incurred and settled.

------

**THE BOWERS GROUP, INC. AND SUBSIDIARIES** 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Years Ended September 30, 2025 and 2024

---

| | |
|:---|:---|
| **Note 1.** | **Summary of Significant Accounting Policies** (continued)  |

---

*Self Insurance* (continued)- As of September 30, 2025 and 2024, the Company has included a liability of $901,917 and $849,917, respectively, in accrued liabilities on its accompanying consolidated balance sheets related to estimated obligations for losses on open claims not yet settled and losses on claims not yet reported as disclosed in Note 9.

The Bowers Group, Inc. is taxed under Section 1362 (S Corporation) of the Internal Revenue Code and similar sections of the Maryland and Virginia state income tax laws, which provide that, in lieu of corporation income taxes, the stockholders are taxed on their proportionate share of the Company's taxable income. Therefore, no provision or liability for federal income taxes has been included in the financial statements. For federal income tax purposes, the subsidiaries are reflected as divisions of The Bowers Group, Inc. In order for the Company to maintain its fiscal year-end for tax purposes, it is required to complete Form 8752 and remit a deposit to the Internal Revenue Service on May 15th of each year. As of September 30, 2025 and 2024, the Company has $4,474,516 and $3,923,886 on deposit with the Internal Revenue Service, respectively.

The Company is subject to franchise taxes in certain states that do not recognize the S Corporation status. These taxes are included in income tax expense on the accompanying consolidated statements of income. Effective October 1, 2020, the Company has elected to pay Maryland income taxes at the entity level on behalf of its stockholders. Accordingly, Maryland income taxes for the years ended September 30, 2025 and 2024 are included in income tax expense. Effective October 1, 2022, the Company elected to pay Virginia income taxes at the entity level rather than at the stockholder level. Accordingly, Virginia income taxes for the year ended September 30, 2025 and 2024 are included in income tax expense on the statements of income.

*Uncertain Tax Positions* - For financial reporting purposes, the Company recognizes tax positions claimed or expected to be claimed based upon whether it is more likely than not that the tax position will be sustained upon examination. The Company recognizes interest, if any, related to unrecognized income tax liabilities in interest expense. Additionally, the Company recognizes penalties, if any, related to unrecognized income tax liabilities in operating expense. As of September 30, 2025 and 2024, the Company had no uncertain tax positions that qualified for either recognition or disclosure in the consolidated financial statements.

*Fair Value Measurement* - The Company measures fair value based on the price that the Company would receive upon selling an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. Various inputs are used in determining the fair value of assets or liabilities. Inputs are classified into a three-tier hierarchy, summarized as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Level 1 – Quoted prices in active markets for identical assets or liabilities

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Level 2 – Other significant observable inputs

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Level 3 – Significant unobservable inputs

------

**THE BOWERS GROUP, INC. AND SUBSIDIARIES** 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Years Ended September 30, 2025 and 2024

---

| | |
|:---|:---|
| **Note 1.** | **Summary of Significant Accounting Policies** (continued)  |

---

*Fair Value Measurement* (continued) - When Level 1 inputs are not available, the Company measures fair value using valuation techniques that maximize the use of relevant observable inputs (Level 2) and minimizes the use of unobservable inputs (Level 3).

---

| | |
|:---|:---|
| **Note 2.** | **Disaggregation of Revenue**  |

---

Revenue from construction contracts and from the rendering of services comprise of revenue from goods and services transferred over time. The Company's contracts and revenue mainly comprise of construction contracts, time-and-material services, and maintenance contracts. Construction contracts are typically either fixed price or guaranteed maximum price. Fixed price construction contracts involve more risk. However, they offer the opportunity for additional profits if the Company completes the contract for less than estimated. Guaranteed maximum price contracts are a cost-type contract where the Company is compensated for actual costs incurred plus a fixed fee subject to a ceiling price. The terms of guaranteed maximum price contracts vary between customers and the scope of the work to be performed. Time-and-material services are comprised of using a set labor fee per hour to control the pricing with the customer, profit may vary if actual labor-hour costs vary significantly from the negotiated rates. Typically, these contracts are used when a customer needs immediate assistance to fix a problem within a building and are non-recurring in nature. Maintenance contracts are comprised of a firm fixed price agreement. Customers engage the Company to evaluate their equipment and the Company then prepares a preventative maintenance plan to service the equipment to avoid costly breakdowns.

The contract-type components of earned revenue are as follows:

---

| | | |
|:---|:---|:---|
|  | 2025 | 2024 |
|  Construction contracts | $733228810 | $527363286 |
|  Time-and-material services | 21523108 | 17823114 |
|  Maintenance contracts | 12243871 | 9605320 |
|  | $766995789 | $554791720 |

---

------

**THE BOWERS GROUP, INC. AND SUBSIDIARIES** 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Years Ended September 30, 2025 and 2024

---

| | |
|:---|:---|
| **Note 3.** | **Contract Receivables, Net**  |

---

The components of contract receivables, net, are as follows:

---

| | | |
|:---|:---|:---|
|  | 2025 | 2024 |
|  Contract receivables: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Completed contracts | $4253890 | $2786048 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Contracts in progress | 130858097 | 67254448 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Service maintenance contracts | 12405307 | 8082992 |
|  | 147517294 | 78123488 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Allowance for credit losses | (155000) | (158491) |
|  | $147362294 | $77964997 |

---

---

| | |
|:---|:---|
| **Note 4.** | **Costs and Estimated Earnings on Uncompleted Contracts**  |

---

The status of uncompleted contracts as of September 30, 2025 and 2024 is as follows:

---

| | | |
|:---|:---|:---|
|  | 2025 | 2024 |
| &nbsp;&nbsp;&nbsp;&nbsp; Construction contracts: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Costs incurred on uncompleted contracts | $916289935 | $790958616 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Estimated earnings | 125161471 | 109519804 |
|  | 1041451406 | 900478420 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Billings to date including conditional retentions | 1138440287 | 960006125 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Less conditional retention | (67299237) | (41858795) |
|  | 1071141050 | 918147330 |
|  Net contract liabilities - construction contracts | $(29689644) | $(17668910) |
|  Maintenance contracts: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Costs incurred on uncompleted contracts | $4626691 | $3499817 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Estimated earnings | 2370262 | 1311592 |
|  | 6996953 | 4811409 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Billings to date including conditional retentions | 9717026 | 7766135 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Less conditional retention | (—) | (—) |
|  | 9717026 | 7766135 |
|  Net contract liabilities - maintenance contracts | $(2720073) | $(2954726) |

---

------

**THE BOWERS GROUP, INC. AND SUBSIDIARIES** 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Years Ended September 30, 2025 and 2024

---

| | |
|:---|:---|
| **Note 4.** | **Costs and Estimated Earnings on Uncompleted Contracts** (continued)  |

---

Contract assets (liabilities) include the following:

---

| | | |
|:---|:---|:---|
|  | 2025 | 2024 |
|  Construction contracts: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Costs and estimated earnings in excess of billings on uncompleted contracts | $23913845 | $9810014 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Conditional retentions included in contract assets | 23029144 | 14572437 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total contract assets | 46942989 | 24382451 |
|  Billings in excess of costs and estimated earnings on uncompleted contracts | (120902726) | (69337719) |
|  Conditional retentions included in contract liabilities | 44270093 | 27286358 |
|  Total contract liabilities | (76632633) | (42051361) |
|  Net contract assets (liabilities) - construction contracts | $(29689644) | $(17668910) |
|  Maintenance contracts: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Costs and estimated earnings in excess of billings on uncompleted contracts | $390230 | $159382 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Conditional retentions included in contract assets |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total contract assets | 390230 | 159382 |
|  Billings in excess of costs and estimated earnings on uncompleted contracts | (3110303) | (3114108) |
|  Conditional retentions included in contract liabilities |  |  |
|  Total contract liabilities | (3110303) | (3114108) |
|  Net contract liabilities - maintenance contracts | $(2720073) | $(2954726) |

---

------

**THE BOWERS GROUP, INC. AND SUBSIDIARIES** 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Years Ended September 30, 2025 and 2024

---

| | |
|:---|:---|
| **Note 5.** | **Backlog Disclosure**  |

---

The following schedule summarizes changes in backlog on contracts during the years ended September 30, 2025 and 2024. Backlog represents the amount of the transaction price, including variable consideration not constrained, allocated to remaining (i.e., unsatisfied or partially unsatisfied) performance obligations at the end of each reporting period. Backlog includes revenue the Company expects to realize both from uncompleted contracts and from signed contracts on which work has not yet begun.

---

| | | |
|:---|:---|:---|
|  | 2025 | 2024 |
|  Backlog balance, beginning of year | $691856742 | $399796677 |
|  Contract adjustments | 1094877601 | 193462930 |
|  New contracts during the year | 202896325 | 635565741 |
|  | 1989630668 | 1228825348 |
|  Less contract revenue earned | (745472681) | (536968606) |
|  Backlog balance, end of year | $1244157987 | $691856742 |

---

---

| | |
|:---|:---|
| **Note 6.** | **Property and Equipment, Net**  |

---

Balances of major classes of assets and total accumulated depreciation and amortization are included in property and equipment, net in the consolidated balance sheets as follows:

---

| | | |
|:---|:---|:---|
|  | 2025 | 2024 |
|  Leasehold improvements | $13463919 | $13225532 |
|  Vehicles | 8784015 | 8112677 |
|  Tools and equipment | 8386176 | 7549878 |
|  Office furniture and equipment | 2372045 | 2372045 |
|  | 33006155 | 31260132 |
|  Less: accumulated depreciation and amortization | (26271017) | (24916560) |
|  | $6735138 | $6343572 |

---

---

| | |
|:---|:---|
| **Note 7.** | **Operating Leases**  |

---

The Company leases office, warehouse and yard space at various locations. The terms of the leases include base monthly rents due in equal monthly installments plus certain real estate taxes and operating costs of the properties. The leases are subject to annual escalation increases and expire on various dates through July 2032.

Rent and operating expenses relating to these leases totaled $4,735,243 and $3,659,572 for the years ended September 30, 2025 and 2024, respectively. Of these, $2,983,538 and $1,893,734 were charged to cost of earned revenue for the years ended September 30, 2025 and 2024, respectively.

------

**THE BOWERS GROUP, INC. AND SUBSIDIARIES** 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Years Ended September 30, 2025 and 2024

---

| | |
|:---|:---|
| **Not 7.** | **Operating Leases** (continued)  |

---

The weighted average remaining lease terms for operating leases were 62 and 76 months as of September 30, 2025 and 2024, respectively. The weighted-average discount rates as of September 30, 2025 and 2024 for operating leases were 4.00% and 3.99%, respectively.

The maturities of the operating leases liability as of September 30, 2025 is as follows:

---

| | |
|:---|:---|
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Year ending September 30, |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2026 | $4342309 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2027 | 3762516 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2028 | 3369798 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2029 | 3464901 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2030 | 2628639 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Thereafter | 2004394 |
|  Total lease payments | 19572557 |
|  Less: interest | (1948281) |
|  Present value of operating leases liability | $17624276 |
|  Less: current maturity | (3700809) |
|  Long-term operating leases liability | $13923467 |

---

Total lease cost for the years ended September 30, 2025 and 2024:

---

| | | |
|:---|:---|:---|
|  | 2025 | 2024 |
| &nbsp;&nbsp;&nbsp;&nbsp; Operating lease cost | $4067291 | $2911906 |
| &nbsp;&nbsp;&nbsp;&nbsp; Variable lease cost | 488838 | 370290 |
| &nbsp;&nbsp;&nbsp;&nbsp; Short-term lease cost | 179114 | 377376 |
|  Total lease cost | $4735243 | $3659572 |

---

---

| | |
|:---|:---|
| **Note 8.** | **Line of Credit Facilities**  |

---

The Company has a revolving line of credit with a financial institution, maturing on the demand of the lender. Advances on the line are limited to $50,000,000 and are subject to limitations based on eligible contract receivables and outstanding letters of credit. This line of credit bears interest at SOFR plus 1% and is secured by the Company's assets. As of September 30, 2025 and 2024, no amounts were outstanding on the line of credit. The line of credit is subject to certain financial covenants.

The line of credit facility includes a $500,000 equipment line. As of September 30, 2025 and 2024, no loans had been drawn on the line and converted into notes.

The line of credit facility includes a letter of credit facility. As of September 30, 2025 and 2024, the Company had $1,985,750 of irrevocable letters of credit outstanding in connection with its self insurance plan which reduced the borrowing base on the line of credit.

------

**THE BOWERS GROUP, INC. AND SUBSIDIARIES** 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Years Ended September 30, 2025 and 2024

---

| | |
|:---|:---|
| **Note 9.** | **Accrued Liabilities**  |

---

Accrued liabilities as of September 30, 2025 and 2024 consist of the following:

---

| | | |
|:---|:---|:---|
|  | 2025 | 2024 |
|  Accrued wages, bonuses and vacation | $14935324 | $14902347 |
|  Union benefits payable | 6130882 | 4270902 |
|  Self insurance loss reserve | 901917 | 849917 |
|  Accrued profit sharing plan contributions | 671229 | 564003 |
|  Other accrued liabilities | 45065 | 68887 |
|  | $22684417 | $20656056 |

---

---

| | |
|:---|:---|
| **Note 10.** | **Income Taxes**  |

---

Income tax expense consists of the following components for the years ended September 30, 2025 and 2024:

---

| | | |
|:---|:---|:---|
|  | 2025 | 2024 |
|  Current Virginia entity level income tax | $2762538 | $1708488 |
|  Current District of Columbia franchise tax expense | 593669 | 506953 |
|  Current Maryland entity level income tax | 893812 | 859 |
|  | $4250019 | $2216300 |

---

---

| | |
|:---|:---|
| **Note 11.** | **Qualified Retirement Plan**  |

---

The Company has a qualified retirement plan with a 401(k) feature, which covers all non-union qualified employees who have attained age 18 and have completed six months of service. The plan allows employees to make voluntary tax deferred contributions, not to exceed statutory limits. The Company makes safe harbor matching contributions of 3% of employees' annual compensation. In addition, the Board of Directors can make a discretionary profit sharing contribution on an annual basis. Employee and safe harbor matching contributions are 100% vested and the discretionary profit sharing contributions vest over a period of 6 years. The Company made matching and profit sharing contributions to the plan totaling $1,331,416 and $1,254,047 for the years ended September 30, 2025 and 2024, respectively.

------

**THE BOWERS GROUP, INC. AND SUBSIDIARIES** 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Years Ended September 30, 2025 and 2024

---

| | |
|:---|:---|
| **Note 12.** | **Concentrations of Credit Risk**  |

---

Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of temporary cash investments and contract and retention receivables.

The Company places its temporary cash investments with one financial institution. Accounts at this institution are insured by the Federal Deposit Insurance Corporation up to certain limits. As of September 30, 2025 and 2024 the Company's uninsured balances totaled $7,611,128 and $5,088,811, respectively.

Contract and retention receivables from four customers totaled 65% of the Company's total contract and retention receivables as of September 30, 2025.

Contract and retention receivables from one customers totaled 17% of the Company's total contract and retention receivables as of September 30, 2024.

---

| | |
|:---|:---|
| **Note 13.** | **Revenues from Major Customers**  |

---

Revenues from three major customers totaled 46% of the Company's earned revenues during the year ended September 30, 2025.

Revenues from one major customers totaled 12% of the Company's earned revenues during the year ended September 30, 2024.

---

| | |
|:---|:---|
| **Note 14.** | **Supplemental Disclosure of Cash Flows Information**  |

---

Cash paid during the years ended September 30, 2025 and 2024 for:

---

| | | |
|:---|:---|:---|
|  | 2025 | 2024 |
|  Interest | $7083 | $216021 |
|  DC Franchise Taxes | $456669 | $656953 |
|  MD Income Taxes | $728852 | $228381 |
|  VA Income Taxes | $2098050 | $3256976 |

---

ROU assets acquired through operating leases totaled $3,459,372 and $6,891,707 for the years ended September 30, 2025 and 2024, respectively.

Cash paid for amounts included in measurement of lease liabilities for the years ended September 30, 2025 and 2024 include:

---

| | | |
|:---|:---|:---|
|  | 2025 | 2024 |
|  Cash paid for operating leases | $3878669 | $2707156 |

---

------

**THE BOWERS GROUP, INC. AND SUBSIDIARIES** 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Years Ended September 30, 2025 and 2024

---

| | |
|:---|:---|
| **Note 15.** | **Union Contracts**  |

---

The Company has agreements with seven different unions located in the Washington DC Metropolitan area. These unions provide pension, health insurance, and other benefits to their members. The Company makes contributions to the unions to fund the benefits. Approximately 90% of the Company's employees are members of these unions.

---

| | |
|:---|:---|
| **Note 16.** | **Multi-employer Pension Plans**  |

---

As illustrated in the table below, the Company significantly participated in three multi-employer defined benefit plans for the year ended September 30, 2025. The most recent Pension Protection Act (PPA) zone status available is for the plans' year-end ranging from April 1, 2025 to August 31, 2025. Based on an actuary's certified information, the Company received the zone status information for the plans to identify the various zones identified with each plan. Plans in the red zone are generally less than 65 percent funded, plans in the yellow zone are less than 80 percent funded, and plans in the green zone are at least 80 percent funded. The "FIP/RP Status Pending/Implemented" column indicates plans for which a financial improvement plan (FIP) or a rehabilitation plan (RP) is either pending or has been implemented. The second to last column lists the expiration date of the collective-bargaining agreement. The last column lists the contributions the Company made for years ended September 30, 2025 and 2024, respectively.

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Pension<br>Protection<br>Act Zone**<br> **Status** | **FIP/RP<br>Status<br>Pending/**<br> **Implemented** | **Surcharge**<br> **Imposed** | **Collective<br>Bargaining<br>Agreement<br>Expiration**<br> **Date** | **Contributions by the Company** | **Contributions by the Company** |
| **Pension Fund Name** | **Pension<br>Protection<br>Act Zone**<br> **Status** | **FIP/RP<br>Status<br>Pending/**<br> **Implemented** | **Surcharge**<br> **Imposed** | **Collective<br>Bargaining<br>Agreement<br>Expiration**<br> **Date** | 2025 | 2024 |
|  Heating, Piping & Refrigeration Pension Fund EIN 52-1058013 | Green as<br>of Sept 1,<br>2025 | No | No | 07/31/2028 | $11009711 \* | $8795355 \* |
|  Plumbers & Pipefitters National Pension Fund Local #5 EIN 52-6152779 | Green as<br>of July 1,<br>2025 | No | No | 07/31/2028 | 1817512 | 1634212 |
|  Sheet Metal Workers D.C. Area Pension Fund Local #100 EIN 52-6038495 | Green as<br>of April 1,<br>2025 | No | No | 10/31/2026 | 6483667 \* | 6233358 \* |
|  Other Plans |  |  |  |  | 1247369 | 588091 |
|  |  |  |  |  | $20558259 | $17251016 |

---

\* The Company contributions are greater than 5% of this plan's total contributions. 

------

**THE BOWERS GROUP, INC. AND SUBSIDIARIES** 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Years Ended September 30, 2025 and 2024

---

| | |
|:---|:---|
| **Note 16.** | **Multi-employer Pension Plans** (continued)  |

---

The risks of participating in these multi-employer plans are different from single-employer plans in the following aspects:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Assets contributed to the multi-employer plan by one employer may be used to provide benefits to employees of
other participating employers.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• If a participating employer stops contributing to the plan, the unfunded obligations of the plan may be borne by
the remaining participating employers.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• If the Company chooses to stop participating in some of the multi-employer plans, the Company may be required to
pay those plans an amount based on the underfunded status of the plan, referred to as a withdrawal liability.

The Company currently has no intention of withdrawing from any of the multi-employer pension plans in which they participate that would result in a significant withdrawal liability.

---

| | |
|:---|:---|
| **Note 17.** | **Subsequent Events**  |

---

The Company has evaluated subsequent events through December 19, 2025, the date which the financial statements were available to be issued.

On November 13, 2025, the Company entered into an agreement with Legence Corp. whereby Legence will acquire The Bowers Group, Inc.

## Exhibit 99.2

**Exhibit 99.2** 

**UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS** 

**Introduction** 

On January 2, 2026, Legence Corp. ("Legence" or the "Company") completed the acquisition of The Bowers Group, Inc. ("Bowers") pursuant to the Equity Purchase Agreement dated November 13, 2025 (the "Purchase Agreement") (the "Acquisition"). Bowers and its subsidiaries operate a business providing specialty mechanical contracting and related services to general contractors and building owners. The Acquisition and related financing transactions are described in the Company's current report on Form 8-K filed on January 2, 2026. The Acquisition has been accounted for as a business combination in accordance with Financial Accounting Standards Board Accounting Standards Codification ("ASC") Topic 805, Business Combinations ("ASC 805"), with Legence as the accounting acquirer. The unaudited pro forma condensed combined financial information (the "Pro Forma Financial Information") has also been adjusted for other significant events during the periods, further described below, which reflect the application of the accounting required by U.S. GAAP, linking the effects of these events to the Company's historical consolidated financial statements.

**Basis of Presentation** 

The unaudited pro forma condensed combined financial information has been prepared in accordance with Article 11 of Regulation S-X (as amended by SEC Release No. 33-10786) ("Article 11"). In addition to the Acquisition, the Company had other significant events during the periods which included a series of organizational transactions (the "Corporate Reorganization"), Initial Public Offering ("IPO") and related financing transactions which are further described below. The Pro Forma Financial Information is intended to show how the Acquisition, Corporate Reorganization, IPO and related financing transactions (collectively, the "Transactions") might have affected the Company's historical financial position and results of operations; it is not necessarily indicative of future results. The Pro Forma Financial Information was derived from the historical financial statements of Legence and Bowers and reflects adjustments depicting the accounting for i) Legence's Corporate Reorganization, IPO, related repayment of outstanding indebtedness and grant of restricted stock unit and stock options in connection with the offering (the "Corporate Reorganization and Offering Transactions") ii) the Acquisition and iii) the financing arrangements entered in connection with the Acquisition.

The Pro Forma Financial Information should be read in conjunction with (i) Legence's historical financial statements and related notes included or incorporated by reference in the Company's registration statement filed pursuant to Rule 424(b)(4) on September 15, 2025 (the "Prospectus"), and Legence's historical financial statements and related notes included in the Company's Form 10-Q for the third quarter filed on November 14, 2025, and (ii) the historical financial statements and related notes of Bowers included in this filing.

The unaudited pro forma condensed combined balance sheet is as of September 30, 2025. It contains the historical financial position of Legence that already reflected the Corporate Reorganization and Offering Transactions and the audited historical balance sheet of Bowers. It is presented to reflect adjustments depicting accounting for the Acquisition and related financing as if the Acquisition closed on September 30, 2025.

The unaudited pro forma condensed combined statements of operations for the nine months ended September 30, 2025, and the year ended December 31, 2024, are presented to reflect adjustments depicting the accounting for the Acquisition, the related financing agreement, and the Corporate Reorganization and Offering Transactions made on the unaudited pro forma condensed combined balance sheet assuming the Acquisition closed on January 1, 2024.

The following Pro Forma Financial Information gives effect to the Transactions, which includes adjustments for the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The Company's Corporate Reorganization and IPO, including the grant of restricted stock units and stock
options and the repayment of indebtedness in connection with the IPO; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The alignment of the Bowers financial statements to conform with Legence financial statement presentation and
accounting policies; and

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The application of the acquisition method of accounting under the provision of ASC 805 and to reflect estimated
consideration transferred of approximately $435.0 million; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The proceeds and uses of the financing arrangements entered in connection with the Acquisition; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Non-recurring costs incurred and expected to be incurred in connection
with the Acquisition; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The allocation between noncontrolling interest ("NCI") and Legence stockholders due to the
Acquisition and related financing.

The pro forma adjustments are based on available information and upon assumptions that Legence management believes are reasonable to reflect, on a pro forma basis, the effect of Transactions on the historical financial information of Legence. The adjustments are described in the notes to the unaudited pro forma condensed combined balance sheet and the unaudited pro forma condensed combined statements of operations.

The Pro Forma Financial Information is presented for informational purposes only and does not purport to represent the actual results of operations or financial position that would have occurred had the Transactions been completed on the dates indicated, nor is it necessarily indicative of the results to be expected in any future period.

**The Corporate Reorganization and Offering Transactions** 

On September 11, 2025, the Securities and Exchange Commission declared effective Legence Corp.'s registration statement on Form S-1 relating to its IPO. The Company's Class A common stock ("Class A Common Stock") commenced trading on the Nasdaq Global Select Market on September 12, 2025, and the IPO closed on September 15, 2025. The Company issued and sold 29,487,627 shares of Class A Common Stock, including shares issued upon the partial exercise of the underwriters' option to purchase additional shares, at a public offering price of $28.00 per share, resulting in net proceeds of approximately $780.2 million after underwriting discounts and commissions.

In connection with the IPO, the Company completed a series of organizational transactions that resulted in an Umbrella Partnership-C Corporation ("UP-C") structure, under which Legence Corp. became the managing member of Legence Holdings, LLC ("Legence Holdings") The Company contributed the net proceeds from the IPO to Legence Holdings in exchange for newly issued limited liability company interests, and Legence Holdings used the proceeds to pay offering-related costs and repay outstanding indebtedness. Following the Corporate Reorganization and the IPO, Legence consolidates Legence Holdings and reports noncontrolling interest representing the equity interests in Legence Holdings not owned by the Company.

**The Acquisition** 

On November 13, 2025, Legence, together with its wholly owned subsidiary, Legence Subsidiary Holdings, LLC, a Delaware limited liability company (the "Purchaser"), entered into a Purchase Agreement with Bowers, and with the Wayne E. Bowers Revocable Living Trust, the Quiet Harbor Trust, and The David O'Donnell Revocable Trust dated November 15, 2008 (each, a "Seller" and collectively, the "Sellers").

Under the terms of the Purchase Agreement, the parties undertook a series of reorganization steps whereby (i) the Sellers caused Bowers and certain of its subsidiaries to convert into Maryland limited liability companies, (ii) the Sellers contributed 100% of their equity interests in Bowers (the "Bowers Interests") to a newly formed Delaware limited liability company ("NewCo"), wholly owned by the Sellers, and (iii) NewCo joined the Purchase Agreement as a party (collectively, the "Bowers Reorganization").

On January 2, 2026 (the "Closing Date"), Legence completed the acquisition of all the outstanding Bowers Interests from NewCo pursuant to the terms and conditions of the Purchase Agreement. At the closing of the Acquisition, the Company paid aggregate consideration consisting of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Approximately $291.4 million paid in cash, subject to customary post-closing purchase price adjustments; and

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• 2,551,672 shares of Legence Class A Common Stock with a preliminary fair value of approximately
$98.6 million, which includes a discount due to certain lock-up and other provisions; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Deferred consideration with a preliminary fair value of $44.9 million, payable on December 31, 2026, in
cash, Class A Common Stock, or a combination thereof, at Legence's discretion.

The shares of Class A Common Stock issued in the Acquisition are subject to applicable restrictive legends under the Securities Act of 1933, as amended, and are subject to a contractual lock-up on transfers, subject to specified exceptions, through and including March 10, 2026.

Concurrently, Legence Holdings amended its existing credit agreement to add an incremental term loan of $200.0 million that was drawn in full at closing of the Acquisition. The incremental term loan proceeds, together with cash on hand and borrowings under the revolving credit facility, were used to fund cash consideration and transaction-related fees and expenses.

------

**Legence Corp.** 

**UNAUDITED PRO FORMA CONDENSED COMBINED BALANCE SHEET** 

**As of September 30, 2025** 

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| ***(in thousands, except par value amounts)***  | ***(in thousands, except par value amounts)***  | ***(in thousands, except par value amounts)***  | ***(in thousands, except par value amounts)***  | ***(in thousands, except par value amounts)***  | ***(in thousands, except par value amounts)***  | ***(in thousands, except par value amounts)***  | ***(in thousands, except par value amounts)***  | ***(in thousands, except par value amounts)***  |
|  | **Legence<br>Corp.<br>(Historical)** | **The Bowers<br>Group, Inc.<br>(Historical)<br>Adjusted<br>(Note 2)** | **Transaction<br>Accounting<br>Adjustments** | **Notes** | **Pro Forma<br>Combined<br>for<br>Transaction<br>Accounting<br>Adjustments** | **Financing<br>Adjustments** | **Notes** | **Pro Forma<br>Combined** |
|  **ASSETS** |  |  |  |  |  |  |  |  |
|  Current assets |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Cash and cash equivalents | 176034 | 56986 | (291411) | **4B** | (63502) | 195917 | **4L** | 132415 |
|  |  |  | (5111) | **4F** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Accounts receivable, net | 588433 | 147362 |  |  | 735795 |  |  | 735795 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Contract assets, net | 234302 | 63686 |  |  | 297988 |  |  | 297988 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Prepaid expenses and other current assets | 39038 | 3785 |  |  | 42823 |  |  | 42823 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total Current assets | 1037807 | 271819 | (296522) |  | 1013104 | 195917 |  | 1209021 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Property and equipment, net of accumulated depreciation | 81094 | 6735 | 6120 | **4C** | 95850 |  |  | 95850 |
|  |  |  | 1901 | **4K** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Operating lease right-of-use assets | 106469 | 17036 | 3000 | **4E** | 129705 |  |  | 129705 |
|  |  |  | 3200 | **4J** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Goodwill | 782931 |  | (105125) | **4A** | 820590 |  |  | 820590 |
|  |  |  | 434987 | **4B** |  |  |  |  |
|  |  |  | (6120) | **4C** |  |  |  |  |
|  |  |  | (302200) | **4D** |  |  |  |  |
|  |  |  | (3000) | **4E** |  |  |  |  |
|  |  |  | 5272 | **4G** |  |  |  |  |
|  |  |  | 14433 | **4H** |  |  |  |  |
|  |  |  | (588) | **4J** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Intangible assets, net | 562361 |  | 302200 | **4D** | 864561 |  |  | 864561 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other assets | 29607 | 6033 | (5272) | **4G** | 30368 |  |  | 30368 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total | 1562462 | 29804 | 348808 |  | 1941074 |  |  | 1941074 |
|  **Total Assets** | **2600269** | **301623** | **52286** |  | **2954178** | **195917** |  | **3150095** |
|  **LIABILITIES** |  |  |  |  |  |  |  |  |
|  Current liabilities |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Accounts payable | 224256 | 68249 | (250) | **4F** | 292255 | 53 | **4L** | 292308 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Accrued compensation and benefits | 89832 |  | 23398 | **4H** | 113230 |  |  | 113230 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Accrued and other current liabilities | 25659 | 33849 | 44941 | **4B** | 104449 |  |  | 104449 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Contract liabilities | 285894 | 76776 |  |  | 362670 |  |  | 362670 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Current portion of operating lease liabilities | 18051 | 3701 | 852 | **4J** | 22604 |  |  | 22604 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Current portion of long-term debt | 16301 | —  | 824 | **4K** | 17125 |  |  | 17125 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total Current liabilities | 659993 | 182575 | 69765 |  | 912333 | 53 |  | 912386 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Long-term debt, net of current portion | 812628 | —  | 1077 | **4K** | 813705 | 198991 | **4L** | 1012696 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Operating lease liabilities, net of current portion | 94568 | 13923 | 1760 | **4J** | 110251 |  |  | 110251 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Tax receivable agreement liability - related party | 146474 |  |  |  | 146474 |  |  | 146474 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deferred tax liabilities, net | 41543 |  |  |  | 41543 |  |  | 41543 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other long-term liabilities | 17590 |  |  |  | 17590 |  |  | 17590 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total | 1112803 | 13923 | 2837 |  | 1129563 | 198991 |  | 1328554 |
|  **Total Liabilities** | **1772796** | **196498** | **72602** |  | **2041896** | **199044** |  | **2240940** |
|  **EQUITY** |  |  |  |  |  |  |  |  |
|  Stockholders' equity |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Class A common stock $0.01 par value | 585 |  | 26 | **4B** | 611 |  |  | 611 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Class B common stock $0.01 par value | 467 |  |  |  | 467 |  |  | 467 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Common stock $0.01 par value - Voting |  | 9 | (9) | **4A** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Common stock $0.01 par value - Nonvoting |  | 32 | (32) | **4A** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Additional paid-in capital | 664299 | 3376 | (3376) | **4A** | 737174 |  |  | 737174 |
|  |  |  | 98609 | **4B** |  |  |  |  |
|  |  |  | (25734) | **4I** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Accumulated deficit | (277228) | 101708 | (101708) | **4A** | (291054) | (3127) | **4L** | (294181) |
|  |  |  | (4861) | **4F** |  |  |  |  |
|  |  |  | (8965) | **4H** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Accumulated other comprehensive (loss) income | (248) |  | (5) | **4I** | (253) |  |  | (253) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total Stockholders' equity | 387875 | 105125 | (46055) |  | 446945 | (3127) |  | 443818 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Noncontrolling interests | 439598 |  | 25739 | **4I** | 465337 |  |  | 465337 |
|  **Total Equity** | **827473** | **105125** | **(20316)** |  | **912282** | **(3127)** |  | **909155** |
|  **Total liabilities and equity** | **2600269** | **301623** | **52286** |  | **2954178** | **195917** |  | **3150095** |

---

*See accompanying notes to unaudited pro forma condensed combined financial information* 

------

**Legence Corp.** 

**UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS** 

**For the Nine Months Ended September 30, 2025** 

*(in thousands, except per share data)* 

---

| | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Legence**<br>**Corp.**<br>**(Historical)** | **Corporate<br>Reorganization**<br>**and Offering<br>Adjustments**<br>**(Note 3)** | **Notes** | **Legence Corp.**<br>**(Historical)**<br>**Adjusted** | **The Bowers**<br>**Group, Inc.**<br>**(Historical) -<br>Adjusted**<br>**(Note 2)** | **Transaction<br>Accounting<br>Adjustments** | **Notes** | **Financing<br>Adjustments** | **Notes** | **Pro Forma**<br>**Combined** |
|  Revenue | $1812849 |  |  | 1812849 | 640520 | (2950) | **4II** |  |  | 2450419 |
|  Cost of revenue | 1424412 | 1438 | **3H** | 1425850 | 520357 | 31 | **4GG** |  |  | 1943291 |
|  |  |  |  |  |  | (2950) | **4II** |  |  |  |
|  |  |  |  |  |  | 3 | **4KK** |  |  |  |
|  **Gross profit** | **388437** | **(1438)** |  | **386999** | **120163** | **(34)** |  | **—** |  | **507128** |
|  Selling, general and administrative | 227814 | 5275 | **3H** | 233089 | 54808 | 453 | **4DD** |  |  | 295059 |
|  |  |  |  |  |  | 3643 | **4EE** |  |  |  |
|  |  |  |  |  |  | 3015 | **4GG** |  |  |  |
|  |  |  |  |  |  | 51 | **4KK** |  |  |  |
|  Depreciation and amortization | 75619 |  |  | 75619 | 1311 | 1801 | **4AA** |  |  | 116812 |
|  |  |  |  |  |  | 37951 | **4BB** |  |  |  |
|  |  |  |  |  |  | 130 | **4KK** |  |  |  |
|  Acquisition-related costs | 971 |  |  | 971 |  |  |  |  |  | 971 |
|  Loss (gain) on sale of property and equipment | (199) |  |  | (199) |  |  |  |  |  | (199) |
|  Equity in earnings of joint venture | (848) |  |  | (848) |  |  |  |  |  | (848) |
|  **Income (loss) from operations** | **85080** | **(6713)** |  | **78367** | **64044** | **(47078)** |  | **—** |  | **95333** |
|  Interest expense, net of capitalized interest | 88228 | (50710) | **3G** | 37518 |  | 32 | **4KK** | 10501 | **4LL** | 48051 |
|  Interest income | (2588) |  |  | (2588) | (1893) |  |  |  |  | (4481) |
|  Loss on debt extinguishment | 5685 | (5685) | **3I** |  |  |  |  |  |  |  |
|  Credit agreement amendment fees | 2990 |  |  | 2990 |  |  |  |  |  | 2990 |
|  Other income, net | (268) |  |  | (268) | (29) |  |  |  |  | (297) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total Other expenses, net | 94047 | (56395) |  | 37652 | (1922) | 32 |  | 10501 |  | 46263 |
|  **Income (loss) before income tax** | **(8967)** | **49682** |  | **40715** | **65966** | **(47110)** |  | **(10501)** |  | **49070** |
|  Income tax expense | 13662 | (2921) | **3E** | 10741 | 3950 | (519) | **4FF** | (1544) | **4MM** | 12628 |
|  **Net income (loss)** | **(22629)** | **52603** |  | **29974** | **62016** | **46591** |  | **(8957)** |  | **36442** |
|  Net income (loss) attributable to noncontrolling interests | 4430 | 10518 | **3F** | 14948 |  | 7655 | **4JJ** | (4550) | **4NN** | 18053 |
|  **Net income (loss) attributable to Legence** | **(27059)** | **42085** |  | **15026** | **62016** | **(54246)** |  | **(4407)** |  | **18389** |
|  | Period from<br>September 12,<br>2025 to<br>September 30,<br>2025<sup>(1)</sup> |  |  |  |  |  |  |  |  |  |
|  Weighted Average Class A Common Shares: |  |  |  |  |  |  |  |  |  |  |
|  Basic | 58511 |  |  |  |  |  |  |  | **5** | 62516 |
|  Diluted | 58511 |  |  |  |  |  |  |  | **5** | 62855 |
| (Loss) Earnings per share |  |  |  |  |  |  |  |  |  |  |
|  Basic | (0.02) |  |  |  |  |  |  |  | **5** | 0.29 |
|  Diluted | (0.02) |  |  |  |  |  |  |  | **5** | 0.29 |

---

(1) The Legence historical computation of basic and diluted earnings per share of Class A Common Stock represents
the period from September 12, 2025 to September 30, 2025, the period where the Company had Class A Common Stock and Class B Common Stock outstanding. Prior to the IPO, Legence Holdings was a single-member limited liability
company and did not present earnings per share.

*See accompanying notes to unaudited pro forma condensed combined financial information.* 

------

**Legence Corp.** 

**UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS** 

**For the Year ended December 31, 2024** 

*(in thousands, except per share data)* 

---

| | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Legence<br>Holdings<br>(Historical)** | **Corporate<br>Reorganization**<br>**and Offering<br>Adjustments**<br>**(Note 3)** | **Notes** | **Legence Corp.**<br>**Adjusted** | **The Bowers**<br>**Group, Inc.**<br>**(Historical) -<br>Adjusted**<br>**(Note 2)** | **Transaction<br>Accounting<br>Adjustments** | **Notes** | **Financing<br>Adjustments** | **Notes** | **Pro Forma**<br>**Combined** |
|  Revenue | 2098602 |  |  | 2098602 | 554207 | (177) | **4II** |  |  | 2652632 |
|  Cost of revenue | 1667835 | 2088 | **3H** | 1669923 | 448844 | 41 | **4GG** |  |  | 2119907 |
|  |  |  |  |  |  | (177) | **4II** |  |  |  |
|  |  |  |  |  |  | 1276 | **4KK** |  |  |  |
|  **Gross profit** | **430767** | **(2088)** |  | **428679** | **105363** | **(1317)** |  | **—** |  | **532725** |
|  Selling, general and administrative | 242888 | 7661 | **3H** | 250549 | 55983 | 604 | **4DD** |  |  | 326442 |
|  |  |  |  |  |  | 15147 | **4EE** |  |  |  |
|  |  |  |  |  |  | 4042 | **4GG** |  |  |  |
|  |  |  |  |  |  | 117 | **4KK** |  |  |  |
|  Depreciation and amortization | 97153 |  |  | 97153 | 1550 | 3576 | **4AA** |  |  | 153110 |
|  |  |  |  |  |  | 50601 | **4BB** |  |  |  |
|  |  |  |  |  |  | 230 | **4KK** |  |  |  |
|  Acquisition-related costs | 5634 |  |  | 5634 |  | 13826 | **4CC** |  |  | 19460 |
|  Goodwill impairment | 17804 |  |  | 17804 |  |  |  |  |  | 17804 |
|  Equity in earnings of joint venture | (3063) |  |  | (3063) |  |  |  |  |  | (3063) |
|  **Income (loss) from operations** | **70351** | **(9749)** |  | **60602** | **47830** | **(89460)** |  | **—** |  | **18972** |
|  Interest expense, net of capitalized interest | 91609 | (74945) | **3G** | 16664 | 216 | 5059 | **4HH** | 16939 | **4LL** | 38946 |
|  |  |  |  |  |  | 68 | **4KK** |  |  |  |
|  Interest income | (5464) |  |  | (5464) | (2698) |  |  |  |  | (8162) |
|  Loss on debt extinguishment |  | 12433 | **3I** | 12433 |  |  |  |  |  | 12433 |
|  Credit agreement amendment fees | 7801 |  |  | 7801 |  |  |  | 3127 | **4LL** | 10928 |
|  Other income, net | (473) |  |  | (473) | (48) |  |  |  |  | (521) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total Other expenses, net | 93473 | (62512) |  | 30961 | (2530) | 5127 |  | 20066 |  | 53624 |
|  **Income (loss) before income tax** | **(23122)** | **52763** |  | **29641** | **50360** | **(94587)** |  | **(20066)** |  | **(34652)** |
|  Income tax expense (benefit) | 4521 | (367) | **3E** | 4154 | 2216 | (8354) | **4FF** | (2964) | **4MM** | (4948) |
|  **Net income (loss)** | **(27643)** | **53130** |  | **25487** | **48144** | **(86233)** |  | **(17102)** |  | **(29704)** |
|  Net income (loss) attributable to noncontrolling interests | 912 | 10743 | **3F** | 11655 |  | (19587) | **4JJ** | (8694) | **4NN** | (16626) |
|  **Net income (loss) attributable to Legence** | **(28555)** | **42387** |  | **13832** | **48144** | **(66646)** |  | **(8408)** |  | **(13078)** |
|  Weighted Average Class A Common Shares: |  |  |  |  |  |  |  |  |  |  |
|  Basic |  |  |  |  |  |  |  |  | **5** | 61063 |
|  Diluted |  |  |  |  |  |  |  |  | **5** | 61063 |
|  Loss per share |  |  |  |  |  |  |  |  |  |  |
|  Basic |  |  |  |  |  |  |  |  | **5** | (0.21) |
|  Diluted |  |  |  |  |  |  |  |  | **5** | (0.21) |

---

*See accompanying notes to unaudited pro forma condensed combined financial information.*

------

**Note 1. Basis of Presentation** 

The historical condensed consolidated financial statements of Legence and the consolidated financial statements of Bowers have been adjusted in the accompanying Pro Forma Financial Information to reflect adjustments reflecting the accounting for the Transactions.

The unaudited pro forma condensed combined statements of operations and financial position were prepared using the following historical information:

**Legence** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Unaudited condensed consolidated balance sheet from the Form 10-Q filing
for the third quarter as of September 30, 2025, filed on November 14, 2025.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Unaudited condensed consolidated statement of operations for the nine months ended September 30, 2025, from
the Form 10-Q filing for the third quarter filed on November 14, 2025.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Audited consolidated statement of operations for the year ended December 31, 2024, of Legence Holdings and
subsidiaries from Legence Corp.'s Prospectus filed pursuant to Rule 424(b)(4) filed on September 15, 2025.

**Bowers** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Audited consolidated balance sheet as of September 30, 2025, included elsewhere in this filing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Audited consolidated statement of operations for the year ended September 30, 2025, included elsewhere in
this filing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Audited consolidated statement of operations for the year ended September 30, 2024, included elsewhere in
this filing.

The unaudited pro forma condensed combined balance sheet is presented as if the adjustments made reflecting the accounting for the Acquisition and related financing were made on September 30, 2025. The unaudited pro forma condensed combined statements of operations for the nine months ended September 30, 2025, and the year ended December 31, 2024, are presented as if the adjustments made on the historical balance sheet and the unaudited pro forma condensed combined balance sheet reflect the accounting for the Corporate Reorganization and Offering Transactions and the Acquisition and related financing were made on January 1, 2024.

For the unaudited pro forma condensed combined statements of operations for the year ended December 31, 2024, Legence reports on a fiscal year ending December 31, while Bowers historically reported on a fiscal year ending September 30. Since the fiscal year-ends differ by not more than one quarter, consistent with Article 11, Legence combined Bowers's statement of operations for the year-ended September 30, 2024, with Legence's statement of operations for the year-ended December 31, 2024.

In order to derive the unaudited pro forma condensed combined statement of operations for the nine months ended September 30, 2025, Bowers's results of operations for the period October 1, 2024 through December 31, 2024 have been removed from Bowers's audited consolidated statement of operations for the year ended September 30, 2025.

Bowers's revenue for the period from October 1, 2024 through December 31, 2024, was $131.4 million, and its net income for this same period was $9.5 million. During this omitted period, Bowers continued normal operating activities. Management has not identified any unusual or non-recurring transactions for this period that would be necessary to understand the Pro Forma Financial Information. Refer to Note 2.1 below for calculating Bowers's statement of operations activity for the interim period starting January 1, 2025 through September 30, 2025.

Legence's historical results for the year ended December 31, 2024, reflect the operations of Legence Holdings, the Company's subsidiary upon the Corporate Reorganization and Offering Transactions. The interim financial information for the nine months ended September 30, 2025, is derived from Legence Corp.'s Form 10-Q for the period then ended, and reflects the period following the Corporate Reorganization and Offering Transactions. As a result, the historical periods included in the pro forma information incorporate the change in reporting structure from Legence Holdings to Legence Corp. Refer to Note 3 below for additional information.

------

The audited and unaudited historical consolidated (condensed) financial statements of both Legence and Bowers were prepared in accordance with U.S. GAAP and presented in U.S. dollars.

The Acquisition will be accounted for using the acquisition method of accounting, as prescribed in ASC 805, under U.S. GAAP, which requires an allocation of the purchase price to the assets acquired and liabilities assumed, based on their fair values as of the date of the Acquisition. As of the date of this Form 8-K/A filing, Legence has not yet completed its detailed valuations and other activities necessary to arrive at the required final estimates of the fair value of Bowers's assets acquired and liabilities assumed, therefore the related allocations of purchase price are preliminary.

The fair value of the consideration transferred to be paid by Legence upon the consummation of the Acquisition was measured using Legence's Class A Common Stock price on the Acquisition date, as adjusted to reflect the contractual terms of the Acquisition, including lock-up restrictions and other limitations on transfer. The pro forma adjustments are preliminary and are subject to change as additional information becomes available and as additional analysis is performed. The preliminary pro forma adjustments have been made solely for the purpose of providing the Pro Forma Financial Information presented herein.

Legence has estimated the fair value of Bowers's assets and liabilities based on discussions with Bowers's management, preliminary valuations and information presented in Bowers's consolidated financial statements. Any increases or decreases in the fair value of assets acquired and liabilities assumed upon completion of the final valuations would result in adjustments to the unaudited pro forma condensed combined balance sheet and unaudited pro forma condensed combined statements of operations. The final allocation of the consideration transferred may be materially different than that reflected in the pro forma allocation of the consideration transferred presented herein.

The Pro Forma Financial Information should be read in conjunction with the Company's historical consolidated financial statements and related notes included in its Prospectus filed on September 15, 2025, and its Quarterly Report on Form 10-Q for the period ending September 30, 2025, as well as the historical financial statements of Bowers included elsewhere in this filing pursuant to Rule 3-05 of Regulation S-X.

**Note 2. Reclassification and Accounting Policy Alignment Adjustments** 

These adjustments represent the reclassification adjustments and accounting policy alignment adjustments applied to Bowers's statement of financial position and combined statement of operations to conform to Legence's financial statement presentation and significant accounting policies. Bowers's combined financial statements were mapped to Legence's financial statement line items, and differences in classification and accounting policies identified through this mapping were recorded as reclassification and policy adjustments.

These adjustments reflect only the preliminary assessment of differences and do not represent a final determination of all reclassification and accounting policy differences that may exist between Legence and Bowers. Legence will continue to perform a comprehensive review of Bowers's accounting policies following the Acquisition. Upon completion of this review, additional differences may be identified, which, once conformed, could result in further adjustments that may have a material impact on the unaudited pro forma condensed combined financial information. The adjustments are summarized below:

------

**Balance Sheet for the Year Ended 9/30/25** 

(in thousands)

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| **Legence Presentation** | **Bowers Presentation** | **The<br>Bowers<br>Group,<br>Inc.<br>(Historical)** | **Reclassifications<br>to Conform to<br>Legence's<br>Presentation** | **Accounting<br>Policy<br>Adjustments** | **Notes** | **The<br>Bowers<br>Group,<br>Inc.<br>(Historical)<br>- Adjusted** |
|  **ASSETS** | **ASSETS** |  |  |  |  |  |
|  **Current assets** | **Current assets** |  |  |  |  |  |
|  Cash and Cash Equivalents | Cash and Cash Equivalents | 56986 |  |  |  | 56986 |
|  | Contract receivables | 147362 | (147362) **2A** |  |  |  |
|  Accounts receivable, net |  |  | 147362 **2A** |  |  | 147362 |
|  | Contract assets - costs and estimated earnings in excess of billing on uncompleted contracts | 24304 | (24304) **2B** |  |  |  |
|  | Contract assets - Conditional retention | 23029 | (23029) **2B** |  |  |  |
|  Contract assets, net |  |  | 47333 **2B** | 16353 | **2AA,**<br> **2CC** | 63686 |
|  | Inventories, at lower of cost (weighted average) or market | 2675 | (2675) **2C** |  |  |  |
|  Prepaid expenses and other current assets | Prepaid expenses | 1110 | 2675 **2C** |  |  | 3785 |
|  **Total current assets** |  | **255466** | **—** | **16353** |  | **271819** |
|  Property and equipment, net of accumulated depreciation | Property and equipment, net | 6735 |  |  |  | 6735 |
|  Operating lease right-of-use assets | Right-of-use assets | 17036 |  |  |  | 17036 |
|  | Equipment deposits | 640 | (640) **2D** |  |  |  |
|  | Tax deposit | 4475 | (4475) **2D** |  |  |  |
|  | Deposits | 121 | (121) **2D** |  |  |  |
|  | Cash surrender value of officers' life insurance | 797 | (797) **2D** |  |  |  |
|  Other assets |  |  | 6033 **2D** |  |  | 6033 |
|  **Total assets** |  | **285270** | **—** | **16353** |  | **301623** |
|  **Liabilities and Equity** |  |  |  |  |  |  |
|  **Current Liabilities** |  |  |  |  |  |  |
|  Accounts payable | Accounts payable | 60820 |  | 7429 | **2CC** | 68249 |
|  Accrued and other current liabilities | Accrued liabilities | 22684 | 11165 **2E** |  |  | 33849 |
|  | Retentions payable | 10035 | (10035) **2E** |  |  |  |
|  | Contract liabilities - billing in excess of costs and estimated earnings on uncompleted contracts | 124013 | (124013) **2F** |  |  |  |
|  | Contract liabilities - Conditional retentions | (44270) | 44270 **2F** |  |  |  |
|  Contract liabilities |  |  | 79743 **2F** | (2967) | **2AA** | 76776 |
|  Current portion of operating lease liabilities | Current maturities of operating leases liability | 3701 |  |  |  | 3701 |
|  | Income tax payable | 1130 | (1130) **2E** |  |  |  |
|  Current portion of long-term debt | Current portion of long-term debt |  |  |  |  |  |
|  **Total current liabilities** |  | **178113** | **—** | **4462** |  | **182575** |
|  Long-term debt, net of current portion |  |  |  |  |  |  |
|  Operating lease liabilities, net of current portion | Operating leases liability, less current maturities | 13923 |  |  |  | 13923 |
|  **Total liabilities** |  | **192036** | **—** | **4462** |  | **196498** |
|  **Stockholders' Equity** |  |  |  |  |  | **—** |
|  | Voting- 9,100 shares issued and outstanding | 9 |  |  |  | 9 |
|  | Nonvoting- 32,112 shares issued and outstanding | 32 |  |  |  | 32 |
|  Additional paid-in capital | Additional paid-in capital | 3376 |  |  |  | 3376 |
|  Accumulated deficit | Retained earnings | 89817 |  | 11891 | **2AA,<br>2CC** | 101708 |
|  **Total stockholders' equity** |  | **93234** | **—** | **11891** |  | **105125** |
|  **Total liabilities and equity** |  | **285270** | **—** | **16353** |  | **301623** |

---

------

---

| |
|:---|
|  **Statement of Operations for the Period Ended 9/30/25** |
|  (in thousands) |

---

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| **Legence Presentation** | **Bowers Presentation** | **The<br>Bowers<br>Group,<br>Inc.<br>(Historical)** | **Reclassifications<br>to Conform to<br>Legence's<br>Presentation** | **Notes** | **Accounting<br>Policy<br>Adjustments** | **Notes** | **The<br>Bowers Group,<br>Inc.<br>(Historical) -<br>Adjusted** |
|  Revenue | Earned revenue | 635573 |  |  | 4947 | **2BB, 2DD** | 640520 |
|  Cost of revenue | Cost of earned revenue | 518314 |  |  | 2043 | **2DD** | 520357 |
|  **Gross profit** | **Gross profit** | **117259** |  |  | **2904** |  | **120163** |
|  Selling, general and administrative | General and administrative expenses | 56084 | (1311) | **2G** | 35 | **2DD** | 54808 |
|  Depreciation and amortization |  |  | 1311 | **2G** |  |  | 1311 |
|  **Income from operations** | **Operating income** | **61175** | **—** |  | **2869** |  | **64044** |
|  **Other expense (income):** | **Other (income) expense:** |  |  |  |  |  |  |
|  Interest income | Interest income | (1893) |  |  |  |  | (1893) |
|  Other income, net | Other income | (29) |  |  |  |  | (29) |
|  **Income (loss) before income tax** | **Income before taxes** | **63097** |  |  | **2869** |  | **65966** |
|  Income tax expense | Income tax expense | 3950 |  |  |  |  | 3950 |
|  **Net income (loss)** | **Net income** | **59147** |  |  | **2869** |  | **62016** |

---

---

| |
|:---|
|  **Statement of Operations for the Period Ended 9/30/24** |
|  (in thousands) |

---

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| **Legence Presentation** | **Bowers Presentation** | **The<br>Bowers<br>Group,<br>Inc.<br>(Historical)** | **Reclassifications<br>to Conform to<br>Legence's<br>Presentation** | **Notes** | **Accounting<br>Policy<br>Adjustments** | **Notes** | **The<br>Bowers<br>Group,<br>Inc.<br>(Historical)<br>- Adjusted** |
|  Revenue | Earned revenue | 554792 |  |  | (585) | **2BB, 2DD** | 554207 |
|  Cost of revenue | Cost of earned revenue | 449203 |  |  | (359) | **2DD** | 448844 |
|  **Gross profit** | **Gross profit** | **105589** |  |  | **(226)** |  | **105363** |
|  Selling, general and administrative | General and administrative expenses | 57529 | (1550) | **2G** | 4 | **2DD** | 55983 |
|  Depreciation and amortization |  |  | 1550 | **2G** |  |  | 1550 |
|  **Income from operations** | **Operating income** | **48060** | **—** |  | **(230)** |  | **47830** |
|  **Other expense (income):** | **Other (income) expense:** |  |  |  |  |  |  |
|  Interest income | Interest income | (2698) |  |  |  |  | (2698) |
|  Interest expense | Interest expense | 216 |  |  |  |  | 216 |
|  Other income, net | Other income | (48) |  |  |  |  | (48) |
|  **Income (loss) before income tax** | **Income before taxes** | **50590** |  |  | **(230)** |  | **50360** |
|  Income tax expense | Income tax expense | 2216 |  |  |  |  | 2216 |
|  **Net income (loss)** | **Net income** | **48374** |  |  | **(230)** |  | **48144** |

---

------

**Reclassification Adjustments** 

The following reclassifications were made to conform The Bowers Group, Inc., to Legence Corp. presentation:

**2A.** Reclassification to "Accounts receivable, net" from "Contract receivables"

**2B.** Reclassification to "Contract assets, net" from "Contract assets - costs and estimated earnings in excess of billing on uncompleted contracts" and "Contract assets - Conditional retention"

**2C.** Reclassification to "Prepaid expenses and other current assets" from "Inventories, at lower of cost (weighted average) or market"

**2D.** Reclassification to "Other assets" from "Equipment deposits", "Tax deposit", "Deposits" and, "Cash surrender value of officers´ life insurance"

**2E.** Reclassification to "Accrued and other current liabilities" from "Retentions payable" and "Income tax payable"

**2F.** Reclassification to "Contract liabilities" from "Contract liabilities - billing in excess of costs and estimated earnings on uncompleted contracts" and "Contract liabilities - Conditional retentions"

**2G:** Reclassification of depreciation expense from "General and administrative expenses" to "Depreciation and amortization". This adjustment has no impact on total operating income.

**Accounting Policy Adjustments** 

**2AA:** Represents the pro forma adjustment to align Bowers's contingency release revenue practice with Legence's revenue recognition policy. Under Legence's policy, contingencies are considered during project performance until the point at which there is not a significant risk of revenue reversal, rather than released at project completion.

**2BB:** Represents the pro forma statement of operations impact of the contingency release adjustment described in 2AA. This entry reflects the increase to revenue and gross margin resulting from applying Legence's policy to Bowers's projects.

**2CC:** Represents the pro forma recognition of project-related costs with Legence's accrual methodology. This adjustment records the related liability in accounts payable and increases contract assets for the corresponding percentage-of-completion revenue impact, with the net effect reflected in accumulated deficit.

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**2DD:** Represents the pro forma statement of operations impact of recognizing project-related costs with Legence's accrual methodology. The adjustment increases cost of revenue and general and administrative expenses, with a corresponding increase to revenue for the percentage-of-completion effect, and updates accumulated deficit for the net impact.

**Note 2.1. Interim Statement of Operations for Bowers for the Period January 1, 2025 to September 30, 2025** 

The table below provides the calculation to derive the unaudited pro forma condensed combined statement of operations for Bowers's for the nine months ended September 30, 2025. The historical results of Bowers's for the year ended September 30, 2025, have been adjusted to remove the results attributable to operations for the period October 1, 2024 through December 31, 2024. This adjustment is made to present Bowers's results for the nine-month period ended September 30, 2025, to align with the interim period presented for Legence as shown below (in thousands):

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| | | | |
|:---|:---|:---|:---|
|  | **Year Ended<br>September 2025**<br>**Before<br>Reclassification<br>(Audited) [A]** | **October 2024 -<br>December 2024**<br>**Carve Out<br>[B]** | **January 2025 -<br>September 2025**<br>**Post Carve Out<br>[A]-[B]** |
|  | **Year Ended<br>September 2025**<br>**Before<br>Reclassification<br>(Audited) [A]** | **October 2024 -<br>December 2024**<br>**Carve Out<br>[B]** | **January 2025 -<br>September 2025**<br>**Post Carve Out<br>[A]-[B]** |
|  Earned revenue | 766996 | 131423 | 635573 |
|  Cost of earned revenue | 625574 | 107260 | 518314 |
|  **Gross profit** | **141422** | **24163** | **117259** |
|  General and administrative expenses | 71052 | 14968 | 56084 |
|  **Operating income** | **70370** | **9195** | **61175** |
|  Other income (expense) |  |  |  |
|  Interest income | 2474 | 581 | 1893 |
|  Interest expense | (7) | (7) |  |
|  Other income | 31 | 2 | 29 |
|  **Income before taxes** | **72868** | **9771** | **63097** |
|  Income tax expense | 4250 | 300 | 3950 |
|  **Net income** | **68618** | **9471** | **59147** |

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**Note 3. Corporate Reorganization and Offering Transaction Adjustments** 

Corporate Reorganization and Offering Transaction accounting adjustments include the following adjustments related to the unaudited pro forma condensed combined statements of operations for the nine months ended September 30, 2025 and the year ended December 31, 2024, as follows:

**3E:** Following the Corporate Reorganization, Legence is subject to U.S. federal income taxes, in addition to state and local taxes. As a result, the unaudited pro forma condensed combined statements of operations reflects an adjustment to taxes assuming the federal rates currently in effect and the highest statutory rates apportioned to each state and local jurisdiction.

**3F:** As described above as part of the Corporate Reorganization, Legence became the managing member of Legence Holdings. As a result of the Corporate Reorganization and the completion of the IPO, which included the exercise of the underwriter option, the ownership percentage held by Legence and by noncontrolling interests was approximately 56% and 44%, respectively. Net income attributable to NCI represents 44% of net income before income taxes.

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**3G:** Reflects (i) the reduction in interest expense as a result of the repayment of a portion of the outstanding indebtedness under the term loan credit facility primarily from use of IPO proceeds, as if such repayment occurred on January 1, 2024, (ii) a reduction in contractual interest expense reflecting a 25 basis-point decrease in interest rates upon the consummation of the IPO pursuant to the terms of the term loan credit facility, (iii) a reduction in interest expense to reflect the interest rate adjustment pursuant to the leverage ratio pricing grid under the Company's term loan credit facility, and (iv) a reduction in amortization expense associated with the historical amortization of debt issuance costs. The adjustment to interest expense is presented as follows (in thousands):

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| | | |
|:---|:---|:---|
|  | **Nine Months Ended<br>September 30, 2025** | **Year Ended<br>December 31, 2024** |
|  Repayment of outstanding indebtedness | 45030 | 69530 |
|  Interest rate decrease upon consummation of an IPO | 1441 | 1208 |
|  Interest rate decrease related to leverage ratio pricing grid | 2678 | 1208 |
|  Reduction of amortization expense related to write-off of debt issuance costs | 1561 | 2999 |
|  Total decrease to interest expense | **50710** | **74945** |

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**3H:** Reflects stock compensation expense related to restricted stock units and stock option grants. In connection with the IPO, Legence granted 620,390 restricted stock units and 668,570 stock options under the 2025 Omnibus Incentive Plan to certain employees and non-employee directors, including our named executive officers. Each stock option granted will have an exercise price of $28.00. Each IPO Grant to employees will vest in three equal installments on each of the first, second and third anniversaries of the applicable vesting commencement date, subject generally to continued employment through the applicable vesting date. Each IPO Grant to our non-employee directors will consist of restricted stock units and will fully vest on the sooner of the first anniversary of the applicable vesting commencement date or the day immediately preceding the Company's 2026 annual stockholder meeting, subject generally to continued service through the applicable vesting date. The grant date fair value of the stock options was determined using the Black Scholes valuation model using the following assumptions:

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| | |
|:---|:---|
|  Expected volatility | 60.0% |
|  Expected dividend yield | 0.0% |
|  Expected term (in years) | 6.0 |
|  Risk-free interest rate | 3.7% |

---

**3I:** The Company prepaid $780.3 million of its term loan debt on September 15, 2025, using IPO proceeds and cash on hand. The adjustment reverses the impact of the loss on debt extinguishment related to previously deferred discounts and debt issuance costs for the period ended September 30, 2025, and reflects the related impact of $12.4 million for the year ended December 31, 2024, calculated as if the indebtedness had been repaid on January 1, 2024.

**Note 4. Acquisition and Related Financing Adjustments** 

The Acquisition will be accounted for under the acquisition method of accounting in accordance with ASC 805, and other applicable U.S. GAAP, which requires, among other things, that the assets acquired, and liabilities assumed be recognized at their acquisition date fair values, with any excess of the consideration transferred over the estimated fair values of the identifiable net assets acquired recorded as goodwill.

**Adjustments to Unaudited Pro Forma Condensed Combined Balance Sheet** 

**4A. Bowers Stockholders' Equity** 

To adjust Bowers's historical financial statements to give pro forma effect to events in connection with the Acquisition that include the elimination of Bowers's historical equity.

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**4B. Consideration Transferred** 

The total preliminary estimated consideration transferred is approximately $435.0 million, determined as of January 2, 2026. This amount includes cash consideration of $291.4 million; 2,551,672 shares of Legence Class A Common Stock, with a fair value of $98.6 million based on Legence's stock price at the Acquisition closing date discounted for lack of marketability; and preliminary fair value of deferred consideration of $44.9 million, payable on December 31, 2026, in cash, Legence Class A Common Stock, or a combination thereof, at Legence's discretion.

The following table sets forth a preliminary allocation of the estimated purchase consideration to the identifiable tangible and intangible assets acquired and liabilities assumed of Bowers based on Bowers's September 30, 2025 balance sheet, with the excess recorded as goodwill (in thousands).

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| | |
|:---|:---|
|  Cash and cash equivalents | 56986 |
|  Accounts receivables, net | 147362 |
|  Contract assets, net | 63686 |
|  Prepaid expenses and other current assets | 3785 |
|  Property and equipment | 14756 |
|  Operating lease right-of-use assets | 23236 |
|  Intangible assets, net | 302200 |
|  Other assets | 761 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; **Total assets** | **612772** |
|  Current liabilities: |  |
|  Accounts payable | 68249 |
|  Accrued compensation and benefits | 14433 |
|  Accrued and other current liabilities | 33849 |
|  Contract liabilities | 76776 |
|  Current portion of operating lease liabilities | 4553 |
|  Current portion of long-term debt | 824 |
|  Long-term debt, net of current portion | 1077 |
|  Operating lease liabilities, net of current portion | 15683 |
|  Deferred tax liabilities, net |  |
|  **Total Liabilities** | **215444** |
|  **Net assets acquired (a)** | **397328** |
|  Estimated purchase consideration (b) | 434987 |
|  **Estimated goodwill (b) - (a)** | **37659** |

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The preliminary purchase accounting adjustments are based on management's preliminary estimates and assumptions, including limited valuation procedures and available information as of the date of preparation of the Pro Forma Financial Information, to allocate the consideration transferred to the identifiable assets acquired and liabilities assumed, including intangible assets, and real and personal property. The final allocation of the consideration

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transferred will be completed after the Company finalizes its detailed valuations during the measurement period, which will not exceed one year from the acquisition date. As a result, the final allocation may differ materially from the preliminary amounts presented herein, and such differences could result in changes to the amounts assigned to goodwill and could have a material impact on future depreciation and amortization expense in the combined company's results of operations.

**4C. Property, Plant and Equipment, Net** 

The adjustment to property, plant and equipment, net reflects the preliminary fair value of the acquired assets as of September 30, 2025, resulting in a $6.1 million increase as follows (in thousands):

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| | | | |
|:---|:---|:---|:---|
|  | **Carrying<br>Value as of<br>September 30,<br>2025** | **Step-up** | **Fair Value** |
|  Auto and trucks | 2442 | 2124 | 4566 |
|  Leasehold improvements | 751 | 2190 | 2941 |
|  Equipment and tools | 3542 | 1447 | 4989 |
|  Office furniture and other |  | 359 | 359 |
|  **Total property and equipment acquired** | **6735** | **6120** | **12855** |

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In addition to the $12.9 million shown in the table above, the Company recognized $1.9 million in finance lease assets related to the acquisition, which is included in Note 4K.

The fair value of the personal property assets was estimated using a combination of the cost and market approaches. The cost approach is based on the premise that a prudent investor would pay no more for an asset than its replacement or reproduction cost. The Company utilized historical cost from the fixed asset subledger to estimate the reproduction cost new, and for physical deterioration and other forms of obsolescence. The market approach estimated value based on observable market transactions for comparable assets; accordingly, market data from reputable, third-party sources was analyzed for similar vehicles to support the fair value conclusions.

**4D. Intangible Assets** 

Reflects the preliminary estimated fair value amounts attributed to the identifiable intangible assets acquired in the Acquisition, as shown in the table below (in thousands, except estimated useful lives):

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **Estimated<br>Useful <br>Life<br>(in Years)** | **Preliminary<br>Estimated<br>Fair Value** | **Amortization<br>Expense for<br>the Nine<br>Months Ended<br>September 30,<br>2025** | **Amortization<br>Expense for<br>the Year<br>Ended<br>December 31,<br>2024** |
|  Customer relationships | 11 | 200100 | 13643 | 18191 |
|  Trade names | 10 | 46600 | 3495 | 4660 |
|  Backlog | 2 | 55500 | 20813 | 27750 |
|  **Identifiable intangible assets** |  | **302200** | **37951** | **50601** |

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The fair values of the customer relationships and backlog intangible assets were determined by using an income approach, specifically a multi-period excess earnings method ("MPEEM"), which is a commonly accepted valuation approach. Under this approach, the net earnings attributable to the asset being measured are isolated using the discounted projected net cash flows. These projected cash flows are isolated from the projected cash flows of the combined asset group over the remaining economic life of the intangible asset being measured. Both the amount and the duration of the cash flows are considered from a market participant perspective. Where appropriate, the net cash flows were adjusted to reflect the attrition of existing customers in the future. The fair value of the trade names intangible assets were determined using an income approach, or discounted cash flow method. The remaining useful life of the acquired intangible assets was estimated based on the period over which substantially all the undiscounted cash flows are expected to be realized.

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**4E. Favorable Leases** 

The favorable lease adjustment of $3.0 million represents the preliminary fair value assigned to below-market lease arrangements assumed in the Acquisition. The fair value of the below-market lease component is calculated using a discounted cash flow method under the income approach, which is a commonly accepted valuation approach. Under this approach, the difference between the contract rent and market rent is projected over the remaining lease terms, including relevant options, and discounted back to present value utilizing a market-based discount rate. The adjustment is recorded as an increase to right-of-use ("ROU") assets and will be amortized over the remaining non-cancelable lease terms.

**4F. Buyer's Transaction Expenses** 

Legence incurred direct, incremental estimated transaction costs of $5.1 million related to the Acquisition, consisting of advisory, legal, accounting and other professional fees. The Company recognized $0.3 million of these costs in the unaudited condensed combined statement of operations for the nine months ended September 30, 2025. The $5.1 million is presented as a reduction in cash with $0.3 million relieved from accounts payable and the remaining $4.8 million presented as a reduction in retained earnings. The transaction costs related to the Acquisition are nonrecurring and will not have a continuing impact on the Company's results of operations.

**4G. Assets Outside of Acquisition Perimeter** 

This adjustment relates to elimination of prepaid taxes of $4.5 million and cash surrender value of life insurance of $0.8 million, which were not acquired in the Acquisition.

**4H. Seller Transaction Bonus** 

The Sellers had certain agreements in place that resulted in a $14.4 million transaction bonus liability to Bowers's employees assumed by Legence upon closing of the Acquisition. In addition, Sellers executed other employee agreements prior to the Acquisition which result in a $9.0 million liability that will be expensed by Legence.

**4I. Noncontrolling Interest Impact of Transaction Accounting Adjustments and Related Financing** 

The Company reports a noncontrolling interest on the portion of net assets not attributable to Legence stockholders. This adjustment reflects the estimated change to the allocation between noncontrolling interest and Legence stockholders including (i) the rebalancing of legacy equity between Legence stockholders and NCI holders due to the issuance of additional shares as purchase consideration for the Acquisition and (ii) the allocation of NCI related to the net assets acquired in the Bowers acquisition, as though the Acquisition occurred on September 30, 2025.

**4J. Recognition of Lease Remeasurement** 

Represents the pro forma adjustment to recognize the remeasurement of the acquired lease-related balances, including ROU assets and corresponding lease liabilities, at Legence's incremental borrowing rate.

**4K. Recording Financing Leases** 

Represents the pro forma adjustment to recognize finance lease obligations, in accordance with Legence's lease accounting policies.

**4L. Debt Financing** 

Legence Holdings entered into Amendment No. 12 to its existing credit agreement with Jefferies Finance LLC as the administrative agent for a group of lenders, pursuant to which the lenders provided a $200.0 million incremental term loan to fund a portion of the cash consideration for the Bowers acquisition and pay transaction expenses. The incremental term loan accrues interest at Term Secured Overnight Financing Rate ("SOFR") plus 2.25% with a SOFR floor of 0.75% and share the same collateral, guarantees and maturity structure as the existing term loan. In connection with the amendment, the Company paid $4.1 million in fees, of which $1.0 million is recognized as deferred financing fees in the unaudited pro forma condensed combined balance sheet and $3.1 million is recognized as credit agreement amendment fees in the unaudited pro forma condensed combined statement of operations for the year ended December 31, 2024.

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**Adjustments to Unaudited Pro Forma Condensed Combined Statement of Operations** 

The following adjustments have been reflected in the unaudited pro forma condensed combined statements of operations for the year ended December 31, 2024, and the nine months ended September 30, 2025, to present adjustments depicting the accounting for Acquisition and related financing in the unaudited pro forma condensed combined balance sheet assuming those adjustments were made on January 1, 2024.

**4AA. Depreciation of Property and Equipment** 

This adjustment reflects the additional depreciation expense resulting from the preliminary fair value step up of acquired property and equipment. The incremental depreciation is calculated based on the preliminary fair values (Note 4C) and remaining useful lives of the assets acquired as shown below (in thousands, except estimated useful lives):

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| | | | |
|:---|:---|:---|:---|
|  | **Estimated<br>Remaining<br>Useful Life<br>(in Years)** | **Depreciation<br>Expense for the Nine<br>Months Ended<br>September 30, 2025** | **Depreciation<br>Expense for the<br>Year Ended<br>December 31,<br>2024** |
|  Autos and trucks | 2-5 | 1282 | 2190 |
|  Leasehold improvements | 1-6 | 542 | 771 |
|  Equipment and tools | 2-5 | 1214 | 2037 |
|  Office furniture and other | 2-5 | 74 | 128 |
|  **Total depreciation expense** |  | **3112** | **5126** |
|  Less: Historical depreciation expense |  | 1311 | 1550 |
|  **Pro forma adjustment to depreciation expense** |  | **1801** | **3576** |

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**4BB. Amortization of Intangible Assets** 

This adjustment represents the straight-line amortization of preliminary fair values of identifiable intangible assets acquired, based on the estimated useful lives, as noted in Note 4D above.

**4CC. Buyer's Transaction Cost** 

The unaudited pro forma condensed combined statement of operations has been adjusted to reflect estimated transaction costs that Legence expects to incur in connection with the Acquisition, assuming the adjustment reflecting that accounting for such costs were made on January 1, 2024, for purposes of presenting the pro forma results for the year ended December 31, 2024. These adjustments include transaction-related compensation costs, a portion of which was expensed as incurred rather than capitalized as part of the acquisition accounting.

**4DD. Amortization of Favorable Lease Adjustments** 

Represents the pro forma amortization of the favorable lease adjustment recognized in connection with the Acquisition. The favorable lease amount is amortized on a straight-line basis over the remaining lease term, resulting in a reduction to operating income in the pro forma statement of operations.

**4EE. Recognition of Retention Bonus as Compensation Expense** 

The unaudited pro forma condensed combined statement of operations has been adjusted to reflect adjustment depicting the accounting for the estimated retention bonus expense that Legence expects to incur in connection with the Acquisition for certain key Bowers employees, payable on the first, second, and third anniversaries of the Acquisition. These adjustments reflect the recognition of the estimated retention bonus expense for the periods presented in accordance with ASC 710.

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**4FF. Income Tax Impact of Adjustments** 

This adjustment reflects the accounting for the estimated tax effects of the pro forma adjustments noted above, calculated using the combined company's estimated statutory tax rates for each period. The impact has been determined using an estimated blended tax rate of 26.06% and 25.94% for the year ended December 31, 2024 and the nine months ended September 30, 2025, respectively.

**4GG. Share Based Payment** 

This adjustment represents the inclusion of stock-based compensation expense for the 284,081 restricted stock units issued in connection with the Acquisition to certain Bowers employees. The fair value of the restricted stock units granted is based on the Legence stock price of $43.04. A portion of these restricted stock units will vest in three equal installments on each of the first, second and third anniversaries of the applicable vesting commencement date, subject generally to continued employment through the applicable vesting date. The remaining restricted stock units will fully vest on the third anniversary of the Acquisition, subject generally to continued service through the applicable vesting date.

**4HH. Accretion of Deferred Consideration** 

Represents the pro forma recognition of deferred consideration associated with the Acquisition, measured by applying a probability-weighted assessment of the settlement alternatives (stock or cash) and discounting the expected payment to present value using the appropriate discount period of one year and present value factor at 5.7%.

**4II. Intercompany Elimination** 

This adjustment represents the intercompany elimination between revenue and cost of revenue for intercompany activity between Bowers and Legence during the periods presented.

**4JJ. Noncontrolling Interests on Transaction-Related Adjustments** 

Represents the pro forma impact of NCI on transaction-related adjustments, consistent with the post-Corporate Reorganization ownership structure disclosed in the Company's Form 10-Q for the period ended September 30, 2025. After giving effect to the shares issued as consideration for the Bowers acquisition, Legence Corp. owns approximately 57% of Legence Holdings, while NCI holders retain the remaining 43%. Accordingly, the portion of the Bowers's historical net income and the related pro forma adjustments attributable to Legence Holdings is allocated to NCI based on the NCI holders' ownership percentage.

**4KK. Remeasurement of Leases** 

Represents the pro forma statement of operations adjustment to reflect the resulting lease related expenses, primarily straight-line lease expense for operating leases and amortization of the ROU asset and interest expense on the lease liability for finance leases, assuming the lease reinstatement and related expense recognition commenced at the beginning of the period presented, consistent with Article 11 and ASC 805.

**4LL. Interest Expense and Amortization of Debt Financing Costs on New Debt** 

This adjustment reflects the estimated incremental interest expense and amortization of debt issuance costs related to new financing Legence obtained in connection with the Acquisition, as noted in Note 4L above. These adjustments represent recurring effects of the new capital structure and are therefore included in both pro forma periods presented. The effect on unaudited pro forma net income of a 0.125% change in interest rates on the acquisition related financing would be $0.2 million and $0.3 million, for the nine months ended September 30, 2025 and for the year ended December 31, 2024, respectively.

**4MM. Income Tax Impact on Interest and Amortization of New Debt** 

This adjustment reflects the estimated income tax effects of the interest expense and amortization of debt issuance costs recorded in Adjustment 4LL, based on the applicable estimated statutory tax rate. The tax impact is included for both pro forma periods presented.

**4NN. Noncontrolling Interests on Finance-Related Adjustments** 

Reflects the allocation of financing-related pro forma adjustments between Legence Corp. and the NCI holders, consistent with the post-Corporate Reorganization ownership structure disclosed in the Company's Form 10-Q for the period ended September 30, 2025 and shares issued as consideration for the Bowers acquisition.

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**Note 5. Earnings Per Share**

Basic pro forma earnings per share is calculated using net income (loss) attributable to Legence divided by the weighted-average number of shares of Class A Common Stock outstanding during the period, including shares issued as consideration transferred for the Acquisition. Diluted pro forma earnings per share is calculated using net income (loss) attributable to Legence divided by the weighted-average number of shares of Class A Common Stock outstanding during the period, including shares issued as consideration transferred for the Acquisition, adjusted to give effect to potentially dilutive securities. The table below presents the computation of pro forma basic and dilutive earnings per share for Legence (in thousands, except per share amounts):

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| | | |
|:---|:---|:---|
|  | **For the Nine<br>Months Ended<br>September 30, 2025** | **For the Year Ended<br>December 31, 2024** |
|  **Numerator:** |  |  |
|  Net income (loss) | 36442 | (29704) |
|  Less: Net income (loss) attributable to noncontrolling interests | 18053 | (16626) |
|  Net income (loss) attributable to Legence (basic) | **18389** | **(13078)** |
|  Net income effect of dilutive securities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Stock options | 12 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; RSUs | 32 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Assumed conversion of noncontrolling interests to shares of Class A Common Stock |  |  |
|  Net income (loss) attributable to Legence (diluted) | **18433** | **(13078)** |
|  **Denominator:** |  |  |
|  Historical Weighted-average Class A Common Stock outstanding | 61352 | 58511 |
|  Class A Common Stock of Legence Corp. as consideration transferred |  | 2552 |
|  Deferred consideration related to the Acquisition<sup>(1)</sup> | 1164 |  |
|  Total Weighted-average Class A Common Stock outstanding (basic) | **62516** | **61063** |
|  Incremental common shares attributable to dilutive instruments: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Stock options | 94 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; RSUs | 245 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Assumed conversion of noncontrolling interests to shares of Class A Common Stock |  |  |
|  Total Weighted-average Class A Common Stock outstanding (diluted) | **62855** | **61063** |
|  Earnings per share: |  |  |
|  Basic | 0.29 | (0.21) |
|  Diluted | 0.29 | (0.21) |

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(1) Deferred consideration payable one year following the closing of the Acquisition, to be settled in cash,
shares, or a combination at the Company's election. For the period ended September 30, 2025, the instrument is included in the basic earnings per share denominator assuming settlement in shares at the beginning of the period.

The following securities were not included in the computation of diluted earnings per share for the year ended December 31, 2024, as there is net loss attributable to Legence, and to do so would be anti-dilutive (in thousands):

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| | | |
|:---|:---|:---|
|  | **For the Nine<br>Months Ended<br>September 30, 2025** | **For the Year Ended<br>December 31, 2024** |
|  Effect of stock options |  | 669 |
|  Effect of RSUs |  | 904 |
|  Assumed conversion of noncontrolling interests to shares of Class A Common Stock | 46681 | 46681 |
|  Deferred consideration related to the Acquisition |  | 1164 |

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