A practical LOI guide built for $1M–$5M moving company acquisitions — covering fleet assets, DOT compliance, seasonal cash flow, and seller transition terms that protect both sides of the deal.
A Letter of Intent (LOI) is the pivotal document in any moving company acquisition. It sets the commercial framework before attorneys draft the definitive purchase agreement, and it signals to a seller that you are a serious, prepared buyer. In the moving industry, a well-crafted LOI goes beyond a standard price-and-terms offer. It must address the asset-heavy nature of the business — trucks, equipment, and storage infrastructure — alongside intangible value drivers like DOT operating authority, corporate relocation contracts, and the seller's personal relationships with referral sources. For acquisitions in the $1M–$5M revenue range, buyers typically use SBA 7(a) financing, which imposes its own structural requirements on how equity, seller notes, and earnouts are arranged. Sellers — often retirement-age owner-operators who have spent 10–30 years building a regional brand — need to see that a buyer understands the operational complexity of the business before they will grant exclusivity. A moving company LOI should typically be 4–8 pages, non-binding on the purchase price except where noted, and should grant the buyer 45–75 days of exclusivity to complete due diligence on fleet condition, FMCSA compliance, insurance history, and customer concentration. Use this guide and template language to build an LOI that reflects industry norms, accelerates lender approval, and lays the groundwork for a clean close.
Find Moving Company Businesses to AcquireParties and Transaction Overview
Identifies the buyer entity, seller entity, and the legal structure of the proposed transaction. For moving companies, clarity on whether this is an asset purchase or stock purchase is critical because DOT operating authority, FMCSA registration, and state PUC licenses may or may not transfer with a stock deal depending on jurisdiction.
Example Language
This Letter of Intent is submitted by [Buyer Name or Buyer Entity], a [state] [LLC/Corporation] ('Buyer'), to [Seller Legal Name], a [state] [LLC/Sole Proprietorship] ('Seller'), operating as [DBA Name] ('the Company'), with its principal place of business at [Address]. Buyer proposes to acquire substantially all assets of the Company, including but not limited to rolling stock, equipment, customer contracts, trade name, goodwill, and DOT operating authority (USDOT# [number]), through an asset purchase transaction. This letter is intended to outline the principal terms upon which Buyer and Seller will negotiate a definitive Asset Purchase Agreement ('APA').
💡 Sellers of moving companies often prefer stock sales to avoid asset-level tax recognition and to simplify license transfers, but buyers nearly always prefer asset purchases to avoid inheriting cargo claim liabilities, workers' compensation exposure, and any unresolved DOT violations. Align early on structure, as this will also affect SBA lender requirements. Note that FMCSA operating authority is not automatically transferred in an asset sale — factor in the timeline and cost to obtain new authority or seek a transfer.
Purchase Price and Valuation Basis
States the proposed purchase price, the valuation methodology used, and how the price was derived from the seller's normalized EBITDA. Moving companies in the lower middle market typically trade at 2.5x–4.5x EBITDA, with higher multiples paid for businesses with recurring corporate contracts, modern fleets, and professional management.
Example Language
Buyer proposes a total purchase price of $[Amount] ('Purchase Price'), representing approximately [X.Xx] times the Company's Seller's Discretionary Earnings (SDE) of $[Amount] for the trailing twelve months ended [Date], as recast and adjusted for owner compensation, personal vehicle expenses, and non-recurring items. The Purchase Price is allocated as follows: (a) tangible assets including fleet and equipment at appraised fair market value of approximately $[Amount]; (b) customer lists, trade name, and goodwill at $[Amount]; and (c) non-compete covenant at $[Amount]. Buyer reserves the right to adjust the Purchase Price based on findings during due diligence, including fleet condition assessments and any identified deferred maintenance obligations exceeding $[Threshold Amount].
💡 Sellers often overestimate fleet value because they use book value rather than fair market value. Require a third-party fleet appraisal during due diligence and make the purchase price adjustment mechanism explicit in the LOI. Also negotiate how deferred maintenance discovered during due diligence affects the final price — a common point of contention when trucks have unreported mechanical issues or require DOT-mandated repairs within 12 months of close.
Payment Structure and Financing Contingency
Details how the purchase price will be funded, including buyer equity, SBA loan proceeds, seller note, and any earnout component. SBA 7(a) loans are the dominant financing vehicle for moving company acquisitions in this size range and impose specific restrictions on seller note subordination and earnout structures.
Example Language
The Purchase Price shall be funded as follows: (a) Buyer equity injection of approximately $[Amount] (representing [X]% of total consideration); (b) SBA 7(a) loan proceeds of approximately $[Amount], subject to lender approval and SBA eligibility confirmation; and (c) a Seller Note in the amount of $[Amount] (representing [X]% of Purchase Price), bearing interest at [X]% per annum, amortized over [5–7] years, fully subordinated to the SBA lender during the loan term. This LOI and Buyer's obligations hereunder are contingent upon Buyer obtaining a financing commitment from an SBA-approved lender within [45] days of execution. Seller agrees to cooperate with lender requests including financial statement submission, fleet documentation, and business tax return production.
💡 SBA lenders will scrutinize the moving company's seasonal cash flow patterns and may require a higher equity injection if summer revenue concentration is extreme. Seller notes must be on full standby for the SBA loan term — sellers sometimes resist this. Earnouts, if included, must be structured carefully to satisfy SBA guidelines; lenders may count earnout obligations as debt service when underwriting. Be transparent about financing structure early to avoid surprises at the commitment letter stage.
Earnout Provisions
Defines performance-based contingent payments tied to revenue or customer retention metrics post-close. Earnouts are common in moving company deals where a seller's personal relationships with corporate accounts or referral partners create customer concentration risk.
Example Language
In addition to the base Purchase Price, Buyer agrees to pay Seller an earnout of up to $[Amount] over a period of [12–24] months following the Closing Date ('Earnout Period'), calculated as follows: (a) if the Company achieves gross revenue of at least $[Target] during the Earnout Period, Seller shall receive a payment of $[Amount]; (b) if the Company retains [Named Corporate Account(s)] as active customers generating at least $[Threshold] in aggregate revenue during the Earnout Period, Seller shall receive an additional payment of $[Amount]. Earnout payments shall be made within [45] days following the end of each measurement period. Buyer shall provide Seller with reasonable access to financial records necessary to verify earnout calculations.
💡 Earnouts in moving businesses are most defensible when tied to objective, verifiable metrics like total gross revenue or retention of named accounts — not EBITDA or profit metrics that a buyer can influence through expense allocation. Sellers should negotiate for the right to audit earnout calculations and for protections against buyer actions that artificially suppress revenue during the earnout period, such as redirecting commercial accounts to affiliated entities.
Assets Included and Excluded
Specifies exactly which assets transfer with the business. For moving companies, this is particularly important given the fleet, equipment, storage infrastructure, and proprietary dispatch or CRM systems that may exist within the business.
Example Language
The transaction shall include all assets used in the operation of the Company's moving business, including but not limited to: (a) all motor vehicles listed on Schedule A (fleet of [X] trucks, including make, model, year, VIN, and current mileage); (b) all moving equipment, pads, dollies, and related supplies; (c) all customer contracts, corporate relocation agreements, and referral partner arrangements; (d) the Company's trade name, website domain, phone numbers, and social media accounts; (e) the Company's DOT operating authority and associated permits, to the extent transferable; (f) all software, dispatch systems, and customer databases. Excluded assets shall include: (i) cash and accounts receivable as of the Closing Date; (ii) any personal vehicles not used in operations; (iii) Seller's personal life insurance policies; and (iv) [any other excluded items to be agreed upon].
💡 Sellers sometimes attempt to exclude high-value trucks that they intend to keep or sell separately after close, which can materially impair the business's operational capacity. Insist on a complete and signed fleet schedule attached to the LOI. Also confirm which phone numbers and online review profiles are included — a moving company's Google Business Profile with hundreds of 5-star reviews is a genuine revenue-generating asset that must explicitly transfer to the buyer.
Due Diligence Period and Access
Establishes the timeline and scope of buyer's investigation of the business, including fleet inspection, financial verification, regulatory review, and insurance history examination.
Example Language
Following execution of this LOI, Seller shall grant Buyer and Buyer's representatives full access to conduct due diligence for a period of [45–60] days ('Due Diligence Period'). Due diligence shall include, without limitation: (a) inspection and third-party mechanical assessment of all fleet vehicles; (b) review of FMCSA compliance records, DOT inspection history, and any outstanding violations or fines; (c) examination of the past three years of financial statements, tax returns, and customer invoices; (d) review of all cargo claims, liability claims, and workers' compensation loss runs for the past five years; (e) confirmation of worker classification for all drivers and movers; (f) review of all corporate relocation contracts and their assignability; and (g) assessment of storage facility lease terms and obligations. Buyer agrees to maintain confidentiality of all information received and to return or destroy documents if the transaction does not proceed.
💡 Fleet inspection is non-negotiable — hire a certified diesel mechanic to assess each truck independently, not just a visual inspection. DOT compliance review should include pulling the company's FMCSA Safety Measurement System (SMS) scores and checking for any Out-of-Service orders. Workers' comp experience modification rate (e-mod) significantly affects insurance costs and is a key underwriting factor for SBA lenders — request five years of loss runs, not just the current certificate.
Exclusivity Period
Grants the buyer a period during which the seller agrees not to solicit, entertain, or engage with other potential buyers. This is one of the most negotiated provisions in an LOI.
Example Language
In consideration of Buyer's commitment of time and resources to due diligence and financing, Seller agrees that from the date of execution of this LOI through the earlier of (a) [60] days or (b) mutual written agreement to terminate discussions, Seller shall not, directly or indirectly, solicit, negotiate, or provide information to any other party in connection with a proposed sale, merger, recapitalization, or transfer of the Company or its assets ('Exclusivity Period'). Seller shall promptly notify Buyer if Seller receives any unsolicited inquiry from a third party during the Exclusivity Period.
💡 Sixty days is standard for moving company deals given the complexity of fleet appraisals and DOT compliance review, but sellers may push for 45 days if they have received competing interest. Buyers should resist agreeing to exclusivity periods shorter than 45 days — lender engagement alone can consume 2–3 weeks. If a seller insists on a shorter window, negotiate for a 15-day extension right triggered by good-faith progress on financing.
Seller Transition and Non-Compete
Defines the seller's post-close obligations including a training and transition period and geographic non-compete restrictions. In owner-operated moving businesses, customer relationships and referral sources are often personal, making transition quality critical to revenue retention.
Example Language
Seller agrees to remain available to Buyer for a transition period of [90–180] days following the Closing Date ('Transition Period') to introduce Buyer to key corporate accounts, referral partners, and crew leads; transfer operational knowledge including dispatch procedures, estimating practices, and vendor relationships; and cooperate with driver and staff communications. Seller's compensation during the Transition Period shall be $[Amount per month]. Following the Transition Period, Seller agrees not to engage, directly or indirectly, in the moving services business within a [50]-mile radius of [City, State] for a period of [3–5] years. Non-compete provisions are subject to enforceability under applicable state law.
💡 For a moving business where the owner is the primary sales and estimating contact, 90 days of transition may be insufficient. Push for 180 days at a fair daily rate — this often costs less than losing a major corporate account in the first year. Non-compete radius should reflect the company's actual service territory; in dense urban markets 25 miles may be appropriate, while rural or regional operators may require a 100-mile radius. Enforce non-solicitation of employees separately — experienced movers and drivers are the hardest asset to replace.
Conditions to Closing
Lists the material conditions that must be satisfied before the transaction can close, protecting the buyer from being obligated to proceed if key elements of the deal change or cannot be confirmed.
Example Language
The obligations of Buyer to consummate the transaction are conditioned upon: (a) satisfactory completion of due diligence with no material adverse findings; (b) receipt of an SBA 7(a) loan commitment in an amount sufficient to fund the transaction; (c) confirmation that all DOT operating authority, state PUC licenses, and local business licenses are current, in good standing, and transferable or replaceable without interruption to operations; (d) fleet appraisal confirming aggregate vehicle fair market value of not less than $[Amount]; (e) no material change in the Company's business, revenue run rate, or customer base between the LOI execution date and Closing; (f) execution of a definitive Asset Purchase Agreement acceptable to both parties; and (g) delivery of a landlord estoppel and assignment consent for any leased facility used in operations.
💡 The 'no material adverse change' condition is particularly important in seasonal businesses — if due diligence occurs in winter but closing is planned for spring, confirm the revenue run rate expectation reflects seasonal norms rather than winter trough. Tie the fleet appraisal minimum value explicitly to the purchase price allocation to preserve the ability to renegotiate if vehicle values come in below estimates.
Confidentiality and Governing Law
Establishes confidentiality obligations and the legal jurisdiction governing the LOI and any disputes arising from it.
Example Language
Each party agrees to keep the terms of this LOI and all information exchanged in connection with the proposed transaction strictly confidential and not to disclose such information to any third party without the prior written consent of the other party, except to legal counsel, financial advisors, and lenders who have a need to know and are bound by equivalent confidentiality obligations. This LOI shall be governed by the laws of the State of [State], without regard to conflict of law principles. This LOI is non-binding except for the provisions relating to exclusivity, confidentiality, and governing law, which shall be legally binding and enforceable.
💡 Specify which provisions are binding and which are not — courts have held certain LOI terms enforceable even when labeled non-binding. The exclusivity and confidentiality provisions should always be explicitly binding. For moving companies with unionized workforces, add a provision restricting Seller from disclosing the pending sale to employees or union representatives without Buyer's prior consent during the due diligence period.
Fleet Valuation and Condition Adjustment Mechanism
Moving companies are asset-heavy businesses where the truck fleet often represents 30–60% of tangible asset value. Negotiate a clear mechanism in the LOI for adjusting the purchase price downward if a third-party fleet appraisal or mechanic's inspection reveals deferred maintenance obligations, required DOT repairs, or fair market values materially below the seller's representations. Establish a dollar threshold — commonly $15,000–$25,000 per vehicle — above which identified repair costs reduce the purchase price dollar-for-dollar.
DOT and FMCSA Compliance Representations
Require the seller to represent in the LOI that the business is in full compliance with FMCSA regulations, that the USDOT number is active and in good standing, and that there are no pending Out-of-Service orders, consent agreements, or unresolved violations. Negotiate for an indemnification carve-out that holds the seller liable for any fines or remediation costs arising from pre-close compliance failures discovered after the deal closes.
Corporate Relocation Contract Assignability
Corporate or military relocation contracts are among the most valuable assets in a moving business and are often the primary justification for paying above a 3x EBITDA multiple. Negotiate language requiring seller to confirm the assignability of all named contracts and to provide consent documentation from counterparties prior to closing. If key contracts cannot be assigned, the purchase price should be adjusted to reflect the loss of that recurring revenue stream.
Workers' Compensation Experience Modification Rate
A moving company's workers' comp e-mod rate directly affects its insurance premiums, which are a major cost line. An e-mod above 1.25 signals above-average claims history and will significantly increase the buyer's operating costs. Negotiate for the seller to disclose the current e-mod, five years of loss runs, and any open claims before exclusivity is granted. Build in a purchase price adjustment if the e-mod is above a mutually agreed threshold.
Seller Note Subordination and SBA Compliance
SBA 7(a) lenders require seller notes to be fully subordinated to the SBA loan during the loan term, with no principal or interest payments permitted without lender consent. Sellers unfamiliar with SBA deals often resist this requirement. Negotiate the seller note terms, standby period, and any partial payment permissions with your SBA lender before finalizing LOI terms so that the seller's expectations are set accurately from the outset.
Earnout Measurement and Anti-Manipulation Protections
If the LOI includes an earnout tied to revenue retention, negotiate explicit anti-manipulation provisions prohibiting the buyer from redirecting revenue to affiliated entities, eliminating sales staff, or materially changing pricing in ways that suppress measured revenue during the earnout period. Include seller audit rights and specify that earnout disputes are subject to binding arbitration with an independent accountant as arbiter.
Non-Solicitation of Employees
Key movers, drivers, and dispatch staff are essential to operational continuity. Negotiate a standalone non-solicitation of employees clause binding on the seller for 2–3 years post-close, separate from the geographic non-compete. This prevents a seller who is also transitioning to a new venture from recruiting the company's experienced crew — a real risk in tight labor markets where the seller has longstanding personal relationships with staff.
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Moving companies in the $1M–$5M revenue range typically sell at 2.5x–4.5x EBITDA or Seller's Discretionary Earnings. Businesses at the higher end of the range tend to have recurring corporate or military relocation contracts, modern and well-maintained fleets, strong online reputations with 4.5+ star ratings, and professional management teams that reduce owner dependency. Businesses at the lower end often have aging trucks with deferred maintenance, high seasonal concentration, or significant owner-operator dependency. Fleet condition and DOT compliance status are the two factors most likely to cause a buyer to revise a multiple downward during due diligence.
Nearly all moving company acquisitions in the lower middle market are structured as asset purchases. This allows the buyer to step up the tax basis of acquired assets, avoid inheriting pre-existing liabilities including cargo claims, workers' compensation exposure, and DOT violations, and selectively exclude liabilities from the transaction. The primary complexity in an asset purchase is that DOT operating authority (USDOT number) does not automatically transfer — buyers must apply for new operating authority or navigate the FMCSA's procedures for transfer, which can take 4–8 weeks. Plan this timeline into your closing schedule to avoid operational gaps.
Your LOI should explicitly address DOT operating authority (USDOT number) and state whether it transfers or whether Buyer will obtain new authority. In an asset purchase, the seller's USDOT number cannot simply be transferred — the buyer must register a new USDOT number and obtain new operating authority from the FMCSA, a process that typically takes 4–8 weeks and requires proof of insurance. To bridge this gap, some buyers negotiate a short-term operating agreement allowing them to operate under the seller's authority immediately post-close while their own application is processed. Confirm this arrangement with legal counsel as operating under another carrier's authority has regulatory implications.
Prioritize five areas in order: first, a third-party mechanical inspection of every truck in the fleet to identify deferred maintenance and estimate capital expenditure needs in the next 12–24 months; second, FMCSA compliance review including SMS scores, inspection history, and any Out-of-Service orders or consent agreements; third, five years of workers' compensation loss runs and current e-mod rate to understand insurance cost trajectory; fourth, customer concentration analysis — identify any corporate or military accounts representing more than 15% of revenue and confirm contract assignability; and fifth, worker classification review for all drivers and movers to assess any independent contractor misclassification exposure that could create liability after close.
The seller transition period is especially important in moving businesses because many owner-operators personally manage corporate account relationships, handle estimating, and serve as the operational hub for dispatch. A 90-day transition is the minimum for most deals; 180 days is more appropriate when the owner holds key corporate contracts or is the primary estimator. Structure the transition with clear deliverables: introductions to all named corporate accounts in writing and in person, documented handoff of dispatch and estimating procedures, and joint communication to crew leads and key staff. Compensate the seller fairly — typically $5,000–$10,000 per month — to maintain their engagement and goodwill throughout the period.
Yes. Moving companies are among the most SBA-eligible businesses in the service sector because they have established operating histories, tangible collateral in the form of truck fleets, and predictable if seasonal revenue. Typical SBA 7(a) deals in this sector involve a 10–20% buyer equity injection, an SBA loan covering 70–80% of the purchase price, and a seller note covering the remainder. SBA lenders will closely examine the business's seasonal cash flow patterns, the age and condition of the fleet (which serves as collateral), the FMCSA compliance record, and the workers' compensation e-mod rate. Work with an SBA lender who has direct experience with transportation or logistics businesses before signing your LOI.
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