Letter of Intent Template for Acquiring a Pet Sitting or Dog Walking Business

Buyer and Seller Identification

Clearly identify all parties to the transaction — the legal name of the acquiring entity or individual buyer, the legal business name of the pet sitting or dog walking company being acquired, and the seller's full legal name. If you're buying through a newly formed LLC or acquisition entity, note that it is 'to be formed' so the seller understands the structure.

💡 If you plan to use an SBA 7(a) loan, confirm with your lender early whether the acquisition vehicle must be an existing entity or can be formed at closing. Sellers of owner-operated pet businesses are sometimes personally attached to the business name — clarify whether the trade name, social media handles, and Google Business Profile are included in the asset purchase.

Transaction Structure

Define whether this is an asset purchase or a stock/membership interest purchase. The vast majority of pet sitting and dog walking business acquisitions are structured as asset purchases to allow the buyer to select which assets and liabilities to assume, limit exposure to unknown pre-closing liabilities such as worker misclassification claims, and provide favorable tax treatment through asset step-up.

💡 Be explicit about digital assets in pet care deals — the Google Business Profile with 300+ five-star reviews and the Instagram account with 4,000 local followers are core value drivers. Sellers sometimes overlook these or have accounts tied to personal email addresses. Clarify transfer mechanics for Time To Pet, Precise Petcare, or whatever scheduling platform the business uses, as client data portability is essential to continuity.

Purchase Price and Valuation Basis

State the proposed total enterprise purchase price and the valuation methodology used to arrive at it. In pet sitting and dog walking acquisitions, purchase price is almost always expressed as a multiple of Seller's Discretionary Earnings (SDE), with multiples typically ranging from 2.5x to 4.5x depending on revenue size, owner dependency level, recurring revenue percentage, and staff stability.

💡 Push for a clear add-back schedule in the LOI stage — many pet sitting operators run personal vehicle expenses, family phone plans, or pet supply purchases through the business. Agreeing upfront on what qualifies as a legitimate add-back prevents valuation disputes at closing. If the seller claims significant cash revenue, discount your offer accordingly unless it can be corroborated through bank deposits, scheduling software data, or client count analysis.

Payment Terms and Deal Structure

Break down how the Purchase Price will be funded across all sources, including buyer equity, SBA or conventional financing, seller note, and any earnout component. Most pet care deals in this segment are financed through a combination of SBA 7(a) funds, a modest seller note, and buyer equity. Earnouts are increasingly common when there is meaningful owner dependency risk.

💡 The earnout clause is the most negotiated element in pet sitting acquisitions because client attrition risk is real when a beloved owner-operator exits. Sellers will resist earnouts tied to metrics outside their control post-sale; buyers should frame earnouts as revenue retention guarantees rather than performance penalties. SBA lenders will require the seller note to be on full standby for the loan term — confirm this with your lender before finalizing payment terms in the LOI.

Due Diligence Period and Access

Define the length of the due diligence period, what materials the seller must provide, and buyer's right to speak with key staff and clients on a limited basis. Pet care due diligence typically runs 30–60 days and must cover financial records, client roster analysis, worker classification status, insurance policies, and operational systems review.

💡 Insist on seeing the client roster broken down by revenue per client — this is the single most important data set in a pet care acquisition. If the top 5 clients represent more than 25–30% of revenue, that is a material concentration risk that should affect your valuation or trigger additional earnout protections. Do not skip the insurance review; care custody and control gaps have resulted in uninsured claims that surface post-closing.

Exclusivity and No-Shop Period

Request an exclusivity period during which the seller agrees not to solicit, entertain, or accept offers from other buyers. This protects the buyer's investment in due diligence and legal costs while the deal is being negotiated.

💡 Sixty days is standard for pet care businesses of this size. Sellers who resist exclusivity entirely are a red flag — it may signal they are running a competitive bid process or are not fully committed to the transaction. If the seller insists on a shorter window, offer to accelerate your due diligence timeline in exchange for the full 60-day exclusivity.

Transition Support and Non-Compete

Outline the seller's commitment to post-closing transition support and the scope of the non-competition and non-solicitation restrictions. In pet sitting businesses, seller transition support is critical because clients have personal relationships with the owner and staff reassurance often comes directly from the departing founder.

💡 The geographic radius and duration of the non-compete are highly negotiable and will be scrutinized by SBA lenders and your attorney for enforceability under state law. In densely populated urban markets, 10–15 miles may be appropriate; in suburban or rural markets, consider expanding to 20–25 miles. Sellers who are genuinely retiring are less resistant to non-competes than those exiting to pursue other ventures — know your seller's post-exit plans before entering this negotiation.

Confidentiality

Confirm that both parties are bound by confidentiality obligations covering all deal-related information, including client lists, financial data, staff details, and the existence of the transaction itself. This is especially important in tight-knit local pet care communities where rumors of a sale can spook clients and trigger staff departures before closing.

💡 Many pet sitting sellers are deeply concerned about staff and clients finding out about the sale before it is finalized. A strong confidentiality clause in the LOI — not just a separate NDA — signals to the seller that you understand the operational sensitivity of the business and take their concerns seriously. This builds trust and smooths the overall negotiation process.

Binding vs. Non-Binding Provisions

Clearly delineate which sections of the LOI are legally binding and which are expressions of intent only. This protects both parties and avoids disputes about LOI enforceability while the deal is being finalized.

💡 Making exclusivity and confidentiality binding while keeping economics non-binding is the standard approach and will be familiar to any experienced M&A attorney or business broker. Avoid making the purchase price or deal structure binding at the LOI stage — you need flexibility to adjust these terms based on what you find in diligence, particularly around owner dependency metrics and worker classification exposure.