Letter of Intent Template for Acquiring a Snow Removal Business

Buyer and Seller Identification

Identify the legal names of both parties, including the entity type through which the acquisition will be made. Specify whether the buyer is acquiring the business as an individual, LLC, or corporation, and note if a new acquisition entity will be formed prior to closing.

💡 If you plan to form a new acquisition entity (e.g., a new LLC), note that in the LOI rather than leaving it blank. Sellers in the snow removal space are often owner-operators and want to know exactly who they're dealing with — individual vs. private equity-backed acquirer matters to them in negotiations around transition roles and earnout oversight.

Purchase Price and Valuation Basis

State the proposed total purchase price and the basis on which it was calculated. For snow removal businesses, this typically means a multiple of weather-normalized EBITDA or Seller's Discretionary Earnings (SDE) across three to five seasons, adjusted for contract mix and equipment value.

💡 Push hard for a five-season average rather than three, especially if recent winters were above-average snowfall years. A seller with two strong recent seasons will argue for a higher multiple — you need normalized data to defend your price. If equipment is aging or deferred maintenance is apparent, carve out a separate equipment credit or escrow holdback tied to an independent equipment appraisal completed during due diligence.

Deal Structure and Payment Terms

Define how the purchase price will be paid, including cash at close, SBA financing, seller note, and any earnout provisions tied to future seasonal performance.

💡 Earnouts are common and reasonable in snow removal deals because of weather risk — use them as a bridge, not a penalty. Sellers will resist earnouts tied only to revenue if they believe a new owner may underprice contracts to win volume. Consider tying the earnout to EBITDA margin retention instead. Always define the snowfall normalization methodology explicitly in the LOI — disputes over this exact calculation are the most common post-close friction point in seasonal acquisitions.

Assets Included in the Sale

Enumerate the key assets transferring with the business, including equipment, vehicles, contracts, customer lists, routes, trade names, and goodwill. Specify what is excluded.

💡 Get a full equipment list with VINs and serial numbers attached to the LOI as Exhibit A — not just a summary. Snow removal equipment depreciates fast and is frequently run hard. If you don't anchor the asset list early, sellers may remove or swap equipment between LOI signing and close. Pay particular attention to salt spreader condition and plow frame integrity — these are high-wear items often with deferred maintenance that materially affects business readiness.

Contract Base Representation

Require the seller to represent the existence, term, and quality of the current contract base, distinguishing between multi-year seasonal contracts and per-event agreements, and confirming renewal status.

💡 The contract base is the core value driver in any snow removal acquisition — treat it like a bank would treat a loan portfolio. Ask for a contract-by-contract spreadsheet showing: customer name, contract type (seasonal vs. per-event), annual contract value, renewal date, and whether auto-renewal language is in place. If the seller can't produce this within 10 days, that's a red flag about operational organization that will surface in due diligence.

Due Diligence Period and Access

Define the length of the due diligence period, what information the seller must provide, and the conditions under which either party can terminate the LOI during this period.

💡 Snow removal due diligence is uniquely time-sensitive relative to the season. If you're acquiring in the spring or summer, use the full 60 days — you'll need time to ride along on site visits, review route density, and inspect equipment before the season starts. If closing is targeted for early fall ahead of a winter season, compress the timeline and prioritize contract review and equipment inspection above all else. Weather-normalized financials require at least five years of data — request all five upfront, not three.

Exclusivity and No-Shop Provision

Secure an exclusivity period during which the seller agrees not to solicit or entertain offers from other buyers while you conduct due diligence.

💡 Sellers in the snow removal market who have strong multi-year contract bases and modern equipment will attract multiple buyers — particularly during the spring-to-summer window when landscaping acquirers are most active. Don't skip exclusivity or accept a short window. Forty-five days is standard; push back firmly on anything under 30. If a seller refuses exclusivity entirely, treat that as a signal that another buyer is already in the picture.

Transition and Training Period

Define the seller's expected post-close involvement, including a training and transition period covering customer introductions, crew oversight, dispatch operations, and seasonal readiness.

💡 One full season is the minimum acceptable transition period for a snow removal acquisition — insist on it. You cannot learn this business from documents alone; you need to operate through at least one active snow season with the seller available. If the seller pushes back on a full season, propose a tiered structure: full-time involvement through the first major storm, part-time availability through the remainder of the season, and on-call support for the following season. Tie a portion of seller note payments to compliance with this transition obligation.

Conditions to Closing

List the key conditions that must be satisfied before the transaction can close, including financing approval, landlord or lease consents, contract assignment approvals, and regulatory requirements.

💡 Contract assignment is the critical closing condition in a snow removal deal. Many commercial property management contracts include anti-assignment clauses that require customer consent. Identify these contracts early in due diligence and begin the consent process before closing — do not assume assignment will be routine. Insurance coverage transfer is also non-negotiable: snow removal businesses carry substantial liability exposure, and you cannot close without confirming your coverage is in place before the first truck rolls.

Confidentiality

Confirm that both parties are bound by confidentiality obligations regarding information shared during the LOI and due diligence process, referencing any previously executed NDA.

💡 If you haven't already executed a mutual NDA before receiving financial data, do so before the LOI is signed — not after. In the snow removal industry, customer contract pricing is highly sensitive. Sellers are rightfully worried that a buyer who doesn't close could use contract pricing intelligence to compete against them directly. Acknowledge this concern directly with the seller and ensure your NDA includes a non-solicitation clause covering employees and customers.