Plumbing service business, 48% service agreement revenue, three master licenses on staff
§ 01 · Observed
What was documented in diligence.
Service agreement list: 340 active agreements at average $480 annual value with 87% renewal rate on trailing 2-year cohort. Three master plumber licenses on staff as W-2 employees — owner's personal license is additional, not sole. Emergency call revenue normalized: trailing 12-month emergency volume was 22% above 3-year average due to winter freeze event. Normalization reduced SDE by $34,000. Fleet appraisal: 6 service vans, 2 jetting trucks at 4.8-year average; appraised at 94% of book. Owner performs 6 billable hours per week — replacement normalization $18,000.
§ 02 · Outcome
What happened.
Signed at 4.2× SDE. Lender DSCR 1.26× on normalized earnings. Closed without repricing.
§ 03 · Structural Pattern
How this deal fits the four-pillar framework.
Upper-band placement driven by service agreement depth with verified renewal rates, license continuity that is completely independent of the exiting owner, and a fleet in the efficient age range. Emergency normalization was the only earnings-quality adjustment required.
This is an anonymized composite drawn from observable structural patterns in the sample window. It is not a specific deal. The structural pattern, band placement, and outcome reflect commonly observed combinations; a future consented case study will replace this entry.
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