Buying or Selling a Camp: The Legal Roadmap

After spending enough time in the industry, many camp professionals aspire to own their own camp, just as many former campers and counselors fondly recall their camp memories and dream of getting back into the industry. As a result, especially in certain regions, there are many more buyers than sellers. This often leads to a competitive purchase process and an occasional bidding war when certain camps go on the market. 

Against this backdrop, a number of camps change hands every year. A common scenario is that a longstanding camp owner may be planning their retirement and a camp sale is their succession plan; of course, camps sell under many other circumstances too. While there are a number of experienced operators and groups that are in the business of buying camps, for many sellers and buyers, the purchase or sale of their camp is a once- or maybe twice-in-a-lifetime transaction. 

When a buyer or seller is engaging in a multi-million dollar transaction and has minimal experience with the process, it can certainly be intimidating. A camp deal also has a structural twist that doesn’t exist in many other business purchases. What’s being sold is both an operating business and the land on which the business is based; the sale is both a real estate transaction and an M&A deal happening simultaneously. 

Since many buyers and sellers are new to the process, the purpose of this article is to provide a roadmap and big picture overview of the sale process and the key legal steps involved. 

Real Estate Sale and Business Sale

In traditional real estate law (the kind readers may be familiar with from buying their own house), the deed is the document that actually transfers ownership at closing. The purchase and sale agreement essentially commits the parties to take the steps needed to complete the transfer of ownership, which is typically subject to contingencies such as a title review, inspections, due diligence, and financing. 

Business acquisitions work differently. The buyer might be: (1) buying the assets of a business, in which case contracts and liabilities may not follow (at least in theory); or (2) buying stock of a corporation or membership interests of an LLC and stepping into the existing legal entity with its existing contracts and liabilities.  

In an asset sale, the buyer is buying only the assets of the business (including its goodwill, reputation, etc.), but the buyer is not buying the business entity itself. Among other things, this means that contracts don’t automatically transfer and may require consent from the counterparty to be assigned to the buyer. In a stock or equity sale, the buyer is buying the existing entity. This means the legal entity itself remains the same but just has new ownership, and its contracts typically stay in place without assignment. This can be an important issue in camp transactions, where permits, vendor agreements, and key relationships may be tied to the existing entity.

In camp deals, we often need to address both pieces of this – transferring the deed and transferring the operating business, either as an asset sale (just buying the camp’s assets and goodwill/reputation) or an equity sale (buying the camp business itself while also taking on its legacy liabilities). Of course, some camp sales just involve the real estate itself and no operating business. This article consider a camp that is selling as a going concern rather than simply a piece of land.

The Roadmap

While the details of every deal are different, there’s a certain roadmap that these transactions typically follow. 

1. Confidentiality Agreement

Needless to say, camp sales are often highly confidential processes. There’s a general sense that, if the camp community found out the camp was on the market, it would be highly detrimental to the business. Thus, as the first step in the process, before any sensitive information is shared, the parties typically enter into a confidentiality agreement (also called a non-disclosure agreement or “NDA”). This agreement requires the potential buyer to keep financial information, enrollment data, staff details, and other proprietary information confidential and to use it only to evaluate the transaction. It may also restrict the buyer from contacting staff, families, or vendors without the seller’s consent. In practice, this is what allows the seller to open their books without risking disruption to the camp community. 

2. LOI/Term Sheet

The first substantive step in a camp sale is typically agreeing on key business terms and then documenting them in a simple term sheet or letter of intent (LOI). This is where the buyer and seller come to agreement on the big business points: sale price; targeted closing date; what is included (and excluded) from the sale; whether the existing owner will stay on board for some period of time and, if so, how much they’ll be paid; and the major “outs” that each party may have. The term sheet is typically a nonbinding summary of business terms, except for certain provisions such as establishing an exclusivity period for the negotiation (meaning, the seller agrees not to solicit or negotiate with other potential buyers for a certain period of time, which gives the buyer an opportunity to complete due diligence and negotiate deal terms). 

This is typically the stage where the parties are still fresh to the process and focused on the big picture. It is an opportunity to get the major business terms on the table and answer the key structural and economic questions before turning to legal drafting. The more of these core issues that can be resolved at the LOI stage, the easier and more efficient it will be for the attorneys to translate those terms into the definitive agreement, and the smoother the remainder of the transaction will be.

It is also worth keeping in mind that, as the deal moves forward, much of the negotiation shifts to the attorneys, and the buyer and seller are a bit more removed from the day-to-day discussions. At that point, unresolved issues may lead to extensive negotiations between attorneys, sometimes driven by misunderstandings of what their clients actually care most about. That can result in billable time being spent negotiating points that the buyer and seller might have resolved quickly if they just talked about it. At the LOI stage, the buyer and seller are usually communicating more directly, which makes it much easier to align on priorities and work through the important issues before they become more time-consuming and expensive to sort out later.

3. Purchase and Sale Agreement

Once the LOI or term sheet is done, the contents of the LOI need to be drafted into a purchase and sale agreement. The seller’s attorney usually provides the draft purchase and sale agreement, which the buyer’s attorney then reviews and edits. In a camp transaction, that agreement often needs to handle both the real estate transfer and the business transfer, either in one combined agreement or in two coordinated agreements that close together (this is what we call the “definitive agreement”). 

The definitive agreement will cover, among other things: the purchase price and related adjustments, including what happens with pre-paid tuition; the buyer’s deposits; the scope and timing of due diligence (which we’ll discuss below) and the parties’ rights if diligence reveals problems; representations and warranties about the property and the business; indemnification/hold-harmless provisions; noncompete and nonsolicit obligations; and post-closing transition obligations. In other words, the definitive agreement spells out exactly what is being bought, what each side is promising about the camp, what happens if those promises turn out to be untrue, what conditions must be satisfied before closing, what the seller is allowed to do following closing (can they go operate another camp, or are they restricted?), and who bears the risk if things go wrong before or after closing.

Unlike the LOI, which is mostly non-binding, the definitive agreement consists of binding legal obligations and many highly technical provisions. It typically involves a far more extensive negotiation and editing process than the LOI. Some attorneys come out of the gate with a balanced purchase agreement, while others take a more aggressive approach to protect their clients’ interests. That initial draft, along with the approach taken by the attorneys during the negotiations – whether collaborative or more adversarial – can have a meaningful impact on how extensive and time-consuming the negotiation process becomes.

4. Due Diligence

In the simplest of terms, due diligence can be described as “kicking the tires.” This is the process of gathering enough evidence to confirm that what the buyer thinks they are buying is what they are actually buying. Diligence may take place at the same time as negotiating the purchase and sale agreement, or after the agreement has been negotiated and signed. The right approach often depends on how quickly the sale needs to happen. If there’s no rush, it can be better to negotiate the purchase and sale agreement first, because if the parties hit an insurmountable obstacle, the buyer hasn’t also spent time and money on diligence. On the other hand, when a deal needs to close quickly, the definitive agreement may be negotiated while due diligence is ongoing. 

In camp sales, diligence usually involves two simultaneous workstreams: first, real estate diligence, and second, business diligence. Real estate diligence involves checking the title, survey, boundaries, easements, access roads, waterfront/wetlands constraints, water supply, septic, the physical plant, and environmental matters. Business diligence considers financial performance, enrollment trends, reputation considerations, legacy legal claims and potential liabilities, staff continuity, insurance coverage and claims history, and regulatory issues (such as licensing and permits, results of past health department inspections, and similar considerations). In practice, this process is driven by detailed diligence requests from counsel, which result in a significant volume of documents that must be gathered and carefully reviewed.

5. Financing and Corporate Structure

Financing often runs in parallel to the contract negotiation and due diligence process, and it often controls the closing date. The buyer in a camp acquisition typically relies on a mix of debt and equity to buy the camp. 

The buyer may proceed with a group of investors who help with the downpayment and take an ownership interest in the business; thus, there may be a camp owner/director, who we ultimately see on the website, and other owners whose role is behind the scenes. In addition, the buyer will typically take on debt. There are certain banks that are known for financing camp sales, and sometimes the seller themselves will hold some amount of the debt too.   

It’s also important to keep in mind the corporate structure of these transactions. Buyers are not typically buying a camp in their own name. They may personally guarantee a loan to facilitate the purchase, but the camp is bought through an entity, which provides a liability shield that insulates the individual owners from the debts and obligations of the entity (but not from their own misconduct). 

Indeed, buyers often use multiple entities for a camp acquisition: one to own the real estate and another for the camp business. The reason for this is primarily liability protection and operational flexibility. The entities themselves protect the owners from personal liability, while separating the real estate from the operating business can help isolate risks, facilitate financing (since lenders often lend against the real estate), and allow for more efficient ownership structures, including bringing in different investors at different levels of the structure.

6. Post-Closing

Closing is the point at which the formal deal is done and the camp has officially changed hands, but what the seller does after closing can be very important. Of course, we’re in the people business. It can be quite jarring for a camp community to see a new owner/director of a long-established camp, so buyers and sellers often treat the period after closing as part of the deal itself. The first couple seasons under new ownership often determine whether value is preserved or destroyed.

As part of this transition, the parties often address whether the seller will remain involved for a period of time, whether through a consulting arrangement, employment agreement, or other transition support. In some cases, a portion of the purchase price may be structured as an earnout tied to future enrollment or performance. In other words, the seller only receives some part of the purchase price if enrollment remains at a certain level one, two, or three years after the sale. This incentivizes the seller to stay involved and ensure the continued success of the business.

Related to this, employee transition is also a key issue. The buyer will need to determine which staff will be retained, whether new employment arrangements will be put in place, and how continuity will be communicated to families and returning campers.

Conclusion

Buying or selling a camp is not a simple transaction, and it is rarely just about the numbers. It is a process that blends real estate, corporate law, financing, and, importantly, the stewardship of a community that often spans generations. While every deal is different, understanding the basic roadmap can help both buyers and sellers approach the process with greater confidence, ask the right questions, and avoid common pitfalls. With the right preparation and advisors, what may feel like an intimidating process should become a structured and manageable path to a successful transition.