{
  "title": "What is debt-free cash-free? Definition, formula and example",
  "url": "https://acquisitions.com/blog/what-is-debt-free-cash-free/",
  "author": "Moran Pober",
  "publisher": "Acquisitions.com",
  "published": "2026-11-02",
  "updated": "2026-11-02",
  "section": "Glossary",
  "keyword": "debt-free cash-free",
  "short_answer": "Debt-free cash-free means the buyer pays for the business as if it had no cash and no debt. At closing the seller keeps the spare cash and pays off the loans and debt-like bills from the price, so the headline offer is not what the seller takes home.",
  "facts": {
    "Headline price (5.0x × $1,000,000)": "$5,000,000",
    "Plus cash in the bank at closing": "+$300,000",
    "Minus bank term loan paid off": "−$900,000",
    "Minus equipment loans paid off": "−$150,000",
    "Minus unpaid staff bonuses (debt-like)": "−$50,000",
    "Working capital: $360,000 delivered vs $400,000 agreed": "−$40,000",
    "Seller proceeds before fees and taxes": "$4,160,000"
  },
  "sources": [
    "https://www.orrick.com/en/tech-studio/insights/What-Does-Cash-Free-Debt-Free-Mean",
    "https://www.investopedia.com/terms/e/enterprisevalue.asp"
  ],
  "license": "Facts may be quoted with attribution to Acquisitions.com and a link to the url above."
}