In the context of company acquisitions/sales, a cash free/debt free clause is increasingly being included in the SPA (Sales and Purchase Agreement) in Germany as well. It governs the financial resources with which the company is to be equipped at the agreed
purchase price is handed over. A buyer pays a purchase price X with XY cash on hand and XY financial liabilities. The purchase price is thus more precisely defined and variable. If it turns out that the cash position at the reporting date was higher than defined in the SPA, the purchase price is increased by this difference; if it subsequently turns out that the financial liabilities at the reporting date were higher than defined in the SPA, the purchase price is reduced accordingly. Instead of the designation cash free and debt free regulation, also
The term “net debt” refers to a “net debt” clause or a “net debt” definition.