After completing any add-backs, it is critical that you take into consideration the future capital requirements of the business as well as debt-service expenses. As such, in capital intensive businesses where equipment needs replacing on a regular basis, you must deduct appropriate amounts from the Owner Benefit number in order to determine both the true value of the business as well as its ability fund future expenditures. Under this formula, you will arrive at a "net" Owner Benefit number or true Free Cash Flow figure.
This held value to shareholders can often be resold to help free up more cash flow for the company and because it is reinvested in the company hopefully it represents growth of earnings. It can also be used to pay insiders royalty interest allowing an exit plan for those individuals.
Because it is derived from shareholders interest in the company or shareholders debt if you like to think in those terms the equity can be sold under a class D registration process 1934 not the 1933 regulations that never existed except under internet special rulings.
Do your own DD the truth is at your local library.
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