I'm looking at a deal (stock sale) with about $1M in active inventory, which is considered excessive because the business really only needs about $400k of inventory on the books if we were to acquire. Our offer will be presented as: Total = purchase price (3.5x EBITDA) + WC (AR - AP). Should we include inventory as part of the WC peg? Or should all the inventory be baked into the purchase price (3.5x EBITDA)? Or perhaps half the inventory value should be baked into the purchase price while the remaining half is set up on a consignment basis? I have read different opinions on this forum, but wanted to get some more feedback.