CEPA (CERTIFIED EXIT PLANNING
ADVISOR) EXAM PREP 2026| BRAND NEW
EXAM QUESTIONS WITH 100% CORRECT
SOLUTIONS | GUARANTEED SUCCESS|
ACE YOUR GRADES.
Which type of transaction does a private equity sponsor acquire older
generation's shares to allow the younger generation management to
continue operating the business?
a) Owner retirements
b) Working capital
c) Family successions
d) Recapitalizations
c) Family successions
In a minority recapitalization transaction, a sponsor acquires less
than 50% of the company to hold minority position to support the
current management team.
a) True
b) False
a) True
Which of the following is not a factor for a private equity group
considering an investment?
a) Stage of development
b) Management
c) Stock price
d) Company size
c) Stock price
,In which type of private equity transaction does the owner or
shareholder end with the most liquidity but the least control?
a) Recapitalization
b) Outright sale
c) Minority recap
d) Majority recap
b) Outright sale
How does a private equity group value a business?
a) EBITDA x multiple
b) How the company makes money
c) The company's growth opportunities
d) Type of business
e) All of the above
e) All of the above
Comprehensive company analysis and due diligence is completed in
which stage of an M&A process?
a) Strategy and planning
b) Materials preparation
c) Research and analysis
d) Negotiation and due diligence
e) Closing documentation and follow up
f) Marketing and bid generation
c) Research and analysis
The investment banker's role on the deal team includes which of the
following set of activities?
a) Direct negotiator for the business, economic and legal terms of the
transaction
b) Provides a customized professional process to maximize sale
proceeds
c) Provides access to a public database and network of buyers
d) All of the above
e) None of the above
b) Provides a customized professional process to maximize sale proceeds
,Why should you consider including a M&A Investment Banker on the
team?
a) Conducts preliminary valuation/research
b) Speeds the process (exponentially)
c) Shelters principals from emotional deal-killers and poor future
relations
d) Provides professional negotiation skills
e) All of the above
e) All of the above
Why would you advise a business owner against timing the sale of
the business?
a) The economic cycle may change
b) Next year's anticipated growth may decrease or flat line
c) The business may be more valuable in its current smaller state that
after growth in the next year
d) All of the above
d) All of the above
What mistake could a seller make when putting together the
information memorandum, which is distributed to interested buyers
after the confidentiality agreement is signed?
a) Including preliminary due diligence
b) Communicate opportunities vs weaknesses
c) Leaving off any problems or issues with the company
d) Not including names of management team
c) Leaving off any problems or issues with the company
The most common application of an Employee Stock Ownership Plan
and Trust is to provide liquidity for private company owners.
a) True
b) False
a) True
Which of the following is a success factor for an ESOP candidate?
a) Unused debt capacity
b) Capable management
, c) Well established company with predictable cash flows
d) All of the above
d) All of the above
Tax regulations and incentives for C Corporations, include:
a) 1042 rollover
b) Annual Contributions to ESOP create a tax deduction
c) Defer capital gains on stock sale
d) Diversify seller's net worth
e) All of the above
e) All of the above
Which of the following is not considered for valuation in an ESOP
transaction?
a) Fair market value
b) Enterprise value
c) Current stock price
d) Lack of marketability discount
c) Current stock price
Besides providing liquidity for the owner, what is another reason an
ESOP may be a viable exit option?
a) Capital formation
b) Employee productivity and retention
c) Known Buyer - controls timing and communication
d) All of the above
d) All of the above
Family businesses face many challenges. The most important
challenges which are not being addressed include which of the
following?
a) Breakdown of communication and trust within the family
b) Heirs unprepared for required roles and accountability
c) Non-technical people-based issues
d) a and b
e) a, b, and c
e) a, b, and c
ADVISOR) EXAM PREP 2026| BRAND NEW
EXAM QUESTIONS WITH 100% CORRECT
SOLUTIONS | GUARANTEED SUCCESS|
ACE YOUR GRADES.
Which type of transaction does a private equity sponsor acquire older
generation's shares to allow the younger generation management to
continue operating the business?
a) Owner retirements
b) Working capital
c) Family successions
d) Recapitalizations
c) Family successions
In a minority recapitalization transaction, a sponsor acquires less
than 50% of the company to hold minority position to support the
current management team.
a) True
b) False
a) True
Which of the following is not a factor for a private equity group
considering an investment?
a) Stage of development
b) Management
c) Stock price
d) Company size
c) Stock price
,In which type of private equity transaction does the owner or
shareholder end with the most liquidity but the least control?
a) Recapitalization
b) Outright sale
c) Minority recap
d) Majority recap
b) Outright sale
How does a private equity group value a business?
a) EBITDA x multiple
b) How the company makes money
c) The company's growth opportunities
d) Type of business
e) All of the above
e) All of the above
Comprehensive company analysis and due diligence is completed in
which stage of an M&A process?
a) Strategy and planning
b) Materials preparation
c) Research and analysis
d) Negotiation and due diligence
e) Closing documentation and follow up
f) Marketing and bid generation
c) Research and analysis
The investment banker's role on the deal team includes which of the
following set of activities?
a) Direct negotiator for the business, economic and legal terms of the
transaction
b) Provides a customized professional process to maximize sale
proceeds
c) Provides access to a public database and network of buyers
d) All of the above
e) None of the above
b) Provides a customized professional process to maximize sale proceeds
,Why should you consider including a M&A Investment Banker on the
team?
a) Conducts preliminary valuation/research
b) Speeds the process (exponentially)
c) Shelters principals from emotional deal-killers and poor future
relations
d) Provides professional negotiation skills
e) All of the above
e) All of the above
Why would you advise a business owner against timing the sale of
the business?
a) The economic cycle may change
b) Next year's anticipated growth may decrease or flat line
c) The business may be more valuable in its current smaller state that
after growth in the next year
d) All of the above
d) All of the above
What mistake could a seller make when putting together the
information memorandum, which is distributed to interested buyers
after the confidentiality agreement is signed?
a) Including preliminary due diligence
b) Communicate opportunities vs weaknesses
c) Leaving off any problems or issues with the company
d) Not including names of management team
c) Leaving off any problems or issues with the company
The most common application of an Employee Stock Ownership Plan
and Trust is to provide liquidity for private company owners.
a) True
b) False
a) True
Which of the following is a success factor for an ESOP candidate?
a) Unused debt capacity
b) Capable management
, c) Well established company with predictable cash flows
d) All of the above
d) All of the above
Tax regulations and incentives for C Corporations, include:
a) 1042 rollover
b) Annual Contributions to ESOP create a tax deduction
c) Defer capital gains on stock sale
d) Diversify seller's net worth
e) All of the above
e) All of the above
Which of the following is not considered for valuation in an ESOP
transaction?
a) Fair market value
b) Enterprise value
c) Current stock price
d) Lack of marketability discount
c) Current stock price
Besides providing liquidity for the owner, what is another reason an
ESOP may be a viable exit option?
a) Capital formation
b) Employee productivity and retention
c) Known Buyer - controls timing and communication
d) All of the above
d) All of the above
Family businesses face many challenges. The most important
challenges which are not being addressed include which of the
following?
a) Breakdown of communication and trust within the family
b) Heirs unprepared for required roles and accountability
c) Non-technical people-based issues
d) a and b
e) a, b, and c
e) a, b, and c
