Commercial APS Practice Questions

Question 1 of 5

Salesperson Daniela's buyer is structuring a commercial deal as an asset purchase rather than a share purchase of the vendor's holding company. Which is most directly addressed by the APS in an asset purchase?

• AThe buyer becomes liable for all of the vendor's pre-closing tax debts automatically
• BThe APS specifies which assets are being acquired, which liabilities (if any) are assumed, the allocation of price, and the related tax consequences — typically isolating the buyer from undisclosed historical liabilities of the vendor
• CAsset purchases are prohibited in Ontario commercial real estate
• DThe buyer must take title in the seller's corporate name

Question 2 of 5

Which of the following is NOT typically found in a commercial APS but IS standard in a residential APS?

• ASchedule of vendor reps and warranties
• BHST election under section 167 of the Excise Tax Act
• CStatement that the purchaser will arrange home inspection within 7 days
• DAssignment-of-leases language

Question 3 of 5

What is a 'firm offer' in the context of a commercial APS, and how does it differ from a conditional offer?

• AA firm offer has no conditions and binds the parties immediately upon acceptance, while a conditional offer becomes binding only when all conditions are waived or fulfilled
• BA firm offer can be withdrawn at any time; a conditional offer cannot
• CA firm offer is verbal; a conditional offer is in writing
• DA firm offer must always be at the asking price

Question 4 of 5

Salesperson Marcus's commercial buyer is concerned about title risk on a multi-tenant retail property. Which combination of APS provisions and related steps best addresses title risk?

• AA title representation by the vendor, a title insurance policy, a requisition period for the buyer's lawyer to raise title objections, and statutory off-title searches (zoning, taxes, work orders)
• BVerbal assurances from the listing agent
• CA flat statement that there are no title risks in commercial deals
• DA municipal zoning bylaw alone

Question 5 of 5

In a commercial purchase by 9876543 Ontario Inc., the parties agree to a 'holdback' of $250,000 at closing. Which best describes this arrangement?

• AA reduction of the purchase price
• BFunds withheld in escrow to address potential post-closing issues such as work orders or rep breaches
• CA finder's fee paid to the listing brokerage
• DA non-refundable deposit