Can a seller take the business back if a buyer stops paying on a vendor take-back note?

It depends entirely on what security the seller actually took at closing, not just on the promissory note itself. A vendor take-back note alone, without any registered security backing it, generally makes the seller an unsecured creditor on default, meaning the seller can sue for the amount owing but has no automatic right to reclaim the business or its assets directly.

Where the seller also registered a security interest, typically under Ontario's Personal Property Security Act against the business's assets, or took a pledge of the purchased shares, that security can give the seller real enforcement rights on default, potentially including seizing or selling the secured collateral, but these remedies follow the procedures and notice requirements that apply to secured lending generally, not an immediate, informal takeover of the business. "Taking the business back" is a significant, procedurally involved step even with good security in place. A seller facing missed vendor take-back payments should have their actual security position reviewed promptly to understand what enforcement options genuinely exist.