A security interest attaches when value has been given, the debtor has rights in the collateral, and a security agreement is in effect. For collateral that is not certificated securities, chattel paper, goods, instruments, or money, perfection is typically achieved by filing a financing statement. A financing statement must generally contain the name of the debtor, the name of the secured party, and an indication of the collateral covered. Alaska law, like the Uniform Commercial Code (UCC) generally, requires that a financing statement provide an adequate description of the collateral. While a UCC-1 financing statement can describe collateral by “type” or “specific listing,” the description must reasonably identify what is covered. For inventory, a description by type is generally sufficient for attachment and perfection. However, when determining priority, the specific nature of the collateral and the perfection method are crucial. If a secured party perfects its interest in inventory by filing, and another party later obtains a security interest in the same inventory, the first to file generally has priority. In this scenario, the secured party that filed first with a sufficient description of the inventory will have priority over a subsequent secured party, assuming all other requirements for attachment and perfection are met. The UCC’s approach prioritizes certainty and notice, which is achieved through proper filing and adequate collateral description.

The core issue here is the priority of security interests when a debtor grants multiple security interests in the same collateral, and one of those interests is a purchase money security interest (PMSI). Under Alaska’s Article 9, a PMSI generally has superpriority, but this superpriority is contingent on strict adherence to notification requirements. For inventory, a secured party with a PMSI must give an authenticated notification to any other secured party whose security interest has already been perfected in the same collateral. This notification must state that the PMSI holder expects to acquire a PMSI in inventory of the debtor. Furthermore, the PMSI must be perfected when the debtor receives possession of the inventory, or within a twenty-day grace period thereafter. In this scenario, Glacier Bank perfected its security interest in all of Aurora Corp’s inventory on January 15th. On February 1st, Summit Finance acquired a PMSI in Aurora Corp’s new inventory. Summit Finance filed its financing statement on February 5th, which perfected its interest. However, Summit Finance failed to provide the required notification to Glacier Bank prior to filing its financing statement. Alaska Statute 45.29.324(d) specifies that a PMSI in inventory has priority over a conflicting security interest in the same inventory if the PMSI holder gives the required notification. Since Summit Finance did not provide the notification to Glacier Bank before filing, its PMSI in the inventory does not have superpriority over Glacier Bank’s earlier perfected security interest. Therefore, Glacier Bank’s security interest has priority because it was the first to file and perfect.

The core of this question revolves around the concept of “attachment” for a security interest under Article 9 of the UCC, as adopted in Alaska. Attachment is the point at which a security interest becomes enforceable against the debtor. For attachment to occur, three conditions must be met: value must be given, the debtor must have rights in the collateral, and there must be an authenticated security agreement that describes the collateral. In this scenario, the debtor, Aurora Outfitters, has signed an authenticated security agreement that adequately describes the snowmobiles. The secured party, Glacier Financial, has provided value by extending a line of credit. The crucial element is whether Aurora Outfitters has “rights in the collateral.” Aurora Outfitters is leasing the snowmobiles from a third-party lessor, North Star Rentals. Generally, a debtor has rights in collateral when they have possession or the right to possess the collateral, or when they have an insurable interest. A leasehold interest is typically considered sufficient “rights in the collateral” for attachment to occur. Therefore, Glacier Financial’s security interest attaches to Aurora Outfitters’ leasehold interest in the snowmobiles at the moment the security agreement is authenticated and value is given, assuming the description is adequate and the agreement is authenticated. The fact that the collateral is leased rather than owned outright does not prevent attachment to the debtor’s leasehold interest. Perfection is a separate step that determines priority against third parties, but attachment is the initial creation of the enforceable security interest against the debtor.

The scenario involves a conflict between a secured party who perfected by filing and another secured party who has a purchase money security interest (PMSI) in inventory. Under Alaska’s UCC Article 9, a PMSI in inventory generally has priority over conflicting security interests in the same inventory, even if the conflicting interest was perfected earlier. This priority is contingent upon several requirements being met by the PMSI holder. First, the PMSI must have attached. Second, the PMSI holder must have perfected by filing a financing statement before the debtor receives possession of the inventory. Third, the PMSI holder must have sent an authenticated notification to any secured party who previously filed a financing statement covering the same type of inventory or who was known by the PMSI holder to have a security interest in that inventory. This notification must be sent within a specified timeframe before the debtor receives possession of the inventory. Finally, the notification must state that the debtor is receiving inventory from the PMSI holder under a security agreement and describe the inventory. In this case, Glacier Bank has a perfected security interest in all of Arctic Outfitters’ inventory. Aurora Corp. has a PMSI in new inventory. If Aurora Corp. meets all the notification and filing requirements of AS 45.09.324(b), its PMSI will have priority over Glacier Bank’s earlier perfected security interest. The question asks about the outcome if Aurora Corp. fails to provide the required notification to Glacier Bank. Failure to provide the notification as specified in AS 45.09.324(b)(2) means Aurora Corp. does not qualify for the special PMSI priority rule for inventory. Consequently, the general priority rule applies, which prioritizes the secured party that filed or perfected first. Glacier Bank filed and perfected its security interest first. Therefore, Glacier Bank’s security interest will have priority over Aurora Corp.’s PMSI.

The question tests the understanding of the priority rules when a secured party finances inventory and subsequently finances equipment acquired by the same debtor, and another secured party has a perfected security interest in all present and after-acquired equipment. Article 9 of the UCC, as adopted in Alaska, establishes a hierarchy for determining priority. Generally, the first secured party to file a financing statement or perfect its security interest prevails. However, specific rules govern inventory and equipment. In this scenario, Glacier Bank has a perfected security interest in all of Aurora Corp’s present and after-acquired inventory. This perfection is achieved by filing a financing statement covering inventory. Simultaneously, Glacier Bank also has a perfected security interest in all of Aurora Corp’s present and after-acquired equipment, also achieved by filing a financing statement covering equipment. When Aurora Corp later acquires new equipment, and Summit Credit Union finances this specific equipment and perfects its security interest by filing a financing statement covering that equipment, the priority between Glacier Bank and Summit Credit Union for this new equipment must be determined. According to Alaska’s UCC Article 9, specifically concerning after-acquired property clauses and the priority of security interests, the general rule is that the first to file or first to perfect prevails. Both Glacier Bank and Summit Credit Union have perfected their security interests by filing. The critical factor is the timing of their respective filings. If Glacier Bank’s initial filing covering after-acquired equipment predates Summit Credit Union’s filing for the new equipment, Glacier Bank will have priority in that equipment, despite Summit Credit Union’s financing being specific to that purchase. This is because Glacier Bank’s security interest attached to the after-acquired equipment upon Aurora Corp acquiring rights in it, and its earlier filing establishes its priority over subsequent filers for all covered collateral, including after-acquired equipment. The fact that Glacier Bank also has an interest in inventory is relevant to its overall security but does not alter the priority determination for the equipment, which is governed by the rules pertaining to equipment collateral and after-acquired property clauses. The specific nature of Summit Credit Union’s financing as a purchase money security interest (PMSI) in equipment is also important. A PMSI in equipment generally has priority over a conflicting security interest in the same equipment if the PMSI is perfected within 20 days after the debtor receives possession of the collateral. However, this PMSI priority is only effective against a prior perfected security interest if the PMSI holder gives an appropriate notification to the holder of the prior interest before the debtor receives possession of the collateral. Assuming Summit Credit Union complied with the notification requirements for its PMSI in equipment, its PMSI would generally take priority over Glacier Bank’s earlier filed, non-PMSI security interest in after-acquired equipment. However, the question asks about the priority of Glacier Bank’s security interest in after-acquired equipment versus Summit Credit Union’s security interest in the newly acquired equipment. Glacier Bank’s initial filing for after-acquired equipment gives it priority over any subsequent filings for that equipment, unless a specific exception applies, such as a properly perfected PMSI with proper notification. If Summit Credit Union’s financing constitutes a PMSI and they properly perfected and notified Glacier Bank, then Summit Credit Union would have priority. But the question is phrased to test the general priority rule for after-acquired property. If we assume no proper PMSI notification was given by Summit Credit Union, or if we consider a scenario where Glacier Bank’s initial filing for after-acquired equipment was indeed earlier, Glacier Bank would have priority. Given the options, the question is likely testing the general rule of first-to-file or first-to-perfect for after-acquired property, and the potential impact of a PMSI. Without explicit details on Summit’s PMSI notification compliance, the most direct application of the after-acquired property rule, combined with the timing of filings, points to the earliest filer. Let’s assume Glacier Bank’s initial filing for after-acquired equipment was prior to Summit’s filing. Final Answer Derivation: 1. Glacier Bank has a perfected security interest in all after-acquired equipment. This means its security interest attaches to any equipment Aurora Corp acquires. 2. Glacier Bank’s perfection is achieved by filing a financing statement covering equipment. 3. Summit Credit Union finances new equipment and perfects by filing a financing statement covering that equipment. 4. The general rule in Alaska UCC Article 9 is that the first secured party to file a financing statement or perfect its security interest has priority. 5. If Glacier Bank’s initial filing for after-acquired equipment was made before Summit Credit Union’s filing for the new equipment, Glacier Bank has priority in that new equipment. 6. A Purchase Money Security Interest (PMSI) in equipment generally has priority over a prior perfected security interest if perfected within 20 days and proper notification is given. If Summit Credit Union had a PMSI and met these requirements, it would have priority. 7. However, the question asks for the priority of Glacier Bank’s interest. The core concept being tested is the priority established by an earlier filing for after-acquired property. If Glacier Bank’s filing for after-acquired equipment was earlier, its security interest attaches to the new equipment and its priority is established by that earlier filing, unless the PMSI exception is fully met by Summit. Assuming the question is designed to highlight the general rule for after-acquired property, and the potential for the earlier filer to maintain priority in the absence of a fully compliant PMSI notification, the correct answer hinges on the timing of the initial filing. Let’s assume the scenario implies Glacier Bank’s initial filing for after-acquired equipment was indeed earlier than Summit’s filing. In that case, Glacier Bank’s perfected security interest in all after-acquired equipment would have priority over Summit Credit Union’s later-perfected security interest in the specific new equipment. Therefore, the priority is determined by the earlier filing of Glacier Bank’s financing statement covering after-acquired equipment. The calculation is conceptual, based on the priority rules of Alaska UCC Article 9. No numerical calculation is involved. The core principle being assessed is the priority established by an earlier-filed financing statement that covers after-acquired property. Under Alaska’s Uniform Commercial Code (UCC) Article 9, when a secured party has a security interest in after-acquired collateral, that security interest attaches to the collateral as soon as the debtor acquires rights in it. The priority of this security interest is generally determined by the time of filing or perfection. If Glacier Bank filed its financing statement covering all present and after-acquired equipment before Summit Credit Union filed its financing statement for the specific new equipment, Glacier Bank’s earlier filing establishes its priority over Summit Credit Union’s interest in that new equipment. This holds true even if Summit Credit Union’s financing is specifically for the purchase of that equipment, unless Summit Credit Union qualifies for and properly perfects a Purchase Money Security Interest (PMSI) with the required notification to Glacier Bank. The explanation focuses on the general rule of first-to-file or first-to-perfect, which is fundamental to secured transactions law in Alaska and across the United States. Understanding how after-acquired property clauses interact with subsequent financing and the rules for PMSI are crucial for advanced students in secured transactions.

This scenario involves a conflict between a secured party and a buyer of inventory. The core issue is whether the buyer takes the inventory free of the secured party’s security interest. Under Alaska’s UCC Article 9, a buyer in the ordinary course of business (BIOC) takes free of a security interest created by its seller even though the security interest is perfected and even though the buyer knows of its existence. To qualify as a BIOC, the buyer must buy in good faith and without knowledge that the sale is in violation of the security interest. Furthermore, the buyer must buy from a person who is in the business of selling goods of that kind. Here, “Northern Lights Outfitters” is clearly in the business of selling fishing gear. “Aurora Anglers” purchased the specialized ice augers in good faith, as there is no indication of bad faith or knowledge that the sale violated the security agreement. The security agreement between “Glacier Bank” and “Northern Lights Outfitters” granted Glacier Bank a security interest in all of Northern Lights Outfitters’ inventory. Glacier Bank perfected its security interest by filing a financing statement. However, the UCC specifically carves out an exception for BIOCs purchasing inventory. Aurora Anglers, by purchasing the ice augers in the ordinary course of business from Northern Lights Outfitters, takes the collateral free of Glacier Bank’s security interest. Therefore, Glacier Bank cannot repossess the ice augers from Aurora Anglers.

The core issue here is determining the priority of competing security interests in a mixed collateral situation, specifically involving inventory and accounts receivable that arise from the sale of that inventory. Under Alaska’s UCC Article 9, a purchase money security interest (PMSI) generally has priority over a conflicting general security interest in the same collateral if the PMSI is perfected within the prescribed timeframe. For inventory, perfection requires filing a financing statement and, in many cases, notification to other secured parties who have filed against that inventory. For accounts receivable that are proceeds of inventory, the perfection of the security interest in the inventory typically extends to the proceeds. In this scenario, Glacier Bank has a properly perfected general security interest in all of Aurora Outfitters’ present and after-acquired inventory and accounts. This means Glacier Bank’s security interest attached and was perfected before any other party. Arctic Supply Co. then sells inventory to Aurora Outfitters under a credit agreement, creating a PMSI in that inventory. To maintain its PMSI priority over Glacier Bank’s earlier perfected security interest in inventory, Arctic Supply Co. must meet two key requirements under Alaska UCC § 9-324: 1. **Perfection:** Arctic Supply Co. must have a perfected security interest in the inventory. This requires filing a financing statement. 2. **Notification:** Arctic Supply Co. must have given the required notification to Glacier Bank, the holder of the conflicting security interest in inventory, *before* Aurora Outfitters received possession of the inventory. The notification must state that Arctic Supply Co. expects to acquire a PMSI in inventory of Aurora Outfitters, describing the inventory. Aurora Outfitters received the inventory on May 1st. Arctic Supply Co. filed its financing statement on April 28th, which is before the inventory was received, satisfying the filing requirement. However, Arctic Supply Co. did not notify Glacier Bank of its intent to acquire a PMSI in the inventory until May 5th, which is *after* Aurora Outfitters received possession of the inventory. Because Arctic Supply Co. failed to notify Glacier Bank *before* Aurora Outfitters received possession of the inventory, its PMSI in the inventory does not have priority over Glacier Bank’s earlier perfected security interest in that same inventory. Consequently, the accounts receivable generated from the sale of that inventory, which are proceeds of the inventory, will also be subject to Glacier Bank’s superior security interest. Therefore, Glacier Bank has priority.

The scenario involves a dispute over priority between a security interest in inventory and a subsequent buyer of that inventory. Under Alaska’s Article 9, a buyer in the ordinary course of business (BIOC) takes free of a security interest created by its seller, even if the security interest is perfected and the buyer knows of its existence, unless the buyer knows that the sale is in violation of the security agreement. Here, Aurora Borealis Outfitters (ABO) granted a security interest in its inventory to Northern Lights Bank (NLB). This security interest attached when ABO obtained rights in the inventory and NLB gave value. NLB perfected its security interest by filing a financing statement. Subsequently, Glacial Adventures Inc. (GAI) purchased a significant quantity of kayaks from ABO. GAI is a buyer in the ordinary course of business because it purchased in good faith, without knowledge that the sale to it was in violation of the security agreement, and from a person in the business of selling goods of that kind. Therefore, GAI takes the kayaks free of NLB’s security interest. The crucial factor is that GAI is a BIOC, and its status as such overrides NLB’s perfected security interest in the inventory being sold in the ordinary course of business.

The scenario involves a secured party, Glacier Bank, holding a security interest in inventory and accounts receivable of a debtor, Aurora Outfitters, a sporting goods retailer in Anchorage, Alaska. Aurora Outfitters subsequently files for bankruptcy. The core issue is determining the priority of Glacier Bank’s security interest against the bankruptcy estate, particularly concerning after-acquired inventory. Under Alaska’s version of UCC Article 9, a security interest generally attaches when value is given, the debtor has rights in the collateral, and a security agreement is in place describing the collateral. Glacier Bank’s initial security agreement granted it a security interest in “all inventory, wherever located, now owned or hereafter acquired.” This after-acquired property clause is generally valid under UCC § 9-204. Perfection occurs when the secured party has filed a financing statement covering the collateral. Glacier Bank filed its financing statement on January 15, 2023, covering all inventory and accounts. Aurora Outfitters acquired new inventory on February 10, 2023, which is also subject to Glacier Bank’s security interest due to the after-acquired property clause. When Aurora Outfitters files for bankruptcy on March 1, 2023, Glacier Bank’s perfected security interest in the after-acquired inventory is generally effective against the bankruptcy trustee, who acts as a hypothetical lien creditor. The trustee’s rights are generally no stronger than those of a creditor who obtains a lien on the debtor’s property before the bankruptcy petition date. Since Glacier Bank perfected its security interest in the after-acquired inventory before the bankruptcy filing, its interest is superior to the claims of the bankruptcy estate with respect to that inventory. The question asks about the status of the security interest in the inventory acquired *after* the initial filing but *before* the bankruptcy. The perfection of the security interest in after-acquired property is established at the time of the initial perfection, provided the security agreement covers such property. Therefore, Glacier Bank’s security interest in the February 10th inventory is perfected as of January 15, 2023, the date of its initial filing, and is therefore valid and enforceable against the bankruptcy estate.

The scenario involves a conflict between a purchase money security interest (PMSI) in inventory and a prior perfected security interest in after-acquired inventory. Under Alaska’s Article 9, a PMSI generally has priority over conflicting security interests in the same collateral. For inventory, this priority extends to after-acquired inventory, provided certain notification requirements are met. First, for the PMSI holder (Northern Lights Bank) to have priority over the existing secured party (Denali Capital) concerning the new inventory delivered to Aurora Outfitters, Northern Lights Bank must have perfected its security interest in the inventory. This typically involves filing a financing statement. Second, to maintain priority over a prior perfected security interest in after-acquired inventory, the PMSI holder must give notice to the holder of the prior security interest. Alaska Statute 45.29.324(d) states that a secured party with a PMSI in inventory has priority over a conflicting security interest in the same inventory if the PMSI secured party gives notice to any secured party who has filed a financing statement covering the inventory or goods covered thereby. This notice must be given before the debtor receives possession of the inventory. The notice must describe the inventory by item or type. In this case, Denali Capital has a perfected security interest in all of Aurora Outfitters’ inventory, including after-acquired inventory. Northern Lights Bank is providing financing for new inventory and has a PMSI in that specific inventory. For Northern Lights Bank’s PMSI to have priority over Denali Capital’s interest in the new inventory, Northern Lights Bank must have given Denali Capital notice of its PMSI before Aurora Outfitters received the new inventory. The facts state that Northern Lights Bank filed its financing statement and sent notice to Denali Capital on October 15th, but the new inventory arrived on October 10th. Since the notice was sent after Aurora Outfitters received the inventory, Northern Lights Bank’s notice was untimely and did not satisfy the requirements of Alaska Statute 45.29.324(d). Therefore, Denali Capital’s prior perfected security interest in after-acquired inventory has priority over Northern Lights Bank’s PMSI in the inventory that arrived before the notice was given.

No calculation is required for this question. The scenario involves a dispute over priority between a secured party who perfected by filing and another secured party who later acquired a purchase money security interest (PMSI) in inventory. Under Alaska’s UCC Article 9, a PMSI in inventory generally has priority over prior perfected security interests if certain conditions are met. These conditions include that the PMSI holder gives notice to any prior secured party of the debtor’s intention to grant a PMSI in inventory. This notice must be given before the debtor receives possession of the inventory. Furthermore, the PMSI must be perfected by filing and by the secured party’s compliance with any applicable inventory financing rules. In this case, Glacier National Bank filed first, establishing a prior perfected security interest in all of Arctic Outfitters’ inventory. Arctic Outfitters then entered into a new financing arrangement with Denali Capital, who obtained a PMSI in new inventory. For Denali Capital’s PMSI to have priority over Glacier National Bank’s prior perfected security interest, Denali Capital must have perfected its interest and provided notice to Glacier National Bank that Arctic Outfitters intended to acquire inventory on a PMSI basis. If Denali Capital failed to provide this notice, Glacier National Bank’s prior perfected security interest would generally maintain its priority. The question tests the understanding of the specific notification requirement for PMSI in inventory to achieve superpriority over a prior perfected security interest.

No calculation is required for this question. This question assesses understanding of the priority rules for purchase money security interests (PMSIs) in inventory under Alaska’s Article 9. A PMSI in inventory grants the secured party priority over conflicting security interests in the same inventory, provided certain conditions are met. Specifically, under Alaska Statute 45.29.324(d), a PMSI in inventory has priority over a conflicting security interest in the inventory if: (1) the PMSI is perfected when the debtor receives possession of the inventory; (2) the PMSI secured party gives an authenticated notification to any holder of a conflicting security interest on file before the filing of the financing statement covering the inventory; and (3) the notification states that the secured party expects to acquire a PMSI in inventory of the debtor, describing the inventory and the debtor. The notification must be sent within six months before the debtor receives possession of the inventory. The question focuses on the timing of perfection and the notification requirement, which are critical for establishing PMSI priority in inventory. Failure to meet these strict requirements, particularly the timely notification to a prior secured party, will result in the PMSI holder not achieving superpriority over the earlier perfected security interest. Therefore, the correct answer hinges on the proper satisfaction of these statutory prerequisites.

The scenario describes a situation involving a security interest in inventory and equipment granted by an Alaska-based manufacturing company, “Aurora Borealis Manufacturing” (ABM), to “Northern Lights Capital” (NLC). ABM subsequently defaults on its obligations. Aurora Borealis Manufacturing also has a separate agreement with “Glacier Bank” for a line of credit secured by its accounts receivable. The question focuses on the priority of NLC’s security interest in the inventory and equipment when ABM defaults, particularly in relation to any potential claims by Glacier Bank or a subsequent buyer of the inventory. Under Alaska’s Article 9 of the Uniform Commercial Code, the general rule for priority is that the first secured party to file a financing statement or perfect its security interest prevails. NLC, as the secured party for inventory and equipment, would have perfected its security interest by filing a financing statement in Alaska. Glacier Bank, securing its loan with accounts receivable, would also have perfected its interest by filing. When a secured party with a perfected security interest in inventory, such as NLC, allows the debtor (ABM) to sell that inventory in the ordinary course of business, the buyer generally takes the inventory free of the secured party’s security interest, even if the buyer knows of the security interest. This is a crucial exception to the general priority rules, designed to facilitate commerce. Alaska UCC § 9-320(a) mirrors this principle. Therefore, if ABM sells its inventory to a buyer in the ordinary course of business, that buyer takes the inventory free of NLC’s security interest. NLC’s perfected security interest in the inventory remains valid against ABM and potentially other secured parties, but not against such a buyer. Glacier Bank’s priority regarding accounts receivable is distinct and does not affect the buyer’s rights to the inventory. The question asks about the status of the security interest in the inventory itself upon sale in the ordinary course.

In Alaska, a security interest attaches when the secured party gives value, the debtor has rights in the collateral, and a security agreement exists that describes the collateral. For inventory, which is a type of collateral that is frequently sold in the ordinary course of business, a secured party may file a financing statement to perfect its security interest. If the secured party also wants to ensure its priority over subsequent purchasers of that inventory, it must ensure that its security interest is properly perfected. The concept of “proceeds” is critical here; when inventory is sold, the secured party’s security interest generally extends to the proceeds of that sale. Under Alaska’s UCC, a filed financing statement covering inventory is generally effective to cover proceeds of that inventory, unless the proceeds are of a type that are not covered by the original description or a separate filing is required. For inventory that is sold in the ordinary course of business, a buyer takes free of the security interest even if perfected, but this does not apply to subsequent purchasers of the collateral itself. The question revolves around the perfection of a security interest in inventory and its proceeds. A filed financing statement for inventory typically covers after-acquired inventory and proceeds. Therefore, a properly filed financing statement for the original inventory loan would cover the proceeds from the sale of that inventory, assuming the proceeds are also inventory or are of a type covered by the original filing. No separate filing is generally required for proceeds that are of the same type as the original collateral or are accounts resulting from the sale of inventory. The key is the initial perfection of the security interest in the inventory itself.

The scenario involves a secured party, Glacier Bank, holding a security interest in inventory and after-acquired inventory of a debtor, Aurora Outfitters, located in Alaska. Aurora Outfitters has also granted a security interest in its accounts receivable to Denali Capital. Glacier Bank properly filed a financing statement covering all inventory, including after-acquired inventory. Denali Capital also properly filed a financing statement covering all accounts receivable. Subsequently, Aurora Outfitters sells a piece of inventory to a buyer for cash. The cash received from the sale of inventory is now considered an account receivable. The question asks about the priority of the security interests in this cash, which has become an account receivable. Under Alaska’s UCC Article 9, a security interest generally continues in collateral even if it is sold, exchanged, or otherwise disposed of, unless the secured party authorized the disposition free of the security interest. The cash received from the sale of inventory is proceeds of that inventory. Both Glacier Bank and Denali Capital have security interests in the accounts receivable. Glacier Bank’s security interest in inventory includes after-acquired inventory. When that inventory is sold, the cash received is proceeds, which are typically classified as accounts receivable under Article 9. The priority rules in Article 9 are generally determined by the first to file or first to perfect rule. However, there is a specific rule for proceeds. A security interest in proceeds is generally perfected if the security interest in the original collateral is perfected. Glacier Bank’s security interest in inventory was perfected by filing. Therefore, its security interest in the proceeds (cash, now an account receivable) is also perfected. When determining priority between two perfected security interests in the same collateral (in this case, the account receivable derived from the sale of inventory), the first to file or first to perfect rule applies. Glacier Bank filed its financing statement covering inventory (which would cover proceeds of inventory) before Denali Capital filed its financing statement covering accounts receivable. Therefore, Glacier Bank has priority in the cash received from the sale of inventory, even though that cash is now classified as an account receivable. This is because Glacier Bank’s security interest attached to the proceeds upon their creation and was perfected by its earlier filing covering the inventory and its proceeds.

The scenario involves a conflict between a perfected purchase money security interest (PMSI) in inventory and a prior perfected security interest in after-acquired inventory. Alaska’s Article 9, like the Uniform Commercial Code (UCC) generally, establishes priority rules to resolve such conflicts. A PMSI generally has superpriority over other security interests, including those in after-acquired property, provided certain requirements are met. For inventory, these requirements typically include attachment of the security interest, perfection, and notice to the prior secured party. In this case, Aurora Loans perfected its security interest in all of Denali Outfitters’ inventory, including after-acquired inventory, on January 15, 2023. Glacier Funding then obtained a PMSI in specific inventory (fishing gear) sold to Denali Outfitters and perfected its interest on February 1, 2023. Crucially, for a PMSI in inventory to have priority over a prior perfected security interest in after-acquired inventory, the PMSI must be perfected when the debtor receives possession of the inventory and the secured party must have given an authenticated notification to the holder of the prior perfected security interest before the debtor receives possession of the inventory. Since Glacier Funding provided notice to Aurora Loans on January 20, 2023, which was before Denali Outfitters received possession of the fishing gear on January 25, 2023, Glacier Funding’s PMSI in the fishing gear has priority over Aurora Loans’ earlier perfected security interest in after-acquired inventory. Therefore, Glacier Funding would have priority regarding the fishing gear.

The scenario involves a conflict between a secured party who perfected by filing and a buyer of inventory. Under Alaska’s Article 9, a buyer in the ordinary course of business (BIOC) takes free of a security interest created by the seller, even if the security interest is perfected. This is a fundamental exception to the general “first to file or perfect” rule. The secured party, Glacier National Bank, filed a financing statement covering all of Aurora Fishing’s inventory. Aurora Fishing then sold a fishing net to a commercial fisherman, Ms. Anya Petrova, who purchased it in the ordinary course of her business. Ms. Petrova did not know that the net was subject to Glacier National Bank’s security interest. Because Ms. Petrova is a BIOC, her interest in the net is superior to Glacier National Bank’s perfected security interest. Therefore, Glacier National Bank cannot repossess the net from Ms. Petrova. The key concept here is the protection afforded to buyers in the ordinary course of business, which is a crucial policy consideration in secured transactions to facilitate the free flow of goods in commerce. This protection is codified in Alaska UCC § 9-320.

This question tests the understanding of the priority rules when a security interest in inventory is granted to a lender and then a purchase money security interest is granted to a supplier of that inventory. Under Alaska’s Article 9, a secured party with a perfected security interest in inventory generally has priority over a subsequent secured party. However, a purchase money security interest (PMSI) in inventory has special priority rules. For a PMSI in inventory to have priority over a prior perfected security interest in the same inventory, the PMSI holder must satisfy several conditions. First, the PMSI must be perfected when the debtor receives possession of the inventory. Second, the PMSI holder must give authenticated notice to any prior secured party who has filed a financing statement covering the inventory. This notice must state that the secured party expects to acquire a PMSI in inventory, describing the inventory, and the notice must be given before the debtor receives possession of the inventory. In this scenario, Aurora Bank’s security interest attached and was perfected first. Borealis Supplies then acquired a PMSI. For Borealis Supplies to have priority over Aurora Bank, it needed to perfect its PMSI and provide the required notice to Aurora Bank *before* the debtor, Denali Outfitters, received possession of the new inventory. Since Borealis Supplies provided notice *after* Denali Outfitters received possession of the inventory, its PMSI does not have priority over Aurora Bank’s prior perfected security interest. Therefore, Aurora Bank retains its priority.

The scenario involves a debtor, Borealis Outfitters Inc., granting a security interest in its entire inventory and all after-acquired inventory to Aurora Lending LLC. Aurora Lending correctly files a financing statement that sufficiently describes the collateral. Subsequently, Borealis Outfitters Inc. obtains a loan from Glacier Bank, also securing it with its inventory, and Glacier Bank files its own financing statement. The core issue is determining the priority between Aurora Lending and Glacier Bank concerning the after-acquired inventory. Under Alaska’s version of UCC Article 9, a security interest generally attaches when value is given, the debtor has rights in the collateral, and a security agreement exists. Perfection occurs when a creditor takes the necessary steps to make their security interest effective against third parties. For inventory, perfection is typically achieved by filing a financing statement. The general rule for priority is that the first to file or the first to perfect prevails. In this case, Aurora Lending filed first, perfecting its security interest in the initial inventory and, crucially, in the after-acquired inventory as it came into existence. Glacier Bank filed later. Therefore, Aurora Lending has priority over Glacier Bank with respect to all inventory, including the after-acquired inventory. The concept of after-acquired property clauses is vital here, as they allow a security interest to extend to property acquired by the debtor after the initial security agreement. As long as the after-acquired property clause is properly included in the security agreement and the secured party perfects its interest, that perfection extends to the after-acquired property. Since Aurora Lending perfected its interest by filing before Glacier Bank, its prior perfected security interest takes precedence over Glacier Bank’s later-perfected security interest in the after-acquired inventory.

The scenario describes a secured party, “Glacier Bank,” holding a security interest in inventory and after-acquired inventory of a debtor, “Aurora Outfitters.” Aurora Outfitters subsequently files for bankruptcy. A key concept here is the priority of security interests, particularly concerning inventory and the impact of after-acquired property clauses in bankruptcy. Under Alaska’s Article 9, a security interest attaches when value is given, the debtor has rights in the collateral, and a security agreement is in place. Perfection typically occurs upon filing a financing statement. An after-acquired property clause grants the secured party a security interest in property acquired by the debtor after the original security agreement is executed. In the context of inventory, this is crucial as inventory is constantly changing. When a debtor files for bankruptcy, the automatic stay generally prevents secured creditors from enforcing their rights. However, the secured party’s perfected security interest in the collateral, including after-acquired inventory, generally survives the bankruptcy filing. The secured party retains its lien on the collateral. The question asks about the status of Glacier Bank’s security interest in inventory acquired *after* the bankruptcy filing. Under federal bankruptcy law, specifically section 363 of the Bankruptcy Code, a debtor in possession may use, sell, or lease collateral in the ordinary course of business. If the debtor wishes to use cash collateral (which can include proceeds from inventory sales, and by extension, new inventory acquired with those proceeds), the secured party must consent or the court must provide adequate protection. Adequate protection aims to preserve the secured party’s interest in the collateral. Without explicit court approval or consent from Glacier Bank, Aurora Outfitters cannot freely use or dispose of the after-acquired inventory in a manner that would diminish Glacier Bank’s secured position. The security interest in the after-acquired inventory, having attached and been perfected prior to bankruptcy, remains attached and perfected. Therefore, Glacier Bank’s security interest continues to cover inventory acquired even after the bankruptcy petition date, subject to any court orders for adequate protection or disposition of collateral. The bankruptcy estate comprises the debtor’s assets, but the secured party’s lien on those assets is generally preserved. The critical distinction is that the security interest *continues* to cover new collateral as it is acquired, as per the terms of the original security agreement.

The scenario involves a secured party, Aurora Lending, and a debtor, Borealis Outfitters, who has granted a security interest in its inventory of custom-made parkas. Aurora Lending properly filed a financing statement covering this inventory on January 15, 2023. Subsequently, Borealis Outfitters obtained a loan from Glacier Bank, which also took a security interest in the same inventory. Glacier Bank perfected its security interest by taking possession of a significant portion of the inventory on March 1, 2023. The question hinges on determining the priority of these competing security interests. Under Alaska’s UCC Article 9, the general rule for priority between secured parties is “first in time, first in right,” meaning the first party to file a financing statement or the first party to perfect its security interest generally prevails. Aurora Lending perfected its interest by filing on January 15, 2023. Glacier Bank perfected its interest by possession on March 1, 2023. Since Aurora Lending’s perfection occurred earlier than Glacier Bank’s perfection, Aurora Lending has priority. The fact that Glacier Bank took possession of *a significant portion* of the inventory does not change the perfection date of its security interest for priority purposes against Aurora Lending’s earlier filed interest. The critical event for priority is the act of perfection itself, not the subsequent physical control over a part of the collateral. Therefore, Aurora Lending’s security interest has priority.

The scenario involves a dispute over priority between a purchase money security interest (PMSI) in inventory and a prior-filed general security interest. Under Alaska’s version of UCC Article 9, a PMSI holder in inventory generally has priority over a prior secured party if certain conditions are met. The PMSI holder, Glacier Financial Services, advanced funds to Arctic Outfitters to purchase new inventory. Glacier filed a financing statement that adequately described the collateral as “all inventory” and also covered “after-acquired inventory.” Subsequently, Northstar Bank, which had a prior perfected security interest in all of Arctic Outfitters’ existing and after-acquired inventory, attempted to repossess the newly acquired inventory. For Glacier’s PMSI to have priority over Northstar’s prior perfected security interest in inventory, Glacier must have complied with the specific requirements for PMSI perfection in inventory under Alaska law. These requirements typically include: (1) the security interest in the inventory must be perfected when the debtor receives possession of the inventory; (2) the secured party must have given an authenticated security agreement covering the inventory; (3) the secured party must have given notice to any other secured party who previously filed a financing statement covering the same type of collateral, and that notice must be received within the five years before the debtor receives possession of the inventory; and (4) the notice must state that the person giving the notice has acquired or expects to acquire a PMSI in inventory of the debtor and must describe the inventory. In this case, Glacier Financial Services filed its financing statement before Arctic Outfitters received possession of the new inventory. However, the critical element for PMSI priority in inventory is the notification requirement to prior secured parties. Northstar Bank, having a prior perfected security interest, must have received notice from Glacier within the prescribed timeframe and with the required content before Arctic Outfitters took possession of the new inventory. If Glacier failed to provide this notice, or if the notice was deficient, Northstar’s prior perfected security interest would likely maintain its priority. The question hinges on whether Glacier fulfilled its notification obligation to Northstar. Without evidence of Glacier providing the requisite notice to Northstar before Arctic Outfitters received the inventory, Northstar’s prior perfected security interest in all inventory, including after-acquired inventory, would prevail. Therefore, Northstar’s security interest has priority.

The scenario describes a secured party, Glacier Holdings LLC, attempting to perfect a security interest in accounts receivable generated by a debtor, Aurora Manufacturing Inc. Aurora is located in Alaska, and Glacier Holdings is also based in Alaska. The security agreement grants Glacier Holdings a security interest in all of Aurora’s accounts, including after-acquired accounts. Aurora then enters into a financing agreement with a second secured party, Borealis Capital Corp., which also claims a security interest in Aurora’s accounts. Borealis Capital files a financing statement in Alaska. Glacier Holdings, however, does not file a financing statement but relies on its control over Aurora’s deposit accounts into which the accounts receivable are deposited. Under Alaska’s version of UCC Article 9, perfection of a security interest in accounts can be achieved through filing a financing statement or, in certain circumstances, through control. While control is a method of perfection for specific types of collateral like deposit accounts, investment property, and electronic chattel paper, it is generally not a method for perfecting a security interest in ordinary accounts. For accounts, the primary method of perfection is filing a financing statement in the jurisdiction where the debtor is located. Since Aurora Manufacturing Inc. is located in Alaska, Glacier Holdings would need to file a financing statement in Alaska to perfect its security interest in the accounts. Borealis Capital’s filing of a financing statement in Alaska perfects its security interest in the accounts. Therefore, Borealis Capital has priority over Glacier Holdings regarding the accounts because it was the first to file a financing statement. Glacier Holdings’ reliance on control over deposit accounts does not perfect its security interest in the underlying accounts receivable themselves. The perfection of a security interest in accounts is distinct from the perfection of a security interest in a deposit account, even if the accounts receivable are deposited into that account.

The core issue here is the priority of a security interest in inventory against a buyer in the ordinary course of business. Under Alaska’s UCC Article 9, a buyer in the ordinary course of business takes free of a security interest created by its seller, even if the security interest is perfected and the buyer knows of its existence, unless the buyer knows that the sale is in violation of the security agreement. In this scenario, Glacier Outfitters, as a buyer in the ordinary course of business of inventory, purchased fishing lures from Arctic Anglers. Arctic Anglers had granted a perfected security interest in its inventory to Denali Bank. Glacier Outfitters purchased the lures in good faith and without knowledge that the sale was in violation of Denali Bank’s security agreement. Therefore, Glacier Outfitters takes the fishing lures free and clear of Denali Bank’s security interest. The perfection of Denali Bank’s security interest and the existence of an after-acquired property clause are irrelevant to the rights of a buyer in the ordinary course of business. The UCC prioritizes the free flow of goods in commerce, which is facilitated by protecting such buyers.

The scenario describes a secured party, Aurora Bank, that has a perfected security interest in the inventory of a debtor, Glacier Outfitters, located in Alaska. Glacier Outfitters then sells a portion of this inventory to a buyer in the ordinary course of business, Borealis Apparel. Under Alaska’s version of UCC Article 9, specifically AS 45.29.320, a buyer in the ordinary course of business takes free of a security interest created by the seller, even if the security interest is perfected and the buyer knows of its existence, unless the buyer knows that the sale is in violation of the security agreement. The UCC distinguishes between a buyer in the ordinary course of business and other types of transferees. The key is that the sale must be from inventory held by a merchant who is in the business of selling goods of that kind. Borealis Apparel’s purchase of the specialized cold-weather gear from Glacier Outfitters, a retailer of such goods, clearly fits the definition of a buyer in the ordinary course of business. Therefore, Aurora Bank’s security interest in the inventory does not follow the collateral into the hands of Borealis Apparel. The bank’s recourse is against Glacier Outfitters for the debt, not against the inventory once it has been sold to a buyer in the ordinary course. The question hinges on the priority rules concerning buyers in the ordinary course of business and the scope of a secured party’s rights against such transferees.

The scenario involves a secured party, Aurora Lending, holding a security interest in inventory and accounts receivable of a debtor, Borealis Manufacturing. Aurora Lending perfected its security interest by filing a financing statement in Alaska. Subsequently, Borealis Manufacturing sold a portion of its inventory to a buyer, Denali Retailers, who then resold some of this inventory to consumers in Washington. The question revolves around the priority of Aurora Lending’s security interest against the buyer of inventory. Under Alaska’s UCC Article 9, a buyer in ordinary course of business (BIOC) takes free of a security interest created by its seller even though the security interest is perfected and even though the buyer knows of its existence, unless the buyer also knows that the sale is in violation of the security agreement. Alaska Statute 45.29.320(a) codifies this principle. Denali Retailers purchased inventory from Borealis Manufacturing, which is a seller of inventory, and Denali Retailers is a retailer that regularly buys goods of that kind. Therefore, Denali Retailers qualifies as a buyer in ordinary course of business. The fact that Aurora Lending perfected its security interest does not prevent Denali Retailers from taking free of it. The crucial element is whether Denali Retailers knew the sale was in violation of the security agreement. The facts provided do not indicate such knowledge. Therefore, Denali Retailers takes the inventory free of Aurora Lending’s security interest.

The scenario involves a security interest in inventory and equipment granted by a debtor, Aurora Borealis Outfitters, to a secured party, Northern Lights Capital. Aurora Borealis Outfitters later obtains a purchase money security interest (PMSI) in new inventory from a supplier, Glacier Goods. The core issue is the priority between Northern Lights Capital’s previously perfected security interest and Glacier Goods’ PMSI in the same inventory. Under Alaska’s version of UCC Article 9, a PMSI in inventory generally takes priority over a prior perfected security interest in the same collateral, provided certain conditions are met. These conditions typically include: (1) the PMSI is perfected when the debtor receives possession of the inventory; (2) the PMSI secured party gives an authenticated notification to any prior secured party entitled to notification under AS 45.9.324(c) before the debtor receives possession of the inventory; and (3) the notification states that the debtor has acquired or will acquire inventory from the secured party. In this case, Northern Lights Capital had a prior perfected security interest in all of Aurora Borealis Outfitters’ inventory and equipment. Glacier Goods then provided new inventory under a PMSI. For Glacier Goods’ PMSI to have priority over Northern Lights Capital’s pre-existing security interest in the inventory, Glacier Goods must have perfected its PMSI and provided the required notification to Northern Lights Capital *before* Aurora Borealis Outfitters received possession of the new inventory. If Glacier Goods failed to provide the notification to Northern Lights Capital before Aurora Borealis Outfitters received the inventory, Northern Lights Capital’s prior perfected security interest would generally retain priority over the new inventory. Therefore, the crucial factor determining priority is whether Glacier Goods complied with the notification requirements of AS 45.9.324(c). Without evidence of such notification, the prior perfected secured party generally prevails.

The scenario involves a secured party, Glacier Bank, holding a security interest in inventory owned by Aurora Outfitters. Aurora Outfitters then sells a portion of this inventory to a buyer, Borealis Retail, who is also a merchant dealing in goods of that kind. Under Alaska’s version of UCC Article 9, specifically AS 45.2.403(b), a buyer in ordinary course of business takes free of a security interest created by the seller even though the security interest is perfected and even though the buyer knows of its existence, unless the buyer also knows that the sale is in violation of the security agreement. Borealis Retail, as a merchant buying inventory from Aurora Outfitters, qualifies as a buyer in ordinary course of business. There is no indication that Borealis Retail knew the sale was in violation of Glacier Bank’s security agreement. Therefore, Borealis Retail takes the inventory free and clear of Glacier Bank’s security interest. Glacier Bank’s recourse would be against Aurora Outfitters for breach of the security agreement, not against Borealis Retail. The concept being tested is the protection afforded to buyers in the ordinary course of business against pre-existing security interests, a fundamental principle of secured transactions designed to facilitate commerce. This protection is crucial for the smooth functioning of markets where goods are frequently resold.

The scenario involves a secured party, Aurora Bank, and a debtor, Borealis Outfitters, with collateral consisting of inventory and after-acquired inventory. Aurora Bank properly filed a financing statement covering all of Borealis Outfitters’ inventory. Subsequently, Borealis Outfitters obtained a loan from Denali Credit, which also took a security interest in the same inventory, including any after-acquired inventory. Denali Credit failed to file a financing statement or take possession of the inventory. Under Alaska’s Article 9, the priority of conflicting security interests is generally determined by the first to file or the first to perfect. Aurora Bank perfected its security interest by filing a financing statement. Denali Credit’s security interest, while attached, was not perfected. Therefore, Aurora Bank’s prior perfected security interest has priority over Denali Credit’s unperfected security interest in the inventory, including any after-acquired inventory, as per Alaska Statutes § 45.29.322(a). This principle extends to after-acquired property clauses, as a security interest in inventory typically encompasses after-acquired inventory unless explicitly excluded, and the first secured party to perfect their interest in that collateral will have priority.

The scenario involves a secured party, Aurora Capital, taking a security interest in inventory and after-acquired inventory from a debtor, Northern Lights Outfitters, a retail store in Juneau, Alaska. Aurora Capital properly filed a financing statement covering all inventory. Subsequently, Northern Lights Outfitters acquired new inventory from a supplier, Glacier Goods, which also took a security interest in that specific inventory to secure the purchase price. Glacier Goods’ security interest qualifies as a purchase money security interest (PMSI) in inventory. Under Alaska’s version of UCC Article 9, a PMSI in inventory generally has priority over a conflicting security interest in the same inventory, provided certain conditions are met. For a PMSI in inventory to have priority, the secured party must have perfected its security interest before the debtor receives possession of the inventory, and the PMSI secured party must give an authenticated notification to any other secured party who has filed a financing statement covering the same type of collateral, and that other secured party must have received the notification. In this case, Glacier Goods’ security interest is in inventory. Aurora Capital has a prior-filed financing statement covering all inventory, including after-acquired inventory. For Glacier Goods’ PMSI to have priority over Aurora Capital’s earlier-filed security interest, Glacier Goods must have perfected its PMSI by filing a financing statement before or at the time the debtor received possession of the inventory, and it must have sent an authenticated notification to Aurora Capital that Northern Lights Outfitters would be acquiring inventory from Glacier Goods, and that notification must have been received by Aurora Capital. Assuming Glacier Goods met these notification requirements and perfected its interest, its PMSI would have priority over Aurora Capital’s security interest in the inventory that Glacier Goods supplied.