ATTACHMENT

Question 1

ATTACHMENT MECHANISMS

Answer 1

1. Sec Agreement
   OR
2. Creditor retains possession or control (consignment inventory)

Question 2

SEC AGREEMENT

Answer 2

a. Writing Record and show intent to create security interest
b. Authenticated by Debtor (Any symbol with present intent)
c. Description of Collateral (Reasonably identify the collateral)

Question 3

ATTACHMENT ELEMENTS

Answer 3

AGREEMENT (PAC)
VALUE (FOR RIGHT)
RIGHTS (IN COLLATERAL)

Question 4

ART 9 COVERS

Answer 4

GOODS
INTANGIBLES
FIXTURES
ACCESSIONS

Question 5

ART 9 GOODS

Answer 5

1- Consumer Goods - Personal
2- Equipment (catch all)
3- Farm Products (S AND P)
4- Inventory

Question 6

ART 9 INTANGIBLES

Answer 6

1. Instruments
2. Documents
3. Chattel paper
4. Investment property
5. Accounts
6. Deposit Accounts
7. Commercial Tort Claims
8. General Intangibles (Catch All)

Question 7

ART 9 FIXTURES

Answer 7

Goods that have become so related to particular real property that an interest in them arises under real property law.

Question 8

ART 9 TRANSACTIONS

Answer 8

TRANSACCIONAL CREATES SI IN

1. personal property or fixtures by contract;
2. an agricultural lien;
3. a sale of accounts, chattel paper, payment intangibles, or promissory notes;
4. certain consignments; or
5. a secured sale disguised as a lease.

Question 9

FUTURE ADVANCE CLAUSE

Answer 9

Will give you money in the future, attached to same collateral (RETAINS PRIORITY)

Question 10

AFTER ACQUIRED PROPERTY CLAUSE:

Answer 10

All of the present and future collateral. Without an explicit after-acquired property clause in the security agreement, the secured party’s security interest only reaches collateral that the debtor had rights in at the time the debtor signed the security agreement.

Question 11

EXCEPTIONS TO AAPC

Answer 11

• INVENTORY OR ACCOUNTS WILL IMPLY AAPC
• NO SI OVER CONSUMER GOODS IF D DOES NOT GET IN 10 DAYS AFTER C GIVES VALUE
• INEFFECTIVE AS TO COMMERCIAL TORTS CLAIMS

Question 12

PROCEEDS FOR ST

Answer 12

RESULT OF DISPOSTION
INSURANCE
CLAIMS
CASH (LOWEST INTERMEDIATE BALANCE)

Question 13

IDENTIFIABLE PROCEEDS

Answer 13

SI AUTOMATICALLY GIVES RIGHT TO IDENTIFIABLE PROCEEDS: PROVE OR TRACK TO COLLATERAL (BURDEN ON CREDITOR)

Question 14

SUPPORTING OBLIGATION

Answer 14

The attachment of a security interest in collateral also is an attachment of a security interest in a supporting obligation for that collateral.

Question 15

LOWEST INTERMEDIATE BALANCE TEST (LIBT)

Answer 15

The lowest balance between time of identifiable cash and test application. Comprises the secured identifiable “proceeds,” but may not exceed value of original cash proceeds deposited.

Question 16

CONTROL FOR ATTACHMENT

Answer 16

COMMERCIAL DEPOSIT ACCOUNTS
ELECTRONIC CHATTEL PAPER
INVESTMENT PROPERTY

Question 17

DESCRIPTION IN SA

Answer 17

Reasonably identify the collateral

i. Normal Vocabulary Words
ii. Art 9 Categories
iii. NOT: “all of X” (supergeneric description is invalid)

Question 18

SA CONTROL OVER DEPOSIT ACCOUNTS

Answer 18

IN SP NAME OR AUTHENTICATED RECORD ALLOWING BANK TO FOLLOW SP ORDERS

Question 19

SA CONTROL OVER ELECTRONIC CP

Answer 19

RELIABLE ELECTRONIC MEDIUM

Question 20

SA INVESTMENT PROPERTIES

Answer 20

CERTIFICATED SECURITIES (S AN B)
SECURITIES ACCOUNTS (D INSTRUCTS)

Question 21

CERTIFICATED SECURITIES CONTROL

Answer 21

REGISTERED: POSSESSION AND ENDORSEMENT OR REGISTERED
BEARER: POSSESSION

Question 22

SECURITIES ACCOUNTS CONTROL

Answer 22

SAME RIGHTS IN ACCOUNTS
OR
INTERMEDIARY WILL COMPLY W/
SP INSTRUCTIONS