Play4Ever Sporting Goods Is a Retailer of Sporting Goods

Multiple Choice

Play4Ever Sporting Goods is a retailer of sporting goods.In 2001,Play4Ever borrowed $1,000,000 from Third National Bank,granting Third National a security interest in "all presently owned and after-acquired inventory." Third National filed a financing statement in May 2002.In early January 2002,Play4Ever borrowed $200,000 from Rocksolid Bank in order to purchase some new inventory.Play4Ever and Rocksolid signed a written security agreement,with the new inventory as collateral,and Rocksolid immediately filed a financing statement.Prior to the Play4Ever's receipt of the inventory,Rocksolid sent written notice to Third National Bank of the new security interest.If Play4Ever defaults on both loans,which of the following is true?

A) Third National has priority on all inventory of Play4Ever, because of the after-acquired property clause.
B) Third National has priority on all inventory of Play4Ever, except that Rocksolid has priority on the specific inventory acquired with the money from the $200,000 loan.
C) Third National has priority on all inventory of Play4Ever acquired before the $200,000 loan, and Rocksolid has priority on all inventory acquired after the $200,000 loan was made.
D) Third National has priority on all inventory of Play4Ever acquired before the $200,000 loan, Rocksolid has priority on the specific inventory acquired with the proceeds from the $200,000 loan, and the two banks have equal priority on any other inventory acquired after the $200,000 loan was made.
E) Third National has priority on all inventory.