Example 1: SP-1 and SP-2 both hold security interests in the same collateral. Both security interests are perfected by filing. SP-1 filed first and has priority under Section 9322(a)(1) [Maine cite section 9-1322, subsection (1), paragraph (a)]. The effectiveness of SP-1's filing lapses. As long as SP- 2's security interest remains perfected thereafter, SP-2 is entitled to priority over SP-1's security interest, which is deemed never to have been perfected as against a purchaser for value (SP-2). See Section 9-322(a)(2) [Maine cite section 9- 1322, subsection (1), paragraph (b)].

Example 2: SP holds a security interest perfected by filing. On July 1, LC acquires a judicial lien on the collateral. Two weeks later, the effectiveness of the financing statement lapses. Although the security interest becomes unperfected upon lapse, it was perfected when LC acquired its lien. Accordingly, notwithstanding the lapse, the perfected security interest has priority over the rights of LC, who is not a purchaser. See Section 9-317(a)(2) [Maine cite section 9-1317, subsection (1), paragraph (b)].

4. Effect of Debtor's Bankruptcy. Under former Section 9- 403(2), lapse was tolled if the debtor entered bankruptcy or another insolvency proceeding. Nevertheless, being unaware that insolvency proceedings had been commenced, filing offices routinely removed records from the files as if lapse had not been tolled. Subsection (c) [Maine cite subsection (3)] deletes the former tolling provision and thereby imposes a new burden on the secured party: to be sure that a financing statement does not lapse during the debtor's bankruptcy. The secured party can prevent lapse by filing a continuation statement, even without first obtaining relief from the automatic stay. See Bankruptcy Code Section 362(b)(3). Of course, if the debtor enters bankruptcy before lapse, the provisions of this Article with respect to lapse would be of no effect to the extent that federal bankruptcy law dictates a contrary result (e.g., to the extent that the Bankruptcy Code determines rights as of the date of the filing of the bankruptcy petition).

5. Continuation Statements. Subsection (d) [Maine cite subsection (4)] explains when a continuation statement may be filed. A continuation statement filed at a time other than that prescribed by subsection (d) [Maine cite subsection (4)] is ineffective, see Section 9-510(c) [Maine cite section 9-1510, subsection (3)], and the filing office may not accept it. See Sections 9-520(a), 9-516(b) [Maine cite section 9-1520, subsection (1), section 9-1516, subsection (2)]. Subsection (e)