In re Thompson

Shepherd Machinery Company (""Shepherd""), appellee herein, is a California corporation engaged in the business of selling and leasing heavy construction equipment in Southern California. J. A. Thompson & Son, Inc. (""Thompson"") was, at the time here in question, a California corporation engaged in construction work. On April 6, 1973 Thompson entered into two agreements with Shepherd, each entitled ""Machinery Lease,"" whereby Thompson leased two compactors and two bulldozers for a term of one year, the term being automatically renewed until termination of the lease either by Thompson by way of written notice to Shepherd or by Shepherd upon the default of Thompson. In conjunction with the leases Thompson acquired an option to purchase the compactors and bulldozers for a price determined pursuant to a formula whereby Thompson received full credit against the option purchase price for all rentals paid. At the time the leases and option to purchase were executed, Thompson was engaged in construction activities in California and Hawaii and maintained offices in both states. Shepherd did not file financing statements covering the equipment in either state. However, about one year prior to the execution of the leases, Shepherd had filed a financing statement in California which named Thompson as debtor and which covered ""after acquired"" property.