David is a farmer who is struggling to make ends meet. He thinks that if he can just purchase some better equipment, he will be able to reap a better harvest. David goes to the local John Deere dealership to see if they have any new equipment that could possibly help to keep him out of the poor house. The John Deere dealer recommends that David take a look at the newest line of hay mowers and bailers. Since David has been using the same old sickle bar mower and 5 ft bailer for the last twenty years, he decides that those two pieces of equipment will be just what he needs to get back in the black. David buys the bailer and hay mower (each priced at $10,000) and the dealer agrees to finance the entire purchase of the equipment for a total price of $20,000. David grants a security interest in the equipment and the dealer promptly files a valid financing statement covering the bailer and the mower.

Two weeks after the dealer files the financing statement, the engine in David’s tractor locks up and this pushes him over the financial edge. David immediately files for bankruptcy, knowing that he will never be able to pay all his loans without a working tractor to run all of his new equipment. David has a number of unsecured loans and the trustee in bankruptcy hopes to be able to use the brand new bailer and mower (David’s only assets of any real value) to pay off the unsecured claims on a pro rata basis. Which statement is correct?

A. The trustee cannot avoid the dealer's security interest, because a trustee cannot use its avoiding powers to avoid a security interest if a financing statement was filed prior to the debtor’s bankruptcy petition.

B. The trustee cannot avoid dealer's security interest because it was not granted on account of an antecedent debt.

C. The trustee can avoid the dealer's security interest because the "strong arm" power allows the trustee to avoid any security interest created w/in 30 days prior to the debtor's bankruptcy petition.

D. The trustee can avoid the dealer's security interest because the debtor was insolvent at the time the security interest was granted.