1.Except as otherwise provided in subsection 7, a perfected purchase-money security
interest in goods other than inventory or livestock has priority over a conflicting
security interest in the same goods, and, except as otherwise provided in section
41-09-47, a perfected security interest in its identifiable proceeds also has priority, if
the purchase-money security interest is perfected when the debtor receives
possession of the collateral or within twenty days thereafter.
2.Subject to subsection 3 and except as otherwise provided in subsection 7, a perfected
purchase-money security interest in inventory has priority over a conflicting security
interest in the same inventory, has priority over a conflicting security interest in chattel
paper or an instrument constituting proceeds of the
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1. Except as otherwise provided in subsection 7, a perfected purchase-money security
interest in goods other than inventory or livestock has priority over a conflicting
security interest in the same goods, and, except as otherwise provided in section
41-09-47, a perfected security interest in its identifiable proceeds also has priority, if
the purchase-money security interest is perfected when the debtor receives
possession of the collateral or within twenty days thereafter.
2. Subject to subsection 3 and except as otherwise provided in subsection 7, a perfected
purchase-money security interest in inventory has priority over a conflicting security
interest in the same inventory, has priority over a conflicting security interest in chattel
paper or an instrument constituting proceeds of the inventory and in proceeds of the
chattel paper, if so provided in section 41-09-50, and, except as otherwise provided in
section 41-09-47, also has priority in identifiable cash proceeds of the inventory to the
extent the identifiable cash proceeds are received on or before the delivery of the
inventory to a buyer, if:
a. The purchase-money security interest is perfected when the debtor receives
possession of the inventory;
b. The purchase-money secured party sends a signed notification to the holder of
the conflicting security interest;
c. The holder of the conflicting security interest receives the notification within five
years before the debtor receives possession of the inventory; and
d. The notification states that the person sending the notification has or expects to
acquire a purchase-money security interest in inventory of the debtor and
describes the inventory.
3. Subdivisions b through d of subsection 2 apply only if the holder of the conflicting
security interest had filed a financing statement covering the same types of inventory:
a. If the purchase-money security interest is perfected by filing, before the date of
the filing; or
b. If the purchase-money security interest is temporarily perfected without filing or
possession under subsection 6 of section 41-09-32, before the beginning of the
twenty-day period thereunder.
4. Subject to subsection 5 and except as otherwise provided in subsection 7, a perfected
purchase-money security interest in livestock that are farm products has priority over a
conflicting security interest in the same livestock, and, except as otherwise provided in
section 41-09-47, a perfected security interest in their identifiable proceeds and
identifiable products in their unmanufactured states also has priority, if:
a. The purchase-money security interest is perfected when the debtor receives
possession of the livestock;
b. The purchase-money secured party sends a signed notification to the holder of
the conflicting security interest;
c. The holder of the conflicting security interest receives the notification within six
months before the debtor receives possession of the livestock; and
d. The notification states that the person sending the notification has or expects to
acquire a purchase-money security interest in livestock of the debtor and
describes the livestock.
5. Subdivisions b through d of subsection 4 apply only if the holder of the conflicting
security interest had filed a financing statement covering the same types of livestock:
a. If the purchase-money security interest is perfected by filing, before the date of
the filing; or
b. If the purchase-money security interest is temporarily perfected without filing or
possession under subsection 6 of section 41-09-32, before the beginning of the
twenty-day period thereunder.
6. Except as otherwise provided in subsection 7, a perfected purchase-money security
interest in software has priority over a conflicting security interest in the same
collateral, and, except as otherwise provided in section 41-09-47, a perfected security
interest in its identifiable proceeds also has priority, to the extent that the
purchase-money security interest in the goods in which the software was acquired for
use has priority in the goods and proceeds of the goods under this section.
7. If more than one security interest qualifies for priority in the same collateral under
subsection 1, 2, 3, or 4:
a. A security interest securing an obligation incurred as all or part of the price of the
collateral has priority over a security interest securing an obligation incurred for
value given to enable the debtor to acquire rights in or the use of collateral; and
b. In all other cases, subsection 1 of section 41-09-42 applies to the qualifying
security interests.