§ 25-9-324.1. Priority of production-money security interests and agricultural liens.
§25‑9‑324.1. Priority of production‑money security interestsand agricultural liens.
(a) Priority overconflicting security interests. Except as otherwise provided in subsections(c), (d), and (e) of this section, if the requirements of subsection (b) ofthis section are satisfied, a perfected production‑money securityinterest in production‑money crops has priority over a conflictingsecurity interest in the same crops and, except as otherwise provided in G.S.25‑9‑327, also has priority in their identifiable proceeds.
(b) Requirements forpriority. A production‑money security interest has priority undersubsection (a) of this section if:
(1) The production‑moneysecurity interest is perfected by filing when the production‑moneysecured party first gives new value to enable the debtor to produce the crops;
(2) The production‑moneysecured party sends an authenticated notification to the holder of theconflicting security interest not less than 10 or more than 30 days before theproduction‑money secured party first gives new value to enable the debtorto produce the crops if the holder had filed a financing statement covering thecrops before the date of the filing made by the production‑money securedparty; and
(3) The notificationstates that the production‑money secured party has or expects to acquirea production‑money security interest in the debtor's crops and provides adescription of the crops.
(c) Multiple production‑moneysecurity interests. Except as otherwise provided in subsection (d) or (e) ofthis section, if more than one security interest qualifies for priority in thesame collateral under subsection (a) of this section, the security interestsrank according to priority in time of filing under G.S. 25‑9‑322(a).
(d) New value toproduce production‑money crops. To the extent that a person holding aperfected security interest in production‑money crops that are thesubject of a production‑money security interest gives new value to enablethe debtor to produce the production‑money crops and the value is in factused for the production of the production‑money crops, the securityinterests rank according to priority in time of filing under G.S. 25‑9‑322(a).
(e) Holder ofagricultural lien and production‑money security interest. To the extentthat a person holds both an agricultural lien and a production‑moneysecurity interest in the same collateral securing the same obligations, therules of priority applicable to agricultural liens govern priority.
(f) Creating orperfecting production‑money security interest not to operate as defaultor accelerating event. Creating or perfecting a production‑moneysecurity interest shall not operate under any circumstances as a default on, anaccelerating event under, or otherwise as a breach of any note or otherinstrument or agreement of any kind or nature to pay debt, any loan or creditagreement, or any security agreement or arrangement of any kind or nature wherethe collateral is real or personal property. (1866‑7, c. 1, s. 1;1872‑3, c. 133, s. 1; Code, s. 1799; 1893, c. 9; Rev., s. 2052; C.S., s.2480; 1925, c. 302, s. 1; 1927, c. 22; 1935, c. 205; 1945, c. 196, s. 4; 1955,c. 816; 1957, c. 999; 1965, c. 700, s. 1; 1967, c. 24, s. 13; 1975, c. 862, s.7; 1979, c. 404, s. 2; 1989 (Reg. Sess., 1990), c. 1024, s. 8(o); 1997‑181,ss. 15, 16; 1997‑336, s. 1; 1997‑456, s. 5; 2000‑169, s. 1.)