                                 CODE OF VIRGINIA

INTERESTS THAT TAKE PRIORITY OVER OR TAKE FREE OF SECURITY INTEREST OR
AGRICULTURAL LIEN (§ 8.9A-317)

a. Conflicting security interests and rights of lien creditors. A security
interest or agricultural lien is subordinate to the rights of:

   1. a person entitled to priority under &#xA7; 8.9A-322; and

   2. except as otherwise provided in subsection (e), a person that becomes a
   lien creditor before the earlier of the time:

A. the security interest or agricultural lien is perfected; or

B. one of the conditions specified in subdivision (b)(3) of &#xA7; 8.9A-203 is
met and a financing statement covering the collateral is filed.

b. Buyers that receive delivery. Except as otherwise provided in subsection (e),
a buyer, other than a secured party, of goods, instruments, tangible documents,
or a certificated security takes free of a security interest or agricultural
lien if the buyer gives value and receives delivery of the collateral without
knowledge of the security interest or agricultural lien and before it is
perfected.

c. Lessees that receive delivery. Except as otherwise provided in subsection
(e), a lessee of goods takes free of a security interest or agricultural lien if
the lessee gives value and receives delivery of the collateral without knowledge
of the security interest or agricultural lien and before it is perfected.

d. Licensees and buyers of certain collateral. Subject to subsections (f)
through (i), a licensee of a general intangible or a buyer, other than a secured
party, of collateral other than electronic money, goods, instruments, tangible
documents, or a certificated security takes free of a security interest if the
licensee or buyer gives value without knowledge of the security interest and
before it is perfected.

e. Purchase-money security interest. Except as otherwise provided in
&#xA7;&#xA7; 8.9A-320 and 8.9A-321, if a person files a financing statement with
respect to a purchase-money security interest before or within twenty days after
the debtor receives delivery of the collateral, the security interest takes
priority over the rights of a buyer, lessee, or lien creditor which arise
between the time the security interest attaches and the time of filing.

f. Buyers of chattel paper. A buyer, other than a secured party, of chattel
paper takes free of a security interest if, without knowledge of the security
interest and before it is perfected, the buyer gives value and:

   1. receives delivery of each authoritative tangible copy of the record
   evidencing the chattel paper; and

   2. if each authoritative electronic copy of the record evidencing the chattel
   paper can be subjected to control under &#xA7; 8.9A-105, obtains control of
   each authoritative electronic copy.

g. Buyers of electronic documents. A buyer of an electronic document takes free
of a security interest if, without knowledge of the security interest and before
it is perfected, the buyer gives value and, if each authoritative electronic
copy of the document can be subjected to control under &#xA7; 8.7-106, obtains
control of each authoritative electronic copy.

h. Buyers of controllable electronic records. A buyer of a controllable
electronic record takes free of a security interest if, without knowledge of the
security interest and before it is perfected, the buyer gives value and obtains
control of the controllable electronic record.

i. Buyers of controllable accounts and controllable payment intangibles. A
buyer, other than a secured party, of a controllable account or a controllable
payment intangible takes free of a security interest if, without knowledge of
the security interest and before it is perfected, the buyer gives value and
obtains control of the controllable account or controllable payment intangible.

HISTORY: 1964, c. 219, § 8.9-301; 1973, c. 509; 1983, c. 204; 1991, c. 536, §
8.2A-307; 1996, c. 216; 2000, c. 1007; 2004, c. 200; 2012, c. 155; 2024, c. 652.