1. (a) A secured party's disposition of collateral after default:

   1. (1) transfers to a transferee for value all of the debtor's rights in the collateral;
   2. (2) discharges the security interest under which the disposition is made; and
   3. (3) discharges any subordinate security interest or other subordinate lien.
2. (b) A transferee that acts in good faith takes free of the rights and interests described in subsection (a), even if the secured party fails to comply with IC 26-1-9.1 or the requirements of any judicial proceeding.

3. (c) If a transferee does not take free of the rights and interests described in subsection (a), the transferee takes the collateral subject to:

   1. (1) the debtor's rights in the collateral;
   2. (2) the security interest or agricultural lien under which the disposition is made; and
   3. (3) any security interest or other lien.

As added by P.L.57-2000, SEC.45.