1. A secured party's acceptance of collateral in full or partial satisfaction of the obligation it secures: a. Discharges the obligation to the extent consented to by the debtor; b. Transfers to the secured party all of a debtor's rights in the collateral; c. Discharges the security interest or agricultural lien that is the subject of the debtor's consent and any subordinate security interest or other subordinate lien; and d. Terminates any other subordinate interest.

2. A subordinate interest is discharged or terminated under subsection 1, even if the secured party fails to comply with this chapter.