J. MILLARD TAWES, Governor                      857

3—604. Tender of Payment.

(1)  Any party making tender of full payment to a holder when
or after it is due is discharged to the extent of all subsequent liability
for interest, costs and attorney's fees.

(2)  The holder's refusal of such tender wholly discharges any
party who has a right of recourse against the party making the
tender.

(3)   Where the maker or acceptor of an instrument payable other-
wise than on demand is able and ready to pay at every place of pay-
ment specified in the instrument when it is due, it is equivalent to
tender.

3—605. Cancellation and Renunciation.

(1)   The holder of an instrument may even without consideration
discharge any party

(a)  in any manner apparent on the face of the instrument or the
indorsement, as by intentionally cancelling the instrument or the
party's signature by destruction or mutilation, or by striking out
the party's signature; or

(b)   by renouncing his rights by a writing signed and delivered or
by surrender of the instrument to the party to be discharged.

(2)  Neither cancellation nor renunciation without surrender of
the instrument affects the title thereto.

3—606. Impairment of Recourse or of Collateral.

(1)   The holder discharges any party to the instrument to the ex-
tent that without such party's consent the holder

(a)  without express reservation of rights releases or agrees not
to sue any person against whom the party has to the knowledge of
the holder a right of recourse or agrees to suspend the right to en-
force against such person the instrument or collateral or otherwise
discharges such person, except that failure or delay in effecting any
required presentment, protest or notice of dishonor with respect to
any such person does not discharge any party as to whom present-
ment, protest or notice of dishonor is effective or unnecessary; or

(b)  unjustifiably impairs any collateral for the instrument given
by or on behalf of the party or any person against whom he has a
right of recourse.

(2)  By express reservation of rights against a party with a right
of recourse the holder preserves

(a)  all his rights against such party as of the time when the in-
strument was originally due; and

(b)  the right of the party to pay the instrument as of that time;
and

(c)  all rights of such party to recourse against others.