KRS 355.3-207: Reacquisition.

Reacquisition of an instrument occurs if it is transferred to a former holder, by negotiation

or otherwise. A former holder who reacquires the instrument may cancel indorsements

made after the reacquirer first became a holder of the instrument. If the canc ellation

causes the instrument to be payable to the reacquirer or to bearer, the reacquirer may

negotiate the instrument. An indorser whose indorsement is canceled is discharged, and

the discharge is effective against any subsequent holder.