For David,
The requirement that said notes not be discounted refers to earlier practice where notes (evidence of indebtedness) were traded and typically discounted prior to their due date. A check is such a note, but in modern banking practice checks are not discounted, they are payable on demand (ie, already due). For an excellent treatise on commercial practices with commercial paper trading practices, see Chitty on Bills of Exchange, available here: http://books.google.com/books?id=L-o...page&q&f=false This is not a reference to lawful money.

Freed