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Section 2. Security for Obl{gatlons. This Agreement secures the payment of all obligations of the City now or hereafter existing under the Note, whether for principal or interest (all such obligations of Cit~being the"Obligations"). Section 3. DeliverV of Pledged Collateral. All Pledged Collateral shall be delivered to and held by or on behalf of the Bank pursuant hereto. Section 4. Transfers and Other T.iens. The City agrees that,.without the prior written consent of the Bank, it will not (i) sell or otherwise dispose of, or grant any option with respect to, any of the Pledged Collateral,. or (ii) create or permit to exist any lien, security interest, or other charge or encumbrance upon or with respect to any of the Pledged Collateral, except for the security interest under this Agreement and the security interest referred to in Section 10 hereof. Section 5. Remedies Upon Default. If any payment due under the Note shall not be made within 15 days after the same shall be due (hereinafter, an "Event of Default"): (a) The Bank may exercise in respect of the Pledged Collateral, in addition to other rights and remedies provided for herein or otherwise available to it, all the rights and remedies of a secured party on default under the Uniform Commercial Code (the "Code") in effect in the State of Missouri at that time. (b) Any cash held by the Bank as Pledged Collateral may, in the discretion of the Bank, be held by the Bank as collateral for, and/or then or at any time thereafter applied in whole or in part by the Bank against, all or any part of the Obligations in such order as the Bank shall elect. Any surplus of such cash or cash proceeds held by the Bank and remaining after payment in full of all the Obligations shall be paid over to the City or to whomsoever may be lawfully entitled to receive such surplus. Section 6. Amendments. Waiver. No amendment or waiver of any provision of this Agreement nor consent to any departure by the City herefrom, shall in any event be effective unless the same shall be in writing and signed by the Bank, and then such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given. STL-68576 - 2 -