Exhibit
10.7


 


COLLATERAL ACCOUNT
NOTIFICATION AND ACKNOWLEDGMENT


(THIRD PARTY)


 


 


Date:  June   , 2003


 


Banc of America Securities LLC


Address:
              


 


 


Ladies and Gentlemen:


 


This is to notify you
that SuperGen, Inc., a Delaware corporation (“Pledgor”) has granted to the
pledgees listed on the signature page hereto (each a “Pledgee” and
collectively, the “Pledgees”) a security interest in account number
                                   
(the “Collateral Account”) held by Banc of America Securities LLC (the
“Securities Intermediary”) together with all financial assets, investment
property, securities, cash and other property now or hereafter held therein,
and the proceeds thereof, including, without limitation, dividends payable in
cash or stock and shares or other proceeds of conversions or splits of any
securities in the Collateral Account (collectively, the “Collateral”).  Pledgor, Pledgees and the Securities
Intermediary agree that the Collateral Account is a “securities account” within
the meaning of Article 8 of the Uniform Commercial Code of the State of New
York (the “UCC”) and that all Collateral held in the Collateral Account will be
treated as financial assets under the UCC.


 


In connection therewith, the parties hereto agree (which agreement by
the Pledgor will be construed as instructions to the Securities Intermediary):


 


1.                                       The
Securities Intermediary is instructed to register the pledge on its books. The
Securities Intermediary shall hold all certificated securities that comprise
all or part of the Collateral with proper endorsements to the Securities
Intermediary or in blank, or will deliver possession of such certificated
securities to Pledgees.


 


2.                                       The
Securities Intermediary is instructed to deliver to Pledgees copies of monthly
statements on the Collateral Accounts.


 


3.                                       Each
Collateral Account will be styled: “Smithfield Pledgee Group Collateral Account
for SuperGen, Inc.”.


 


4.                                       All
dividends, interest, gains and other profits with respect to the Collateral
Account will be reported in the name and tax identification number of the
Pledgor.


 


5.                                       The
Securities Intermediary may not, without the prior written consent of Pledgees,
sell, transfer, deliver, release or otherwise dispose of the Collateral or any
interest therein unless the proceeds thereof are held or reinvested in the
Collateral Account as part of the Collateral. 
Except for such limitation and unless and until Pledgees entitled to a
majority of the Collateral (“Required Pledgees”) provide the Securities
Intermediary with written instructions to the contrary (which instruction shall
be deemed to have been given by Pledgees on the date that a fully executed
counterpart of this Agreement is delivered to Securities Intermediary if the
box set forth below is checked), the Securities Intermediary


 

















 


may comply with any other orders or instructions from
Pledgor concerning the Collateral Account.


 


ý  The
Securities Intermediary may not, without prior written consent of Required
Pledgees, accept instructions from anyone other than Required Pledgees with
respect to the sale, transfer, delivery, release or other disposition of the
Collateral.


 


6.                                       The
Securities Intermediary agrees to comply with any order or instruction from
Required Pledgees concerning the Collateral Account, including an order or
instruction directing sale, transfer or redemption of all or part of the
Collateral and the remittance of the proceeds thereof, if any, to Pledgees,
without further consent by Pledgor. 
Securities Intermediary shall have no responsibility or liability to
Pledgor for complying with any order or instruction, whether oral or written,
concerning the Collateral Account originated by Pledgees and shall have no
responsibility to investigate the appropriateness of any such order or
instruction, even if Pledgor notifies Securities Intermediary that Pledgees are
not legally entitled to originate any such order or instruction.  The Securities Intermediary shall have no
responsibility or liability to Pledgees for complying with any order or
instruction, whether oral or written, concerning the Collateral Account
originated by Pledgor except to the extent such compliance would cause the
Securities Intermediary to violate (i) paragraph 5 hereof or (ii) written
orders or instructions previously received from Pledgee, but only to the extent
Securities Intermediary has had reasonable opportunity to act thereon.  The Securities Intermediary shall be able to
rely upon any notice or order that it reasonably believes to be genuine.  The Securities Intermediary shall have no
responsibility or liability to Pledgees with respect to the value of the
Collateral Account or any of the Collateral. 
This Agreement does not create any obligation or duty on the part of the
Securities Intermediary other than those expressly set forth herein.


 


7.                                       The
Securities Intermediary shall not be liable for any loss or damage with respect
to any matter that may arise out of or in connection with this Agreement or any
action taken or not taken pursuant hereto, except to the extent caused by the
Securities Intermediary’s gross negligence or willful misconduct. Without
limiting the foregoing, in no event shall the Securities Intermediary be
responsible for indirect or consequential damages, regardless of any notice, or
any loss or damage caused, directly or indirectly, by conditions beyond its
control.  Pledgor agrees to indemnify
and hold the Securities Intermediary, its directors, officers, employees and
agents harmless from and against any and all claims, causes of action,
liabilities, lawsuits, demands and/or damages, including, without limitation,
any and all costs, including court costs and reasonable attorneys’ fees, that
may arise out of or in connection with this Agreement or any action taken or
not taken pursuant hereto, except to the extent caused by the Securities
Intermediary’s gross negligence or willful misconduct.  Pledgees agree to indemnify and hold the
Securities Intermediary, its directors, officers, employees and agents harmless
from and against any and all claims, causes of action, liabilities, lawsuits,
demands and/or damages, including, without limitation, any and all costs,
including court costs and reasonable attorneys’ fees, that may arise or result
from the Securities Intermediary complying with the instructions


 


2

















 


and orders of Pledgees given in connection with
Pledgees’ exercise of its control over and secured rights in the Collateral
Account, except to the extent caused by the Securities Intermediary’s gross
negligence or willful misconduct.  The
indemnities of Pledgor and Pledgees set forth in this Section 7 shall survive
the termination of this Agreement.


 


8.                                       The
Securities Intermediary is instructed that the Collateral Account is to remain
a “cash account” within the meaning of Regulation T issued by the Board of
Governors of the Federal Reserve System. 
The Securities Intermediary represents that it has not received notice
regarding any lien, encumbrance or other claim to the Collateral or the
Collateral Account from any other person and has not entered into an agreement
with any third party to act on such third party’s instructions without further
consent of the Pledgor.  The Securities
Intermediary further agrees not to enter into any such agreement with any third
party.


 


9.                                       The
Securities Intermediary subordinates to the lien and security interest of
Pledgees any right of setoff, encumbrance, security interest or other claim
that it may have against the Collateral.


 


10.                                 To
the extent a conflict exists between the terms of this Agreement and any
account agreement between Pledgor and the Securities Intermediary, the terms of
this Agreement will control, provided that this Agreement shall not alter or
affect any mandatory arbitration provision currently in effect between the Securities
Intermediary and Pledgor.


 


11.                                 The
terms of this Agreement will in no way be modified except by a writing signed
by Pledgor, the Securities Intermediary, and Required Pledgees.


 


12.                                 The
Securities Intermediary reserves the right, unilaterally, to terminate this
Agreement, such termination to be effective thirty (30) days after written
notice thereof is given to Pledgor and Pledgees.  At the end of such thirty (30) day period, the Securities Intermediary will deliver all assets
held in the Collateral Account to Pledgees
unless Pledgees and Pledgor deliver joint
instruction to the Securities Intermediary  during
such thirty (30) day period to deliver or transfer the assets held in the
Collateral Account to another party or securities intermediary.  Nothing set forth in this provision shall be
deemed to limit the rights of Pledgees
to issue orders or instructions to the Securities Intermediary pursuant to
paragraph 6 hereof.  Termination shall
not affect any of the rights and liabilities of the parties hereto incurred
before the date of termination.


 


13.                                 This
Agreement and the instructions and orders required or permitted to be executed
and delivered hereunder set forth the entire agreement of the parties with
respect to the subject matter hereof, and, subject to paragraph 10 above,
supersede any prior agreement and contemporaneous oral agreements of the
parties concerning its subject matter.


 


14.                                 Except
as otherwise expressly provided herein, any notice, order, instruction, request
or other communication required or permitted to be given under this Agreement
shall be in writing and deemed to have been properly given when delivered in
person, or when sent by facsimile or other electronic means and electronic
confirmation of error free receipt is


 


3

















 


received or upon receipt of notice sent by certified
or registered United States mail, return receipt requested, postage prepaid,
addressed to the party at the address set forth below.


 


15.                                 If
any party to this Agreement is not a natural person, the person executing this
Agreement on behalf of such party hereby represents that he or she has the
proper authority to execute this Agreement on behalf of such party.


 


16.                                 The
construction and effect of every provision of this Agreement, the rights of the
parties hereunder and any questions arising out of the Agreement, shall be
governed by the statutory and common law of the State of New York without
reference to the conflict of law provisions thereof.


 


*     *     *   
 *     *     *     *    
*


 


4

















 


IN WITNESS WHEREOF, the Pledgor and the Pledgees have agreed to the
terms of this Agreement as of the date indicated above.


 


	
  PLEDGOR:

  	
  PLEDGEE:

  
	
   

  	
   

  
	
  SUPERGEN, INC.

  	
  SMITHFIELD FIDUCIARY LLC

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  	
  Name:  Adam
  J. Chill

  
	
  Title:

  	
   

  	
   

  	
  Title: 
  Authorized Signatory

  
	
  Telephone No.:

  	
   

  	
   

  	
  Telephone No.: 
  (212) 287-4720

  
	
  Address:

  	
  Address:  

  	
  c/o Highbridge Capital Management, LLC

  
	
  4140 Dublin Boulevard

  	
  9 West 57th Street, 27th Floor

  
	
  Suite 200

  	
  New York, New York 10019

  
	
  Dublin, California 94568

  	
   

  
	
   

  	
   

  
	
  Date:

  	
   

  	
   

  	
  Date:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  PLEDGEE:

  	
  PLEDGEE:

  
	
   

  	
   

  
	
  OMICRON MASTER TRUST

  	
  MAINFIELD ENTERPRISES INC.

  
	
   

  	
   

  
	
  By:  Omicron
  Capital L.P., as investment advisor

  	
  By:

  	
   

  	
   

  
	
  By:  Omicron
  Capital Inc., its general partner

  	
   

  	
   

  	
   

  
	
   

  	
  Name:  Avi
  Vigder

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
  Title: 
  Director

  
	
  Name: 
  Olivier Morali

  	
  Telephone No.: 
  (212) 651-9005

  
	
  Title: 
  President

  	
  Address:  c/o Cavallo Capital Group

  
	
  Telephone No.: 
  (212) 803-5262

  	
  660 Madison Avenue, 18th Floor

  
	
  Address:  c/o Omicron Capital L.P.

  	
  New York, New York 
  10021

  
	
  810 Seventh Avenue, 39th Floor

  	
   

  
	
  New York, New York 
  10019

  	
  Date:

  	
   

  	
   

  
	
   

  	
   

  
	
  Date:

  	
   

  	
   

  	
   

  
															



 


5

















 


	
  CRANSHIRE CAPITAL L.P.

  	
  OTAPE LLC

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
  Name: 
  Mitchell P. Kopin

  	
  Name: 
  Richard Cayne

  
	
  Title:  

  	
  President – Downsview Capital, Inc., 

  	
  Title: 
  General Counsel

  
	
   

  	
  the General Partner

  	
   

  
	
  Telephone No.: 
  (847)  562-9030

  	
  Telephone No.: 
  (914) 694-5857

  
	
  Address: c/o Downsview Capital, Inc.

  	
  Address:  c/o
  OTA LLC

  
	
  666 Dundee Road, Suite 1901

  	
  1 Manhattanville Road

  
	
  Northbrook, Illinois  60062

  	
  Purchase, New York 
  10577

  
	
   

  	
   

  
	
  Date:

  	
   

  	
   

  	
  Date:

  	
   

  	
   

  
										



 


	
  Acknowledged and Agreed to:

  	
   

  
	
   

  	
   

  
	
  BANC OF AMERICA SECURITIES LLC

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
   

  
	
  Date:

  	
   

  	
   

  	
   

  
						



 


6