Cell Therapeutics exchanges 83% of convertible preferreds

By Jennifer Chiou

New York, Feb. 5 - Cell Therapeutics, Inc. announced that it has issued 6,634 shares of series F preferred stock in exchange for an equal number of the company's series A, B and C convertible preferred stock, accounting for an 83% interest in all series of its convertible preferreds.

Each share of the new preferred stock will become convertible into 7,143 shares of Cell Therapeutics' common stock at a conversion price of $0.14 per common share, representing a significant premium to the current market price, the company said.

The company noted that the series F preferreds cannot become convertible into common stock before April 1.

Additionally, Cell Therapeutics has the ability to call all of the series F preferreds for cash when the volume-weighted average price has exceeded $0.28 for 10 consecutive trading days.

The new preferreds do not provide a redemption right for the holders as the previous three series of preferreds did.

"We are pleased that almost all of the remaining preferred shareholders were willing to trade in their securities and enable Cell Therapeutics to avoid their redemption rights and dividend payments, saving the company approximately $6.6 million over the next six months, for a meaningful equity position in the company upon their conversion into common stock," chief executive officer James A. Bianco said in a news release.

Cell Therapeutics is a Seattle-based biopharmaceutical company developing treatments for cancer.

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