Company Further Simplifies Its Capital Structure By Completing the Elimination of All Previously Outstanding Preferred Stock
SEATTLE, April 13 /PRNewswire-FirstCall/ -- Cell Therapeutics, Inc. (Nasdaq and MTA: CTIC) today announced that it has agreed to sell up to $20 million of Series 1 Preferred Stock and warrants in a registered offering to a single institutional investor. The investor initially purchased today, for $15 million cash, shares of Series 1 Preferred Stock with a stated value of $15 million and certain associated common stock warrants and has the right to, within 60 days, purchase for an additional $5 million cash additional shares of Series 1 Preferred Stock with a stated value of $5 million with no additional warrants. The Series 1 Preferred Stock is convertible into shares of common stock at a conversion price of $0.30. The investor received 45% warrant coverage on the initial $15 million purchase. The warrants have an exercise price of $0.41 per share, for total potential additional proceeds of approximately $9 million. Approximately three-fifths of the warrants cannot be exercised until after six months from issuance, or 61 days from issuance if the investor does not exercise its option to purchase the additional Series 1 Preferred Stock.
The Series 1 Preferred Stock is non-dividend bearing and has no voting rights except to the extent required by law.
Separately, the Company reacquired the remaining 100 outstanding shares ($100,000 stated value) of its Series A 3% Convertible Preferred Stock in exchange for 288,517 shares of common stock, and the Company has agreed to reacquire the remaining 1,000 outstanding shares ($1,000,000 stated value) of its Series D 7% Preferred Stock in exchange for shares of common stock based on a formula keyed to the volume-weighted average price over a 3-day period following April 13, 2009.
Upon completion of these exchanges, the only preferred stock of the Company outstanding will be the new Series 1 Preferred Stock, thereby relieving the Company of future potential redemptions and restrictive covenants contained in the prior series of Preferred Stock.
Rodman & Renshaw, LLC, a subsidiary of Rodman & Renshaw Capital Group, Inc. (Nasdaq: RODM), acted as the exclusive placement agent for the transaction.
A shelf registration statement relating to the Series 1 Preferred Stock and warrants issued and to be issued in the offering, and to the underlying common stock, has been filed with the Securities and Exchange Commission and has become effective. A prospectus supplement related to the offering has been filed with the Securities and Exchange Commission. Copies of the prospectus supplement and accompanying base prospectus may be obtained directly from Cell Therapeutics, Inc., 501 Elliott Avenue West, Suite 400, Seattle, Washington 98119. This announcement is neither an offer to sell nor a solicitation of an offer to buy any of our Series 1 Preferred Stock or warrants or underlying common stock. No offer, solicitation or sale will be made in any jurisdiction in which such offer, solicitation or sale is unlawful.
This press release includes forward-looking statements that involve a number of risks and uncertainties, the outcome of which could materially and/or adversely affect actual future results. The risks and uncertainties include the risk that the investor might not exercise its option to buy additional Series 1 Preferred Stock and/or might not exercise its warrants, the Company's ability to continue to raise additional capital as needed to fund its operations, and other risk factors listed or described from time to time in the Company's filings with the Securities and Exchange Commission including, without limitation, the Company's most recent filings on Forms 10-K and 8-K. Except as required by law, the Company does not intend to update any of the statements in this press release upon further developments.
Media Contact: Dan Eramian T: 206.272.4343 C: 206.854.1200 E: firstname.lastname@example.org www.CellTherapeutics.com/press_room Investors Contact: Ed Bell T: 206.272.4345 Lindsey Jesch Logan T: 206.272.4347 F: 206.272.4434 E: email@example.com www.CellTherapeutics.com/investors
|SOURCE Cell Therapeutics, Inc.|
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