Seattle-based Cell Therapeutics got a much-needed financial shot in the arm just days after filing SEC papers that indicated CTI needed new money to continue operations. Cell Therapeutics announced that a single institutional investor--who was not named--has agreed to purchase $44.5 million worth of newly issued 18.33 percent convertible senior notes that are due 2011. The deal comes with a conversion price of $0.79 per share and a warrant to purchase approximately 28.2 million shares of common stock with an exercise price of $0.79 per share. The company says that $22.25 million will be funded this week and the remaining $22.25 million must be funded prior to August 25, 2008. Further funding could be arranged as well.
In regulatory filings last week CTI said that "We have an immediate need to raise additional capital in the next thirty days in order to meet our operation needs." And its travails may not be over.
In today's announcement CTI stated: "The Company continues to have a substantial amount of debt outstanding and the quarterly interest expense associated with the debt is significant; the Company's operating expenses continue to exceed its net revenues and the Company will continue to need to raise capital to fund its operating expenses."
- read the release