Cell Therapeutics enters agreement to sell $21.0 million of Series 7 Preferred Stock

Cell Therapeutics, Inc. (Nasdaq and MTA: CTIC) (the "Company") today announced that it has entered into an agreement to sell, subject to customary closing conditions, $21.0 million of shares of its Series 7 Preferred Stock and warrants to purchase shares of its common stock in a registered offering to four institutional investors. Each share of Series 7 Preferred Stock is convertible at the option of the holder, at any time during its existence, into approximately 2,703 shares of common stock at a conversion price of $0.37 per share of common stock, for a total of 56,756,757 common shares.

In connection with the offering, the investors received warrants to purchase up to 22,702,704 shares of common stock. The warrants have an exercise price of $0.45 per warrant share, for total potential additional proceeds to the Company of approximately $10.2 million upon exercise of the warrants. The warrants are exercisable six months and one day after the date of issuance and expire five years from the date of issuance.

The Company intends to use the net proceeds from the offering for general corporate purposes, which may include, among other things, paying interest on and/or retiring portions of its outstanding debt, funding research and development, preclinical and clinical trials, the preparation and filing of new drug applications and general working capital. The Company may also use a portion of the net proceeds to fund possible investments in, or acquisitions of, complementary businesses, technologies or products. The Company has recently engaged in limited discussions with third parties regarding such investments or acquisitions, but has no current agreements or commitments with respect to any investment or acquisition.

Shares of the Series 7 Preferred Stock will receive dividends in the same amount as any dividends declared and paid on shares of common stock and have no voting rights on general corporate matters.

The closing of the offering is expected to occur on October 22, 2010, at which time the Company will receive the cash proceeds and deliver the securities.

Rodman & Renshaw, LLC, a wholly-owned subsidiary of Rodman & Renshaw Capital Group, Inc., (Nasdaq: RODM), acted as the exclusive placement agent for the offering. Trout Capital LLC provided financial advisory services.

A shelf registration statement relating to the shares of Series 7 Preferred Stock and warrants issued in the offering (and the shares of common stock issuable upon conversion of the Series 7 Preferred Stock and exercise of the warrants) has been filed with the Securities and Exchange Commission (the "SEC"). The shelf registration statement was automatically effective upon filing with the SEC. A prospectus supplement relating to the offering will be filed with the SEC. Copies of the prospectus supplement and accompanying prospectus may be obtained directly from the Company by contacting the Company at the following address: Cell Therapeutics, Inc., 501 Elliott Avenue West, Suite 400, Seattle, Washington 98119. This press release does not constitute an offer to sell nor a solicitation of an offer to buy the Series 7 Preferred Stock or warrants (or the shares of common stock issuable upon conversion of the Series 7 Preferred Stock and exercise of the warrants). No offer, solicitation or sale will be made in any jurisdiction in which such offer, solicitation or sale is unlawful.