8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report: (Date of earliest event reported): May 20, 2010 (May 16, 2010)

CELL THERAPEUTICS, INC.

(Exact name of registrant as specified in its charter)

Washington	001-12465	91-1533912
(State or other jurisdiction of incorporation or organization)	(Commission File Number)	(I.R.S. Employer Identification Number)

501 Elliott Avenue West, Suite 400

Seattle, Washington 98119

(Address of principal executive offices)

Registrant’s telephone number, including area code: (206) 282-7100

Not applicable

(Former name or former address, if changed since last report).

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 3.02 Unregistered Sales of Equity Securities.

On May 16, 2010, Cell Therapeutics, Inc. (the “Company”) entered into privately negotiated exchange agreements (the “Exchange Agreements”) with certain holders of some of the Company’s outstanding 4% Convertible Senior Subordinated Notes due 2010 (the “Notes”). Pursuant to the terms of the Exchange Agreements, the Company may exchange up to approximately 60 million shares of its common stock, no par value, for approximately $30 million aggregate outstanding principal amount of Notes in one or a series of exchanges, which may be effected over several days. The term of the Exchange Agreements is ten days, subject to extension, unless earlier terminated by any party to the Exchange Agreements. The final number of shares of common stock and the final principal amount of Notes to be exchanged will be determined based on a number of factors, including, among others, the trading price and volume of the common stock during the term of the Exchange Agreements, the volume weighted average price of the common stock on the securities exchanges where the common stock is listed for trading and the setting of minimum share prices with respect to the maximum number of shares that may be exchanged on a particular trading day. The Company will pay accrued and unpaid interest to the applicable settlement date on the Notes in cash.

On May 18, 2010 and May 19, 2010, pursuant to one of the Exchange Agreements, the Company agreed to exchange an aggregate of 2,439,593 shares of its common stock for $1,069,000 aggregate outstanding principal amount of the Notes.

The shares of common stock issuable under the Exchange Agreements will be issued pursuant to the exemption from registration provided by Section 4(2) of the Securities Act of 1933, as amended (the “Securities Act”), and/or Regulation D thereunder.

This Current Report on Form 8-K does not constitute an offer to exchange the Notes or other securities of the Company for shares of common stock or any other securities of the Company.

Item 7.01 Regulation FD Disclosure.

On May 17, 2010, the Company announced that it entered into the Exchange Agreements with certain holders of the Notes. A copy of the Company’s press release, entitled “Cell Therapeutics, Inc. Announces Agreements to Exchange up to $30 Million Aggregate Outstanding Principal Amount of 4% Convertible Senior Subordinated Notes due 2010 for Common Stock” is furnished and not filed pursuant to Item 7.01 as Exhibit 99.1 hereto. Such information shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities of that section, and shall not be deemed to be incorporated by reference into any of the Company’s filings under the Securities Act or the Exchange Act, whether made before or after the date hereof, and regardless of any general incorporation language in such filings, except to the extent expressly set forth by specific reference in such a filing.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

Exhibit No.	Description
99.1	Press Release, dated May 17, 2010, entitled “Cell Therapeutics, Inc. Announces Agreements to Exchange up to $30 Million Aggregate Outstanding Principal Amount of 4% Convertible Senior Subordinated Notes due 2010 for Common Stock.”

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: May 20, 2010	CELL THERAPEUTICS, INC.
	By:	/s/ James A. Bianco
	Name:	James A. Bianco, M.D.
	Title:	Chief Executive Officer

EXHIBIT INDEX

Exhibit No.	Description
99.1	Press Release, dated May 17, 2010, entitled “Cell Therapeutics, Inc. Announces Agreements to Exchange up to $30 Million Aggregate Outstanding Principal Amount of 4% Convertible Senior Subordinated Notes due 2010 for Common Stock.”

EX-99.1

Exhibit 99.1

	501 Elliott Ave. W. #400 Seattle, WA 98119	T 206.282.7100 F 206.272.4010

Cell Therapeutics, Inc. Announces Agreements to Exchange up to $30 Million Aggregate Outstanding Principal Amount of 4% Convertible Senior Subordinated Notes due 2010 for Common Stock

May 17, 2010 Seattle—Cell Therapeutics, Inc. (the “Company”) (NASDAQ and MTA: CTIC) today announced that it has entered into exchange agreements (the “Exchange Agreements”) with certain holders of some of the Company’s outstanding 4% Convertible Senior Subordinated Notes due 2010 (the “Notes”).

Pursuant to the terms of the Exchange Agreements, the Company may exchange up to approximately 60 million shares of its common stock for up to approximately $30 million aggregate outstanding principal amount of Notes in one or a series of exchanges, which may be effected over several days. Each of the Company and the other parties to the Exchange Agreements has the right to decide whether to participate in a particular exchange and there is no assurance any exchanges will occur. The term of the Exchange Agreements is ten days, subject to extension unless earlier terminated by any party to the Exchange Agreements. The final number of shares of common stock and the final principal amount of Exchange Notes to be exchanged will be determined based on a number of factors, including, among others, the trading price and volume of the common stock during the term of the Exchange Agreements, the volume weighted average price of the common stock on the securities exchanges where the common stock is listed for trading and the setting of minimum share prices with respect to the maximum number of shares that may be exchanged on a particular trading day. These factors may cause fluctuations in the trading price of the Company’s common stock during the term of the Exchange Agreements. The Company will pay accrued and unpaid interest to, but excluding, the settlement date on the Exchange Notes in cash.

The terms of the Exchange Agreements were privately negotiated with certain holders of the Notes and the issuance of shares of common stock in connection with the Exchange Agreements is exempt from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”), pursuant to the exemption contained in Section 4(2) of the Securities Act and/or Regulation D thereunder. The shares of common stock to be issued in connection with the Exchange Agreements will not be registered under the Securities Act or state securities laws and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and applicable state securities laws.

www.CellTherapeutics.com

Page 2 of 2

This press release does not constitute an offer to sell or the solicitation of an offer to buy any securities of the Company and shall not constitute an offer, solicitation or sale in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful. This press release is being issued pursuant to and in accordance with Rule 135c under the Securities Act.

About Cell Therapeutics, Inc.

Headquartered in Seattle, the Company is a biopharmaceutical company committed to developing an integrated portfolio of oncology products aimed at making cancer more treatable. For additional information, please visit http://www.CellTherapeutics.com.

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 and the trading price of the Company’s securities. Specifically, the risks and uncertainties include risks associated with fluctuations in the trading price of the Company’s common stock during the term of the Exchange Agreements, that the Company may not complete the exchange or may not complete the exchange for the full amount of the Notes pursuant to the terms of the Exchange Agreements, the Company’s ability to realize the benefits from any reduction in its outstanding indebtedness and the 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, 10-Q and 8-K. Except as may be required by law, the Company does not intend to update or alter its forward-looking statements whether as a result of new information, future events, or otherwise.

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For Further Information Contact:

Media Contact:

Dan Eramian

T: 206.272.4343

C: 206.854.1200

E: deramian@ctiseattle.com

www.CellTherapeutics.com/press_room

Investors Contact:

Ed Bell

T: 206.282.7100

Lindsey Jesch Logan

T: 206.272.4347

F: 206.272.4434

E: invest@ctiseattle.com

www.CellTherapeutics.com/investors

www.CellTherapeutics.com