Exhibit 10.2
February 4, 2009
To RHP Master Fund, Ltd.:
This letter memorializes that today
Cell Therapeutics, Inc. (“CTI”) and RHP Master Fund,
Ltd. (“RHP”) have agreed to resolve their differences.
Such agreement will be documented in two agreements—this
letter agreement (this “Letter Agreement”) and a
separate, litigation-specific Settlement Agreement and Mutual
Release. CTI and RHP shall also be bound by such separate,
litigation-specific Settlement Agreement and Mutual Release (which
provides for litigation-specific additional consideration and is
being entered into simultaneously herewith) in addition to the
Letter Agreement.
By signing a copy of this Letter
Agreement where indicated below and returning it to CTI, RHP agrees
to exchange, at a closing to occur before the close of business
today, all its 250 shares of Series A 3% Convertible Preferred
Stock of CTI for 4,000,000 shares of newly-issued Common Stock of
CTI (the “Common Stock”). CTI agrees to issue such
Common Stock at such closing in exchange for such 250 shares of
Series A 3% Convertible Preferred Stock of CTI.
Additional requirements applicable
to the exchange transaction are:
1. RHP, by signing below, agrees to
from and after the closing of the exchange vote for/consent to any
CTI-proposed stock split, reverse stock split or share
authorization increase with regard to CTI common stock as proposed
in the CTI proxy statement for the meeting of shareholders to be
held on February 27, 2009, as long as the record date for such
vote/consent occurs when RHP still beneficially owns any of the
Common Stock.
2. RHP, by signing below, represents
and warrants that it is the record owner of 250 shares of Series A
3% Convertible Preferred Stock of CTI and agrees to deliver its
existing preferred stock share certificate to CTI, free and clear
of all liens, encumbrances and adverse claims, by no later
February 9, 2009. However, even if RHP breaches the agreement
by failing to deliver such preferred stock share certificate, such
preferred stock share certificate shall be void and shall no longer
represent CTI securities.
3. RHP, by signing below, consents
(as a member of its series, and looking to the attainment of a
consent by the holders of at least 67% of the shares of such
series) not only to all of the transactions contemplated by the
exchange transaction as described in this Letter Agreement (and to
all effects of such transaction), but also to all of the
transactions contemplated by the Series F exchange
