CTI BioPharma Corp (fka CTIC)

[foggdogg]

CTI is to collect 10 Million:


Form 8-K for CELL THERAPEUTICS INC


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16-Mar-2009

Entry into a Material Definitive Agreement, Completion of Acquisition or Di



Item 1.01. Entry into a Material Definitive Agreement
On March 15, 2009, Cell Therapeutics, Inc., a Washington corporation ("CTI"), completed the sale of its 50% membership interest (the "Interest") in RIT Oncology LLC (the "Joint Venture") to Spectrum Pharmaceuticals, Inc., a Delaware corporation ("Spectrum"), to fully divest of its ownership in the 50/50 owned Zevalin® joint venture established in December 2008 with Spectrum, for approximately $16.5 million, pursuant to the terms and conditions of the Limited Liability Company Interest Assignment Agreement dated March 15, 2009 between CTI and Spectrum.

In consideration for the Interest, on March 2, 2009, CTI received a cash payment of $6.5 million (less the amount of a consent fee paid to Biogen Idec Inc.), and following the closing, on March 16, 2009, Spectrum funded into escrow $10 million, of which $6.5 million will automatically be released to CTI on April 3, 2009 and $3.5 million, subject to certain adjustments for among other things payables determined to be owed between CTI and the Joint Venture, will be released to CTI on April 15, 2009. As part of the transaction, CTI agreed to forego the right to receive up to $15 million in product sales milestone payments provided to CTI in connection with the original transaction establishing the Joint Venture.

As part of the closing, CTI assigned to Spectrum that certain amended and restated security agreement and guarantee granted in favor of Biogen Idec Inc. to secure the performance of the Joint Venture obligations with respect to Zevalin, and Spectrum has agreed to reimburse CTI for any liability incurred based upon claims made by Biogen under such contracts or any other contracts associated with the Zevalin business to which CTI was previously a party.

In addition, CTI extended the terms of the existing master services agreement with the Joint Venture and has agreed to perform transition services for the benefit of the Zevalin business until May 31, 2009.





Item 2.01 Completion of Acquisitions or Disposition of Assets

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