CTI BIOPHARMA CORP. (NASDAQ:CTIC) Files An 8-K Entry into a Material Definitive Agreement

(i) Underwriting Agreement

On June 6, 2017, CTI BioPharma Corp. (the Company) entered into
an underwriting agreement (the Underwriting Agreement) with
Jefferies LLC acting as sole book-running manager and as
representative of the several underwriters named therein
(collectively, the Underwriters), relating to the offer and sale
(the Offering) of 22,500 shares of the Companys Series N-3
Preferred Stock, no par value per share (the Series N-3 Preferred
Stock). The price to the public in this Offering was $2,000 per
share of Series N-3 Preferred Stock. The net proceeds to the
Company from this Offering are expected to be approximately $42.8
million, after deducting underwriting discounts, commissions and
other estimated offering expenses. The Offering closed on June 9,
2017.

Each share of Series N-3 Preferred Stock is convertible at the
option of the holder (subject to a limited exception), at any
time after issuance, into the number of shares of the Companys
common stock, no par value per share (Common Stock), determined
by dividing the aggregate stated value of the Series N-3
Preferred Stock of $2,000 per share to be converted by the
initial conversion price of $3.00 per share of Common Stock. Cash
will be paid in lieu of any fractional shares. The initial
conversion price is subject to adjustment in certain events. For
a discussion of certain additional terms of the Series N-3
Preferred Stock, please refer to Item 3.03 of this Current Report
on Form 8-K, which is incorporated herein by reference.

The Offering was made to the Companys shelf registration
statement on Form S-3 filed with the Securities and Exchange
Commission (SEC) on November 21, 2014, which became effective on
December 8, 2014 (Registration Statement No. 333-200452), as
supplemented by a preliminary prospectus supplement, free writing
prospectus and final prospectus supplement filed with the SEC on
June 5, 2017, June 6, 2017 and June 7, 2017, respectively.

The Company plans to use the net proceeds from the Offering to
(i) conduct the PAC203 clinical trial, (ii) submit a new
Marketing Authorization Application for pacritinib to the
European Medicines Agency, (iii) conduct additional research
concerning the possible application of pacritinib in indications
outside of myelofibrosis, and (iv) complete the PIX306 clinical
trial, as well as for general corporate purposes, which may
include funding research and development, conducting preclinical
and clinical trials, acquiring or in-licensing potential new
pipeline candidates, preparing and filing possible new drug
applications and general working capital.

In the Underwriting Agreement, the Company has agreed to
indemnify the Underwriters against certain liabilities, including
liabilities under the Securities Act of 1933, as amended, or to
contribute to payments that the Underwriters may be required to
make because of such liabilities.

The above descriptions of the Underwriting Agreement and the
Series N-3 Preferred Stock are qualified in their entirety by
reference to Exhibit 1.1 and Exhibits 3.1 attached hereto,
respectively.

A copy of the opinion of Karr Tuttle Campbell related to the
legality of the Series N-3 Preferred Stock (and the shares of
Common Stock issuable upon conversion of the Series N-3 Preferred
Stock) is attached hereto as Exhibit 5.1.

(ii) Letter Agreement with BVF Partners L.P.

On June 9, 2017, the Company entered into a letter agreement
(Letter Agreement) with BVF Partners L.P. (BVF Partners), an
existing shareholder of the Company, to which the Company has
agreed to, upon BVF Partnerss election and subject to any board
and committee approvals, exchange shares of common stock
purchased by BVF Partners directly from the Company or underlying
convertible preferred stock purchased by BVF Partners directly
from the Company, including the shares of common stock underlying
the Series N-3 Preferred Stock offered in the Offering, into
shares of a convertible non-voting preferred stock with
substantially similar terms as the convertible Series N-3
Preferred Stock in this Offering, including a conversion blocker
initially set at 9.99% of the Companys common stock. Such right
would terminate if at any time BVF Partners beneficial ownership
of the Companys common stock falls below 5%. The Company will
take commercially reasonable efforts to cooperate to effectuate
such exchange, provided that it does not adversely affect the
Company and complies with applicable federal and state securities
laws.

The above description of the Letter Agreement is qualified in its
entirety by reference to Exhibit 10.1, which is attached hereto
as Exhibit 10.1 and incorporated herein by reference.

Item 3.03. Material Modification to Rights of Security Holders.

On and effective June 8, 2017, the Company filed an Articles of
Amendment (the Series N-3 Articles of Amendment) to its Amended
and Restated Articles of Incorporation, as amended (as so
amended, the Amended Articles) with the Secretary of State of the
State of Washington, establishing and designating the Series N-3
Preferred Stock and the rights, preferences and privileges
thereof. to the Series N-3 Articles of Amendment, each share of
Series N-3 Preferred Stock is entitled to a liquidation
preference equal to the initial stated value of such holders
Series N-3 Preferred Stock of $2,000 per share, plus any declared
and unpaid dividends and any other payments that may be due on
such shares, before any distribution of assets may be made to
holders of capital stock ranking junior to the Series N-3
Preferred Stock.

The Series N-3 Preferred Stock is not entitled to dividends
except to share in any dividends actually paid on the Common
Stock or any pari passu>or junior securities. The Series N-3
Preferred Stock will have no voting rights, except as otherwise
expressly provided in the Amended Articles or as otherwise
required by law. However, so long as at least 20% of the
aggregate originally issued shares of Series N-3 Preferred Stock
are outstanding, the Company cannot amend its Amended Articles,
bylaws or other charter documents, in each case so as to: (i)
materially, specifically and adversely affect the rights of the
Series N-3 Preferred Stock; (ii) repay, repurchase or offer to
repay or repurchase or otherwise acquire any shares of Common
Stock, Common Stock equivalents, or other securities junior to
the Series N-3 Preferred Stock, except in certain limited
circumstances; (iii) authorize or create any class of senior
preferred stock; or (iv) enter into any agreement or
understanding with respect to any of the foregoing, in each case,
without the affirmative written consent of holders of a majority
of the outstanding shares of Series N-3 Preferred Stock.

The shares of Series N-3 Preferred Stock (i) may be converted
into shares of Common Stock at the election of the holder
(subject to a limited exception) and (ii) are subject to
automatic conversion into shares of Common Stock in certain
circumstances.

The above description of the Series N-3 Articles of Amendment is
qualified in its entirety by reference to the text of such
amendment, a copy of which is attached hereto as Exhibit 3.1 and
incorporated herein by reference.

Item 5.03. Amendments to Articles of Incorporation or Bylaws;
Changes in Fiscal Year.

The description of the Series N-3 Articles of Amendment contained
in Item 3.03 of this Current Report on Form 8-K is incorporated
herein by reference.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits.