Novuspharma S.p.A. Stock Option Plan



 Exhibit 10.1 
  
 CELL THERAPEUTICS, INC. 
  
 NOVUSPHARMA S.p.A. STOCK OPTION PLAN 
  
 (as amended and restated) 
  
 CELL THERAPEUTICS, INC., hereby establishes the Cell Therapeutics, Inc. Novuspharma S.p.A. Stock Option Plan, effective as of December 23, 2003.

  
 SECTION 1 
 BACKGROUND AND PURPOSE 
  
 1.1 Background. The Plan permits the grant of Nonqualified Stock Options and Restricted Stock. 
  
 1.2 Purpose of the Plan. The Plan is intended to attract, motivate,
and retain employees, consultants and directors of the Company’s Affiliates. The Plan also is designed to encourage stock ownership by Participants, thereby aligning their interests with those of the Company’s shareholders. 
  
 SECTION 2 
 DEFINITIONS 
  
 The following words and phrases shall have the following meanings unless a different meaning is plainly required by the context: 
  
 2.1 “1934 Act” means the Securities Exchange Act of 1934, as amended. Reference to a specific section of the 1934 Act or regulation
thereunder shall include such section or regulation, any valid regulation promulgated under such section, and any comparable provision of any future legislation or regulation amending, supplementing or superseding such section or regulation.

  
 2.2 “Affiliate” means any corporation or any
other entity (including, but not limited to, partnerships and joint ventures) controlling, controlled by, or under common control with the Company. 
  
 2.3 “Award” means, individually or collectively, a grant under the Plan of Nonqualified Stock Options or Restricted Stock. 
  
 2.4 “Award Agreement” means the written agreement setting
forth the terms and provisions applicable to each Award granted under the Plan. 
  
 2.5 “Board” or “Board of Directors” means the Board of Directors of the Company. 
  
 2.6 “Change in Control” means the occurrence of any of the following events: 
  
 (a) Any “person” (as such term is used in Sections
13(d) and 14(d) of the Exchange Act) becomes the “beneficial owner” (as defined in Rule 13d-3 of the Exchange Act), 







 directly or indirectly, of securities of the Company representing fifty percent (50%) or more of the
total voting power represented by the Company’s then outstanding voting securities; 
  
 (b) The consummation of the sale or disposition by the Company of all or substantially all of the Company’s assets; 
  
 (c) A change in the composition of the Board occurring
within a two-year period, as a result of which fewer than a majority of the directors are Incumbent Directors. “Incumbent Directors” means directors who either (A) are Directors as of the effective date of the Plan, or (B) are elected, or
nominated for election, to the Board with the affirmative votes of at least a majority of the Directors at the time of such election or nomination (but will not include an individual whose election or nomination is in connection with an actual or
threatened proxy contest relating to the election of directors to the Company); or 
  
 (d) The consummation of a merger or consolidation of the Company with any other corporation, other than a merger or consolidation which
would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity or its parent) at least fifty
percent (50%) of the total voting power represented by the voting securities of the Company or such surviving entity or its parent outstanding immediately after such merger or consolidation. 
  
 2.7 “Code” means the Internal Revenue Code of 1986, as
amended. Reference to a specific section of the Code or regulation thereunder shall include such section or regulation, any valid regulation promulgated under such section, and any comparable provision of any future legislation or regulation
amending, supplementing or superseding such section or regulation. 
  
 2.8 “Committee” means the Board or a committee appointed by the Board (pursuant to Section 3.1) to administer the Plan. 
  
 2.9 “Company” means Cell Therapeutics, Inc., a Washington corporation, or any successor thereto. 
  
 2.10 “Consultant” means any consultant, independent
contractor, or other person who provides significant services to the Company or its Affiliates, but who is neither an Employee nor a Director. 
  
 2.11 “Director” means any individual who is a member of the Board of Directors of the Company. 
  
 2.12 “Disability” means a permanent and total disability
within the meaning of Section 22(e)(3) of the Code, provided that the Committee in its discretion may determine whether a permanent and total disability exists in accordance with uniform and non-discriminatory standards adopted by the Committee from
time to time. 
  
 2.13 “Employee” means any
employee of the Company or of an Affiliate, whether such employee is so employed at the time the Plan is adopted or becomes so employed subsequent to the adoption of the Plan. 
  

 2 








 2.14 “Exercise Price” means the price at which a Share may be purchased by a Participant
pursuant to the exercise of an Option. 
  
 2.15 “Fair
Market Value” means the greater of: (i) the average of the closing prices for a share of Company common stock on the Nasdaq National Market for each trading day during the one-month period immediately preceding (A) the closing date of the
merger of Novuspharma S.P.A. with the Company (the “Merger”) if the relevant Grant Date for an Option is the closing date of the Merger or (B) any relevant Grant Date, (ii) the average of the closing prices for a share of Company common
stock on the Nuovo Mercato Telematico Azionario (if applicable) for each trading day during the one-month period immediately preceding (C) the closing date of the Merger if the relevant Grant Date for an Option is the closing date of the Merger or
(D) any relevant Grant Date, (iii) the closing price for a share of Company common stock on the Nasdaq National Market on the relevant Grant Date, and (iv) the closing price for a share of Company common stock on the Nuovo Mercato Telematico
Azionario (if applicable) on the relevant Grant Date. Notwithstanding the preceding, for federal, state, foreign and local income tax reporting purposes, Fair Market Value shall be determined by the Committee (or its delegate) in accordance with
uniform and nondiscriminatory standards adopted by it from time to time. 
  
 2.16 “Grant Date” means, with respect to an Award, the date that the Award was granted. 
  
 2.17 “Nonqualified Stock Option” means an option to purchase Shares which is not intended to be an “incentive stock option” for
purposes of Section 422 of the Code. 
  
 2.18
“Option” means a Nonqualified Stock Option. 
  
 2.19 “Participant” means an Employee, Consultant, or Director who has an outstanding Award. 
  
 2.20 “Period of Restriction” means the period during which the transfer of Shares of Restricted Stock are subject to restrictions and
therefore, the Shares are subject to a substantial risk of forfeiture. As provided in Section 6, such restrictions may be based on the passage of time, the achievement of target levels of performance, or the occurrence of other events as determined
by the Committee, in its discretion. 
  
 2.21
“Plan” means the Cell Therapeutics, Inc. Novuspharma S.p.A. Stock Option Plan, as set forth in this instrument and as hereafter amended from time to time. 
  
 2.22 “Restricted Stock” means an Award granted to a Participant pursuant to Section 6. 
  
 2.23 “Rule 16b-3” means Rule 16b-3 promulgated under the
1934 Act, and any future regulation amending, supplementing or superseding such regulation. 
  
 2.24 “Section 16 Person” means a person who, with respect to the Shares, is subject to Section 16 of the 1934 Act. 
  
 2.25 “Shares” means the shares of common stock of the Company. 
  

 3 








 2.26 “Subsidiary” means any corporation in an unbroken chain of corporations beginning
with the Company if each of the corporations other than the last corporation in the unbroken chain then owns stock possessing fifty percent (50%) or more of the total combined voting power of all classes of stock in one of the other corporations in
such chain. 
  
 2.27 “Termination of Service”
means (a) in the case of an Employee, a cessation of the employee-employer relationship between the Employee and the Company or an Affiliate for any reason, including, but not by way of limitation, a termination by resignation, discharge, death,
Disability or the disaffiliation of an Affiliate, but excluding any such termination where there is a simultaneous reemployment by the Company or an Affiliate; (b) in the case of a Consultant, a cessation of the service relationship between the
Consultant and the Company or an Affiliate for any reason, including, but not by way of limitation, a termination by resignation, discharge, death, Disability, or the disaffiliation of an Affiliate, but excluding any such termination where there is
a simultaneous re-engagement of the consultant by the Company or an Affiliate; and (c) in the case of a Director, a cessation of the Director’s service on the Board for any reason, including, but not by way of limitation, a termination by
resignation, death, Disability or non-reelection to the Board. 
  
 SECTION 3 
 ADMINISTRATION 
  
 3.1 The Committee. The Plan shall be administered by the Committee. If the Committee is not the Board then the Committee shall consist of not less
than two (2) Directors who shall be appointed from time to time by, and shall serve at the pleasure of, the Board of Directors. If the Committee is not the Board then the Committee shall be comprised solely of Directors who both are
“non-employee directors” under Rule 16b-3. 
  
 3.2
Authority of the Committee. It shall be the duty of the Committee to administer the Plan in accordance with the Plan’s provisions. The Committee shall have all powers and discretion necessary or appropriate to administer the Plan and to
control its operation, including, but not limited to, the power to (a) determine which Employees, Consultants and Directors shall be granted Awards, (b) prescribe the terms and conditions of the Awards, (c) interpret the Plan and the Awards, (d)
adopt such procedures and subplans as are necessary or appropriate to permit participation in the Plan by Employees and Directors who are foreign nationals or employed outside of the United States, (e) adopt rules for the administration,
interpretation and application of the Plan as are consistent therewith, and (f) interpret, amend or revoke any such rules. 
  
 3.3 Delegation by the Committee. The Committee, in its sole discretion and on such terms and conditions as it may provide, may delegate (a) all or
any part of its authority and powers under the Plan to one or more Directors, and (b) more limited authority and powers under the Plan to one or more officers of the Company; provided, however, that the Committee may not delegate its authority and
powers (a) with respect to Section 16 Persons, or (b) in any way which would jeopardize the Plan’s qualification under 
Rule 16b-3. 
  
 3.4 Decisions Binding. All determinations and decisions made by the Committee, the Board, and any delegate of the Committee pursuant to the
provisions of the Plan shall be final, conclusive, and binding on all persons, and shall be given the maximum deference permitted by law. 
  

 4 








 SECTION 4 
 SHARES SUBJECT TO THE PLAN 
  
 4.1
Number of Shares. Subject to adjustment as provided in Section 4.3, the total number of Shares available for grant under the Plan shall not exceed 350,000 Shares. Shares granted under the Plan may be either authorized but unissued Shares or
treasury Shares. 
  
 4.2 Lapsed Awards. If an Award is
settled in cash, or is cancelled, terminates, expires, or lapses for any reason, any Shares subject to such Award again shall be available to be the subject of an Award. 
  
 4.3 Adjustments in Awards and Authorized Shares. In the event that any dividend or other distribution (whether in the
form of cash, Shares, other securities, or other property), recapitalization, stock split, reverse stock split, reorganization, merger, consolidation, split-up, spin-off, combination, repurchase, or exchange of Shares or other securities of the
Company, or other change in the corporate structure of the Company affecting the Shares occurs such that an adjustment is determined by the Committee (in its sole discretion) to be appropriate in order to prevent dilution or enlargement of the
benefits or potential benefits intended to be made available under the Plan, then the Committee shall, in such manner as it may deem equitable, adjust the number and class of Shares which may be delivered under the Plan, and the number, class, and
price of Shares subject to outstanding Awards. Notwithstanding the preceding, the number of Shares subject to any Award always shall be a whole number. 
  
 SECTION 5 
 STOCK OPTIONS 
  
 5.1 Grant of Options. Subject to the terms and provisions of the Plan,
Options may be granted to Employees, Consultants and Directors at any time and from time to time as determined by the Committee in its sole discretion. The Committee may only grant Nonqualified Stock Options and the Committee, in its sole
discretion, shall determine the number of Shares subject to each Option. 
  
 5.2 Award Agreement. Each Option shall be evidenced by an Award Agreement that shall specify the Exercise Price, the Grant Date, the expiration date of the Option, the number of Shares to which the Option
pertains, any conditions to exercise the Option, and such other terms and conditions as the Committee, in its discretion, shall determine. 
  
 5.3 Exercise Price. The Exercise Price for each Option shall be determined by the Committee in its sole discretion but shall not be less than one
hundred percent (100%) of the Fair Market Value of a Share on the Grant Date. 
  
 5.4 Expiration of Options. 
  
 5.4.1 Expiration Dates. Each Option shall terminate no later than the first to occur of the following events: 
  
 (a) The date for termination of the Option set forth in the written Award Agreement, or 
  

 5 








 (b) If no date for the termination of the Option is set forth in the written Award
Agreement (other than reference to Section 5.4.1(c)), the date of the Participant’s Termination of Service for any reason; or 
  
 (c) The expiration of ten (10) years from the Grant Date. 
  
 5.4.2 Committee Discretion. Subject to the limits of Section 5.4.1, the Committee, in its sole
discretion, (a) shall provide in each Award Agreement when each Option expires and becomes unexercisable, and (b) may, after an Option is granted, extend the maximum term of the Option. 
  
 5.5 Exercisability of Options. Options granted under the Plan shall be exercisable at such times and be subject to
such restrictions and conditions as the Committee shall determine in its sole discretion. After an Option is granted, the Committee, in its sole discretion, may accelerate the exercisability of the Option. 
  
 5.6 Payment. Options shall be exercised by the Participant’s
delivery of a written notice of exercise to the Secretary of the Company (or its designee), setting forth the number of Shares with respect to which the Option is to be exercised, accompanied by full payment for the Shares. 
  
 Upon the exercise of any Option, the Exercise Price shall be payable to the
Company in full in cash or its equivalent. The Committee, in its sole discretion, also may permit exercise by any other means which the Committee, in its sole discretion, determines to both provide legal consideration for the Shares, and to be
consistent with the purposes of the Plan. 
  
 As soon as
practicable after receipt of a written notification of exercise and full payment for the Shares purchased, the Company shall deliver to the Participant (or the Participant’s designated broker), Share certificates (which may be in book entry
form) representing such Shares. 
  
 5.7 Restrictions on Share
Transferability. The Committee may impose such restrictions on any Shares acquired pursuant to the exercise of an Option as it may deem advisable, including, but not limited to, restrictions related to applicable federal securities laws, the
requirements of any national securities exchange or system upon which Shares are then listed or traded, or any blue sky or state securities laws. 
 SECTION 6 
 RESTRICTED STOCK 
  
 6.1 Grant of Restricted Stock. Subject to the terms and provisions of the Plan, the Committee, at any time and from time to time, may grant Shares
of Restricted Stock to Employees, Directors and Consultants in such amounts as the Committee, in its sole discretion, shall determine. The Committee, in its sole discretion, shall determine the number of Shares to be granted to each Participant.

  

 6 








 6.2 Restricted Stock Agreement. Each Award of Restricted Stock shall be evidenced by an Award
Agreement that shall specify the Period of Restriction, the number of Shares granted, and such other terms and conditions as the Committee, in its sole discretion, shall determine. Unless the Committee determines otherwise, Shares of Restricted
Stock shall be held by the Company as escrow agent until the restrictions on such Shares have lapsed. 
  
 6.3 Transferability. Except as provided in this Section 6, Shares of Restricted Stock may not be sold, transferred, pledged, assigned, or otherwise
alienated or hypothecated until the end of the applicable Period of Restriction. 
  
 6.4 Other Restrictions. The Committee, in its sole discretion, may impose such other restrictions on Shares of Restricted Stock as it may deem advisable or appropriate, in accordance with this Section 6.4.

  
 6.4.1 General Restrictions. The
Committee may set restrictions based upon the achievement of specific performance objectives (Company-wide, divisional, or individual), applicable federal or state securities laws, or any other basis determined by the Committee in its discretion.

  
 6.4.2 Legend on Certificates. The
Committee, in its discretion, may legend the certificates representing Restricted Stock to give appropriate notice of such restrictions. 
  
 6.5 Removal of Restrictions. Except as otherwise provided in this Section 6, Shares of Restricted Stock covered by each Restricted Stock grant made
under the Plan shall be released from escrow as soon as practicable after the last day of the Period of Restriction. The Committee, in its discretion, may accelerate the time at which any restrictions shall lapse or be removed. After the
restrictions have lapsed, the Participant shall be entitled to have any legend or legends under Section 6.4.2 removed from his or her Share certificate, and the Shares shall be freely transferable by the Participant. 
  
 6.6 Voting Rights. During the Period of Restriction, Participants
holding Shares of Restricted Stock granted hereunder may exercise full voting rights with respect to those Shares, unless the Committee determines otherwise. 
  
 6.7 Dividends and Other Distributions. During the Period of Restriction, Participants holding Shares of Restricted Stock shall be entitled to
receive all dividends and other distributions paid with respect to such Shares unless otherwise provided in the Award Agreement. If any such dividends or distributions are paid in Shares, the Shares shall be subject to the same restrictions on
transferability and forfeitability as the Shares of Restricted Stock with respect to which they were paid. 
  
 6.8 Return of Restricted Stock to Company. On the date set forth in the Award Agreement, the Restricted Stock for which restrictions have not
lapsed shall revert to the Company and again shall become available for grant under the Plan. 
  

 7 








 SECTION 7 
 MISCELLANEOUS 
  
 7.1 Change in
Control. 
  
 7.1.1 Generally. In the
event of a Change in Control, and except as the Committee (as constituted immediately prior to such Change in Control) may otherwise determine in its sole discretion, (i) all Awards granted hereunder shall become fully exercisable as of the date of
the Change in Control, whether or not then exercisable; and (ii) all restrictions and conditions on any Award then outstanding shall lapse as of the date of the Change in Control. 
  
 7.1.2 Options. If the Committee determines that Options will be assumed or an equivalent option or
right substituted by the successor corporation or a parent or Subsidiary of the successor corporation, then 
  
 (a) in the event that the successor corporation refuses to assume or substitute for the Option, then the Options held by such Participant
shall become one hundred percent (100%) exercisable. If an Option becomes fully vested and exercisable in lieu of assumption or substitution in the event of a Change in Control, the Company shall notify the Participant in writing or electronically
that the Option shall be fully vested and exercisable (subject to the consummation of the Change in Control) for a period of fifteen (15) days from the date of such notice, and the Option shall terminate upon the expiration of such period.

  
 (b) For the purposes of this Section 7.1, the
Option shall be considered assumed if, following the Change in Control, the option confers the right to purchase or receive, for each Share subject to the Option immediately prior to the Change in Control, the consideration (whether stock, cash, or
other securities or property) received in the Change in Control by holders of Shares for each Share held on the effective date of the transaction (and if holders were offered a choice of consideration, the type of consideration chosen by the holders
of a majority of the outstanding Shares); provided, however, that if such consideration received in the Change in Control is not solely common stock of the successor corporation or its parent, the Committee or the Board may, with the consent of the
successor corporation, provide for the consideration to be received upon the exercise of the Option, for each Share subject to the Option, to be solely common stock of the successor corporation or its parent equal in fair market value to the per
share consideration received by holders of Shares in the Change in Control, as determined on the date of the Change in Control. 
  
 7.1.3 Restricted Stock. If the Committee determines that any Company repurchase or reacquisition right with respect to outstanding
Shares of Restricted Stock held by the Participant will be assigned to the successor corporation, then in the event that the successor corporation refuses to accept the assignment of any such Company repurchase or reacquisition right, such Company
repurchase or reacquisition right will lapse and the Participant will become one hundred percent (100%) vested in such Shares of Restricted Stock immediately prior to the Change in Control. 
  
 7.2 No Effect on Employment or Service. Nothing in the Plan shall
interfere with or limit in any way the right of the Company to terminate any Participant’s employment or service at any time, with or without cause. For purposes of the Plan, transfer of employment of a Participant 
  

 8 








 between the Company and any one of its Affiliates (or between Affiliates) shall not be deemed a Termination of Service.
Employment with the Company and its Affiliates is on an at-will basis only. 
  
 7.3 Participation. No Employee or Consultant shall have the right to be selected to receive an Award under this Plan, or, having been so selected, to be selected to receive a future Award. 
  
 7.4 Indemnification. Each person who is or shall have been a member of
the Committee, or of the Board, shall be indemnified and held harmless by the Company against and from (a) any loss, cost, liability, or expense that may be imposed upon or reasonably incurred by him or her in connection with or resulting from any
claim, action, suit, or proceeding to which he or she may be a party or in which he or she may be involved by reason of any action taken or failure to act under the Plan or any Award Agreement, and (b) from any and all amounts paid by him or her in
settlement thereof, with the Company’s approval, or paid by him or her in satisfaction of any judgment in any such claim, action, suit, or proceeding against him or her, provided he or she shall give the Company an opportunity, at its own
expense, to handle and defend the same before he or she undertakes to handle and defend it on his or her own behalf. The foregoing right of indemnification shall not be exclusive of any other rights of indemnification to which such persons may be
entitled under the Company’s Certificate of Incorporation or Bylaws, by contract, as a matter of law, or otherwise, or under any power that the Company may have to indemnify them or hold them harmless. 
  
 7.5 Successors. All obligations of the Company under the Plan, with
respect to Awards granted hereunder, shall be binding on any successor to the Company, whether the existence of such successor is the result of a direct or indirect purchase, merger, consolidation, or otherwise, of all or substantially all of the
business or assets of the Company. 
  
 7.6 Beneficiary
Designations. If permitted by the Committee, a Participant under the Plan may name a beneficiary or beneficiaries to whom any vested but unpaid Award shall be paid in the event of the Participant’s death. Each such designation shall revoke
all prior designations by the Participant and shall be effective only if given in a form and manner acceptable to the Committee. In the absence of any such designation, any vested benefits remaining unpaid at the Participant’s death shall be
paid to the Participant’s estate and, subject to the terms of the Plan and of the applicable Award Agreement, any unexercised vested Award may be exercised by the administrator or executor of the Participant’s estate. 
  
 7.7 Limited Transferability of Awards. No Award granted under the Plan
may be sold, transferred, pledged, assigned, or otherwise alienated or hypothecated, other than by will, by the laws of descent and distribution, or to the limited extent provided in Section 6.6. All rights with respect to an Award granted to a
Participant shall be available during his or her lifetime only to the Participant. 
  
 7.8 No Rights as Stockholder. Except to the limited extent provided in Sections 6.6 and 6.7, no Participant (nor any beneficiary) shall have any of the rights or privileges of a stockholder of the Company with
respect to any Shares issuable pursuant to an Award (or exercise thereof), unless and until certificates representing such Shares shall have been issued, recorded on the records of the Company or its transfer agents or registrars, and delivered to
the Participant (or beneficiary). 
  

 9 








 SECTION 8 
 AMENDMENT, TERMINATION, AND DURATION 
  
 8.1 Amendment, Suspension, or Termination. The Board, in its sole discretion, may amend, suspend or terminate the Plan, or any part thereof, at any time and for any reason. The amendment, suspension, or termination of the Plan shall
not, without the consent of the Participant, alter or impair any rights or obligations under any Award theretofore granted to such Participant. No Award may be granted during any period of suspension or after termination of the Plan. Notwithstanding
the foregoing, the Board may not, without stockholder consent, reduce the exercise price of any outstanding Option or cancel and re-grant Options at a lower exercise price. 
  
 8.2 Duration of the Plan. The Plan shall be effective upon Board approval, and subject to Section 8.1 (regarding the
Board’s right to amend or terminate the Plan), shall remain in effect thereafter until December 31, 2006. 
  
 SECTION 9 
 TAX WITHHOLDING 
  
 9.1 Withholding Requirements. Prior to the delivery of any Shares or cash pursuant to an Award (or exercise thereof),
the Company shall have the power and the right to deduct or withhold, or require a Participant to remit to the Company, an amount sufficient to satisfy federal, state, local and foreign taxes (including the Participant’s FICA obligation)
required to be withheld with respect to such Award (or exercise thereof). 
  
 9.2 Withholding Arrangements. The Committee, in its sole discretion and pursuant to such procedures as it may specify from time to time, may permit a Participant to satisfy such tax withholding obligation, in
whole or in part by (a) electing to have the Company withhold otherwise deliverable Shares, or (b) delivering to the Company already-owned Shares having a Fair Market Value equal to the minimum amount required to be withheld. The amount of the
withholding requirement shall be deemed to include any amount which the Committee agrees may be withheld at the time the election is made, not to exceed the amount determined by using the maximum federal, state or local marginal income tax rates
applicable to the Participant with respect to the Award on the date that the amount of tax to be withheld is to be determined. The Fair Market Value of the Shares to be withheld or delivered shall be determined as of the date that the taxes are
required to be withheld. 
  
 SECTION 10 
 LEGAL CONSTRUCTION 
  
 10.1 Gender and Number. Except where otherwise indicated by the context, any masculine term used herein also shall include the feminine; the plural
shall include the singular and the singular shall include the plural. 
  
 10.2 Severability. In the event any provision of the Plan shall be held illegal or invalid for any reason, the illegality or invalidity shall not affect the remaining parts of the Plan, and the Plan shall be construed and enforced as
if the illegal or invalid provision had not been included. 
  

 10 








 10.3 Requirements of Law. The granting of Awards and the issuance of Shares under the Plan shall
be subject to all applicable laws, rules, and regulations, and to such approvals by any governmental agencies or national securities exchanges as may be required. 
  
 10.4 Securities Law Compliance. With respect to Section 16 Persons, transactions under this Plan are intended to
comply with all applicable conditions of Rule 16b-3. To the extent any provision of the Plan, Award Agreement or action by the Committee fails to so comply, it shall be deemed null and void, to the extent permitted by law and deemed advisable by the
Committee. 
  
 10.5 Governing Law. The Plan and all Award
Agreements shall be construed in accordance with and governed by the laws of the State of Washington. 
  
 10.6 Captions. Captions are provided herein for convenience only, and shall not serve as a basis for interpretation or construction of the Plan.

  

 11 








 EXECUTION 
  
 IN WITNESS WHEREOF, the Company, by its duly authorized officer, has executed this amended and restated Plan on the date indicated below. 
  

					
	 	  	CELL THERAPEUTICS, INC.
			
	Dated: February 11, 2004	  	 By:
	 	/s/    JAMES A. BIANCO
	 	 	 	 	

			
	 	  	 Title:
	 	President and Chief Executive Officer