SEC FORM 3

SEC Form 3

FORM 3

UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

INITIAL STATEMENT OF BENEFICIAL OWNERSHIP OF SECURITIES

Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934
or Section 30(h) of the Investment Company Act of 1940

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1. Name and Address of Reporting Person^*

Stratton Kenneth Blair

(Last)

(First)

(Middle)

C/O STEMCELLS, INC.

3155 PORTER DRIVE

(Street)

PALO ALTO

94304

(City)

(State)

(Zip)

2. Date of Event Requiring Statement (Month/Day/Year)
09/15/2008

3. Issuer Name and Ticker or Trading Symbol
STEMCELLS INC [ STEM ]

4. Relationship of Reporting Person(s) to Issuer
(Check all applicable)

	Director	10% Owner
X	Officer (give title below)	Other (specify below)
	General Counsel

5. If Amendment, Date of Original Filed (Month/Day/Year)

6. Individual or Joint/Group Filing (Check Applicable Line)

X	Form filed by One Reporting Person
	Form filed by More than One Reporting Person

Table I - Non-Derivative Securities Beneficially Owned
1. Title of Security (Instr. 4)	2. Amount of Securities Beneficially Owned (Instr. 4)	3. Ownership Form: Direct (D) or Indirect (I) (Instr. 5)	4. Nature of Indirect Beneficial Ownership (Instr. 5)
Common Stock	82,500⁽¹⁾	D
Common Stock	4,578	I	By 401(k) Plan⁽²⁾

Table II - Derivative Securities Beneficially Owned (e.g., puts, calls, warrants, options, convertible securities)
1. Title of Derivative Security (Instr. 4)	2. Date Exercisable and Expiration Date (Month/Day/Year)		3. Title and Amount of Securities Underlying Derivative Security (Instr. 4)		4. Conversion or Exercise Price of Derivative Security	5. Ownership Form: Direct (D) or Indirect (I) (Instr. 5)	6. Nature of Indirect Beneficial Ownership (Instr. 5)
1. Title of Derivative Security (Instr. 4)	Date Exercisable	Expiration Date	Title	Amount or Number of Shares	4. Conversion or Exercise Price of Derivative Security	5. Ownership Form: Direct (D) or Indirect (I) (Instr. 5)	6. Nature of Indirect Beneficial Ownership (Instr. 5)
Employee Stock Option (right to buy)	⁽³⁾	02/28/2017	Common Stock	150,000	$2.62	D

Explanation of Responses:

1. Restricted stock units, with 1/3 vesting on March 10, 2009, 1/3 vesting on March 10, 2010, and 1/3 vesting on March 10, 2011.

2. Shares held in 401(k) account, in accordance with issuer's employer-match policies.

3. The option vests over four years, with 1/4 of the shares vesting on the anniversary of the grant and the remainder vesting at 1/48 per month thereafter. Options to purchase 37,500 shares became exerciseable on February 28, 2008, with an additional 3,125 shares becoming exercisable monthly thereafter for the remainder of the vesting period.

Remarks:

	/s/ Kenneth B. Stratton	04/07/2009
	** Signature of Reporting Person	Date
Reminder: Report on a separate line for each class of securities beneficially owned directly or indirectly.
* If the form is filed by more than one reporting person, see Instruction 5 (b)(v).
** Intentional misstatements or omissions of facts constitute Federal Criminal Violations See 18 U.S.C. 1001 and 15 U.S.C. 78ff(a).
Note: File three copies of this Form, one of which must be manually signed. If space is insufficient, see Instruction 6 for procedure.
Persons who respond to the collection of information contained in this form are not required to respond unless the form displays a currently valid OMB Number.