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StemCells, Inc. Announces Closing of Public Offering of Common Stock and Warrants

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The Company received total proceeds, net of underwriting discounts, of approximately $9.5 million.  The proceeds will be used for general corporate purposes, including working capital and operational purposes, including product development.

"We are pleased to have successfully closed the first tranche of this offering of up to $20 million, despite an extremely difficult financing environment for emerging life sciences companies," said Martin McGlynn, the Company's President and CEO.  "We view this funding as an important bridge to a number of potentially significant, value creating, milestones for the Company in 2012, such as the completion of our Phase I trial in Pelizaeus-Merzbacher disease, the initiation of a U.S. multicenter Phase I/II trial in age-related macular degeneration, and the dosing of the AIS B cohort in our ongoing spinal cord injury trail."

Each unit sold in the offering consisted of (i) one share of the Company's common stock, par value $.01 per share, and (ii) one Series A Warrant to purchase one share of the Company's common stock.  The Series B Warrants are exercisable immediately at an exercise price of $1.25 per unit and will expire at the close of business on May 2, 2012.  If all Series B Warrants are exercised, the Company will receive additional gross proceeds in the amount of approximately $10 million.

Roth Capital Partners, LLC and Chardan Capital Markets, LLC acted as underwriters for the offering. LifeTech Capital, a division of Aurora Capital LLC, acted as financial advisor to the Company.