SEC FORM 4

SEC Form 4

FORM 4

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

STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP

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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Check this box if no longer subject to Section 16. Form 4 or Form 5 obligations may continue. See Instruction 1(b).

1. Name and Address of Reporting Person^*

STILLWATER LLC

(Last)

(First)

(Middle)

15 EAST 62ND STREET

(Street)

NEW YORK

10021

(City)

(State)

(Zip)

2. Issuer Name and Ticker or Trading Symbol
EMAGIN CORP [ EMAN ]

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

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

3. Date of Earliest Transaction (Month/Day/Year)
12/22/2008

4. 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 Acquired, Disposed of, or Beneficially Owned
1. Title of Security (Instr. 3)	2. Transaction Date (Month/Day/Year)	2A. Deemed Execution Date, if any (Month/Day/Year)	3. Transaction Code (Instr. 8)		4. Securities Acquired (A) or Disposed Of (D) (Instr. 3, 4 and 5)			5. Amount of Securities Beneficially Owned Following Reported Transaction(s) (Instr. 3 and 4)	6. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	7. Nature of Indirect Beneficial Ownership (Instr. 4)
1. Title of Security (Instr. 3)	2. Transaction Date (Month/Day/Year)	2A. Deemed Execution Date, if any (Month/Day/Year)	Code	V	Amount	(A) or (D)	Price		6. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	7. Nature of Indirect Beneficial Ownership (Instr. 4)
Common Stock	12/22/2008		C⁽¹⁾		717,620	A	$0.35	2,693,735	D
Common Stock								276,084	I	By Rainbow Gate Corporation⁽²⁾

Table II - Derivative Securities Acquired, Disposed of, or Beneficially Owned (e.g., puts, calls, warrants, options, convertible securities)
1. Title of Derivative Security (Instr. 3)	2. Conversion or Exercise Price of Derivative Security	3. Transaction Date (Month/Day/Year)	3A. Deemed Execution Date, if any (Month/Day/Year)	4. Transaction Code (Instr. 8)		5. Number of Derivative Securities Acquired (A) or Disposed of (D) (Instr. 3, 4 and 5)		6. Date Exercisable and Expiration Date (Month/Day/Year)		7. Title and Amount of Securities Underlying Derivative Security (Instr. 3 and 4)		8. Price of Derivative Security (Instr. 5)	9. Number of derivative Securities Beneficially Owned Following Reported Transaction(s) (Instr. 4)	10. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	11. Nature of Indirect Beneficial Ownership (Instr. 4)
1. Title of Derivative Security (Instr. 3)	2. Conversion or Exercise Price of Derivative Security	3. Transaction Date (Month/Day/Year)	3A. Deemed Execution Date, if any (Month/Day/Year)	Code	V	(A)	(D)	Date Exercisable	Expiration Date	Title	Amount or Number of Shares	8. Price of Derivative Security (Instr. 5)		10. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	11. Nature of Indirect Beneficial Ownership (Instr. 4)
Amended and Restated 8% Secured Convertible Note	$0.35⁽¹⁾	12/22/2008		C⁽¹⁾			717,620	07/21/2006	12/22/2008	Common Stock	717,620	$251,166.67⁽¹⁾	0	D
Series B Convertible Preferred Stock	$0.75⁽³⁾	12/22/2008		P⁽⁴⁾		4,033		12/22/2008	⁽³⁾⁽⁴⁾	Common Stock	5,377,333	$1,000⁽³⁾	4,033	D
Stock Purchase Warrants (right to buy)	$1.03⁽⁵⁾	12/22/2008		P⁽⁵⁾		1,875,467		12/22/2008	12/22/2013	Common Stock	1,875,467	$1.03⁽⁵⁾	1,875,467	D
Amended and Restated 8% Secured Convertible Note	$0.75⁽³⁾	12/22/2008		H⁽⁶⁾			937,333	07/21/2006	12/22/2008	Common Stock	937,333	$703,000⁽⁶⁾	0	I	By Rainbow Gate Corporation⁽²⁾
Series B Convertible Preferred Stock	$0.75⁽³⁾	12/22/2008		P⁽⁶⁾		703		12/22/2008	⁽³⁾⁽⁶⁾	Common Stock	937,333	$1,000⁽³⁾	703	I	By Rainbow Gate Corporation⁽²⁾
Stock Purchase Warrants (right to buy)	$0.48⁽⁷⁾							⁽⁷⁾	⁽⁷⁾	Common Stock	1,000,000		1,000,000	D
Stock Purchase Warrants (right to buy)	$1.13⁽⁸⁾							⁽⁸⁾	⁽⁸⁾	Common Stock	240,385		240,385	D
Stock Purchase Warrants (right to buy)	$1.03⁽⁹⁾							⁽⁹⁾	⁽⁹⁾	Common Stock	653,333		653,333	I	By Rainbow Gate Corporation⁽²⁾
Stock Purchase Warrants (right to buy)	$2.5⁽¹⁰⁾							⁽¹⁰⁾	⁽¹⁰⁾	Common Stock	29,742		29,742	I	By Rainbow Gate Corporation⁽²⁾
Stock Purchase Warrants (right to buy)	$10⁽¹¹⁾							⁽¹¹⁾	⁽¹¹⁾	Common Stock	54,545		54,545	I	By Rainbow Gate Corporation⁽²⁾

Explanation of Responses:

1. Pursuant to the terms of the Amended and Restated 8% Senior Secured Convertible Note Due 2008 purchased pursuant to the Note Purchase Agreement, dated July 21, 2006, as amended on March 28, 2007, and further amended on July 23, 2007, as part of a private placement with the Issuer, the Reporting Person elected to fully convert the unpaid principal and interest of such Note into shares of Issuer's Common Stock.

2. These securities are owned solely by Rainbow Gate Corporation. The sole member of Stillwater LLC is the investment manager of Rainbow Gate Corporation, and this report shall not be deemed an admission that Stillwater LLC is the beneficial owner of these securities except to the extent of its pecuniary interest therein.

3. The shares of Series B Convertible Preferred Stock have the rights and preferences set forth on the Certificate of Designations of Series B Convertible Preferred Stock filed with the Secretary of State for the State of Delaware on December 19, 2008. The Series B Convertible Preferred Stock has a stated value of $1,000 per share and currently has a conversion price of $0.75 per share.

4. The shares of Series B Convertible Preferred Stock were purchased on December 22, 2008 as part of a private placement with the Issuer in accordance with the Securities Purchase Agreement, dated December 18, 2008, between the Issuer and the Reporting Person.

5. The Stock Purchase Warrants to purchase Issuer's Common Stock were acquired on December 22, 2008 as part of a private placement by the Issuer in accordance with the Securities Purchase Agreement, dated December 18, 2008, between the Issuer and the Reporting Person. The Stock Purchase Warrants have an exercise price of $1.03, are exercisable immediately, and will expire on December 22, 2013.

6. Pursuant to the terms of the Exchange Agreement, dated December 22, 2008, between the Issuer and Rainbow Gate Corporation, Rainbow Gate Corporation exchanged the unpaid principal and interest on its Amended and Restated 8% Senior Secured Convertible Note Due 2008 purchased pursuant to the Note Purchase Agreement, dated July 21, 2006, as amended on July 23, 2007, as part of a private placement with the Issuer, into shares of Series B Convertible Preferred Stock. This exchange is being reported above as the cancellation of such Note and acquisition of the Series B Convertible Preferred Stock.

7. The warrants to purchase Issuer's Common Stock have an exercise price of $0.48 per share, are exercisable immediately, and will expire on July 21, 2011.

8. The warrants to purchase Issuer's Common Stock are exercisable immediately, will expire on April 2, 2013 and originally had an exercise price of $1.30 per share, but due to the Issuer's execution of Amendment No. 3 to the Loan and Security Agreement with Moriah Capital, LP and the Issuer's execution of the Securities Purchase Agreement with the Reporting Person and the Issuer's execution of the Exchange Agreement with Rainbow Gate Corporation, Ginola Limited and Navacorp III LLC, the warrants were re-priced to $1.13 per share in accordance with the terms of the original warrant.

9. The warrants to purchase Issuer's Common Stock have an exercise price of $1.03, are exercisable immediately, and will expire on July 21, 2011.

10. The warrants to purchase Issuer's Common Stock are exercisable immediately, will expire on April 25, 2010, and had an exercise price of $3.45 per share, but due to the Issuer's execution of Amendment No. 3 to the Loan and Security Agreement with Moriah Capital, LP and the Issuer's execution of the Securities Purchase Agreement with the Reporting Person and the Issuer's execution of the Exchange Agreement with Rainbow Gate Corporation, Ginola Limited and Navacorp III LLC, the warrants were re-priced to $2.50 per share in accordance with the terms of the original warrant.

11. The warrants to purchase Issuer's Common Stock have an exercise price of $10.00 per share, are exercisable immediately, and will expire on October 20, 2010.

	/s/ Mortimer D.A. Sackler, President of Stillwater LLC	12/24/2008
	** 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 4 (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).
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