Ownership Submission
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, Section 17(a) of the Public Utility Holding Company Act of 1935 or Section 30(h) of the Investment Company Act of 1940
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(Print or Type Responses)
1. Name and Address of Reporting Person *
  Gaehde Nicholas C
2. Date of Event Requiring Statement (Month/Day/Year)
08/21/2017
3. Issuer Name and Ticker or Trading Symbol
ROSETTA STONE INC [RST]
(Last)
(First)
(Middle)
1621 NORTH KENT STREET, SUITE 1200
4. Relationship of Reporting Person(s) to Issuer
(Check all applicable)
_____ Director _____ 10% Owner
__X__ Officer (give title below) _____ Other (specify below)
President, Lexia Learning
5. If Amendment, Date Original Filed(Month/Day/Year)
(Street)

ARLINGTON, VA 22209
6. Individual or Joint/Group Filing(Check Applicable Line)
_X_ Form filed by One Reporting Person
___ Form filed by More than One Reporting Person
(City)
(State)
(Zip)
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 58,225
D (1)
 

Reminder: Report on a separate line for each class of securities beneficially owned directly or indirectly. SEC 1473 (7-02)
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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 of Derivative Security: Direct (D) or Indirect (I)
(Instr. 5)
6. Nature of Indirect Beneficial Ownership
(Instr. 5)
Date Exercisable Expiration Date Title Amount or Number of Shares
Employee Stock Option (right to buy)   (2) 08/15/2023 Common Stock 9,421 $ 15.91 (3) D  
Employee Stock Option (right to buy)   (4) 02/14/2024 Common Stock 1,829 $ 11.96 (5) D  
Employee Stock Option (right to buy)   (6) 02/12/2025 Common Stock 3,771 $ 9.78 (7) D  
Employee Stock Option (right to buy)   (8) 02/19/2026 Common Stock 40,391 $ 7.47 (9) D  

Reporting Owners

Reporting Owner Name / Address Relationships
Director 10% Owner Officer Other
Gaehde Nicholas C
1621 NORTH KENT STREET
SUITE 1200
ARLINGTON, VA 22209
      President, Lexia Learning  

Signatures

Sonia Galindo, Attorney-in-fact 08/23/2017
**Signature of Reporting Person Date

Explanation of Responses:

* 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).
(1) Includes 47,562 shares of restricted common stock on which forfeiture restrictions have not yet lapsed.
(2) Options vest over four years at a rate of 1/4 per year on the anniversary of the grant date, August 15, 2013.
(3) The exercise price is equal to the closing price of the common stock of the Issuer on the New York Stock Exchange on August 15, 2013, the date of grant.
(4) Options vest over four years at a rate of 1/4 per year on the anniversary of the grant date, February 14, 2014.
(5) The exercise price is equal to the closing price of the common stock of the Issuer on the New York Stock Exchange on February 14, 2014, the date of grant.
(6) Options vest over four years at a rate of 1/4 per year on the anniversary of the grant date, February 12, 2015.
(7) The exercise price is equal to the closing price of the common stock of the Issuer on the New York Stock Exchange on February 12, 2015, the date of grant.
(8) Options vest over four years at a rate of 1/4 per year on the anniversary of the grant date, February 19, 2016.
(9) The exercise price is equal to the closing price of the common stock of the Issuer on the New York Stock Exchange on February 19, 2016, the date of grant.
 
Remarks:
Mr. Gaehde was designated a Section 16 Officer, effective August 21, 2017, by the Rosetta Stone Inc. Board of Directors on July 28, 2017.

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