In the formation of Modern Hebrew denominative verbs, two structural properties are transferred from the base to the derived form: the consonantal root and the consonant cluster. While the model of Root-to-Template Association (McCarthy 1981) is largely based on root transfer, it fails to account for cluster transfer. In this paper I argue that the model which can actually account for cluster transfer as well as root transfer is what I will term here Stem Modification (Steriade 1988). Within this model, segmental and prosodic adjustments are made on the base itself and not on some designated material extracted from the base. This approach to stem formation also eliminates the notion of the consonantal root from the grammar of Modern Hebrew.