##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-K
 þ
    
    Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 for the
fiscal year ended December 31, 2007.
 OR
 o
    
    Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 for the transition period from  to
 Commission File Number 1-13053
 STILLWATER MINING COMPANY
  DELAWARE
    
    81-0480654(State or other jurisdiction
    
    (I.R.S. Employerof incorporation or organization)
    
    Identification No.)
 1321 DISCOVERY DRIVE, BILLINGS, MONTANA 59102
 (406) 373-8700
 Securities registered pursuant to Section 12(b) of the Act:
 NAME OF EACH EXCHANGETITLE OF EACH CLASS
    
    ON WHICH REGISTEREDCommon Stock, $0.01 par value
    
    The New York Stock ExchangePreferred Stock Purchase Rights
    
    The New York Stock Exchange
 Securities registered pursuant to Section 12(g) of the Act: None
 o þ
 o þ
 þ o
 þ
  Large accelerated filer o
    
    Accelerated filer þ
    
    Non-accelerated filer   o
(Do not check if a smaller reporting company)
    
    Smaller Reporting Company o
 o þ
   DOCUMENTS INCORPORATED BY REFERENCE
 Certain information required in Part III of this Annual Report on Form 10-K is incorporated
herein by reference to the registrants Proxy Statement for its 2008 Annual Meeting of
Stockholders.




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##### 



TABLE OF CONTENTS
 GLOSSARYPART IITEMS 1, 1A AND 2
    
    BUSINESS, RISK FACTORS AND PROPERTIES
    
    
    6ITEM 3
    
    LEGAL PROCEEDINGS
    
    
    40ITEM 4
    
    SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
    
    
    40PART IIITEM 5
    
    MARKET FOR REGISTRANTS COMMON EQUITY RELATED
STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY
SECURITIES
    
    
    41ITEM 6
    
    SELECTED FINANCIAL DATA
    
    
    42ITEM 7
    
    MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
    
    
    50ITEM 7A
    
    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
    
    
    68ITEM 8
    
    FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
    
    
    71ITEM 9
    
    CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE
    
    
    101ITEM 9A
    
    CONTROLS AND PROCEDURES
    
    
    101ITEM 9B
    
    OTHER INFORMATION
    
    
    102PART IIIITEM 10
    
    DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
    
    
    102ITEM 11
    
    EXECUTIVE COMPENSATION
    
    
    104ITEM 12
    
    SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT AND RELATED STOCKHOLDER MATTERS
    
    
    104ITEM 13
    
    CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS,
AND DIRECTOR INDEPENDENCE
    
    
    104ITEM 14
    
    PRINCIPAL ACCOUNTING FEES AND SERVICES
    
    
    104PART IVITEM 15
    
    EXHIBITS, FINANCIAL STATEMENT SCHEDULES
    
    
    104SIGNATURES
    
    
    108Consent of KPMG LLPConsent of Behre Dolbear & Company IncRule 13a-14(a)/15d-14(a) Certification of CEORule 13a-14(a)/15d-14(a) Certification of VP and CFOSection 1350 CertificationSection 1350 Certification




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GLOSSARY OF SELECTED MINING TERMS
  Adit
    
    A horizontal tunnel or drive, open to the surface at one end, which is used as an
entrance to a mine.Anorthosite
    
    Igneous rock composed almost wholly of the mineral plagioclase feldspar.Assay
    
    The analysis of the proportions of metals in ore, or the testing of an ore or mineral for
composition, purity, weight, or other properties of commercial interest.Catalysts
    
    Catalysts are materials that facilitate one or more chemical reactions without being
consumed in the reaction themselves. As referenced in this report, platinum-group metals
serve as catalysts within the catalytic converters used in automotive exhaust and
pollution control systems and, where so indicated, within similar applications in
petroleum refining or other chemical processes.Close-spaced drilling
    
    The drilling of holes designed to extract representative samples of rock in a target area.Concentrate
    
    A mineral processing product that generally describes the material that is produced after
crushing and grinding ore effecting significant separation of gangue (waste) minerals
from the metal and/or metal minerals, and discarding the waste and minor amounts of metal
and/or metal minerals. The resulting concentrate of metal and/or metal minerals
typically has an order of magnitude higher content of metal and/or metal minerals than
the beginning ore material.Crystallize
    
    Process by which matter becomes crystalline (solid) from a gaseous, fluid or dispersed
state. The separation, usually from a liquid phase on cooling, of a solid crystalline
phase.Cut-off grade
    
    The lowest grade of mineralized material that qualifies as ore in a given deposit. The
grade above which minerals are considered economically mineable considering the following
parameters: estimates over the relevant period of mining costs, ore treatment costs,
general and administrative costs, smelting and refining costs, royalty expenses,
by-product credits, process and refining recovery rates and PGM prices.Decline
    
    A gently sloped underground excavation constructed for purposes of moving mobile
equipment, materials, supplies or personnel from surface openings to deeper mine workings
or as an alternative to hoisting in a shaft for mobilization of equipment and materials
between mine levels.Dilution
    
    An estimate of the amount of waste or low-grade mineralized rock which will be mined with
the ore as part of normal mining practices in extracting an orebody.Drift
    
    A major horizontal access tunnel used for the transportation of ore or waste.Ductility
    
    Property of a solid material that undergoes more or less plastic deformation before it
ruptures. The ability of a material to stretch without fracturing.Fault
    
    A geologic fracture or a zone of fractures along which there has been displacement of the
sides relative to one another parallel to the fracture.Filter cake
    
    The PGM-bearing product that is shipped from the base metal refinery, as the Companys
final product, to a third-party toll refinery for the final extractive stages in the
refining process.
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Footwall
    
    The underlying side of a fault, orebody, or mine working; especially the wall rock
beneath an inclined vein, fault, or reef.Gabbro rocks
(See Mafic/Ultramafic)
    
    A group of dark-colored igneous rocks composed primarily of the minerals plagioclase
feldspar and clinopyroxene, with minor orthopyroxene.Gangue material
    
    The non-metalliferous or waste metalliferous mineral in the ore.Grade
    
    The average metal content, as determined by assay of a ton of ore. For precious metals,
grade is normally expressed as troy ounces per ton of ore or as grams per metric tonne of
ore.Hanging wall
    
    The overlying side of a fault, orebody, or mine working; especially the wall rock above
an inclined vein, fault, or reef. (Compare footwall.)Hoist
    
    See shaftJackleg drill
    
    A manually operated rock drill, generally powered by compressed air, used to drill holes
for blasting rock and to install ground support hardware.Lenticular-shaped
    
    Resembling in shape the cross section of a double-convex lens.Load-haul-dump
    
    A vehicle used underground to scoop up mined material and move it to a central collection
or discharge point. Generally called an LHD by miners.Lode claims
    
    Claims to the mineral rights along a lode (vein) structure of mineralized material on
Federal land; typically in the U.S. lode claims are 1,500 feet in length and 600 feet
wide along the trend of the mineralized material.Mafic rocks
    
    Igneous rocks composed chiefly of dark, ferromagnesian minerals in addition to
lighter-colored feldspars.Matrix
    
    The finer-grained material between the larger particles of a rock or the material
surrounding mineral particles.Mill
    
    A processing plant that produces a concentrate of the valuable minerals or metals
contained in an ore. The concentrate must then be treated in some other type of plant,
such as a smelter, to effect recovery of the pure metal. Term used interchangeably with
concentrator.Millsite claims
    
    Claiming of Federal land for millsite purposes or other operations connected with mining
lode claims. Used for nonmineralized land not necessarily contiguous with the vein or
lode.Mineral beneficiation
    
    A treatment process separating the valuable minerals from the host material.Mineralization
    
    The concentration of metals and their compounds in rocks, and the processes involved
therein.Mineralized material
    
    A mineralized body which has been delineated by appropriately spaced drilling and/or
underground sampling to support a general estimate of available tonnage and average grade
of metals. Such a deposit does not qualify as a reserve until a comprehensive evaluation
based upon unit cost, grade, recoveries, and other material factors conclude legal and
economic feasibility.Mouat Agreement
    
    Mining and Processing Agreement dated March 16, 1984 regarding the Mouat family. The
Mouat royalty stems back to the formation of Stillwater Mining Company at which time
claims staked by the Mouats forebears in 1876 were leased to Stillwater Mining Company.
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Net smelter royalty
    
    A share of revenue paid by the Company to the owner of a royalty interest generally
calculated based on the imputed value of the PGM concentrate delivered to the smelter.
At Stillwater Mining Company, royalties are calculated on the mineral production subject
to each royalty as a percentage of the revenue received by the Company after deducting
treatment, refining and transportation charges paid to third parties, and certain other
costs incurred in connection with processing the concentrate at the Columbus smelter.Norite
    
    Coarse-grained igneous rock composed of the minerals plagioclase feldspar and
orthopyroxene.Ore
    
    That part of a mineral deposit which could be economically and legally extracted or
produced at the time of reserve determination.Outcrop
    
    The part of a rock formation that appears at the earths surface often protruding above
the surrounding ground.PGM
    
    The platinum group metals collectively and in any combination of palladium, platinum,
rhodium, ruthenium, osmium, and iridium. Reference to PGM grades for the Companys
operations include measured quantities of palladium and platinum only.PGM rich matte
    
    Matte is an intermediate product of smelting; an impure metallic sulfide mixture made by
melting sulfide ore concentrates. PGM rich matte is a matte with an elevated level of
platinum group metals.Probable
(indicated) 
reserves
    
    Reserves for which quantity and grade and/or quality are computed from information
similar to that used for proven (measured) reserves, but the sites for inspection,
sampling, and measurement are farther apart or are otherwise less adequately spaced. The
degree of assurance, although lower than that for proven (measured) reserves, is high
enough to assume continuity between points of observation.Proven (measured) 
reserves
    
    Reserves for which (a) quantity is computed from dimensions revealed in outcrops,
trenches, workings or drill holes; grade and/or quality are computed from the results of
detailed sampling; and (b) the sites for inspection, sampling and measurement are spaced
so closely and the geologic character is so well defined that size, shape, depth and
mineral content of reserves are well established.Recovery
    
    The percentage of contained metal actually extracted from ore in the course of processing
such ore.Reef
    
    A layer precipitated within the Stillwater Layered Igneous Complex enriched in platinum
group metal-bearing minerals, chalcopyrite, pyrrhotite, pentlandite, and other sulfide
materials. The J-M Reef, which the Company mines, occurs at a regular stratigraphic
position within the Stillwater Complex. Note: this use of reef is uncommon and
originated in South Africa where it is used to describe the PGM-bearing Merensky, UG2,
and other similar layers in the Bushveld Complex.Refining
    
    The final stage of metal production in which residual impurities are removed from the
metal.Reserves
    
    That part of a mineral deposit which could be economically and legally extracted or
produced at the time of the reserve determination.Recycling materials
    
    Spent PGM-bearing materials collected for reprocessing from automotive, petroleum,
chemical, medical, food and other catalysts. Additionally, PGMs for recycling may be
sourced from scrap electronics and thermocouples, old jewelry and materials used in
manufacturing glass.
 4




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Shaft
    
    A vertical or steeply inclined excavation for the purposes of opening and servicing an
underground mine. It is usually equipped with a hoist at the top which lowers and raises
a conveyance for handling personnel and materials.Slag
    
    Slag is a nonmetallic product resulting from the mutual dissolution of flux and
nonmetallic impurities during smelting. A silica rich slag is a smelting slag that
contains a relatively high level of silica.Sill
    
    (1) With respect to a mine opening, the base or floor of the excavated area (stope); (2)
With respect to intrusive rock, a tabular intrusive unit that is conformable with
surrounding rock layers.Slusher
    
    (1) An electric double-drum winch with two steel ropes attached to an open-bottomed scoop
that transports (drags) ore from the rock face to a loading point, where the ore is
discharged. (2) A very selective mining method in which small ore stopes are mined using
a slusher.Smelting
    
    Heating ore or concentrate material with suitable flux materials at high temperatures
creating a fusion of these materials to produce a melt consisting of two layers with a
slag of the flux and gangue (waste) minerals on top and molten impure metals below. This
generally produces an unfinished product (matte) requiring refining.Sponge
    
    A granular (shot) form of PGM. Commonly, the form required for manufacture of many
PGM-based chemicals and catalysts.Stope
    
    A localized area of underground excavation from which ore is extracted.Strike
    
    The course, direction or bearing of a vein or a layer of rock.Tailings
    
    That portion of the mined material that remains after the valuable minerals have been
extracted.Tolling
    
    Processing of material owned by others for a fee without taking title to the material.Troy ounce
    
    A unit measure used in the precious metals industry. A troy ounce is equal to 31.10
grams. The amounts of palladium and platinum produced and/or sold by the Company are
reported in troy ounces. There are 12 troy ounces to a troy pound.Ultramafic rocks
    
    Igneous rocks composed chiefly of dark, ferromagnesian minerals in the absence of
significant lighter-colored feldspars.Vein
    
    A mineralized zone having regular development in length, width and depth that clearly
separates it from neighboring rock.Wall rock
    
    The rock adjacent to, enclosing, or including a vein, layer, or dissemination of ore
minerals. See Hanging wall and Footwall above.
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PART I
 
 ITEMS 1, 1A AND 2
 BUSINESS, RISK FACTORS AND PROPERTIES
 INTRODUCTION AND 2007 HIGHLIGHTS
       6




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Highlights:
 
    
    The Companys revenues, in terms of dollars and ounces sold, for 2007 and 2006 were:
 Year ended December 31,
    
    Sales Revenues (1)
    
    
    Troy Ounces Sold(in thousands)
    
    Palladium
    
    
    Platinum
    
    
    Rhodium
    
    
    Other
    
    
    Total
    
    
    Palladium
    
    
    Platinum
    
    
    Rhodium
    
    
    Total2007Mine production
    
    $
    162,811
    
    
    $
    114,645
    
    
    $
    
    
    
    $
    
    
    
    $
    277,456
    
    
    
    425
    
    
    
    120
    
    
    
    
    
    
    
    545PGM recycling
    
    
    36,505
    
    
    
    149,061
    
    
    
    138,798
    
    
    
    2,030
    
    
    
    326,394
    
    
    
    102
    
    
    
    119
    
    
    
    24
    
    
    
    245Other
    
    
    15,365
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    15,365
    
    
    
    44
    
    
    
    
    
    
    
    
    
    
    
    44Total
    
    $
    214,681
    
    
    $
    263,706
    
    
    $
    138,798
    
    
    $
    2,030
    
    
    $
    619,215
    
    
    
    571
    
    
    
    239
    
    
    
    24
    
    
    
    8342006Mine production
    
    $
    172,171
    
    
    $
    120,033
    
    
    $
    
    
    
    $
    
    
    
    $
    292,204
    
    
    
    466
    
    
    
    138
    
    
    
    
    
    
    
    604PGM recycling
    
    
    31,987
    
    
    
    143,259
    
    
    
    93,206
    
    
    
    1,489
    
    
    
    269,941
    
    
    
    100
    
    
    
    128
    
    
    
    22
    
    
    
    250Sales of palladium received in
Norilsk Nickel transaction
    
    
    17,637
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    17,637
    
    
    
    63
    
    
    
    
    
    
    
    
    
    
    
    63Other
    
    
    10,538
    
    
    
    2,530
    
    
    
    20,298
    
    
    
    
    
    
    
    33,366
    
    
    
    33
    
    
    
    2
    
    
    
    6
    
    
    
    41Total
    
    $
    232,333
    
    
    $
    265,822
    
    
    $
    113,504
    
    
    $
    1,489
    
    
    $
    613,148
    
    
    
    662
    
    
    
    268
    
    
    
    28
    
    
    
    958
 
 (1)
    
    Sales of by-products are reflected as a reduction to costs of metals sold and not as revenue. 
    
    The Company reported a net loss of $14.3 million, or $0.15 per diluted share, in 2007,
compared to net income of $7.9 million, or $0.09 per diluted share, in 2006. See
Managements Discussion and Analysis of Financial Condition and Results of Operations  Year
Ended December 31, 2007 Compared to Year Ended December 31, 2006.
 
    
    Beginning in 2005, the Company embarked upon long-term changes to its mining operations
that, when fully implemented, are expected to increase production levels and reduce operating
costs. These changes include continuing to advance the safety systems, increasing the
developed state of both mines, expanding the use of selective mining methods, increasing
production levels, and reducing operating costs. These efforts continued during 2006 and
2007. The Company believes that its implementation of more selective mining methods, best
suited to each mining area, will reduce the amount of waste rock mined, thereby increasing the
effective ore grade realized. According to plan, such increases in effective realized ore
grade, along with measured growth in production rates, are expected to generate economies of
scale that will reduce unit production costs over time. These operational efforts are
discussed in more detail in Managements Discussion and Analysis of Financial Condition and
Results of Operations.
 
    
    In 2007, the Company produced a total of 537,000 ounces of palladium and platinum compared
to 601,000 ounces in 2006. Total consolidated cash cost per ounce (a non-GAAP measure) was
$328 in 2007, compared with $295 in 2006. This increase in cash costs per ounce reflected the
effect of lower production at both mines. Lower production at
Stillwater Mine was attributable to
various labor issues during 2007, including a change in work schedule that was followed by higher attrition rates among skilled miners and maintenance workers at the Stillwater Mine,
plus the effects of contract negotiations and a week-long strike at the Stillwater Mine. See
Selected Financial and Operating Data for further discussion of non-GAAP measures.
 
    
    Revenues from PGM recycling grew 21% during 2007, increasing to $326.4 million in 2007,
from $269.9 million in 2006. Recycled ounces sold, excluding tolled material, declined
slightly in 2007 to 245,000 ounces compared to 250,000 ounces in 2006, however, the Companys
combined average realization on recycling sales (which include palladium, platinum and
rhodium) increased to $1,312 per ounce in 2007 from $1,078 per ounce in 2006. The Company
processed increased volumes of recycled materials on a tolling basis in 2007. The Company
toll processed approximately 112,000 ounces of PGMs during 2007, up from approximately 90,000
tolled ounces in 2006. Thus, total recycle volume increased to approximately 373,000 ounces
of PGMs in 2007 up 7.8% from approximately 346,000 ounces in 2006.
 
    
    The Companys 2007 capital expenditures totaled $87.9 million, down from $97.8 million in
2006. Capital spending in both years reflected efforts to advance the developed state of the
mines by accelerating the delineation and development of proven reserves and by completing
various major infrastructure projects. Capitalized development
expenditures totaled $65.5 million in 2007, down from $74.8 million in 2006. Development
expenditures were lower in 2007 because the Companys mines are approaching optimal development
levels. Improving the developed state of the mines allows for earlier and better economic
analysis of appropriate mining methods in each area, supports growth in mining rates and
contributes to more efficient and cost-effective mining. Infrastructure projects completed
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during 2007 included the development of a new ventilation drift at the Stillwater Mine and some new
surface facilities at the East Boulder Mine. For a discussion of certain risks associated with the
Companys business, please read Business and
Properties  Current Operations, and  Risk Factors
and Managements Discussion and Analysis of Financial Condition and Results of Operations.
 HISTORY OF THE COMPANY
    GEOLOGY OF THE J-M REEF
     8




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ORE RESERVES
 proven probable
 Methodology
     9




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SEC Guidelines
    Results
   Proven and Probable Ore Reserves
  10




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DECEMBER 31, 2007
    
    
    DECEMBER 31, 2006
    
    
    DECEMBER 31, 2005AVERAGE
    
    
    CONTAINED
    
    
    
    
    
    
    AVERAGE
    
    
    CONTAINED
    
    
    
    
    
    
    AVERAGE
    
    
    CONTAINEDTONS
    
    
    GRADE
    
    
    OUNCES
    
    
    TONS
    
    
    GRADE
    
    
    OUNCES
    
    
    TONS
    
    
    GRADE
    
    
    OUNCES(000s)
    
    
    (OUNCE/TON)
    
    
    (000S)
    
    
    (000s)
    
    
    (OUNCE/TON)
    
    
    (000S)
    
    
    (000s)
    
    
    (OUNCE/TON)
    
    
    (000S)Stillwater Mine (2)Proven Reserves
    
    
    2,784
    
    
    
    0.65
    
    
    
    1,796
    
    
    
    2,775
    
    
    
    0.66
    
    
    
    1,818
    
    
    
    2,458
    
    
    
    0.68
    
    
    
    1,664Probable Reserves
    
    
    14,360
    
    
    
    0.61
    
    
    
    8,791
    
    
    
    15,539
    
    
    
    0.63
    
    
    
    9,749
    
    
    
    15,638
    
    
    
    0.63
    
    
    
    9,812Total Proven and Probable
Reserves (1)
    
    
    17,144
    
    
    
    0.62
    
    
    
    10,586
    (4)
    
    
    18,314
    
    
    
    0.63
    
    
    
    11,567
    
    
    
    18,096
    
    
    
    0.63
    
    
    
    11,476East Boulder Mine (2)Proven Reserves
    
    
    2,017
    
    
    
    0.46
    
    
    
    921
    
    
    
    2,011
    
    
    
    0.45
    
    
    
    902
    
    
    
    1,665
    
    
    
    0.47
    
    
    
    788Probable Reserves
    
    
    20,868
    
    
    
    0.46
    
    
    
    9,660
    
    
    
    22,116
    
    
    
    0.48
    
    
    
    10,579
    
    
    
    22,190
    
    
    
    0.53
    
    
    
    11,818Total Proven and Probable
Reserves (1)
    
    
    22,885
    
    
    
    0.46
    
    
    
    10,581
    
    
    
    24,127
    
    
    
    0.48
    
    
    
    11,481
    
    
    
    23,855
    
    
    
    0.53
    
    
    
    12,606Total Company Reserves (2)Proven Reserves
    
    
    4,800
    
    
    
    0.57
    
    
    
    2,717
    
    
    
    4,786
    
    
    
    0.57
    
    
    
    2,721
    
    
    
    4,123
    
    
    
    0.59
    
    
    
    2,452Probable Reserves
    
    
    35,228
    
    
    
    0.52
    
    
    
    18,451
    
    
    
    37,656
    
    
    
    0.54
    
    
    
    20,327
    
    
    
    37,828
    
    
    
    0.57
    
    
    
    21,630Total Proven and Probable
Reserves (1)
    
    
    40,028
    
    
    
    0.53
    
    
    
    21,167
    (3)(4)
    
    
    42,442
    
    
    
    0.54
    
    
    
    23,048
    (3)
    
    
    41,951
    
    
    
    0.57
    
    
    
    24,082
    (3)
 
 (1)
    
    Reserves are defined as that part of a mineral deposit that could be economically and legally
extracted or produced at the time of the reserve determination. Proven ore reserves are
defined as ore reserves for which (a) quantity is computed from dimensions revealed in
outcrops, trenches, workings or drill holes; grade and/or quality are computed from the
results of detailed sampling and (b) the sites for inspection, sampling and measurement are
spaced so closely and the geologic character is so well defined that size, shape, depth and
mineral content of ore reserves are well-established. Probable ore reserves are defined as
ore reserves for which quantity and grade and/or quality are computed from information similar
to that used for proven ore reserves, but the sites for inspection, sampling, and measurement
are farther apart or are otherwise less adequately spaced. The degree of assurance, although
lower than that for proven ore reserves, is high enough to assume continuity between points of
observation. The proven and probable ore reserves reflect variations in the PGM content and
structural impacts on the J-M Reef. These variations are the result of localized depositional
and structural influences on the distributions of economic PGM mineralization. Geologic
domains within the reserve boundaries of the two mines include areas where as little as 0% and
up to 100% of the J-M Reef is economically mineable. The ore reserve estimate gives effect to
these assumptions. See Business and Properties  Risk Factors and Managements Discussion
and Analysis of Financial Condition and Results of Operations  Factors That May Affect Future
Results and Financial Condition.(2)
    
    Expressed as palladium plus platinum in-situ ounces at a ratio of approximately 3.55 parts
palladium to 1 part platinum. Stillwater Mine is at a 3.49 to 1 ratio and the East Boulder
Mine is 3.60 to 1.(3)
    
    Average mining and processing losses of approximately 17.3% must be deducted to arrive at the
estimated saleable ounces.(4)
    
    Columns do not add mathematically due to rounding. Discussion
   11




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##### Table of Contents




    
    Additions to proven ore reserves from new definition drilling that about equaled 2007
ore production and exceeded 2006 production,
    
    Deletions from probable ore reserves as areas are converted by new drilling from
probable to proven ore reserves,
    
    Additions from development activity to convert mineralized inventory to probable ore
reserves,
    
    Additions and deletions from adjustments to ore reserve estimation factors and mine
planning criteria.
   
  IMPAIRMENT OF LONG-LIVED ASSETS
 Accounting for
the Impairment or Disposal of Long-Lived Assets
  12




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##### Table of Contents



CURRENT OPERATIONS
  Properties and Facilities  February 2008
 
  
    
    Surface access limitations (property ownership and environmental sensitivity);
 
    
    Topographic and climatic extremes involving rugged mountainous terrain and substantial
elevation differences;
 
    
    Specific characteristics of the mineralized zone (narrow  average width 5 feet, depth  up
to 1.5 miles of vertical extent, and long  approximately 28 miles in length);
 
    
    Downward angle of mineralized zone dipping from near vertical to 38 degrees;
 
    
    A deposit which extends both laterally and to depth from available mine openings; and
 
    
    Proven and probable ore reserves extending for a lateral distance of approximately 34,000
feet at the Stillwater Mine and approximately 17,000 feet at the East Boulder Mine  a
combined distance underground of approximately 9.7 miles.
 13




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##### Table of Contents



STILLWATER MINE
       14




---



##### Table of Contents



15




---



##### Table of Contents



EAST BOULDER MINE
   
   16




---



##### Table of Contents



EXPLORATION AND DEVELOPMENT ACTIVITIES
      17




---



##### Table of Contents



Location and Development Activity
    
    2007
    
    2006
    
    2005Stillwater MineNew Primary Development (equivalent feet)(1)
    
    
    26,033
    
    
    
    31,156
    
    
    
    37,806New Footwall Lateral (equivalent feet)(1)
    
    
    10,987
    
    
    
    15,257
    
    
    
    19,863New Definition drilling (feet)
    
    
    311,607
    
    
    
    436,920
    
    
    
    505,616East Boulder MineNew Primary Development (equivalent feet)(1)
    
    
    13,015
    
    
    
    15,235
    
    
    
    18,349New Footwall Lateral (equivalent feet)(1)
    
    
    6,283
    
    
    
    6,077
    
    
    
    10,605New Definition drilling (feet)
    
    
    179,845
    
    
    
    226,597
    
    
    
    242,849
 
 (1)    Based on one linear foot of excavation, 11 feet wide by 12 feet high (cross-section of
132 ft.2). ETALLURGICAL COMPLEX
 Smelter
    Base Metal Refinery
  18




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##### Table of Contents



RECYCLING ACTIVITIES
      OTHER PROPERTIES
  19




---



##### Table of Contents



CREDIT AGREEMENT
        20




---



##### Table of Contents



Credit FacilityScheduled RepaymentsYear ended
    
    (in thousands)2008
    
    $
    1,0192009
    
    
    1,0192010
    
    
    96,305Total
    
    $
    98,343
 PGM SALES AND HEDGING ACTIVITIES
 Mine Production
   21




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##### Table of Contents



PALLADIUM
    
    PLATINUMSubject to
    
    Subject to
    
    Subject to
    
    Subject toFloor Prices
    
    Ceiling Prices
    
    Floor Prices
    
    Ceiling Prices% of Mine
    
    Avg. Floor
    
    % of Mine
    
    Avg. Ceiling
    
    % of Mine
    
    Avg. Floor
    
    % of Mine
    
    Avg. CeilingYear
    
    Production
    
    Price
    
    Production
    
    Price
    
    Production
    
    Price
    
    Production
    
    Price2008
    
    
    100
    %
    
    $
    360
    
    
    
    20
    %
    
    $
    975
    
    
    
    70
    %
    
    $
    425
    
    
    
    14
    %
    
    $
    8502009
    
    
    100
    %
    
    $
    364
    
    
    
    20
    %
    
    $
    975
    
    
    
    70
    %
    
    $
    425
    
    
    
    14
    %
    
    $
    8502010
    
    
    100
    %
    
    $
    360
    
    
    
    20
    %
    
    $
    975
    
    
    
    70
    %
    
    $
    425
    
    
    
    14
    %
    
    $
    8502011
    
    
    20
    %
    
    $
    300
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2012
    
    
    20
    %
    
    $
    300
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
 Accounting for Derivative Instruments and Certain
Hedging Activities Amendment of Statement 133 on Derivative Instruments and
Hedging Activities, Accounting for Derivative Instruments and Hedging
Activities.
  Recycling Activities
   22




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##### Table of Contents



Other activities
  Palladium acquired in connection with Norilsk Nickel transaction
  TITLE AND ROYALTIES
   23




---



##### Table of Contents



SAFETY
     EMPLOYEES
  Number ofEmployees atSITE
    
    December 31,2007
    
    2006Stillwater Mine
    
    
    845
    
    
    
    972East Boulder Mine
    
    
    551
    
    
    
    523Smelter and Refinery Complex
    
    
    161
    
    
    
    156Columbus and Billings Administrative Support
    
    
    68
    
    
    
    68Total
    
    
    1,625
    
    
    
    1,719
 24




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##### Table of Contents



REGULATORY AND ENVIRONMENTAL MATTERS
 General
     Permitting and Reclamation
 25




---



##### Table of Contents



MMC NORILSK NICKEL INVESTMENT
  26




---



##### Table of Contents



COMPETITION: PALLADIUM AND PLATINUM MARKET
 GENERAL
   GLOBAL DEMAND
  Platinum 2007 Interim Review Report
   27




---



##### Table of Contents



(BAR GRAPH)
    
    (BAR GRAPH)
 Charts reproduced from the Johnson Matthey Platinum 2007 Interim Review. Consent to cite
Johnson Matthey was neither sought nor obtained.
      28




---



##### Table of Contents



GLOBAL SUPPLY
   (BAR GRAPH)
    
    (BAR GRAPH)
 Charts reproduced from the Johnson Matthey Platinum 2007 Interim Review. Permission to
reproduce was neither sought nor obtained.
   29




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##### Table of Contents



PRICES
  PALLADIUM
    
    PLATINUMYEAR
    
    HIGH
    
    LOW
    
    AVERAGE
    
    HIGH
    
    LOW
    
    AVERAGE1996
    
    $
    144
    
    
    $
    114
    
    
    $
    128
    
    
    $
    432
    
    
    $
    367
    
    
    $
    3971997
    
    $
    239
    
    
    $
    118
    
    
    $
    177
    
    
    $
    497
    
    
    $
    343
    
    
    $
    3961998
    
    $
    419
    
    
    $
    201
    
    
    $
    284
    
    
    $
    429
    
    
    $
    334
    
    
    $
    3721999
    
    $
    454
    
    
    $
    285
    
    
    $
    358
    
    
    $
    457
    
    
    $
    342
    
    
    $
    3772000
    
    $
    970
    
    
    $
    433
    
    
    $
    680
    
    
    $
    622
    
    
    $
    414
    
    
    $
    5442001
    
    $
    1,090
    
    
    $
    315
    
    
    $
    604
    
    
    $
    640
    
    
    $
    415
    
    
    $
    5292002
    
    $
    435
    
    
    $
    222
    
    
    $
    338
    
    
    $
    607
    
    
    $
    453
    
    
    $
    5392003
    
    $
    269
    
    
    $
    148
    
    
    $
    201
    
    
    $
    840
    
    
    $
    603
    
    
    $
    6912004
    
    $
    333
    
    
    $
    178
    
    
    $
    230
    
    
    $
    936
    
    
    $
    767
    
    
    $
    8462005
    
    $
    295
    
    
    $
    172
    
    
    $
    201
    
    
    $
    1,012
    
    
    $
    844
    
    
    $
    8972006
    
    $
    404
    
    
    $
    261
    
    
    $
    320
    
    
    $
    1,355
    
    
    $
    982
    
    
    $
    1,1432007
    
    $
    382
    
    
    $
    320
    
    
    $
    355
    
    
    $
    1,544
    
    
    $
    1,118
    
    
    $
    1,3032008*
    
    $
    519
    
    
    $
    364
    
    
    $
    404
    
    
    $
    2,180
    
    
    $
    1,531
    
    
    $
    1,742
 
 *
    
    (Through February 22, 2008) AVAILABLE INFORMATION
  RISK FACTORS
  VULNERABILITY TO METALS PRICE VOLATILITY-CHANGES IN SUPPLY AND DEMAND COULD REDUCE MARKET PRICES
   30




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##### Table of Contents



31




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##### Table of Contents



THE COMPANY DEPENDS UPON A FEW CUSTOMERS AND ITS SALES AND OPERATIONS COULD SUFFER IF IT LOSES ANY
OF THEM
     32




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##### Table of Contents



FAILURE TO RENEW LONG-TERM SALES CONTRACTS FOR OUNCES PRODUCED FROM MINE PRODUCTION COULD RESULT IN
CURTAILMENT OR CLOSURE OF OPERATIONS
  THE COMPANY IS A RELATIVELY HIGH COST PRIMARY PRODUCER
    ACHIEVEMENT OF THE COMPANYS PRODUCTION GOALS IS SUBJECT TO UNCERTAINTIES
    33




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##### Table of Contents



ORE RESERVES ARE VERY DIFFICULT TO ESTIMATE AND ORE RESERVE ESTIMATES MAY REQUIRE ADJUSTMENT IN THE
FUTURE; CHANGES IN ORE GRADES, MINING PRACTICES AND ECONOMIC FACTORS COULD MATERIALLY AFFECT THE
COMPANYS PRODUCTION AND REPORTED RESULTS
     Year endedDecember 31,
    
    2007
    
    2006
    
    2005
    
    2004
    
    2003
    
    2002
    
    2001
    
    2000
    
    1999
    
    1998
    
    1997(in percent)Stillwater Mine
    
    
    68
    
    
    
    94
    
    
    
    101
    
    
    
    62
    
    
    
    52
    
    
    
    71
    
    
    
    104
    
    
    
    111
    
    
    
    66
    
    
    
    150
    
    
    
    163East Boulder Mine (1)
    
    
    107
    
    
    
    91
    
    
    
    110
    
    
    
    125
    
    
    
    86
    
    
    
    91
    
    
    
    88
    
    
    
    *
    
    
    
    *
    
    
    
    *
    
    
    
    *
 
 (1)
    
    East Boulder Mine commenced full-time commercial production on January 1, 2002. 34




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##### Table of Contents



AN EXTENDED PERIOD OF LOW PGM PRICES COULD RESULT IN A REDUCTION OF ORE RESERVES AND A POTENTIAL
ASSET IMPAIRMENT WRITEDOWN
    USERS OF PGMS MAY REDUCE THEIR CONSUMPTION AND SUBSTITUTE OTHER MATERIALS FOR PALLADIUM AND
PLATINUM
   35




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##### Table of Contents



IF THE COMPANY IS UNABLE TO OBTAIN SURETY COVERAGE TO COLLATERALIZE ITS RECLAMATION LIABILITIES,
OPERATING PERMITS MAY BE AFFECTED
  MINING RISKS AND POTENTIAL INADEQUACY OF INSURANCE COVERAGE  THE COMPANYS BUSINESS IS SUBJECT TO
SIGNIFICANT RISKS THAT MAY NOT BE COVERED BY INSURANCE
  
    
    unusual and unexpected rock formations affecting ore or wall rock characteristics,
 
    
    ground or slope failures,
 
    
    cave-ins, ground water influx and other mining or ground-related problems,
 
    
    environmental hazards,
 
    
    industrial accidents,
 
    
    organized labor disputes or work slow-downs,
 
    
    metallurgical and other processing, smelting or refining problems,
 
    
    wild fires, flooding and periodic interruptions due to inclement or hazardous weather
conditions or other acts of God,
 
    
    mechanical equipment failure and facility performance problems, and
 
    
    availability and cost of critical materials, equipment and skilled manpower.
  HEDGING AND LONG-TERM SALES CONTRACTS COULD LIMIT THE REALIZATION OF HIGHER METAL PRICES
  36




---



##### Table of Contents



CHANGES TO REGULATIONS AND COMPLIANCE WITH REGULATIONS COULD INCREASE COSTS AND CAUSE DELAYS
     m m
 37




---



##### Table of Contents



THE COMPANY IS SUBJECT TO COVENANTS IN ITS CREDIT AGREEMENTS WHICH IT MAY NOT ALWAYS BE ABLE TO
MEET
  LIMITED AVAILABILITY OF ADDITIONAL MINING PERSONNEL AND UNCERTAINTY OF LABOR RELATIONS MAY AFFECT
THE COMPANYS ABILITY TO ACHIEVE ITS PRODUCTION TARGETS
    UNCERTAINTY OF TITLE TO PROPERTIES  THE VALIDITY OF UNPATENTED MINING CLAIMS IS SUBJECT TO TITLE
RISK
  38




---



##### Table of Contents



RELIANCE ON THIRD PARTIES FOR SOURCING OF RECYCLING MATERIALS
    THE COMPLEXITY OF PROCESSING PLATINUM GROUP METALS POSES OPERATIONAL AND ENVIRONMENTAL RISKS IN
ADDITION TO TYPICAL MINING RISKS
  39




---



##### Table of Contents



ITEM 3
 LEGAL PROCEEDINGS
      
 ITEM 4
 SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
  40




---



##### Table of Contents



PART II
 
 ITEM 5
 MARKET FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER
PURCHASES OF EQUITY SECURITIES
 PERFORMANCE GRAPH
  
 Cumulative Total Return
 12/31/02
    
    12/31/03
    
    12/31/04
    
    12/31/05
    
    12/31/06
    
    12/31/07Stillwater Mining
Company
    
    $
    100.00
    
    
    $
    178.88
    
    
    $
    210.47
    
    
    $
    216.26
    
    
    $
    233.46
    
    
    $
    180.56Peer Group
    
    
    100.00
    
    
    
    138.08
    
    
    
    126.05
    
    
    
    233.52
    
    
    
    394.40
    
    
    
    505.83Russell 2000
    
    
    100.00
    
    
    
    147.25
    
    
    
    174.24
    
    
    
    182.18
    
    
    
    215.64
    
    
    
    212.26
  41




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##### Table of Contents



ITEM 6
 SELECTED FINANCIAL DATA
 (in thousands, except per share and current ratio data)
    
    2007
    
    
    2006
    
    
    2005
    
    
    2004
    
    
    2003INCOME STATEMENT DATARevenues(1)Mine production
    
    $
    277,456
    
    
    $
    292,204
    
    
    $
    264,206
    
    
    $
    266,684
    
    
    $
    240,406PGM recycling
    
    
    326,394
    
    
    
    269,941
    
    
    
    90,695
    
    
    
    76,388
    
    
    
    8,866Sales of palladium received in Norilsk Nickel transaction
    
    
    
    
    
    
    17,637
    
    
    
    87,309
    
    
    
    85,952
    
    
    
    Other
    
    
    15,365
    
    
    
    33,366
    
    
    
    65,252
    
    
    
    18,503
    
    
    
    6,551Total revenues
    
    $
    619,215
    
    
    $
    613,148
    
    
    $
    507,462
    
    
    $
    447,527
    
    
    $
    255,823Costs and ExpensesCosts of metals sold: (1)Mine production
    
    
    203,121
    
    
    
    199,982
    
    
    
    190,171
    
    
    
    173,571
    
    
    
    173,375PGM recycling
    
    
    305,911
    
    
    
    250,444
    
    
    
    85,522
    
    
    
    71,326
    
    
    
    7,988Sales of palladium received in Norilsk Nickel transaction
    
    
    
    
    
    
    10,785
    
    
    
    74,542
    
    
    
    63,774
    
    
    
    Other
    
    
    14,289
    
    
    
    32,300
    
    
    
    65,163
    
    
    
    18,628
    
    
    
    6,728Total costs of metals sold
    
    
    523,321
    
    
    
    493,511
    
    
    
    415,398
    
    
    
    327,299
    
    
    
    188,091Depreciation and amortization (1)Mine production
    
    
    82,396
    
    
    
    83,583
    
    
    
    79,032
    
    
    
    57,321
    
    
    
    41,285PGM recycling
    
    
    142
    
    
    
    100
    
    
    
    55
    
    
    
    48
    
    
    
    71Total depreciation and amortization
    
    
    82,538
    
    
    
    83,683
    
    
    
    79,087
    
    
    
    57,369
    
    
    
    41,356General and administrative (1)
    
    
    28,285
    
    
    
    28,018
    
    
    
    20,464
    
    
    
    19,739
    
    
    
    14,700Impairment of property, plant and equipment
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    390,295Operating income (loss)
    
    $
    (14,929
    )
    
    $
    7,936
    
    
    $
    (7,356
    )
    
    $
    39,480
    
    
    $
    (380,696
    )Total income tax benefit (provision)
    
    $
    
    
    
    $
    (10
    )
    
    $
    (13
    )
    
    $
    (3
    )
    
    $
    74,939Net income (loss)
    
    $
    (14,929
    )
    
    $
    7,929
    
    
    $
    (13,874
    )
    
    $
    29,838
    
    
    $
    (323,260
    )Other comprehensive income (loss), net of tax
    
    $
    9,578
    
    
    $
    1,799
    
    
    $
    (12,437
    )
    
    $
    (4,145
    )
    
    $
    585Comprehensive income (loss)
    
    $
    (4,679
    )
    
    $
    9,728
    
    
    $
    (26,311
    )
    
    $
    25,693
    
    
    $
    (322,675
    )Pro-forma net income (loss) assuming the new amortization method
is applied retroactively (2)
    
    $
    (14,929
    )
    
    $
    7,929
    
    
    $
    (13,874
    )
    
    $
    23,803
    
    
    $
    (241,729
    )Weighted average common shares outstandingBasic
    
    
    92,016
    
    
    
    91,260
    
    
    
    90,702
    
    
    
    90,180
    
    
    
    67,807Diluted
    
    
    92,016
    
    
    
    91,580
    
    
    
    90,702
    
    
    
    90,540
    
    
    
    67,807Basic earnings (loss) per share
    
    $
    (0.15
    )
    
    $
    0.09
    
    
    $
    (0.15
    )
    
    $
    0.33
    
    
    $
    (4.77
    )Diluted earnings (loss) per share
    
    $
    (0.15
    )
    
    $
    0.09
    
    
    $
    (0.15
    )
    
    $
    0.33
    
    
    $
    (4.77
    )Pro-forma amounts assuming the new amortization method
is applied retroactively (2)Basic earnings (loss) per share
    
    $
    (0.15
    )
    
    $
    0.09
    
    
    $
    (0.15
    )
    
    $
    0.26
    
    
    $
    (3.56
    )Diluted earnings (loss) per share
    
    $
    (0.15
    )
    
    $
    0.09
    
    
    $
    (0.15
    )
    
    $
    0.26
    
    
    $
    (3.56
    )CASH FLOW DATANet cash provided by operating activities
    
    $
    56,422
    
    
    $
    96,963
    
    
    $
    141,134
    
    
    $
    136,840
    
    
    $
    47,215Net cash used in investing activities
    
    $
    (80,967
    )
    
    $
    (78,909
    )
    
    $
    (134,261
    )
    
    $
    (77,801
    )
    
    $
    (54,156
    )Net cash provided by (used in) financing activities
    
    $
    (2,379
    )
    
    $
    (9,954
    )
    
    $
    (22,665
    )
    
    $
    1,352
    
    
    $
    29,639
 
 (1)
    
    The 2005, 2004 and 2003 amounts for revenues, costs of metals sold, depreciation and
amortization, and general and administration have been reclassified to conform to current year
presentation.(2)
    
    See Note 3 to the Companys audited financial statements as filed in the Companys 2006
Annual Report on Form 10-K. 42




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##### Table of Contents



ITEM 6
 SELECTED FINANCIAL DATA
 (Continued)
 (in thousands, except per share and current ratio data)
    
    2007
    
    2006
    
    2005
    
    2004
    
    2003BALANCE SHEET DATACash and cash equivalents
    
    $
    61,436
    
    
    $
    88,360
    
    
    $
    80,260
    
    
    $
    96,052
    
    
    $
    35,661Inventories
    
    $
    118,663
    
    
    $
    106,895
    
    
    $
    86,634
    
    
    $
    159,942
    
    
    $
    202,485Total current assets
    
    $
    264,816
    
    
    $
    284,339
    
    
    $
    268,911
    
    
    $
    303,655
    
    
    $
    265,006Property, plant and equipment, net
    
    $
    465,054
    
    
    $
    460,328
    
    
    $
    445,199
    
    
    $
    434,924
    
    
    $
    419,528Total assets
    
    $
    742,407
    
    
    $
    756,023
    
    
    $
    721,457
    
    
    $
    744,718
    
    
    $
    690,588Current portion of long-term debt and capital lease obligations
    
    $
    1,209
    
    
    $
    1,674
    
    
    $
    1,776
    
    
    $
    1,986
    
    
    $
    1,935Portion of debt repayable upon liquidation of finished palladium
in inventory
    
    $
    
    
    
    $
    
    
    
    $
    7,324
    
    
    $
    19,076
    
    
    $
    74,106Total current liabilities
    
    $
    68,974
    
    
    $
    85,590
    
    
    $
    69,087
    
    
    $
    67,238
    
    
    $
    110,270Long-term debt and capital lease obligations
    
    $
    126,841
    
    
    $
    129,007
    
    
    $
    132,307
    
    
    $
    143,028
    
    
    $
    85,445Total liabilities
    
    $
    225,003
    
    
    $
    243,467
    
    
    $
    227,913
    
    
    $
    231,989
    
    
    $
    211,291Stockholders equity
    
    $
    517,404
    
    
    $
    512,556
    
    
    $
    493,544
    
    
    $
    512,729
    
    
    $
    479,297Working capital
    
    $
    195,842
    
    
    $
    198,749
    
    
    $
    199,824
    
    
    $
    236,417
    
    
    $
    154,736Current ratio
    
    
    3.8
    
    
    
    3.3
    
    
    
    3.9
    
    
    
    4.5
    
    
    
    2.4
 43




---



##### Table of Contents



(in thousands, except per ounce and per ton costs)
    
    2007
    
    
    2006
    
    
    2005
    
    
    2004
    
    
    2003OPERATING AND COST DATAConsolidated:Ounces produced:Palladium
    
    
    413
    
    
    
    463
    
    
    
    428
    
    
    
    439
    
    
    
    450Platinum
    
    
    124
    
    
    
    138
    
    
    
    126
    
    
    
    130
    
    
    
    134Total
    
    
    537
    
    
    
    601
    
    
    
    554
    
    
    
    569
    
    
    
    584Tons milled
    
    
    1,169
    
    
    
    1,289
    
    
    
    1,206
    
    
    
    1,212
    
    
    
    1,185Mill head grade (ounce per ton)
    
    
    0.50
    
    
    
    0.51
    
    
    
    0.50
    
    
    
    0.51
    
    
    
    0.53Sub-grade tons milled (1)
    
    
    75
    
    
    
    62
    
    
    
    80
    
    
    
    58
    
    
    
    84Sub-grade mill head grade (ounce per ton)
    
    
    0.12
    
    
    
    0.13
    
    
    
    0.15
    
    
    
    0.22
    
    
    
    0.20Total tons milled (1)
    
    
    1,244
    
    
    
    1,351
    
    
    
    1,286
    
    
    
    1,270
    
    
    
    1,269Combined mill head grade (ounce per ton)
    
    
    0.48
    
    
    
    0.49
    
    
    
    0.48
    
    
    
    0.50
    
    
    
    0.51Total mill recovery (%)
    
    
    91
    
    
    
    91
    
    
    
    91
    
    
    
    91
    
    
    
    91Total operating costs per ounce (Non-GAAP)(2)
    
    $
    266
    
    
    $
    240
    
    
    $
    278
    
    
    $
    254
    
    
    $
    249Total cash costs per ounce (Non-GAAP)(2)
    
    $
    328
    
    
    $
    295
    
    
    $
    324
    
    
    $
    297
    
    
    $
    283Total production costs per ounce (Non-GAAP)(2)
    
    $
    485
    
    
    $
    432
    
    
    $
    472
    
    
    $
    402
    
    
    $
    354Total operating costs per ton milled (Non-GAAP)
(2)
    
    $
    115
    
    
    $
    107
    
    
    $
    120
    
    
    $
    114
    
    
    $
    115Total cash costs per ton milled (Non-GAAP)(2)
    
    $
    142
    
    
    $
    131
    
    
    $
    139
    
    
    $
    133
    
    
    $
    130Total production costs per ton milled (Non-GAAP)
(2)
    
    $
    210
    
    
    $
    192
    
    
    $
    203
    
    
    $
    180
    
    
    $
    163Stillwater Mine:Ounces produced:Palladium
    
    
    274
    
    
    
    314
    
    
    
    293
    
    
    
    311
    
    
    
    328Platinum
    
    
    85
    
    
    
    95
    
    
    
    88
    
    
    
    94
    
    
    
    100Total
    
    
    359
    
    
    
    409
    
    
    
    381
    
    
    
    405
    
    
    
    428Tons milled
    
    
    640
    
    
    
    739
    
    
    
    710
    
    
    
    728
    
    
    
    730Mill head grade (ounce per ton)
    
    
    0.60
    
    
    
    0.60
    
    
    
    0.57
    
    
    
    0.59
    
    
    
    0.62Sub-grade tons milled(1)
    
    
    75
    
    
    
    62
    
    
    
    80
    
    
    
    58
    
    
    
    84Sub-grade mill head grade (ounce per ton)
    
    
    0.12
    
    
    
    0.13
    
    
    
    0.15
    
    
    
    0.22
    
    
    
    0.20Total tons milled(1)
    
    
    715
    
    
    
    801
    
    
    
    790
    
    
    
    786
    
    
    
    814Combined mill head grade (ounce per ton)
    
    
    0.55
    
    
    
    0.56
    
    
    
    0.53
    
    
    
    0.56
    
    
    
    0.58Total mill recovery (%)
    
    
    92
    
    
    
    92
    
    
    
    92
    
    
    
    92
    
    
    
    91Total operating costs per ounce (Non-GAAP) (2)
    
    $
    232
    
    
    $
    228
    
    
    $
    270
    
    
    $
    238
    
    
    $
    231Total cash costs per ounce (Non-GAAP)(2)
    
    $
    292
    
    
    $
    280
    
    
    $
    314
    
    
    $
    278
    
    
    $
    262Total production costs per ounce (Non-GAAP)(2)
    
    $
    423
    
    
    $
    400
    
    
    $
    454
    
    
    $
    366
    
    
    $
    322Total operating costs per ton milled (Non-GAAP)(2)
    
    $
    116
    
    
    $
    116
    
    
    $
    130
    
    
    $
    123
    
    
    $
    121Total cash costs per ton milled (Non-GAAP)(2)
    
    $
    147
    
    
    $
    143
    
    
    $
    151
    
    
    $
    143
    
    
    $
    138Total production costs per ton milled (Non-GAAP)
(2)
    
    $
    213
    
    
    $
    205
    
    
    $
    219
    
    
    $
    189
    
    
    $
    169East Boulder Mine:Ounces produced:Palladium
    
    
    139
    
    
    
    149
    
    
    
    135
    
    
    
    128
    
    
    
    122Platinum
    
    
    39
    
    
    
    43
    
    
    
    38
    
    
    
    36
    
    
    
    34Total
    
    
    178
    
    
    
    192
    
    
    
    173
    
    
    
    164
    
    
    
    156Tons milled
    
    
    529
    
    
    
    550
    
    
    
    496
    
    
    
    484
    
    
    
    455Mill head grade (ounce per ton)
    
    
    0.38
    
    
    
    0.39
    
    
    
    0.40
    
    
    
    0.39
    
    
    
    0.39Sub-grade tons milled (1)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Sub-grade mill head grade (ounce per ton)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Total tons milled (1)
    
    
    529
    
    
    
    550
    
    
    
    496
    
    
    
    484
    
    
    
    455Combined mill head grade (ounce per ton)
    
    
    0.38
    
    
    
    0.39
    
    
    
    0.40
    
    
    
    0.39
    
    
    
    0.39Total mill recovery (%)
    
    
    90
    
    
    
    89
    
    
    
    89
    
    
    
    88
    
    
    
    89Total operating costs per ounce (Non-GAAP)(2)
    
    $
    337
    
    
    $
    266
    
    
    $
    297
    
    
    $
    294
    
    
    $
    299Total cash costs per ounce (Non-GAAP)(2)
    
    $
    403
    
    
    $
    326
    
    
    $
    346
    
    
    $
    344
    
    
    $
    343Total production costs per ounce (Non-GAAP)(2)
    
    $
    611
    
    
    $
    501
    
    
    $
    511
    
    
    $
    491
    
    
    $
    441Total operating costs per ton milled (Non-GAAP)
(2)
    
    $
    113
    
    
    $
    93
    
    
    $
    103
    
    
    $
    100
    
    
    $
    103Total cash costs per ton milled (Non-GAAP)(2)
    
    $
    136
    
    
    $
    113
    
    
    $
    120
    
    
    $
    117
    
    
    $
    118Total production costs per ton milled (Non-GAAP)
(2)
    
    $
    206
    
    
    $
    174
    
    
    $
    178
    
    
    $
    167
    
    
    $
    151
 44




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##### Table of Contents



(in thousands, where noted)
    
    2007
    
    
    2006
    
    
    2005
    
    
    2004
    
    
    2003SALES AND PRICE DATAOunces sold (000)Mine production:Palladium (oz.)
    
    
    425
    
    
    
    466
    
    
    
    431
    
    
    
    432
    
    
    
    459Platinum (oz.)
    
    
    120
    
    
    
    138
    
    
    
    135
    
    
    
    125
    
    
    
    131Total
    
    
    545
    
    
    
    604
    
    
    
    566
    
    
    
    557
    
    
    
    590Other PGM activities:(5)Palladium (oz.)
    
    
    146
    
    
    
    196
    
    
    
    502
    
    
    
    418
    
    
    
    5Platinum (oz.)
    
    
    119
    
    
    
    130
    
    
    
    81
    
    
    
    77
    
    
    
    18Rhodium (oz.)
    
    
    24
    
    
    
    28
    
    
    
    38
    
    
    
    21
    
    
    
    1Total
    
    
    289
    
    
    
    354
    
    
    
    621
    
    
    
    516
    
    
    
    24By-products from mining: (6)Rhodium (oz.)
    
    
    4
    
    
    
    4
    
    
    
    3
    
    
    
    3
    
    
    
    4Gold (oz.)
    
    
    11
    
    
    
    11
    
    
    
    11
    
    
    
    9
    
    
    
    11Silver (oz.)
    
    
    9
    
    
    
    6
    
    
    
    6
    
    
    
    10
    
    
    
    6Copper (lb.)
    
    
    942
    
    
    
    892
    
    
    
    911
    
    
    
    868
    
    
    
    1,129Nickel (lb.)
    
    
    1,171
    
    
    
    1,585
    
    
    
    1,307
    
    
    
    1,282
    
    
    
    1,379Average realized price per ounce
(3)Mine production:Palladium ($/oz.)
    
    $
    384
    
    
    $
    370
    
    
    $
    356
    
    
    $
    376
    
    
    $
    352Platinum ($/oz.)
    
    $
    953
    
    
    $
    868
    
    
    $
    821
    
    
    $
    839
    
    
    $
    603Combined ($/oz.) (4)
    
    $
    509
    
    
    $
    484
    
    
    $
    467
    
    
    $
    480
    
    
    $
    408Other PGM activities:(5)Palladium ($/oz.)
    
    $
    352
    
    
    $
    306
    
    
    $
    199
    
    
    $
    231
    
    
    $
    216Platinum ($/oz.)
    
    $
    1,247
    
    
    $
    1,122
    
    
    $
    876
    
    
    $
    817
    
    
    $
    666Rhodium ($/oz.)
    
    $
    5,732
    
    
    $
    4,111
    
    
    $
    1,861
    
    
    $
    1,032
    
    
    $
    512By-products from mining: (6)Rhodium ($/oz.)
    
    $
    6,217
    
    
    $
    4,516
    
    
    $
    2,155
    
    
    $
    952
    
    
    $
    487Gold ($/oz.)
    
    $
    699
    
    
    $
    603
    
    
    $
    444
    
    
    $
    410
    
    
    $
    365Silver ($/oz.)
    
    $
    13
    
    
    $
    12
    
    
    $
    7
    
    
    $
    5
    
    
    $
    5Copper ($/lb.)
    
    $
    3.34
    
    
    $
    2.91
    
    
    $
    1.55
    
    
    $
    1.19
    
    
    $
    0.68Nickel ($/lb.)
    
    $
    16.91
    
    
    $
    10.04
    
    
    $
    5.96
    
    
    $
    6.30
    
    
    $
    4.10Average market price per ounce
(4)Palladium ($/oz.)
    
    $
    355
    
    
    $
    320
    
    
    $
    201
    
    
    $
    230
    
    
    $
    201Platinum ($/oz.)
    
    $
    1,303
    
    
    $
    1,143
    
    
    $
    897
    
    
    $
    846
    
    
    $
    691Combined ($/oz.)(4)
    
    $
    564
    
    
    $
    508
    
    
    $
    366
    
    
    $
    368
    
    
    $
    309
 
 (1)
    
    Sub-grade tons milled includes reef waste material only. Total tons milled includes ore tons
and sub-grade tons only.(2)
    
    Total operating costs include costs of mining, processing and administrative expenses at the
mine site (including mine site overhead and credits for metals produced other than palladium
and platinum from mine production). Total cash costs include total operating costs plus
royalties, insurance and taxes other than income taxes. Total production costs include total
cash costs plus asset retirement costs and depreciation and amortization. Income taxes,
corporate general and administrative expenses, asset impairment writedowns, gain or loss on
disposal of property, plant and equipment, restructuring costs, Norilsk Nickel transaction
expenses and interest income and expense are not included in total operating costs, total cash
costs or total production costs. Operating costs per ton, operating costs per ounce, cash
costs per ton, cash costs per ounce, production costs per ton and production costs per ounce
are non-GAAP measurements that management uses to monitor and evaluate the efficiency of its
mining operations. These measures of cost are not defined under U.S. Generally Accepted
Accounting Principles (GAAP). Please see Reconciliation of Non-GAAP Measures to Costs of
Revenues and the accompanying discussion for additional detail.(3)
    
    The Companys average realized price represents revenues, which include the effect of
contract floor and ceiling prices, hedging gains and losses realized on commodity instruments
and contract discounts, divided by ounces sold. The average market price represents the
average London PM Fix for the actual months of the period.(4)
    
    The Company reports a combined average realized and market price of palladium and platinum at
the same ratio as ounces that are produced from the base metal refinery.(5)
    
    Ounces sold and average realized price per ounce from other PGM activities relate to ounces
produced from processing of catalyst materials, ounces purchased in the open market for resale
and palladium received in the Norilsk Nickel transaction.(6)
    
    By-product metals sold reflect contained metal. Realized prices reflect net values
(discounted due to product form and transportation and marketing charges) per unit received. 45




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##### Table of Contents



Reconciliation of Non-GAAP measures to costs of revenues
   Total Costs of Revenues
 Total Production Costs (Non-GAAP)
 Total Production Cost per Ton
Milled (Non-GAAP)
 Total Production Cost per Ounce (Non-GAAP)
 46




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##### Table of Contents



Total Cash Costs (Non-GAAP)
 Total Cash Cost per Ton Milled
(Non-GAAP)
 Total Cash Cost per Ounce (Non-GAAP)
 Total Operating Costs (Non-GAAP)
 Total Operating Cost per Ton
Milled (Non-GAAP)
 Total Operating Cost per Ounce (Non-GAAP)
 47




---



##### Table of Contents



(in thousands, except per ounce and per ton data)
    
    2007
    
    
    2006
    
    
    2005
    
    
    2004
    
    
    2003Consolidated:Total operating costs (Non-GAAP)
    
    $
    143,142
    
    
    $
    144,144
    
    
    $
    154,139
    
    
    $
    144,589
    
    
    $
    145,452Total cash costs (Non-GAAP)
    
    $
    176,538
    
    
    $
    177,045
    
    
    $
    179,308
    
    
    $
    168,915
    
    
    $
    165,528Total production costs (Non-GAAP)
    
    $
    260,932
    
    
    $
    259,619
    
    
    $
    261,112
    
    
    $
    228,940
    
    
    $
    206,570Divided by total ounces
    
    
    537
    
    
    
    601
    
    
    
    554
    
    
    
    569
    
    
    
    584Divided by total tons milled
    
    
    1,244
    
    
    
    1,351
    
    
    
    1,286
    
    
    
    1,270
    
    
    
    1,269Total operating cost per ounce (Non-GAAP)
    
    $
    266
    
    
    $
    240
    
    
    $
    278
    
    
    $
    254
    
    
    $
    249Total cash cost per ounce (Non-GAAP)
    
    $
    328
    
    
    $
    295
    
    
    $
    324
    
    
    $
    297
    
    
    $
    283Total production cost per ounce (Non-GAAP)
    
    $
    485
    
    
    $
    432
    
    
    $
    472
    
    
    $
    402
    
    
    $
    354Total operating cost per ton milled (Non-GAAP)
    
    $
    115
    
    
    $
    107
    
    
    $
    120
    
    
    $
    114
    
    
    $
    115Total cash cost per ton milled (Non-GAAP)
    
    $
    142
    
    
    $
    131
    
    
    $
    139
    
    
    $
    133
    
    
    $
    130Total production cost per ton milled (Non-GAAP)
    
    $
    210
    
    
    $
    192
    
    
    $
    203
    
    
    $
    180
    
    
    $
    163Reconciliation to consolidated costs of revenues:Total operating costs (Non-GAAP)
    
    $
    143,142
    
    
    $
    144,144
    
    
    $
    154,139
    
    
    $
    144,589
    
    
    $
    145,452Royalties, taxes and other
    
    
    33,396
    
    
    
    32,901
    
    
    
    25,169
    
    
    
    24,326
    
    
    
    20,076Total cash costs (Non-GAAP)
    
    $
    176,538
    
    
    $
    177,045
    
    
    $
    179,308
    
    
    $
    168,915
    
    
    $
    165,528Asset retirement costs
    
    
    734
    
    
    
    650
    
    
    
    535
    
    
    
    457
    
    
    
    342Depreciation and amortization
    
    
    82,396
    
    
    
    83,583
    
    
    
    79,032
    
    
    
    57,321
    
    
    
    41,285Depreciation and amortization (in inventory)
    
    
    1,264
    
    
    
    (1,659
    )
    
    
    2,182
    
    
    
    2,247
    
    
    
    (585
    )Total production costs (Non-GAAP)
    
    $
    260,932
    
    
    $
    259,619
    
    
    $
    261,057
    
    
    $
    228,940
    
    
    $
    206,570Change in product inventories
    
    
    11,848
    
    
    
    41,642
    
    
    
    141,512
    
    
    
    78,260
    
    
    
    13,844Costs of recycling activities
    
    
    305,911
    
    
    
    250,444
    
    
    
    85,522
    
    
    
    71,325
    
    
    
    7,988Recycling activities  depreciation
    
    
    142
    
    
    
    100
    
    
    
    55
    
    
    
    48
    
    
    
    71Add: Profit from recycling activities
    
    
    27,026
    
    
    
    25,389
    
    
    
    6,339
    
    
    
    6,105
    
    
    
    881Loss or (gain) on sale of assets and other costs
    
    
    (180
    )
    
    
    279
    
    
    
    112
    
    
    
    
    
    
    
    93Total consolidated costs of revenues
    
    $
    605,679
    
    
    $
    577,473
    
    
    $
    494,597
    
    
    $
    384,678
    
    
    $
    229,447Stillwater Mine:Total operating costs (Non-GAAP)
    
    $
    83,174
    
    
    $
    93,230
    
    
    $
    102,931
    
    
    $
    96,381
    
    
    $
    98,722Total cash costs (Non-GAAP)
    
    $
    104,807
    
    
    $
    114,726
    
    
    $
    119,681
    
    
    $
    112,463
    
    
    $
    111,938Total production costs (Non-GAAP)
    
    $
    152,095
    
    
    $
    163,823
    
    
    $
    172,938
    
    
    $
    148,365
    
    
    $
    137,670Divided by total ounces
    
    
    359
    
    
    
    409
    
    
    
    381
    
    
    
    405
    
    
    
    428Divided by total tons milled
    
    
    715
    
    
    
    801
    
    
    
    790
    
    
    
    786
    
    
    
    814Total operating cost per ounce (Non-GAAP)
    
    $
    232
    
    
    $
    228
    
    
    $
    270
    
    
    $
    238
    
    
    $
    231Total cash cost per ounce (Non-GAAP)
    
    $
    292
    
    
    $
    280
    
    
    $
    314
    
    
    $
    278
    
    
    $
    262Total production cost per ounce (Non-GAAP)
    
    $
    423
    
    
    $
    400
    
    
    $
    454
    
    
    $
    366
    
    
    $
    322Total operating cost per ton milled (Non-GAAP)
    
    $
    116
    
    
    $
    116
    
    
    $
    130
    
    
    $
    123
    
    
    $
    121Total cash cost per ton milled (Non-GAAP)
    
    $
    147
    
    
    $
    143
    
    
    $
    151
    
    
    $
    143
    
    
    $
    138Total production cost per ton milled (Non-GAAP)
    
    $
    213
    
    
    $
    205
    
    
    $
    219
    
    
    $
    189
    
    
    $
    169
 48




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##### Table of Contents



(in thousands, per ounce and per ton data)
    
    2007
    
    
    2006
    
    
    2005
    
    
    2004
    
    
    2003Stillwater Mine continued:Reconciliation to costs of revenues:Total operating costs (Non-GAAP)
    
    $
    83,174
    
    
    $
    93,230
    
    
    $
    102,931
    
    
    $
    96,381
    
    
    $
    98,722Royalties, taxes and other
    
    
    21,633
    
    
    
    21,496
    
    
    
    16,750
    
    
    
    16,082
    
    
    
    13,216Total cash costs (Non-GAAP)
    
    $
    104,807
    
    
    $
    114,726
    
    
    $
    119,681
    
    
    $
    112,463
    
    
    $
    111,938Asset retirement costs
    
    
    512
    
    
    
    470
    
    
    
    370
    
    
    
    305
    
    
    
    280Depreciation and amortization
    
    
    46,521
    
    
    
    49,620
    
    
    
    52,295
    
    
    
    33,955
    
    
    
    26,134Depreciation and amortization (in inventory)
    
    
    255
    
    
    
    (993
    )
    
    
    592
    
    
    
    1,642
    
    
    
    (682
    )Total production costs (Non-GAAP)
    
    $
    152,095
    
    
    $
    163,823
    
    
    $
    172,938
    
    
    $
    148,365
    
    
    $
    137,670Change in product inventories
    
    
    (2,872
    )
    
    
    1,882
    
    
    
    6,773
    
    
    
    (3,764
    )
    
    
    6,156Add: Profit from recycling activities
    
    
    17,883
    
    
    
    17,612
    
    
    
    4,344
    
    
    
    4,274
    
    
    
    659Loss or (gain) on sale of assets and other costs
    
    
    (254
    )
    
    
    187
    
    
    
    81
    
    
    
    
    
    
    
    70Total costs of revenues
    
    $
    166,852
    
    
    $
    183,504
    
    
    $
    184,136
    
    
    $
    148,875
    
    
    $
    144,555East Boulder Mine(1)Total operating costs (Non-GAAP)
    
    $
    59,968
    
    
    $
    50,914
    
    
    $
    51,208
    
    
    $
    48,208
    
    
    $
    46,730Total cash costs (Non-GAAP)
    
    $
    71,731
    
    
    $
    62,319
    
    
    $
    59,627
    
    
    $
    56,452
    
    
    $
    53,590Total production costs (Non-GAAP)
    
    $
    108,837
    
    
    $
    95,796
    
    
    $
    88,120
    
    
    $
    80,575
    
    
    $
    68,900Divided by total ounces
    
    
    178
    
    
    
    192
    
    
    
    173
    
    
    
    164
    
    
    
    156Divided by total tons milled
    
    
    529
    
    
    
    550
    
    
    
    496
    
    
    
    484
    
    
    
    455Total operating cost per ounce (Non-GAAP)
    
    $
    337
    
    
    $
    266
    
    
    $
    297
    
    
    $
    294
    
    
    $
    299Total cash cost per ounce (Non-GAAP)
    
    $
    403
    
    
    $
    326
    
    
    $
    346
    
    
    $
    344
    
    
    $
    343Total production cost per ounce (Non-GAAP)
    
    $
    611
    
    
    $
    501
    
    
    $
    511
    
    
    $
    491
    
    
    $
    441Total operating cost per ton milled (Non-GAAP)
    
    $
    113
    
    
    $
    93
    
    
    $
    103
    
    
    $
    100
    
    
    $
    103Total cash cost per ton milled (Non-GAAP)
    
    $
    136
    
    
    $
    113
    
    
    $
    120
    
    
    $
    117
    
    
    $
    118Total production cost per ton milled (Non-GAAP)
    
    $
    206
    
    
    $
    174
    
    
    $
    178
    
    
    $
    167
    
    
    $
    151Reconciliation to costs of revenues:Total operating costs (Non-GAAP)
    
    $
    59,968
    
    
    $
    50,914
    
    
    $
    51,208
    
    
    $
    48,208
    
    
    $
    46,730Royalties, taxes and other
    
    
    11,763
    
    
    
    11,405
    
    
    
    8,419
    
    
    
    8,244
    
    
    
    6,860Total cash costs (Non-GAAP)
    
    $
    71,731
    
    
    $
    62,319
    
    
    $
    59,627
    
    
    $
    56,452
    
    
    $
    53,590Asset retirement costs
    
    
    222
    
    
    
    180
    
    
    
    165
    
    
    
    152
    
    
    
    62Depreciation and amortization
    
    
    35,877
    
    
    
    33,963
    
    
    
    26,737
    
    
    
    23,366
    
    
    
    15,151Depreciation and amortization (in inventory)
    
    
    1,007
    
    
    
    (666
    )
    
    
    1,591
    
    
    
    605
    
    
    
    97Total production costs (Non-GAAP)
    
    $
    108,837
    
    
    $
    95,796
    
    
    $
    88,120
    
    
    $
    80,575
    
    
    $
    68,900Change in product inventories
    
    
    432
    
    
    
    (439
    )
    
    
    (4,967
    )
    
    
    (379
    )
    
    
    960Add: Profit from recycling activities
    
    
    9,143
    
    
    
    7,777
    
    
    
    1,995
    
    
    
    1,831
    
    
    
    222Loss or (gain) on sale of assets and other costs
    
    
    36
    
    
    
    40
    
    
    
    
    
    
    
    
    
    
    
    23Total costs of revenues
    
    $
    118,448
    
    
    $
    103,174
    
    
    $
    85,148
    
    
    $
    82,027
    
    
    $
    70,105Other PGM activities(2)Reconciliation to costs of revenues:Change in product inventories
    
    $
    14,288
    
    
    $
    40,199
    
    
    $
    139,705
    
    
    $
    82,402
    
    
    $
    6,728Recycling activities  depreciation
    
    
    142
    
    
    
    100
    
    
    
    55
    
    
    
    48
    
    
    
    71Costs of recycling activities
    
    
    305,911
    
    
    
    250,444
    
    
    
    85,522
    
    
    
    71,325
    
    
    
    7,988Loss or (gain) on sale of assets and other costs
    
    
    38
    
    
    
    52
    
    
    
    31
    
    
    
    
    
    
    
    Total costs of revenues
    
    $
    320,379
    
    
    $
    290,795
    
    
    $
    225,313
    
    
    $
    153,775
    
    
    $
    14,787
 
 (1)
    
    East Boulder Mine commenced full-time commercial production on January 1, 2002.(2)
    
    Other PGM activities include recycling and sales of palladium received in the Norilsk Nickel
transaction and other. 49




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##### Table of Contents



ITEM 7
 MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
  OVERVIEW
 PRINCIPAL
FACTORS AFFECTING STILLWATER MINING COMPANY
      50




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##### Table of Contents



2007 PERFORMANCE
   51




---



##### Table of Contents



Recent Developments 
 52




---



##### Table of Contents



STRATEGIC INITIATIVES
    53




---



##### Table of Contents




    
    Transforming Mining Operations- The Company has identified a series of comprehensive
operating changes designed to increase efficiency, reduce unit costs of production, and
increase total PGM ounces produced, all in an effort to address the Companys sustainability
beyond 2012 should the Company no longer have PGM pricing floors as in the current contracts
with the auto companies. These changes are grouped into five overlapping stages:
 -
    
    Maintain and improve the current strong safety and environmental performance at all operations;-
    
    Increase the developed state of both mines, improving infrastructure and expanding proven reserves;-
    
    Apply more selective mining methods, better matching the method to the opportunity;-
    
    Increase ore production rates to realize economies of scale at both mines;-
    
    Reduce operating costs through mine optimization and addressing targeted efficiencies.
 Safety and Environment 
 Good Neighbor
 Developed
state 
   54




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##### Table of Contents



Selective Mining 
    Production Increases 
  55




---



##### Table of Contents



Expanding Smelter Capacity 
  
    
    Marketing Palladium- Substantial marketing support for platinum has existed for many years
through sponsoring industry organizations, while over the same period any corresponding
support for palladium has been very limited. Recently, palladium has resurfaced as a primary
jewelry metal, largely based on its favorable price position relative to gold and platinum.
The Company has followed this development closely, championing and chronicling it for the
industry and has undertaken a leadership role in promoting market development for palladium.
 Palladium
used for jewelry 
 www.luxurypalladium.com
 Palladium used for diesel engines
 56




---



##### Table of Contents



Palladium used for hydrogen energy
 
    
    Diversification- Management is concerned with the approaching expiration of its automotive
contracts and the volatility of metal prices, both of which are leading the Company to
consider proposals intended to strengthen its balance sheet. In view of the controlling share
ownership position held by Norilsk Nickel, the Company expects to continue to discuss its
future direction and alternatives with Norilsk Nickel in order to benefit from identified
opportunities that may be proposed. While the Company regards itself as principally a
palladium and platinum company, it has not limited its consideration of future growth
opportunities to PGMs, given the scarcity of PGM resources.
     CAPITALIZED MINE DEVELOPMENT
  57




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##### Table of Contents




    
    Unamortized costs of the shaft at the Stillwater Mine and the initial development at the
East Boulder Mine are treated as life-of-mine infrastructure costs, to be amortized over
total proven and probable reserves at each location, and
    
    All development costs of footwall laterals, ramps and associated facilities are amortized
over the ore reserves in the immediate and geologically relevant vicinity of the
development.
  REVENUES
     58




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##### Table of Contents



Year ended December 31,
    
    Sales Revenues (1)
    
    
    Troy Ounces Sold(in thousands)
    
    Palladium
    
    
    Platinum
    
    
    Rhodium
    
    
    Other
    
    
    Total
    
    
    Palladium
    
    
    Platinum
    
    
    Rhodium
    
    
    Total2007Mine production
    
    $
    162,811
    
    
    $
    114,645
    
    
    $
    
    
    
    $
    
    
    
    $
    277,456
    
    
    
    425
    
    
    
    120
    
    
    
    
    
    
    
    545PGM recycling
    
    
    36,505
    
    
    
    149,061
    
    
    
    138,798
    
    
    
    2,030
    
    
    
    326,394
    
    
    
    102
    
    
    
    119
    
    
    
    24
    
    
    
    245Other
    
    
    15,365
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    15,365
    
    
    
    44
    
    
    
    
    
    
    
    
    
    
    
    44Total
    
    $
    214,681
    
    
    $
    263,706
    
    
    $
    138,798
    
    
    $
    2,030
    
    
    $
    619,215
    
    
    
    571
    
    
    
    239
    
    
    
    24
    
    
    
    8342006Mine production
    
    $
    172,171
    
    
    $
    120,033
    
    
    $
    
    
    
    $
    
    
    
    $
    292,204
    
    
    
    466
    
    
    
    138
    
    
    
    
    
    
    
    604PGM recycling
    
    
    31,987
    
    
    
    143,259
    
    
    
    93,206
    
    
    
    1,489
    
    
    
    269,941
    
    
    
    100
    
    
    
    128
    
    
    
    22
    
    
    
    250Sales of palladium
received
in Norilsk Nickel
transaction
    
    
    17,637
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    17,637
    
    
    
    63
    
    
    
    
    
    
    
    
    
    
    
    63Other
    
    
    10,538
    
    
    
    2,530
    
    
    
    20,298
    
    
    
    
    
    
    
    33,366
    
    
    
    33
    
    
    
    2
    
    
    
    6
    
    
    
    41Total
    
    $
    232,333
    
    
    $
    265,822
    
    
    $
    113,504
    
    
    $
    1,489
    
    
    $
    613,148
    
    
    
    662
    
    
    
    268
    
    
    
    28
    
    
    
    9582005Mine production
    
    $
    153,668
    
    
    $
    110,538
    
    
    $
    
    
    
    $
    
    
    
    $
    264,206
    
    
    
    431
    
    
    
    135
    
    
    
    
    
    
    
    566PGM recycling
    
    
    8,970
    
    
    
    59,692
    
    
    
    20,672
    
    
    
    1,361
    
    
    
    90,695
    
    
    
    46
    
    
    
    68
    
    
    
    12
    
    
    
    126Sales of palladium
received
in Norilsk Nickel
transaction
    
    
    87,309
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    87,309
    
    
    
    438
    
    
    
    
    
    
    
    
    
    
    
    438Other
    
    
    3,616
    
    
    
    11,515
    
    
    
    50,121
    
    
    
    
    
    
    
    65,252
    
    
    
    18
    
    
    
    13
    
    
    
    26
    
    
    
    57Total
    
    $
    253,563
    
    
    $
    181,745
    
    
    $
    70,793
    
    
    $
    1,361
    
    
    $
    507,462
    
    
    
    933
    
    
    
    216
    
    
    
    38
    
    
    
    1,187
 
 (1)
    
    Sales of by-products are reflected as a reduction to costs of metals sold and not as revenue. RESULTS OF OPERATIONS
 YEAR ENDED DECEMBER 31, 2007 COMPARED TO YEAR ENDED DECEMBER 31, 2006
 Revenues
   59




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##### Table of Contents



Costs
of Metals Sold 
     Depreciation and amortization
 Exploration 
 60




---



##### Table of Contents



Marketing
 General and administrative
 Interest income and expense
 Total income tax provision de minimis
 Other comprehensive income (loss), net of tax
 YEAR ENDED DECEMBER 31, 2006 COMPARED TO YEAR ENDED DECEMBER 31, 2005
 Revenues
    61




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##### Table of Contents



Costs
of Metals Sold 
      Depreciation and amortization
 Exploration 
 62




---



##### Table of Contents



Marketing
 General and administrative
 Interest income and expense
 Total income tax provision
 Other comprehensive income (loss), net of tax
 LIQUIDITY AND CAPITAL RESOURCES
       63




---



##### Table of Contents



CREDIT AGREEMENT
     64




---



##### Table of Contents



Credit FacilityScheduled RepaymentsYear ended
    
    (in thousands)2008
    
    $
    1,0192009
    
    
    1,0192010
    
    
    96,305Total
    
    $
    98,343
  CONTRACTUAL OBLIGATIONS
  (in thousands)
    
    2008
    
    
    2009
    
    
    2010
    
    
    2011
    
    
    2012
    
    
    Thereafter
    
    
    TotalTerm loan facility
    
    $
    1,019
    
    
    $
    1,019
    
    
    $
    96,305
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    98,343Special Industrial
Education Impact
Revenue Bonds
    
    
    190
    
    
    
    97
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    287Exempt Facility
Revenue Bonds
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    30,000
    
    
    
    30,000Operating leases
    
    
    275
    
    
    
    240
    
    
    
    240
    
    
    
    240
    
    
    
    234
    
    
    
    465
    
    
    
    1,694Asset retirement
obligations
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    73,770
    
    
    
    73,770Payments of interest
    
    
    10,448
    
    
    
    10,050
    
    
    
    6,555
    
    
    
    2,400
    
    
    
    2,400
    
    
    
    18,000
    
    
    
    49,853Other noncurrent
liabilities
    
    
    
    
    
    
    16,280
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    16,280Total
    
    $
    11,932
    
    
    $
    27,686
    
    
    $
    103,100
    
    
    $
    2,640
    
    
    $
    2,634
    
    
    $
    122,235
    
    
    $
    270,227
  FACTORS THAT MAY AFFECT FUTURE RESULTS AND FINANCIAL CONDITION
  65




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##### Table of Contents



CRITICAL ACCOUNTING POLICIES
 Mine Development Expenditures  Capitalization and Amortization
       
    
    Unamortized costs of the shaft at the Stillwater Mine and the initial development at the
East Boulder Mine are treated as life-of-mine infrastructure costs, amortized over total
proven and probable reserves at each location, and
    
    All ongoing development costs of footwall laterals, ramps and associated facilities are
amortized over the ore reserves in the immediate and geologically relevant vicinity of the
development.
  66




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##### Table of Contents



Asset Impairment
 Accounting for
the Impairment or Disposal of Long-Lived Assets
  Income Taxes
 Accounting for Income Taxes
  Post-closure Reclamation Costs
 Accounting for
Asset Retirement Obligations
  67




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##### Table of Contents



Derivative Instruments
 Accounting for Derivative Instruments and Hedging Activities
 
 ITEM 7A
QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK
  COMMODITY PRICE RISK
    68




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##### Table of Contents



69




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##### Table of Contents



Mine Production:  Financially Settled Forwards
 PlatinumOunces
    
    Avg. Price
    
            
            
            
            
        
    IndexFirst Quarter 2008
    
    
    9,000
    
    
    $
    1,104
    
    
            
            
            
            
        
    Monthly London PM AverageSecond Quarter 2008
    
    
    6,000
    
    
    $
    1,054
    
    
            
            
            
            
        
    Monthly London PM AveragePGM Recycling:Financially Settled ForwardsPalladiumOunces
    
    Avg. Price
    
            
            
            
            
        
    IndexFirst Quarter 2008
    
    
    4,873
    
    
    $
    372
    
    
            
            
            
            
        
    Monthly London PM AveragePGM Recycling:Fixed Forwards
 Platinum
    
    Palladium
    
    RhodiumOunces
    
    Avg. Price
    
    Ounces
    
    Avg. Price
    
    Ounces
    
    Avg. PriceFirst Quarter 2008
    
    
    28,009
    
    
    $
    1,525
    
    
    
    8,269
    
    
    $
    366
    
    
    
    2,636
    
    
    $
    6,761Second Quarter 2008
    
    
    5,427
    
    
    $
    1,516
    
    
    
    1,069
    
    
    $
    368
    
    
    
    399
    
    
    $
    6,488
 INTEREST RATE RISK
  70




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##### Table of Contents



ITEM 8
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
 
 Report of Independent Registered Public Accounting Firm
 
    Internal Control  Integrated Framework
  
 71




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##### Table of Contents



Report of Independent Registered Public Accounting Firm
 
 Internal ControlIntegrated Framework
    Internal
Control  Integrated Framework




---



##### Table of Contents



STILLWATER MINING COMPANY
 
 STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
 (in thousands, except per share data)
 Year ended December 31,
    
    2007
    
    
    2006
    
    
    2005REVENUESMine production
    
    $
    277,456
    
    
    $
    292,204
    
    
    $
    264,206PGM recycling
    
    
    326,394
    
    
    
    269,941
    
    
    
    90,695Sales of palladium received in Norilsk Nickel transaction
    
    
    
    
    
    
    17,637
    
    
    
    87,309Other
    
    
    15,365
    
    
    
    33,366
    
    
    
    65,252Total revenues
    
    
    619,215
    
    
    
    613,148
    
    
    
    507,462COSTS AND EXPENSESCosts of metals sold:Mine production
    
    
    203,121
    
    
    
    199,982
    
    
    
    190,171PGM recycling
    
    
    305,911
    
    
    
    250,444
    
    
    
    85,522Sales of palladium received in Norilsk Nickel transaction
    
    
    
    
    
    
    10,785
    
    
    
    74,542Other
    
    
    14,289
    
    
    
    32,300
    
    
    
    65,163Total costs of metals sold
    
    
    523,321
    
    
    
    493,511
    
    
    
    415,398Depreciation and amortization:Mine production
    
    
    82,396
    
    
    
    83,583
    
    
    
    79,032PGM recycling
    
    
    142
    
    
    
    100
    
    
    
    55Total depreciation and amortization
    
    
    82,538
    
    
    
    83,683
    
    
    
    79,087Total costs of revenues
    
    
    605,859
    
    
    
    577,194
    
    
    
    494,485Exploration
    
    
    1,062
    
    
    
    332
    
    
    
    Marketing
    
    
    5,586
    
    
    
    4,186
    
    
    
    592General and administrative
    
    
    21,817
    
    
    
    23,221
    
    
    
    19,872(Gain)/loss on disposal of property, plant and equipment
    
    
    (180
    )
    
    
    279
    
    
    
    112Restructuring credits, net
    
    
    
    
    
    
    
    
    
    
    (243
    )Total costs and expenses
    
    
    634,144
    
    
    
    605,212
    
    
    
    514,818OPERATING INCOME (LOSS)
    
    
    (14,929
    )
    
    
    7,936
    
    
    
    (7,356
    )OTHER INCOME (EXPENSE)Other
    
    
    236
    
    
    
    94
    
    
    
    11Interest income
    
    
    11,705
    
    
    
    11,322
    
    
    
    5,217Interest expense
    
    
    (11,269
    )
    
    
    (11,413
    )
    
    
    (11,733
    )INCOME (LOSS) BEFORE INCOME TAX PROVISION
    
    
    (14,257
    )
    
    
    7,939
    
    
    
    (13,861
    )Income tax provision
    
    
    
    
    
    
    (10
    )
    
    
    (13
    )NET INCOME (LOSS)
    
    
    (14,257
    )
    
    
    7,929
    
    
    
    (13,874
    )Other comprehensive income (loss), net of tax
    
    
    9,578
    
    
    
    1,799
    
    
    
    (12,437
    )COMPREHENSIVE INCOME (LOSS)
    
    $
    (4,679
    )
    
    $
    9,728
    
    
    $
    (26,311
    )
  73




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##### Table of Contents



STILLWATER MINING COMPANY
 STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
 (in thousands, except per share data)
 (Continued)
 Year ended December 31,
    
    2007
    
    
    2006
    
    
    2005BASIC AND DILUTED EARNINGS (LOSS) PER SHARENet income (loss)
    
    $
    (14,257
    )
    
    $
    7,929
    
    
    $
    (13,874
    )Weighted average common shares outstandingBasic
    
    
    92,016
    
    
    
    91,260
    
    
    
    90,702Diluted
    
    
    92,016
    
    
    
    91,580
    
    
    
    90,702Basic earnings (loss) per shareNet income (loss)
    
    $
    (0.15
    )
    
    $
    0.09
    
    
    $
    (0.15
    )Diluted earnings (loss) per shareNet income (loss)
    
    $
    (0.15
    )
    
    $
    0.09
    
    
    $
    (0.15
    )
  74




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##### Table of Contents



STILLWATER MINING COMPANY
 
 BALANCE SHEETS
 (in thousands, except share and per share amounts)
 December 31,
    
    2007
    
    
    2006ASSETSCurrent assetsCash and cash equivalents
    
    $
    61,436
    
    
    $
    88,360Restricted cash
    
    
    5,885
    
    
    
    3,785Investments, at fair market value
    
    
    27,603
    
    
    
    35,497Inventories
    
    
    118,663
    
    
    
    106,895Advances on inventory purchases
    
    
    28,396
    
    
    
    24,191Trade receivables
    
    
    12,144
    
    
    
    16,008Deferred income taxes
    
    
    4,597
    
    
    
    5,063Other current assets
    
    
    6,092
    
    
    
    4,540Total current assets
    
    
    264,816
    
    
    
    284,339Property, plant and equipment, net
    
    
    465,054
    
    
    
    460,328Long-term investments
    
    
    3,556
    
    
    
    1,869Other noncurrent assets
    
    
    8,981
    
    
    
    9,487Total assets
    
    $
    742,407
    
    
    $
    756,023LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilitiesAccounts payable
    
    $
    17,937
    
    
    $
    24,833Accrued payroll and benefits
    
    
    20,944
    
    
    
    20,348Property, production and franchise taxes payable
    
    
    10,528
    
    
    
    11,123Current portion of long-term debt and capital lease obligations
    
    
    1,209
    
    
    
    1,674Fair value of derivative instruments
    
    
    6,424
    
    
    
    15,145Unearned income
    
    
    788
    
    
    
    570Other current liabilities
    
    
    11,144
    
    
    
    11,897Total current liabilities
    
    
    68,974
    
    
    
    85,590Long-term debt and capital lease obligations
    
    
    126,841
    
    
    
    129,007Fair value of derivative instruments
    
    
    
    
    
    
    715Deferred income taxes
    
    
    4,597
    
    
    
    5,063Accrued workers compensation
    
    
    9,982
    
    
    
    10,254Asset retirement obligation
    
    
    10,506
    
    
    
    8,550Other noncurrent liabilities
    
    
    4,103
    
    
    
    4,288Total liabilities
    
    $
    225,003
    
    
    $
    243,467Stockholders equityPreferred stock, $0.01 par value, 1,000,000 shares authorized, none issued
    
    
    
    
    
    
    Common stock, $0.01 par value, 200,000,000 shares authorized, 92,405,111 and
91,514,668 shares issued and outstanding
    
    
    924
    
    
    
    915Paid-in capital
    
    
    626,625
    
    
    
    617,107Accumulated deficit
    
    
    (104,120
    )
    
    
    (89,863
    )Accumulated other comprehensive loss
    
    
    (6,025
    )
    
    
    (15,603
    )Total stockholders equity
    
    
    517,404
    
    
    
    512,556Total liabilities and stockholders equity
    
    $
    742,407
    
    
    $
    756,023
  75




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##### Table of Contents



STILLWATER MINING COMPANY
 
 STATEMENTS OF CASH FLOWS
 (in thousands)
 Year ended December 31,
    
    2007
    
    
    2006
    
    
    2005CASH FLOWS FROM OPERATING ACTIVITIESNet income (loss)
    
    $
    (14,257
    )
    
    $
    7,929
    
    
    $
    (13,874
    )Adjustments to reconcile net income (loss) to net cash
provided by operating activities:Depreciation and amortization
    
    
    82,538
    
    
    
    83,683
    
    
    
    79,087Lower of cost or market inventory adjustment
    
    
    6,013
    
    
    
    2,519
    
    
    
    2,466(Gain)/loss on disposal of property, plant and equipment
    
    
    (180
    )
    
    
    279
    
    
    
    112Asset retirement obligation
    
    
    734
    
    
    
    650
    
    
    
    536Restructuring credits, net
    
    
    
    
    
    
    
    
    
    
    (243
    )Cash paid on accrued restructuring costs
    
    
    
    
    
    
    
    
    
    
    (334
    )Stock issued under employee benefit plans
    
    
    5,470
    
    
    
    4,910
    
    
    
    4,715Amortization of debt issuance costs
    
    
    500
    
    
    
    783
    
    
    
    624Share based compensation
    
    
    3,805
    
    
    
    3,549
    
    
    
    2,371Changes in operating assets and liabilities:Inventories
    
    
    (16,518
    )
    
    
    (24,440
    )
    
    
    73,024Advances on inventory purchases
    
    
    (4,205
    )
    
    
    (17,241
    )
    
    
    (6,950
    )Trade receivables
    
    
    3,864
    
    
    
    11,279
    
    
    
    (2,151
    )Employee compensation and benefits
    
    
    596
    
    
    
    2,547
    
    
    
    4,406Accounts payable
    
    
    (6,896
    )
    
    
    10,426
    
    
    
    (622
    )Property, production and franchise taxes payable
    
    
    (780
    )
    
    
    1,581
    
    
    
    359Workers compensation
    
    
    (272
    )
    
    
    4,400
    
    
    
    793Unearned income
    
    
    218
    
    
    
    (75
    )
    
    
    405Restricted cash
    
    
    (2,100
    )
    
    
    (1,100
    )
    
    
    (35
    )Other
    
    
    (2,108
    )
    
    
    5,284
    
    
    
    (3,555
    )NET CASH PROVIDED BY OPERATING ACTIVITIES
    
    
    56,422
    
    
    
    96,963
    
    
    
    141,134CASH FLOWS FROM INVESTING ACTIVITIESCapital expenditures
    
    
    (87,876
    )
    
    
    (97,802
    )
    
    
    (92,074
    )Purchases of long-term investments
    
    
    (1,687
    )
    
    
    (1,869
    )
    
    
    Proceeds from disposal of property, plant and equipment
    
    
    396
    
    
    
    615
    
    
    
    129Purchases of investments
    
    
    (64,925
    )
    
    
    (106,287
    )
    
    
    (98,419
    )Proceeds from maturities of investments
    
    
    73,125
    
    
    
    126,434
    
    
    
    56,103NET CASH USED IN INVESTING ACTIVITIES
    
    
    (80,967
    )
    
    
    (78,909
    )
    
    
    (134,261
    )CASH FLOWS FROM FINANCING ACTIVITIESPayments on long-term debt and capital lease obligations
    
    
    (2,631
    )
    
    
    (10,726
    )
    
    
    (22,683
    )Issuance of common stock, net of stock issue costs
    
    
    252
    
    
    
    825
    
    
    
    40Payments for debt issuance costs
    
    
    
    
    
    
    (579
    )
    
    
    (22
    )Other
    
    
    
    
    
    
    526
    
    
    
    NET CASH USED IN FINANCING ACTIVITIES
    
    
    (2,379
    )
    
    
    (9,954
    )
    
    
    (22,665
    )CASH AND CASH EQUIVALENTSNet increase (decrease)
    
    
    (26,924
    )
    
    
    8,100
    
    
    
    (15,792
    )Balance at beginning of year
    
    
    88,360
    
    
    
    80,260
    
    
    
    96,052BALANCE AT END OF YEAR
    
    $
    61,436
    
    
    $
    88,360
    
    
    $
    80,260
  76




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##### Table of Contents



STILLWATER MINING COMPANY
 
 STATEMENTS OF CHANGES IN STOCKHOLDERS EQUITY
 (in thousands)
 Retained Earnings
    
    
    Accumulated OtherShares
    
    
    Common
    
    
    
    
    
    
    (Accumulated
    
    
    Comprehensive Income
    
    
    Total StockholdersOutstanding
    
    
    Stock
    
    
    Paid-in Capital
    
    
    Deficit)
    
    
    (Loss)
    
    
    EquityBALANCE AT DECEMBER 31, 2004
    
    
    90,434
    
    
    $
    904
    
    
    $
    600,708
    
    
    $
    (83,918
    )
    
    $
    (4,965
    )
    
    $
    512,729Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (13,874
    )
    
    
    
    
    
    
    (13,874
    )Change in net unrealized gains on derivative
financial instruments, net of tax
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (12,639
    )
    
    
    (12,639
    )Change in fair market value of securities
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    202
    
    
    
    202Common stock issued under employee benefit plans
    
    
    532
    
    
    
    6
    
    
    
    4,709
    
    
    
    
    
    
    
    
    
    
    
    4,715Stock option expense
    
    
    
    
    
    
    
    
    
    
    404
    
    
    
    
    
    
    
    
    
    
    
    404Common stock issued under stock plans
    
    
    11
    
    
    
    
    
    
    
    40
    
    
    
    
    
    
    
    
    
    
    
    40Common stock issued under Directors deferral plan
    
    
    12
    
    
    
    
    
    
    
    33
    
    
    
    
    
    
    
    
    
    
    
    33Nonvested shares of common stock granted to
officers and employees
    
    
    3
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Amortization of unearned nonvested stock
    
    
    
    
    
    
    
    
    
    
    1,934
    
    
    
    
    
    
    
    
    
    
    
    1,934BALANCE AT DECEMBER 31, 2005
    
    
    90,992
    
    
    $
    910
    
    
    $
    607,828
    
    
    $
    (97,792
    )
    
    $
    (17,402
    )
    
    $
    493,544Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    7,929
    
    
    
    
    
    
    
    7,929Change in net unrealized gains on derivative
financial instruments, net of tax
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,824
    
    
    
    1,824Change in fair market value of securities
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (25
    )
    
    
    (25
    )Common stock issued under employee benefit plans
    
    
    409
    
    
    
    4
    
    
    
    4,906
    
    
    
    
    
    
    
    
    
    
    
    4,910Stock option expense
    
    
    
    
    
    
    
    
    
    
    276
    
    
    
    
    
    
    
    
    
    
    
    276Common stock issued under stock plans
    
    
    101
    
    
    
    1
    
    
    
    824
    
    
    
    
    
    
    
    
    
    
    
    825Common stock issued under Directors deferral plan
    
    
    4
    
    
    
    
    
    
    
    43
    
    
    
    
    
    
    
    
    
    
    
    43Nonvested shares of common stock granted to
officers and employees
    
    
    9
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Amortization of unearned nonvested stock
    
    
    
    
    
    
    
    
    
    
    3,250
    
    
    
    
    
    
    
    
    
    
    
    3,250Forfeiture of nonvested stock
    
    
    
    
    
    
    
    
    
    
    (20
    )
    
    
    
    
    
    
    
    
    
    
    (20
    )BALANCE AT DECEMBER 31, 2006
    
    
    91,515
    
    
    $
    915
    
    
    $
    617,107
    
    
    $
    (89,863
    )
    
    $
    (15,603
    )
    
    $
    512,556Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (14,257
    )
    
    
    
    
    
    
    (14,257
    )Change in net unrealized gains on derivative
financial instruments, net of tax
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    9,247
    
    
    
    9,247Change in fair market value of securities
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    331
    
    
    
    331Common stock issued under employee benefit plans
    
    
    488
    
    
    
    5
    
    
    
    5,465
    
    
    
    
    
    
    
    
    
    
    
    5,470Stock option expense
    
    
    
    
    
    
    
    
    
    
    392
    
    
    
    
    
    
    
    
    
    
    
    392Common stock issued under stock plans
    
    
    29
    
    
    
    
    
    
    
    252
    
    
    
    
    
    
    
    
    
    
    
    252Common stock issued under Directors deferral plan
    
    
    5
    
    
    
    4
    
    
    
    74
    
    
    
    
    
    
    
    
    
    
    
    78Nonvested shares of common stock granted to
officers and employees
    
    
    368
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Amortization of unearned nonvested stock
    
    
    
    
    
    
    
    
    
    
    4,374
    
    
    
    
    
    
    
    
    
    
    
    4,374Forfeiture of nonvested stock
    
    
    
    
    
    
    
    
    
    
    (1,039
    )
    
    
    
    
    
    
    
    
    
    
    (1,039
    )BALANCE AT DECEMBER 31, 2007
    
    
    92,405
    
    
    $
    924
    
    
    $
    626,625
    
    
    $
    (104,120
    )
    
    $
    (6,025
    )
    
    $
    517,404
  77




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##### Table of Contents



STILLWATER MINING COMPANY
 
 NOTES TO THE FINANCIAL STATEMENTS
 NOTE 1
NATURE OF OPERATIONS
    NOTE 2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
 CASH AND CASH EQUIVALENTS
  RESTRICTED CASH
  INVESTMENTS
 Accounting for Certain Investments in Debt and Equity Securities
 78




---



##### Table of Contents



The Equity Method of Accounting for Investments in Common Stock.
 INVENTORIES
  RECEIVABLES
  PROPERTY, PLANT AND EQUIPMENT
      79




---



##### Table of Contents



LEASES
 Accounting for Leases.
 ASSET IMPAIRMENT
 Accounting for the Impairment or Disposal of Long-Lived
Assets.
  FAIR VALUE OF FINANCIAL INSTRUMENTS
   Fair Value Measurements
 REVENUE RECOGNITION
  80




---



##### Table of Contents



Revenue Recognition
 HEDGING PROGRAM
 Accounting for Derivative Instruments and Hedging Activities Accounting for
Derivative Instruments and Certain Hedging Activities, Amendment of Statement 133
on Derivative Instruments and Hedging Activities,
  RECLAMATION AND ENVIRONMENTAL COSTS
 Accounting for
Asset Retirement Obligations
   81




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##### Table of Contents



INCOME TAXES
 Accounting for Income Taxes
  Accounting for Uncertainty in Income Taxes
 STOCK-BASED COMPENSATION
 Share-Based Payment
 EARNINGS (LOSS) PER SHARE
    COMPREHENSIVE INCOME (LOSS)
  82




---



##### Table of Contents



DEBT ISSUANCE COSTS
  USE OF ESTIMATES
  RECLASSIFICATIONS
  NOTE 3
SALES
 Mine Production
   83




---



##### Table of Contents



PALLADIUM
    
    PLATINUMSubject to
    
    Subject to
    
    Subject to
    
    Subject toFloor Prices
    
    Ceiling Prices
    
    Floor Prices
    
    Ceiling Prices% of Mine
    
    Avg. Floor
    
    % of Mine
    
    Avg. Ceiling
    
    % of Mine
    
    Avg. Floor
    
    % of Mine
    
    Avg. CeilingYear
    
    Production
    
    Price
    
    Production
    
    Price
    
    Production
    
    Price
    
    Production
    
    Price2008
    
    
    100
    %
    
    $
    360
    
    
    
    20
    %
    
    $
    975
    
    
    
    70
    %
    
    $
    425
    
    
    
    14
    %
    
    $
    8502009
    
    
    100
    %
    
    $
    364
    
    
    
    20
    %
    
    $
    975
    
    
    
    70
    %
    
    $
    425
    
    
    
    14
    %
    
    $
    8502010
    
    
    100
    %
    
    $
    360
    
    
    
    20
    %
    
    $
    975
    
    
    
    70
    %
    
    $
    425
    
    
    
    14
    %
    
    $
    8502011
    
    
    20
    %
    
    $
    300
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2012
    
    
    20
    %
    
    $
    300
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
  PGM Recycling
  Other activities
  NOTE 4
DERIVATIVE INSTRUMENTS
  Commodity Derivatives
  84




---



##### Table of Contents



PGM Recycling
   85




---



##### Table of Contents



Mine Production:  Financially Settled Forwards
 PlatinumOunces
    
    Avg. Price
    
            
            
            
            
        
    IndexFirst Quarter 2008
    
    
    9,000
    
    
    $
    1,104
    
    
            
            
            
            
        
    Monthly London PM AverageSecond Quarter 2008
    
    
    6,000
    
    
    $
    1,054
    
    
            
            
            
            
        
    Monthly London PM AveragePGM Recycling:Financially Settled ForwardsPalladiumOunces
    
    Avg. Price
    
            
            
            
            
        
    IndexFirst Quarter 2008
    
    
    4,873
    
    
    $
    372
    
    
            
            
            
            
        
    Monthly London PM AveragePGM Recycling:Fixed Forwards
 Platinum
    
    Palladium
    
    RhodiumOunces
    
    Avg. Price
    
    Ounces
    
    Avg. Price
    
    Ounces
    
    Avg. PriceFirst Quarter 2008
    
    
    28,009
    
    
    $
    1,525
    
    
    
    8,269
    
    
    $
    366
    
    
    
    2,636
    
    
    $
    6,761Second Quarter 2008
    
    
    5,427
    
    
    $
    1,516
    
    
    
    1,069
    
    
    $
    368
    
    
    
    399
    
    
    $
    6,488
 Interest Rate Derivatives
  NOTE 5
SHARE-BASED PAYMENTS
 STOCK PLANS
    86




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##### Table of Contents



Nonvested Shares:
  Nonvested
    
    
    MarketShares
    
    
    Value on
    
    
    Compensation ExpenseGrant Date
    
    Vesting Date
    
    Granted
    
    
    Grant Date
    
    
    2007
    
    
    2006
    
    
    2005May 3, 2005
    
    November 2, 2005
    
    
    10,904
    
    
    $
    80,035
    
    
    $
    
    
    
    $
    
    
    
    $
    80,035April 27, 2006
    
    October 26, 2006
    
    
    9,752
    
    
    $
    160,030
    
    
    
    
    
    
    
    160,030
    (1)
    
    
    May 7, 2004
    
    May 7, 2007
    
    
    348,170
    
    
    $
    4,460,058
    
    
    
    495,562
    
    
    
    1,486,686
    
    
    
    1,486,686May 3, 2005
    
    May 3, 2008
    
    
    225,346
    
    
    $
    1,654,040
    
    
    
    260,656
    (2)
    
    
    551,347
    
    
    
    367,564April 27, 2006
    
    April 27, 2009
    
    
    288,331
    
    
    $
    4,731,512
    
    
    
    1,056,171
    (2)
    
    
    1,051,447
    
    
    
    February 22, 2007
    
    February 22, 2010
    
    
    426,514
    
    
    $
    5,433,788
    
    
    
    1,242,863
    (2)
    
    
    
    
    
    
    May 3, 2007
    
    November 3, 2007
    
    
    17,654
    
    
    $
    280,000
    
    
    
    280,000
    
    
    
    
    
    
    
    Total compensation expense of nonvested shares
    
    
    
    
    
    $
    3,335,252
    
    
    $
    3,249,510
    
    
    $
    1,934,285
 
 (1)
    
    A total of 1,219 nonvested shares that were granted on April 27, 2006 to non-management
directors were forfeited in 2006 due to the resignation of one member from the Companys board
of directors. Compensation expense of $20,004 was reversed in 2006 due to this resignation.(2)
    
    78,493, 57,148, and 44,554 nonvested shares granted in 2007, 2006, and 2005, respectively,
were forfeited in 2007 due to the resignation of one member of the Companys senior
management. Compensation expense in 2007 has been reduced to reflect compensation expense of
$255,318, $494,949, and $281,606 recognized in 2007, 2006, and 2005, respectively, due to this
resignation. Compensation expense in 2007 was also reduced by approximately $7,000 for
forfeiture of approximately 3,200 nonvested shares granted to certain members of management
and other employees who terminated employment in the first quarter of 2007. Deferral Plans:
 Omnibus Opinion  1967 Accounting for Deferred
Compensation Arrangements Where Amounts Earned are Held in a Rabbi Trust and Invested
 Omnibus Opinion 1967 Accounting for Deferred Compensation Arrangements Where Amounts Earned are Held in a Rabbi Trust
and Invested
 87




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##### Table of Contents



Stock Options:
   Year ended December 31,
    
    2007
    
    2006
    
    2005Weighted average expected lives (years)
    
    
    3.9
    
    
    
    3.8
    
    
    
    3.7Interest rate
    
    
    4.5
    %
    
    
    4.8
    %
    
    
    4.4
    %Volatility
    
    
    56
    %
    
    
    58
    %
    
    
    56
    %Dividend yield
    
    
    0
    
    
    
    0
    
    
    
    0
  Weighted-AverageWeighted Average
    
    
    Grant-Date FairShares
    
    
    Exercise Price
    
    
    ValueOptions outstanding at December 31, 2004
    
    
    1,732,801
    
    
    $
    20.92Options exercisable at December 31, 2004
    
    
    1,521,8672005 ActivityOptions granted
    
    
    71,025
    
    
    
    9.73
    
    
    $
    4.59Options exercised
    
    
    (11,429
    )
    
    
    3.65Options canceled/forfeited
    
    
    (274,100
    )
    
    
    22.71Options outstanding at December 31, 2005
    
    
    1,518,297
    
    
    $
    20.20Options exercisable at December 31, 2005
    
    
    1,361,5822006 ActivityOptions granted
    
    
    88,950
    
    
    
    12.27
    
    
    $
    5.86Options exercised
    
    
    (100,850
    )
    
    
    8.32Options canceled/forfeited
    
    
    (155,486
    )
    
    
    24.89Options outstanding at December 31, 2006
    
    
    1,350,911
    
    
    $
    20.02Options exercisable at December 31, 2006
    
    
    1,209,6442007 ActivityOptions granted
    
    
    71,450
    
    
    
    11.59
    
    
    $
    5.44Options exercised
    
    
    (29,375
    )
    
    
    9.14Options canceled/forfeited
    
    
    (118,961
    )
    
    
    16.01Options outstanding at December 31, 2007
    
    
    1,274,025
    
    
    $
    20.18Options exercisable at December 31, 2007
    
    
    1,149,830
    
    
    
    21.11
  88




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##### Table of Contents



Options Outstanding
    
    
    Options ExercisableAverage
    
    
    Weighted
    
    
    
    
    
    
    WeightedRange of
    
    
    Number
    
    
    Remaining
    
    
    Average
    
    
    Number
    
    
    AverageExercise Price
    
    
    Outstanding
    
    
    Contract Life
    
    
    Exercise Price
    
    
    Exercisable
    
    
    Exercise Price$
    2.30
    
    
    -
    
    $
    4.66
    
    
    
    11,593
    
    
    
    4.3
    
    
    $
    2.93
    
    
    
    11,593
    
    
    $
    2.93$
    4.67
    
    
    -
    
    $
    9.33
    
    
    
    147,633
    
    
    
    4.9
    
    
    $
    7.22
    
    
    
    118,643
    
    
    $
    6.88$
    9.34
    
    
    -
    
    $
    13.99
    
    
    
    143,101
    
    
    
    7.5
    
    
    $
    11.99
    
    
    
    60,748
    
    
    $
    12.12$
    14.00
    
    
    -
    
    $
    18.65
    
    
    
    259,734
    
    
    
    2.5
    
    
    $
    15.79
    
    
    
    246,882
    
    
    $
    15.80$
    18.66
    
    
    -
    
    $
    23.31
    
    
    
    275,364
    
    
    
    3.9
    
    
    $
    19.36
    
    
    
    275,364
    
    
    $
    19.36$
    23.32
    
    
    -
    
    $
    27.98
    
    
    
    180,225
    
    
    
    1.3
    
    
    $
    26.51
    
    
    
    180,225
    
    
    $
    26.51$
    27.99
    
    
    -
    
    $
    32.64
    
    
    
    94,675
    
    
    
    2.0
    
    
    $
    30.51
    
    
    
    94,675
    
    
    $
    30.51$
    32.65
    
    
    -
    
    $
    37.30
    
    
    
    110,200
    
    
    
    3.0
    
    
    $
    34.65
    
    
    
    110,200
    
    
    $
    34.65$
    37.31
    
    
    -
    
    $
    41.96
    
    
    
    51,500
    
    
    
    2.9
    
    
    $
    38.33
    
    
    
    51,500
    
    
    $
    38.331,274,025
    
    
    
    3.5
    
    
    $
    20.18
    
    
    
    1,149,830
    
    
    $
    21.11
  Weighted-AverageGrant-Date FairNonvested Options
    
    Options
    
    ValueNonvested options at January 1, 2007
    
    
    141,267
    
    
    $
    5.57Options granted
    
    
    71,450
    
    
    
    5.44Options vested
    
    
    (63,160
    )
    
    
    5.33Options forfeited
    
    
    (25,362
    )
    
    
    5.67Nonvested options at December 31, 2007
    
    
    124,195
    
    
    $
    5.38
  Employee Benefit Plans:
  89




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##### Table of Contents



NOTE 6
INCOME TAXES
  December 31, (in thousands)
    
    2007
    
    
    2006Mine development costs
    
    $
    89,077
    
    
    $
    78,861Inventory
    
    
    2,190
    
    
    
    837Total deferred tax liabilities
    
    
    91,267
    
    
    
    79,698Noncurrent liabilities
    
    
    (7,619
    )
    
    
    (7,847
    )Property and equipment
    
    
    (19,921
    )
    
    
    (19,977
    )Current liabilities
    
    
    (6,788
    )
    
    
    (5,901
    )Net operating loss and other carryforwards
    
    
    (127,194
    )
    
    
    (110,602
    )Total deferred tax assets
    
    
    (161,522
    )
    
    
    (144,327
    )Valuation allowance
    
    
    70,255
    
    
    
    64,629Net deferred tax assets
    
    
    (91,267
    )
    
    
    (79,698
    )Net deferred tax liabilities
    
    $
    
    
    
    $
    
   Year ended December 31, (in thousands)
    
    2007
    
    
    2006
    
    
    2005Income (loss) before income taxes
    
    $
    (14,257
    )
    
    $
    7,939
    
    
    $
    (13,861
    )Income tax (benefit) or expense at statutory rate of 35%
    
    $
    (4,990
    )
    
    $
    2,779
    
    
    $
    (4,851
    )State income tax benefit, net of federal benefit
    
    
    (626
    )
    
    
    348
    
    
    
    (608
    )Change in valuation allowance
    
    
    5,626
    
    
    
    (3,046
    )
    
    
    5,348Other
    
    
    (10
    )
    
    
    (71
    )
    
    
    124Net income tax provision
    
    $
    
    
    
    $
    10
    
    
    $
    13
   Accounting for Uncertainties in Income Taxes, an Interpretation of FASB
Statement No. 109
 90




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##### Table of Contents



NOTE 7
COMPREHENSIVE INCOME (LOSS)
    AccumulatedAvailable for
    
    
    
    
    
    
    OtherSale
    
    
    Commodity
    
    
    Comprehensive(in thousands)
    
    Securities
    
    
    Instruments
    
    
    LossBalance at December 31, 2004
    
    $
    
    
    
    $
    (4,965
    )
    
    $
    (4,965
    )Reclassification to earnings
    
    
    
    
    
    
    8,021
    
    
    
    8,021Change in value
    
    
    202
    
    
    
    (20,660
    )
    
    
    (20,458
    )Comprehensive income (loss)
    
    $
    202
    
    
    $
    (12,639
    )
    
    $
    (12,437
    )Balance at December 31, 2005
    
    $
    202
    
    
    $
    (17,604
    )
    
    $
    (17,402
    )Reclassification to earnings
    
    
    
    
    
    
    31,055
    
    
    
    31,055Change in value
    
    
    (25
    )
    
    
    (29,231
    )
    
    
    (29,256
    )Comprehensive income (loss)
    
    $
    (25
    )
    
    $
    1,824
    
    
    $
    1,799Balance at December 31, 2006
    
    $
    177
    
    
    $
    (15,780
    )
    
    $
    (15,603
    )Reclassification to earnings
    
    
    
    
    
    
    31,669
    
    
    
    31,669Change in value
    
    
    331
    
    
    
    (22,422
    )
    
    
    (22,091
    )Comprehensive income
    
    $
    331
    
    
    $
    9,247
    
    
    $
    9,578Balance at December 31, 2007
    
    $
    508
    
    
    $
    (6,533
    )
    
    $
    (6,025
    )
 NOTE 8
SEGMENT INFORMATION
   91




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##### Table of Contents



(in thousands)
    
    Mine
    
    PGM
    
    AllYear ended December 31, 2007
    
    Production
    
    Recycling
    
    Other
    
    TotalRevenues
    
    $
    277,456
    
    
    $
    326,394
    
    
    $
    15,365
    
    
    $
    619,215Depreciation and amortization
    
    $
    82,396
    
    
    $
    142
    
    
    $
    
    
    
    $
    82,538Interest income
    
    $
    
    
    
    $
    6,684
    
    
    $
    5,021
    
    
    $
    11,705Interest expense
    
    $
    
    
    
    $
    
    
    
    $
    11,269
    
    
    $
    11,269Income (loss) before income taxes
    
    $
    (7,843
    )
    
    $
    27,025
    
    
    $
    (33,439
    )
    
    $
    (14,257
    )Capital expenditures
    
    $
    87,257
    
    
    $
    382
    
    
    $
    237
    
    
    $
    87,876Total assets
    
    $
    516,308
    
    
    $
    88,588
    
    
    $
    137,511
    
    
    $
    742,407
 (in thousands)
    
    Mine
    
    PGM
    
    AllYear ended December 31, 2006
    
    Production
    
    Recycling
    
    Other
    
    TotalRevenues
    
    $
    292,204
    
    
    $
    269,941
    
    
    $
    51,003
    
    
    $
    613,148Depreciation and amortization
    
    $
    83,583
    
    
    $
    100
    
    
    $
    
    
    
    $
    83,683Interest income
    
    $
    
    
    
    $
    5,992
    
    
    $
    5,330
    
    
    $
    11,322Interest expense
    
    $
    
    
    
    $
    
    
    
    $
    11,413
    
    
    $
    11,413Income (loss) before income taxes
    
    $
    8,411
    
    
    $
    25,334
    
    
    $
    (25,806
    )
    
    $
    7,939Capital expenditures
    
    $
    97,284
    
    
    $
    209
    
    
    $
    309
    
    
    $
    97,802Total assets
    
    $
    512,128
    
    
    $
    71,587
    
    
    $
    172,308
    
    
    $
    756,023
 (in thousands)
    
    Mine
    
    PGM
    
    AllYear ended December 31, 2005
    
    Production
    
    Recycling
    
    Other
    
    TotalRevenues
    
    $
    264,206
    
    
    $
    90,695
    
    
    $
    152,561
    
    
    $
    507,462Depreciation and amortization
    
    $
    79,032
    
    
    $
    55
    
    
    $
    
    
    
    $
    79,087Interest income
    
    $
    
    
    
    $
    1,221
    
    
    $
    3,996
    
    
    $
    5,217Interest expense
    
    $
    
    
    
    $
    
    
    
    $
    11,733
    
    
    $
    11,733Income (loss) before income taxes
    
    $
    (5,109
    )
    
    $
    6,339
    
    
    $
    (15,091
    )
    
    $
    (13,861
    )Capital expenditures
    
    $
    92,076
    
    
    $
    29
    
    
    $
    
    
    
    $
    92,105Total assets
    
    $
    488,508
    
    
    $
    27,446
    
    
    $
    205,503
    
    
    $
    721,457
 92




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##### Table of Contents



NOTE 9
INVESTMENTS
  Gross
    
    
    Grossunrealized
    
    
    unrealized
    
    
    Fair(in thousands)
    
    Cost
    
    
    gains
    
    
    losses
    
    
    market value2007Federal agency notes
    
    $
    24,154
    
    
    $
    466
    
    
    $
    
    
    
    $
    24,620Commercial paper
    
    
    2,965
    
    
    
    18
    
    
    
    
    
    
    
    2,983Mutual funds
    
    
    511
    
    
    
    24
    
    
    
    
    
    
    
    535Total
    
    $
    27,630
    
    
    $
    508
    
    
    $
    
    
    
    $
    28,1382006Federal agency notes
    
    $
    25,464
    
    
    $
    111
    
    
    $
    
    
    
    
    25,575Commercial paper
    
    
    9,856
    
    
    
    66
    
    
    
    
    
    
    
    9,922Total
    
    $
    35,320
    
    
    $
    177
    
    
    $
    
    
    
    $
    35,497
    NOTE 10
INVENTORIES
   93




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##### Table of Contents



(in thousands)
    
    2007
    
    
    2006Metals inventoryRaw ore
    
    $
    1,061
    
    
    $
    596Concentrate and in-process
    
    
    36,933
    
    
    
    37,086Finished goods
    
    
    62,933
    
    
    
    53,081100,927
    
    
    
    90,763Materials and supplies
    
    
    17,736
    
    
    
    16,132Total
inventory
    
    $
    118,663
    
    
    $
    106,895
 NOTE 11
DEBT AND CAPITAL LEASE OBLIGATIONS
 CREDIT AGREEMENT
      94




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##### Table of Contents



Credit FacilityScheduled RepaymentsYear ended
    
    (in thousands)2008
    
    $
    1,0192009
    
    
    1,0192010
    
    
    96,305Total
    
    $
    98,343
 EQUIPMENT LEASE AGREEMENTS
  EXEMPT FACILITY REVENUE BONDS
  95




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##### Table of Contents



SPECIAL INDUSTRIAL EDUCATION IMPACT REVENUE BONDS
  CASH PAID FOR INTEREST
  NOTE 12
PROPERTY, PLANT AND EQUIPMENT
  (in thousands)
    
    2007
    
    
    2006Machinery and equipment
    
    $
    71,905
    
    
    $
    61,206Leased equipment
    
    
    
    
    
    
    2,614Buildings and structural components
    
    
    150,064
    
    
    
    143,859Mine development
    
    
    452,244
    
    
    
    373,929Land
    
    
    7,721
    
    
    
    7,721Construction-in-progress:Stillwater Mine
    
    
    47,072
    
    
    
    47,428East Boulder Mine
    
    
    33,358
    
    
    
    40,658Other
    
    
    3,902
    
    
    
    2,433766,266
    
    
    
    679,848Less accumulated depreciation and amortization
    
    
    (301,212
    )
    
    
    (219,520
    )Total property,
plant, and equipment
    
    $
    465,054
    
    
    $
    460,328
 The Companys capital expenditures for the years ended December 31, were as follows:
 (in thousands)
    
    2007
    
    
    2006
    
    
    2005Stillwater Mine
    
    $
    47,864
    
    
    $
    53,650
    
    
    $
    53,059East Boulder Mine
    
    
    33,991
    
    
    
    41,173
    
    
    
    38,041Other
    
    
    6,021
    
    
    
    2,979
    
    
    
    1,005Total capital expenditures
    
    
    87,876
    
    
    
    97,802
    
    
    
    92,105Acquired by capital lease transactions
    
    
    
    
    
    
    
    
    
    
    (31
    )Total cash paid for capital expenditures
    
    $
    87,876
    
    
    $
    97,802
    
    
    $
    92,074
 96




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##### Table of Contents



NOTE 13
ASSET RETIREMENT OBLIGATION
  Stillwater
    
    
    East Boulder(in thousands)
    
    Mine
    
    
    Mine
    
    
    TotalBalance at
January 1, 2005
    
    $
    4,976
    
    
    $
    1,816
    
    
    $
    6,792Liabilities incurred
    
    
    
    
    
    
    
    
    
    
    Accretion expense
    
    
    370
    
    
    
    166
    
    
    
    536Revision of estimated cash flows
    
    
    
    
    
    
    
    
    
    
    Balance at December 31, 2005
    
    $
    5,346
    
    
    $
    1,982
    
    
    $
    7,328Liabilities incurred
    
    
    
    
    
    
    1,453
    
    
    
    1,453Accretion expense
    
    
    470
    
    
    
    180
    
    
    
    650Revision of estimated cash flows
    
    
    
    
    
    
    (881
    )
    
    
    (881
    )Balance at December 31, 2006
    
    $
    5,816
    
    
    $
    2,734
    
    
    $
    8,550Liabilities incurred
    
    
    1,222
    
    
    
    
    
    
    
    1,222Accretion expense
    
    
    512
    
    
    
    222
    
    
    
    734Revision of estimated cash flows
    
    
    
    
    
    
    
    
    
    
    Balance at December 31, 2007
    
    $
    7,550
    
    
    $
    2,956
    
    
    $
    10,506
   NOTE 14
RESTRUCTURING COSTS
  97




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##### Table of Contents



(in thousands)Balance at December 31, 2004
    
    $
    577Cash paid
    
    
    (334
    )Accrual adjustments
    
    
    (243
    )Balance at December 31, 2005
    
    $
    
 NOTE 15
RELATED PARTIES
  NOTE 16
COMMITMENTS AND CONTINGENCIES
  REFINING AGREEMENTS
  PURCHASE COMMITMENT
  OPERATING LEASES
  98




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##### Table of Contents



Minimum LeaseYear ended (in thousands)
    
    Payment2008
    
    $
    2752009
    
    
    2402010
    
    
    2402011
    
    
    240Thereafter
    
    
    699Total
    
    $
    1,694
 SIGNIFICANT CUSTOMERS
  2007
    
    2006
    
    2005Customer A
    
    
    36
    %
    
    
    36
    %
    
    
    38
    %Customer B
    
    
    28
    %
    
    
    18
    %
    
    
    20
    %Customer C
    
    
    *
    
    
    
    *
    
    
    
    20
    %Customer D
    
    
    *
    
    
    
    11
    %
    
    
    *64
    %
    
    
    65
    %
    
    
    78
    %
 
 *
    
    Represents less than 10% of total revenues LABOR UNION CONTRACTS
  LEGAL PROCEEDINGS
  REGULATIONS AND COMPLIANCE
 m m
 99




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##### Table of Contents



NOTE 17
QUARTERLY DATA (UNAUDITED)
  2007 Quarter Ended(in thousands, except per share data)
    
    March 31
    
    June 30
    
    September 30
    
    December 31Revenue
    
    $
    146,450
    
    
    $
    160,963
    
    
    $
    163,087
    
    
    $
    148,714Depreciation and amortization
    
    $
    20,438
    
    
    $
    21,656
    
    
    $
    20,146
    
    
    $
    20,320Operating income (loss)
    
    $
    (1,195
    )
    
    $
    (2,773
    )
    
    $
    (11,206
    )
    
    $
    245Net income (loss)
    
    $
    (1,059
    )
    
    $
    (2,516
    )
    
    $
    (11,053
    )
    
    $
    371Comprehensive income (loss)
    
    $
    (6,234
    )
    
    $
    2,930
    
    
    $
    (7,503
    )
    
    $
    6,128Basic earnings per share (loss)
    
    $
    (0.01
    )
    
    $
    (0.03
    )
    
    $
    (0.12
    )
    
    $
    Diluted earnings per share (loss)
    
    $
    (0.01
    )
    
    $
    (0.03
    )
    
    $
    (0.12
    )
    
    $
    
 2006 Quarter EndedMarch 31
    
    June 30
    
    September 30
    
    December 31Revenue
    
    $
    139,959
    
    
    $
    116,826
    
    
    $
    180,817
    
    
    $
    175,546Depreciation and amortization
    
    $
    19,935
    
    
    $
    21,376
    
    
    $
    20,003
    
    
    $
    22,369Operating income (loss)
    
    $
    1,428
    
    
    $
    (2,671
    )
    
    $
    6,171
    
    
    $
    3,008Net income (loss)
    
    $
    597
    
    
    $
    (2,337
    )
    
    $
    6,862
    
    
    $
    2,807Comprehensive income (loss)
    
    $
    (15,953
    )
    
    $
    (15,379
    )
    
    $
    28,316
    
    
    $
    12,744Basic earnings per share (loss)
    
    $
    0.01
    
    
    $
    (0.03
    )
    
    $
    0.08
    
    
    $
    0.03Diluted earnings per share (loss)
    
    $
    0.01
    
    
    $
    (0.03
    )
    
    $
    0.07
    
    
    $
    0.03
 100




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##### Table of Contents



ITEM 9
CHANGES IN AND DISAGREEMENTS WITH
ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
 Not Applicable
 
 ITEM 9A
CONTROLS AND PROCEDURES
 (a)
    
    Disclosure Controls and Procedures.
  (b)
    
    Changes in Internal Controls.
  (c)
    
    Internal Control Over Financial Reporting.
  Managements Report on Internal Control over Financial Reporting.
  101




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##### Table of Contents



ITEM 9B
 OTHER
INFORMATION
 Not Applicable
 
 PART III
 
 ITEM 10
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
   Name
    
    Age
    
    PositionFrancis R. McAllister
    
    
    65
    
    
    Chairman of the Board and Chief Executive OfficerJohn R. Stark
    
    
    55
    
    
    Vice President, Human Resources, Secretary and
Corporate CounselTerrell I. Ackerman
    
    
    54
    
    
    Vice President, Planning and Process OperationsGregory A. Wing
    
    
    58
    
    
    Vice President, and Chief Financial Officer
  EXECUTIVE OFFICERS
 Francis R. McAllister (age 65)
 John R. Stark (age 55)
 Greg R. Struble (age 50)
 102




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##### Table of Contents



Terrell I. Ackerman (age 54)
 Gregory A. Wing (age 58)
  Audit Committee Financial Expert
  Code of Ethics
 http://www.stillwatermining.com
 Corporate Governance
 http://www.stillwatermining.com
 NYSE CEO Certification
  103




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##### Table of Contents



ITEM 11
EXECUTIVE COMPENSATION
  
 ITEM 12
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT AND RELATED STOCKHOLDERS MATTERS
  
 ITEM 13
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
  
 ITEM 14
PRINCIPAL ACCOUNTING FEES AND SERVICES
  
 PART IV
 
 ITEM 15
EXHIBITS, FINANCIAL STATEMENT SCHEDULES
   PageReport
of Independent Registered Public Accounting Firm
    
    71Statement of Operations and Comprehensive Income (Loss)
    
    73Balance Sheet
    
    75Statement of Cash Flow
    
    76Statement of Changes in Stockholders Equity
    
    77Notes to Financial Statements
    
    78
    104




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##### Table of Contents



EXHIBITS
 Number
    
    Description2.1
    
    Exchange Agreement for 10,000 shares of common stock, dated October
1, 1993 (incorporated by reference to Exhibit 2.1 to the
Registrants Registration Statement on Form S-1 (File No. 33-85904)
as declared effective by the Commission on December 15, 1994 (the
1994 S-1)).3.1
    
    Restated Certificate of Incorporation of Stillwater Mining Company,
dated October 23, 2003 (incorporated by reference to Exhibit 3.1 to
the Form 10-Q for the quarterly period ended September 30, 2003,
filed on October 27, 2003).3.2
    
    Amended and Restated By-Laws of Stillwater Mining Company,
(incorporated by reference to Exhibit 3.2 to the Form 8-K filed on
December 29, 2004).4.1
    
    Form of Indenture, dated April 29, 1996, between Stillwater Mining Company and Colorado National Bank
with respect to the Companys 7% Convertible Subordinated Notes Due 2003 (incorporated by reference
to Exhibit 4.1 of the Registrants Form 8-K, dated April 29, 1996).4.2
    
    Rights Agreement, dated October 26, 1995 (incorporated by reference to Form 8-A, filed on October 30,
1995).4.3
    
    Amendment No. 1, dated as of November 20, 2002, to the Rights Agreement between Stillwater Mining
Company and Computershare Trust Company, Inc. (incorporated by reference to Exhibit 4.1 of the
Registrants Form 8-K, dated November 21, 2002).10.2
    
    Mining and Processing Agreement, dated March 16, 1984 regarding the Mouat family; and Compromise of
Issues Relating to the Mining and Processing Agreement (incorporated by reference to Exhibit 10.8 to
the 1994 S-1).10.3
    
    Conveyance of Royalty Interest and Agreement between Stillwater Mining Company and Manville Mining
Company, dated October 1, 1993 (incorporated by reference to Exhibit 10.9 to the 1994 S-1).10.4
    
    Palladium Sales Agreement, made as of August 13, 1998, between Stillwater Mining Company and Ford
Motor Company (portions of the agreement have been omitted pursuant to a confidential treatment
request) (incorporated by reference to Exhibit 10.1 to the Registrants Form 8-K, dated July 21,
1998).10.5
    
    Palladium and Platinum Sales Agreement, made as of August 17, 1998, between Stillwater Mining Company
and General Motors Corporation (portions of the agreement have been omitted pursuant to a
confidential treatment request) (incorporated by reference to Exhibit 10.3 to the Registrants Form
8-K, dated July 21, 1998).10.7
    
    Employment Agreement between Francis R. McAllister and Stillwater Mining Company, dated July 23, 2001
(incorporated by reference to Exhibit 10.1 to the Form 10-Q for the quarterly period ended September
30, 2001).10.8
    
    Employment agreement between John R. Stark and Stillwater Mining Company dated July 23, 2001
(incorporated by reference to Exhibit 10.18 to the Form 10-K for the year ended December 31, 2001).10.9
    
    First Amendment Agreement to Palladium Sales Agreement between Stillwater Mining Company and Ford
Motor Company, dated October 27, 2000 (incorporated by reference to Exhibit 10.20 of the Registrants
2000 10-K) (portions of the agreement have been omitted pursuant to a confidential treatment
request).10.10
    
    Second Amendment Agreement to Palladium and Platinum Sales Agreement between Stillwater Mining
Company and Ford Motor Company, dated March 27, 2001 (incorporated by reference to Exhibit 10.1 to
the Form 10-Q for the quarterly period ended March 31, 2001) (portions of the agreement have been
omitted pursuant to a confidential treatment request).10.11
    
    First Amendment Agreement to Palladium and Platinum Sales Agreement between Stillwater Mining Company
and General Motors Corporation, dated November 20, 2000 (incorporated by reference to Exhibit 10.21
of the Registrants 2000 10-K) (portions of the agreement have been omitted pursuant to a
confidential treatment request).10.12
    
    Refining Agreement between Stillwater Mining Company and Catalyst and Chemicals Division of Johnson
Matthey Inc. dated July 27, 2000 (incorporated by reference to Exhibit 10.22 of the Registrants 2000
10-K) (portions of the agreement have been omitted pursuant to a confidential treatment request).10.13
    
    Second Amendment Agreement to Palladium and Platinum Sales Agreement between Stillwater Mining
Company and General Motors Corporation, dated February 14, 2001 (incorporated by reference to Exhibit
10.24 of the Registrants 2001 10-K).
 105




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##### Table of Contents



Number
    
    Description10.14
    
    Employment Agreement between Greg R. Struble and Stillwater Mining Company, dated February 4, 2008
(incorporated by reference to Exhibit 10.1 to the Form 8-K filed February 11, 2008).10.15
    
    2008 Restricted Stock Unit Agreement between Greg R. Struble and Stillwater Mining Company, dated
February 4, 2008 (incorporated by reference to Exhibit 10.2 to the Form 8-K filed February 11, 2008).10.16
    
    Third Amendment to Palladium and Platinum Sales Agreement between Stillwater Mining Company and Ford
Motor Company, dated March 13, 2002 (incorporated by reference to Exhibit 10.33 of the Registrants
2002 10-K) (portions of the agreement have been omitted pursuant to a confidential treatment
request).10.17
    
    Employment Agreement between Terrell I. Ackerman and Stillwater Mining Company dated May 8, 2002
(incorporated by reference to Exhibit 10.34 of the Registrants 2002 10-K).10.18
    
    Amended and Restated General Employee Stock Plan, dated October 23, 2003 (incorporated by reference
to Exhibit 10.1 to the Form 10-Q for the quarterly period ended September 30, 2003).10.19
    
    Employment Agreement between Stephen A. Lang and Stillwater Mining Company dated September 1, 2003
(incorporated by reference to Exhibit 10.2 to the Form 10-Q for the quarterly period ended September
30, 2003).10.20
    
    Stock Purchase Agreement between Stillwater Mining Company and MMC Norilsk Nickel and Norimet Ltd.
dated June 23, 2003 (incorporated by reference to Exhibit 10.1 to the Form 8-K, dated June 23, 2003).10.21
    
    Registration Rights Agreement, Stillwater Mining Company and Norimet Ltd. dated June 23, 2003.
(incorporated by reference to Exhibit 10.2 to the Form 8-K dated June 23, 2003).10.23
    
    Palladium Sales Agreement, made as of March 3, 2004, among Stillwater Mining Company and Engelhard
Corporation (incorporated by reference to Exhibit 10.39 to the Form 10-K filed on March 15,
2004(portions of this agreement have been omitted pursuant to a confidential treatment request).10.24
    
    Employment Agreement between Gregory A. Wing and Stillwater Mining Company dated as of March 22, 2004
(incorporated by reference to Exhibit 10.40 to the Form 10-K filed on March 15, 2004).10.25
    
    Articles of Agreement between Stillwater Mining Company (East Boulder) Paper, Allied Industrial,
Chemical and Energy Workers International Union, ratified July 2002 (incorporated by reference to
Exhibit 10.41 to the Form 10-K filed on March 15, 2004).10.26
    
    Amendment No. 1 to Stockholders Agreement, dated as of March 19, 2004, made by and among Stillwater
Mining Company and MMC Norilsk Nickel (incorporated by reference to Exhibit 2.1 to the Form 10-Q
filed on May 7, 2004).10.28
    
    Articles of Agreement between Stillwater Mining Company (Stillwater Mine & Mill, and the Processing
and Warehouse facilities) Paper, Allied Industrial, Chemical and Energy Workers International Union,
ratified July 19, 2004 (incorporated by reference to Exhibit 10.1 to the Form 10-Q filed on August 5,
2004).10.29
    
    Credit Agreement, dated August 3, 2004, between Stillwater Mining Company and TD Securities (USA),
Ltd. (incorporated by reference to Exhibit 10.2 to the Form 10-Q filed on August 5, 2004).10.30
    
    Fourth Amendment to Palladium and Platinum Sales Agreement between Stillwater Mining Company and Ford
Motor Company, dated February 20, 2003 (incorporated by reference to Exhibit 10.1 to the Form 10-Q
filed on November 2, 2004).10.31
    
    Fifth Amendment to Palladium and Platinum Sales Agreement between Stillwater Mining Company and Ford
Motor Company, dated May 4, 2004 (incorporated by reference to Exhibit 10.1 to the Form 10-Q filed on
November 2, 2004).10.33
    
    Contract between Stillwater Mining Company and USW International Union, Local 1, East Boulder Unit,
effective July 10, 2005 (incorporated by reference to Exhibit 10.1 to the Form 10-Q filed on August
8, 2005).10.34
    
    409A Nonqualified Deferred
Compensation Plan, (incorporated by reference to exhibit 10.34 to the
Form 10-K filed on March 16, 2006).10.35
    
    2004 Equity Incentive Plan (incorporated by reference to Appendix A to the Proxy statement, dated
April 29, 2004).10.36
    
    409A Non-Employee Directors Deferred Compensation Plan (incorporated by reference to Exhibit 10.1 to
the Form-8K dated May 9, 2005).10.37
    
    Amendment No. 1 to Credit Agreement, dated August 3, 2004, between Stillwater Mining Company and TD
Securities (USA), Ltd., dated January 31, 2006 (incorporated by reference to Exhibit 10.1 to the Form
8-K dated February 3, 2006).10.38
    
    Amendment No. 2 and Waiver to Credit Agreement, dated August 3, 2004, between Stillwater Mining
Company and TD Securities (USA), Ltd., dated November 5, 2007 (incorporated by reference to Exhibit
10.1 to the Form 8-K dated November 8, 2007).
 106




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##### Table of Contents



Number
    
    Description10.39
    
    Articles of Agreement between Stillwater Mining Company (Stillwater Mine & Mill, and the Processing
and Warehouse facilities) and United Steel Workers (USW) Local 11-0001, ratified July 16, 2007
(incorporated by reference to Exhibit 10.1 to the Form 10-Q filed on August 7, 2007).10.40
    
    Supplemental Memorandum of Understanding between Stillwater Mining Company (Stillwater Mine & Mill,
and the Processing and Warehouse facilities) and United Steel Workers (USW) Local 11-0001, ratified
September 4, 2007 (incorporated by reference to Exhibit 10.2 to the Form 10-Q filed on November 6,
2007).10.41
    
    Third Amendment Agreement to Palladium and Platinum Sales Agreement between Stillwater Mining Company
and General Motors Corporation, dated August 8, 2007 (portions of the agreement have been omitted
pursuant to a confidential treatment request), (incorporated by reference to Exhibit 10.3 to the Form
10-Q filed on November 6, 2007).10.42
    
    Palladium and Rhodium Sales Agreement, made as of August 8, 2007, between Stillwater Mining Company
and General Motors Corporation (portions of the agreement have been omitted pursuant to a
confidential treatment request), (incorporated by reference to Exhibit 10.4 to the Form 10-Q filed on
November 6, 2007).18.1
    
    Preferability letter from KPMG LLP dated March 30, 2005. (incorporated by reference to Exhibit 18.1
to the Form 10-K filed on March 31, 2005).23.1
    
    Consent of KPMG LLP, Independent Registered Public Accounting Firm (filed herewith).23.2
    
    Consent of Behre Dolbear & Company, Inc. (filed herewith).31.1
    
    Rule 13a-14(a)/15d-14(a) Certification  Chief Executive Officer, (filed herewith).31.2
    
    Rule 13a-14(a)/15d-14(a) Certification  Vice President and Chief Financial Officer, (filed herewith).32.1
    
    Section 1350 Certification, (filed herewith).32.2
    
    Section 1350 Certification, (filed herewith).
 107




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##### Table of Contents



SIGNATURES
  STILLWATER MINING COMPANY
(Registrant)Dated: February 26, 2008
    By:
    /s/ Francis R. McAllisterFrancis R. McAllisterChairman and Chief Executive Officer  Signature and Title
    
    
    
    Date/s/ Francis R. McAllister

Francis R. McAllister
    
    
    
    February 26, 2008Chairman, Chief Executive Officer and Director(Principal Executive Officer)/s/ Gregory A. Wing

Gregory A. Wing
    
    
    
    February 26, 2008Vice President and Chief Financial Officer(Principal Accounting Officer)/s/ Craig L. Fuller

Craig L. Fuller, Director
    
    
    
    February 26, 2008/s/ Patrick M. James

Patrick M. James, Director
    
    
    
    February 26, 2008/s/ Steven S. Lucas

Steven S. Lucas, Director
    
    
    
    February 26, 2008/s/ Joseph P. Mazurek

Joseph P. Mazurek, Director
    
    
    
    February 26, 2008/s/ Sheryl K. Pressler
    
    
    
    February 26, 2008Sheryl K. Pressler, Director/s/ Donald W. Riegle Jr.

Donald W. Riegle Jr., Director
    
    
    
    February 26, 2008/s/ Todd D. Schafer

Todd D. Schafer, Director
    
    
    
    February 26, 2008
 108




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##### Table of Contents



Exhibit Index
 Number
    
    Description2.1
    
    Exchange Agreement for 10,000 shares of common stock, dated October
1, 1993 (incorporated by reference to Exhibit 2.1 to the
Registrants Registration Statement on Form S-1 (File No. 33-85904)
as declared effective by the Commission on December 15, 1994 (the
1994 S-1)).3.1
    
    Restated Certificate of Incorporation of Stillwater Mining Company,
dated October 23, 2003 (incorporated by reference to Exhibit 3.1 to
the Form 10-Q for the quarterly period ended September 30, 2003,
filed on October 27, 2003).3.2
    
    Amended and Restated By-Laws of Stillwater Mining Company,
(incorporated by reference to Exhibit 3.2 to the Form 8-K filed on
December 29, 2004).4.1
    
    Form of Indenture, dated April 29, 1996, between Stillwater Mining Company and Colorado National Bank
with respect to the Companys 7% Convertible Subordinated Notes Due 2003 (incorporated by reference
to Exhibit 4.1 of the Registrants Form 8-K, dated April 29, 1996).4.2
    
    Rights Agreement, dated October 26, 1995 (incorporated by reference to Form 8-A, filed on October 30,
1995).4.3
    
    Amendment No. 1, dated as of November 20, 2002, to the Rights Agreement between Stillwater Mining
Company and Computershare Trust Company, Inc. (incorporated by reference to Exhibit 4.1 of the
Registrants Form 8-K, dated November 21, 2002).10.2
    
    Mining and Processing Agreement, dated March 16, 1984 regarding the Mouat family; and Compromise of
Issues Relating to the Mining and Processing Agreement (incorporated by reference to Exhibit 10.8 to
the 1994 S-1).10.3
    
    Conveyance of Royalty Interest and Agreement between Stillwater Mining Company and Manville Mining
Company, dated October 1, 1993 (incorporated by reference to Exhibit 10.9 to the 1994 S-1).10.4
    
    Palladium Sales Agreement, made as of August 13, 1998, between Stillwater Mining Company and Ford
Motor Company (portions of the agreement have been omitted pursuant to a confidential treatment
request) (incorporated by reference to Exhibit 10.1 to the Registrants Form 8-K, dated July 21,
1998).10.5
    
    Palladium and Platinum Sales Agreement, made as of August 17, 1998, between Stillwater Mining Company
and General Motors Corporation (portions of the agreement have been omitted pursuant to a
confidential treatment request) (incorporated by reference to Exhibit 10.3 to the Registrants Form
8-K, dated July 21, 1998).10.7
    
    Employment Agreement between Francis R. McAllister and Stillwater Mining Company, dated July 23, 2001
(incorporated by reference to Exhibit 10.1 to the Form 10-Q for the quarterly period ended September
30, 2001).10.8
    
    Employment agreement between John R. Stark and Stillwater Mining Company dated July 23, 2001
(incorporated by reference to Exhibit 10.18 to the Form 10-K for the year ended December 31, 2001).10.9
    
    First Amendment Agreement to Palladium Sales Agreement between Stillwater Mining Company and Ford
Motor Company, dated October 27, 2000 (incorporated by reference to Exhibit 10.20 of the Registrants
2000 10-K) (portions of the agreement have been omitted pursuant to a confidential treatment
request).10.10
    
    Second Amendment Agreement to Palladium and Platinum Sales Agreement between Stillwater Mining
Company and Ford Motor Company, dated March 27, 2001 (incorporated by reference to Exhibit 10.1 to
the Form 10-Q for the quarterly period ended March 31, 2001) (portions of the agreement have been
omitted pursuant to a confidential treatment request).10.11
    
    First Amendment Agreement to Palladium and Platinum Sales Agreement between Stillwater Mining Company
and General Motors Corporation, dated November 20, 2000 (incorporated by reference to Exhibit 10.21
of the Registrants 2000 10-K) (portions of the agreement have been omitted pursuant to a
confidential treatment request).10.12
    
    Refining Agreement between Stillwater Mining Company and Catalyst and Chemicals Division of Johnson
Matthey Inc. dated July 27, 2000 (incorporated by reference to Exhibit 10.22 of the Registrants 2000
10-K) (portions of the agreement have been omitted pursuant to a confidential treatment request).10.13
    
    Second Amendment Agreement to Palladium and Platinum Sales Agreement between Stillwater Mining
Company and General Motors Corporation, dated February 14, 2001 (incorporated by reference to Exhibit
10.24 of the Registrants 2001 10-K).




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##### Table of Contents



Number
    
    Description10.14
    
    Employment Agreement between Greg R. Struble and Stillwater Mining Company, dated February 4, 2008
(incorporated by reference to Exhibit 10.1 to the Form 8-K filed February 11, 2008).10.15
    
    2008 Restricted Stock Unit Agreement between Greg R. Struble and Stillwater Mining Company, dated
February 4, 2008 (incorporated by reference to Exhibit 10.2 to the Form 8-K filed February 11, 2008).10.16
    
    Third Amendment to Palladium and Platinum Sales Agreement between Stillwater Mining Company and Ford
Motor Company, dated March 13, 2002 (incorporated by reference to Exhibit 10.33 of the Registrants
2002 10-K) (portions of the agreement have been omitted pursuant to a confidential treatment
request).10.17
    
    Employment Agreement between Terrell I. Ackerman and Stillwater Mining Company dated May 8, 2002
(incorporated by reference to Exhibit 10.34 of the Registrants 2002 10-K).10.18
    
    Amended and Restated General Employee Stock Plan, dated October 23, 2003 (incorporated by reference
to Exhibit 10.1 to the Form 10-Q for the quarterly period ended September 30, 2003).10.19
    
    Employment Agreement between Stephen A. Lang and Stillwater Mining Company dated September 1, 2003
(incorporated by reference to Exhibit 10.2 to the Form 10-Q for the quarterly period ended September
30, 2003).10.20
    
    Stock Purchase Agreement between Stillwater Mining Company and MMC Norilsk Nickel and Norimet Ltd.
dated June 23, 2003 (incorporated by reference to Exhibit 10.1 to the Form 8-K, dated June 23, 2003).10.21
    
    Registration Rights Agreement, Stillwater Mining Company and Norimet Ltd. dated June 23, 2003.
(incorporated by reference to Exhibit 10.2 to the Form 8-K dated June 23, 2003).10.23
    
    Palladium Sales Agreement, made as of March 3, 2004, among Stillwater Mining Company and Engelhard
Corporation (incorporated by reference to Exhibit 10.39 to the Form 10-K filed on March 15,
2004(portions of this agreement have been omitted pursuant to a confidential treatment request).10.24
    
    Employment Agreement between Gregory A. Wing and Stillwater Mining Company dated as of March 22, 2004
(incorporated by reference to Exhibit 10.40 to the Form 10-K filed on March 15, 2004).10.25
    
    Articles of Agreement between Stillwater Mining Company (East Boulder) Paper, Allied Industrial,
Chemical and Energy Workers International Union, ratified July 2002 (incorporated by reference to
Exhibit 10.41 to the Form 10-K filed on March 15, 2004).10.26
    
    Amendment No. 1 to Stockholders Agreement, dated as of March 19, 2004, made by and among Stillwater
Mining Company and MMC Norilsk Nickel (incorporated by reference to Exhibit 2.1 to the Form 10-Q
filed on May 7, 2004).10.28
    
    Articles of Agreement between Stillwater Mining Company (Stillwater Mine & Mill, and the Processing
and Warehouse facilities) Paper, Allied Industrial, Chemical and Energy Workers International Union,
ratified July 19, 2004 (incorporated by reference to Exhibit 10.1 to the Form 10-Q filed on August 5,
2004).10.29
    
    Credit Agreement, dated August 3, 2004, between Stillwater Mining Company and TD Securities (USA),
Ltd. (incorporated by reference to Exhibit 10.2 to the Form 10-Q filed on August 5, 2004).10.30
    
    Fourth Amendment to Palladium and Platinum Sales Agreement between Stillwater Mining Company and Ford
Motor Company, dated February 20, 2003 (incorporated by reference to Exhibit 10.1 to the Form 10-Q
filed on November 2, 2004).10.31
    
    Fifth Amendment to Palladium and Platinum Sales Agreement between Stillwater Mining Company and Ford
Motor Company, dated May 4, 2004 (incorporated by reference to Exhibit 10.1 to the Form 10-Q filed on
November 2, 2004).10.33
    
    Contract between Stillwater Mining Company and USW International Union, Local 1, East Boulder Unit,
effective July 10, 2005 (incorporated by reference to Exhibit 10.1 to the Form 10-Q filed on August
8, 2005).10.34
    
    409A Nonqualified Deferred
Compensation Plan, (incorporated by reference to exhibit 10.34 to the
Form 10-K filed on March 16, 2006).10.35
    
    2004 Equity Incentive Plan (incorporated by reference to Appendix A to the Proxy statement, dated
April 29, 2004).10.36
    
    409A Non-Employee Directors Deferred Compensation Plan (incorporated by reference to Exhibit 10.1 to
the Form-8K dated May 9, 2005).10.37
    
    Amendment No. 1 to Credit Agreement, dated August 3, 2004, between Stillwater Mining Company and TD
Securities (USA), Ltd., dated January 31, 2006 (incorporated by reference to Exhibit 10.1 to the Form
8-K dated February 3, 2006).10.38
    
    Amendment No. 2 and Waiver to Credit Agreement, dated August 3, 2004, between Stillwater Mining
Company and TD Securities (USA), Ltd., dated November 5, 2007 (incorporated by reference to Exhibit
10.1 to the Form 8-K dated November 8, 2007).




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##### Table of Contents



Number
    
    Description10.39
    
    Articles of Agreement between Stillwater Mining Company (Stillwater Mine & Mill, and the Processing
and Warehouse facilities) and United Steel Workers (USW) Local 11-0001, ratified July 16, 2007
(incorporated by reference to Exhibit 10.1 to the Form 10-Q filed on August 7, 2007).10.40
    
    Supplemental Memorandum of Understanding between Stillwater Mining Company (Stillwater Mine & Mill,
and the Processing and Warehouse facilities) and United Steel Workers (USW) Local 11-0001, ratified
September 4, 2007 (incorporated by reference to Exhibit 10.2 to the Form 10-Q filed on November 6,
2007).10.41
    
    Third Amendment Agreement to Palladium and Platinum Sales Agreement between Stillwater Mining Company
and General Motors Corporation, dated August 8, 2007 (portions of the agreement have been omitted
pursuant to a confidential treatment request), (incorporated by reference to Exhibit 10.3 to the Form
10-Q filed on November 6, 2007).10.42
    
    Palladium and Rhodium Sales Agreement, made as of August 8, 2007, between Stillwater Mining Company
and General Motors Corporation (portions of the agreement have been omitted pursuant to a
confidential treatment request), (incorporated by reference to Exhibit 10.4 to the Form 10-Q filed on
November 6, 2007).18.1
    
    Preferability letter from KPMG LLP dated March 30, 2005. (incorporated by reference to Exhibit 18.1
to the Form 10-K filed on March 31, 2005).23.1
    
    Consent of KPMG LLP, Independent Registered Public Accounting Firm (filed herewith).23.2
    
    Consent of Behre Dolbear & Company, Inc. (filed herewith).31.1
    
    Rule 13a-14(a)/15d-14(a) Certification  Chief Executive Officer, (filed herewith).31.2
    
    Rule 13a-14(a)/15d-14(a) Certification  Vice President and Chief Financial Officer, (filed herewith).32.1
    
    Section 1350 Certification, (filed herewith).32.2
    
    Section 1350 Certification, (filed herewith).