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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, 2008.
 OR
 o
    
    Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934for 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.)
 536 EAST PIKE AVENUE, COLUMBUS, MONTANA 59019
 (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
    
    Smaller reporting company o(Do not check if a smaller reporting company)
 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 2009 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
    
    
    45ITEM 4 SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
    
    
    45PART IIITEM 5 MARKET FOR REGISTRANTS COMMON EQUITY, RELATED
STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
    
    
    46ITEM 6 SELECTED FINANCIAL DATA
    
    
    47ITEM 7 MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
    
    
    55ITEM 7A QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
    
    
    70ITEM 8 FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
    
    
    72ITEM 9 CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE
    
    
    105ITEM 9A CONTROLS AND PROCEDURES
    
    
    105ITEM 9B OTHER INFORMATION
    
    
    107PART IIIITEM 10 DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
    
    
    107ITEM 11 EXECUTIVE COMPENSATION
    
    
    109ITEM 12 SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT AND RELATED STOCKHOLDER MATTERS
    
    
    109ITEM 13 CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS,
AND DIRECTOR INDEPENDENCE
    
    
    110ITEM 14 PRINCIPAL ACCOUNTING FEES AND SERVICES
    
    
    110PART IVITEM 15 EXHIBITS, FINANCIAL STATEMENT SCHEDULES
    
    
    110SIGNATURES
    
    
    114EX-10.43EX-10.44EX-23.1EX-23.2EX-31.1EX-31.2EX-32.1EX-32.2




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##### Table of Contents



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 ore
body.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.Footwall
    
    The underlying side of a fault, ore body, or mine working; especially the wall rock beneath an inclined vein, fault, or reef.
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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, ore body, 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.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.
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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.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.
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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 2008 HIGHLIGHTS
      Business and Properties  Ore Reserves
 Worldwide Financial and Credit Crises
   6




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Business and Properties  Risk Factors
 2008  In Review:
 
    
    The Companys revenues, in terms of dollars and ounces sold, for 2008, 2007 and 2006 were:
 Year ended December 31,
    
    Sales Revenues (1)
    
    
    Troy Ounces Sold (2)(in thousands)
    
    Palladium
    
    
    Platinum
    
    
    Rhodium
    
    
    Other
    
    
    Total
    
    
    Palladium
    
    
    Platinum
    
    
    Rhodium
    
    
    Other
    
    
    Total2008Mine production
    
    $
    163,433
    
    
    $
    160,171
    
    
    $
    16,474
    
    
    $
    20,286
    
    
    $
    360,364
    
    
    
    399
    
    
    
    115
    
    
    
    2
    
    
    
    19
    
    
    
    535PGM recycling
    
    
    47,760
    
    
    
    227,358
    
    
    
    197,469
    
    
    
    2,801
    
    
    
    475,388
    
    
    
    119
    
    
    
    131
    
    
    
    25
    
    
    
    
    
    
    
    275Other
    
    
    19,980
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    19,980
    
    
    
    49
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    49Total
    
    $
    231,173
    
    
    $
    387,529
    
    
    $
    213,943
    
    
    $
    23,087
    
    
    $
    855,732
    
    
    
    567
    
    
    
    246
    
    
    
    27
    
    
    
    19
    
    
    
    8592007Mine production
    
    $
    162,811
    
    
    $
    114,645
    
    
    $
    23,407
    
    
    $
    30,414
    
    
    $
    331,277
    
    
    
    425
    
    
    
    120
    
    
    
    4
    
    
    
    20
    
    
    
    569PGM 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
    
    
    $
    162,205
    
    
    $
    32,444
    
    
    $
    673,036
    
    
    
    571
    
    
    
    239
    
    
    
    28
    
    
    
    20
    
    
    
    8582006Mine production
    
    $
    172,171
    
    
    $
    120,033
    
    
    $
    17,196
    
    
    $
    25,434
    
    
    $
    334,834
    
    
    
    466
    
    
    
    138
    
    
    
    4
    
    
    
    18
    
    
    
    626PGM 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
    
    
    $
    130,700
    
    
    $
    26,923
    
    
    $
    655,778
    
    
    
    662
    
    
    
    268
    
    
    
    32
    
    
    
    18
    
    
    
    980
 
 (1)
    
    Other  column includes gold, silver, nickel and copper by-product sales from mine
production and sales of metal purchased in the open market.(2)
    
    Other column includes gold and silver by-product ounces sold. Not reflected in the
other ounce column in the table above are approximately 931,000 pounds and 940,000 pounds
of nickel and copper, respectively, sold in 2008. Comparative sales in 2007 were
approximately 1.2 million pounds and 942,000 pounds of nickel
and copper, respectively. Sales in 2006 included approximately 1.6
million pounds of nickel and approximately 900,000 pounds of copper. 
    
    The Company reported a net loss of $112.7 million, or $1.21 per diluted share, in 2008,
compared to a net loss of $15.5 million, or $0.17 per diluted share, in 2007. The net loss
for 2008 includes impairment charges amounting to $70.7 million. The impairment charges are
comprised of a $67.3 million carrying value adjustment at the East Boulder Mine and a $3.4
million charge to mark long-term investments in Pacific North West Capital Corp. and Benton
Resources Corp. to current market. Additional charges taken in 2008 included a $16.6 million
lower-of-cost-or-market inventory adjustment, a $3.4 million allowance against trade
receivables and a $26.0 million write-down of advances on inventory purchases. The Company
also recorded a $5.4 million provision for corporate restructuring. See Managements
Discussion and Analysis of Financial Condition and Results of Operations  Year Ended
December 31, 2008 Compared to Year Ended December 31, 2007.
    
    Following a period of exceptionally strong PGM prices during the first half of 2008, prices
began to decline in mid-July. By October, as the U.S. economic picture deteriorated, PGM
prices were down to levels not seen since 2003. The effect of these exceptionally low prices
during the 2008 fourth quarter was to eradicate the profitability reported for the first nine
months of 2008 and led to a substantial reported loss for the full year (including the $70.7
million of impairment charges). In response to the low PGM prices, the Company initiated a
restructuring of its operations in the fourth quarter and is now managing its business
activities toward remaining modestly cash positive, although in the current pricing
environment the Company will report substantial book losses. As additional cost-saving
measures, capital expenditures will be scaled back sharply for 2009, expenditure restrictions
have been implemented, operations at the East Boulder Mine were restructured, operations at
the Stillwater Mine were modified and our workforce realigned, resulting in an overall
reduction in workforce of 218 employees and 32 contractors. As of December 31, 2008, these
measures appear to have stabilized the Companys cash situation: however, there can be no
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assurance that further steps to conserve cash will not be required in the future. The
restructuring efforts are discussed in more detail in Managements Discussion and Analysis of
Financial Condition and Results of Operations.
    
    In 2008, the Company produced a total of 498,900 ounces of palladium and platinum compared
to 537,500 ounces in 2007. Total consolidated cash cost per ounce (a non-GAAP measure) was
$396 in 2008, compared with $331 in
2007. This increase in cash costs per ounce reflected the effect of higher material costs and
lower PGM production at both mines. Mine production for 2009 is projected at 495,000 ounces of
palladium and platinum. Total cash costs per ounce (a non-GAAP measure) for 2009, are projected
at $399 per ounce. See Part II, Item 6 Selected Financial and Operating Data for further
discussion of non-GAAP measures.
    
    Revenues from PGM recycling grew 45.6% during 2008, increasing to $475.4 million in 2008,
from $326.4 million in 2007, driven by higher average realized PGM prices and by modest volume
growth. Recycled ounces sold, excluding tolled material, increased in 2008 to 275,000 ounces
compared to 245,000 ounces in 2007 and the Companys combined average realization on recycling
sales (which include palladium, platinum and rhodium) increased to $1,716 per ounce in 2008
from $1,312 per ounce in 2007. In addition to purchased material, the Company processed
126,000 ounces of PGMs on a tolling basis in 2008 up from 112,000 tolled ounces in 2007. In
total, recycled volumes fed to the smelter increased to 398,100 ounces of PGMs in 2008 up 6.7%
from 373,000 ounces in 2007. The Company experienced a serious decline in the volumes of
recycled material received during the fourth quarter of 2008, the result of the worldwide
financial and credit crises and associated drop in PGM prices during the quarter. The
downturn has created problems for the Company in collecting on its
advances on inventory purchases,
although the Company cash balances have benefitted from a reduction of the working capital
required to sustain recycling activities. The Companys operating income from the recycling
segment is directly related both to the volumes of material processed and to the underlying
prices; in general, after adjusting for processing times, a 50% reduction in either recycling
volumes processed or average realized PGM prices would reduce recycling income by half.
Working capital associated with these recycling activities as inventories and advances was
$23.3 million and $83.7 million at December 31, 2008 and 2007, respectively. The year-end
2008 balance reflects a write-down of $26.0 million against Advances on inventory purchases
in the fourth quarter of 2008.
    
    The Companys 2008 capital expenditures totaled $82.3 million, down from $87.9 million in
2007. Capital spending in both years reflected continuing 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 $55.9 million in 2008, down from $65.5 million in 2007. Development expenditures were
lower in 2008 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. Major infrastructure projects undertaken during
2008 include the continuation of the dedicated electric-truck haulage ramp and related shop
facilities that will access the lower levels of the Stillwater Mine and the construction of a
second electric furnace at the smelter. Capital spending in 2009, reflecting cash
conservation efforts, is currently budgeted at about $39 million. 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.
    
    On March 12, 2008, the Company issued and sold $181.5 million aggregate principal amount of
senior convertible debentures due 2028 (debentures). The debentures pay interest at 1.875%
per annum, payable semi-annually on March 15 and September 15 of each year, commencing
September 15, 2008. The debentures will mature on March 15, 2028, subject to earlier
repurchase or conversion. Each $1,000 principal amount of debentures is initially
convertible, at the option of the holders, into approximately 42.5351 shares of the Companys
common stock, at any time prior to the maturity date. The conversion rate is subject to
certain adjustments, but will not be adjusted for accrued interest or any unpaid interest.
The conversion rate initially represents a conversion price of $23.51 per share. Holders of
the debentures may require the Company to repurchase all or a portion of their debentures on
March 15, 2013, March 15, 2018 and March 15, 2023, or upon the occurrence of certain events
including a change in control. The Company may redeem the debentures for cash beginning on or
after March 22, 2013.
 HISTORY OF THE COMPANY
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GEOLOGY OF THE J-M REEF
     Selected Financial and Operating Data
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ORE RESERVE DETERMINATION
 proven probable
 Methodology
   Proven and Probable Ore Reserves  Discussion
   10




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SEC Guidelines
     Results
 Business and Properties  Risk Factors  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
  PROVEN AND PROBABLE ORE RESERVES
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DECEMBER 31, 2008
    
    DECEMBER 31, 2007
    
    DECEMBER 31, 2006AVERAGE
    
    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
    
    
    2,911
    
    
    
    0.65
    
    
    
    1,898
    
    
    
    2,784
    
    
    
    0.65
    
    
    
    1,796
    
    
    
    2,775
    
    
    
    0.66
    
    
    
    1,818Probable Reserves
    
    
    14,030
    
    
    
    0.64
    
    
    
    8,911
    
    
    
    14,360
    
    
    
    0.61
    
    
    
    8,791
    
    
    
    15,539
    
    
    
    0.63
    
    
    
    9,749Total Proven and Probable Reserves (1)
    
    
    16,941
    
    
    
    0.64
    
    
    
    10,809
    
    
    
    17,144
    
    
    
    0.62
    
    
    
    10,586
    (4)
    
    
    18,314
    
    
    
    0.63
    
    
    
    11,567East Boulder Mine (2)Proven Reserves
    
    
    2,066
    
    
    
    0.45
    
    
    
    935
    
    
    
    2,017
    
    
    
    0.46
    
    
    
    921
    
    
    
    2,011
    
    
    
    0.45
    
    
    
    902Probable Reserves
    
    
    19,202
    
    
    
    0.45
    
    
    
    8,717
    
    
    
    20,868
    
    
    
    0.46
    
    
    
    9,660
    
    
    
    22,116
    
    
    
    0.48
    
    
    
    10,579Total Proven and Probable Reserves (1)
    
    
    21,268
    
    
    
    0.45
    
    
    
    9,652
    
    
    
    22,885
    
    
    
    0.46
    
    
    
    10,581
    
    
    
    24,127
    
    
    
    0.48
    
    
    
    11,481Total Company Reserves (2)Proven Reserves
    
    
    4,977
    
    
    
    0.57
    
    
    
    2,833
    
    
    
    4,800
    
    
    
    0.57
    
    
    
    2,717
    
    
    
    4,786
    
    
    
    0.57
    
    
    
    2,721Probable Reserves
    
    
    33,232
    
    
    
    0.53
    
    
    
    17,628
    
    
    
    35,228
    
    
    
    0.52
    
    
    
    18,451
    
    
    
    37,656
    
    
    
    0.54
    
    
    
    20,327Total Proven and Probable Reserves (1)
    
    
    38,209
    
    
    
    0.54
    
    
    
    20,461
    
    
    
    40,028
    
    
    
    0.53
    
    
    
    21,167
    (3)(4)
    
    
    42,442
    
    
    
    0.54
    
    
    
    23,048
    (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 19.3% must be deducted to arrive at the
estimated saleable ounces.(4)
    
    Columns do not add mathematically due to rounding. Discussion
  12




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##### Table of Contents




    
    Additions to proven ore reserves from new definition drilling,
    
    Deletions as proven reserves are mined,
    
    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.
  
   13




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##### Table of Contents



IMPAIRMENT OF LONG-LIVED ASSETS
 Accounting for
the Impairment or Disposal of Long-Lived Assets
   CURRENT OPERATIONS
   
  14




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##### Table of Contents




    
    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 extent underground of approximately 9.7 miles.
 STILLWATER MINE
 Business and Properties  Risk Factors
    15




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##### Table of Contents



16




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##### Table of Contents



Business and Properties  Current Operations 
Regulatory and Environmental Matters  Permitting and Reclamation
 Selected Financial and Operating Data
 EAST BOULDER MINE
   17




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##### Table of Contents



Selected Financial and Operating
Data
 18




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##### Table of Contents



EXPLORATION AND DEVELOPMENT ACTIVITIES
    Location and Development Activity
    
    2008
    
    2007
    
    2006Stillwater MineNew Primary Development (equivalent feet)(1)
    
    
    25,047
    
    
    
    26,033
    
    
    
    31,156New Footwall Lateral (equivalent feet)(1)
    
    
    10,836
    
    
    
    10,987
    
    
    
    15,257New Definition drilling (feet)
    
    
    358,761
    
    
    
    311,607
    
    
    
    436,920East Boulder MineNew Primary Development (equivalent feet)(1)
    
    
    9,963
    
    
    
    13,015
    
    
    
    15,235New Footwall Lateral (equivalent feet)(1)
    
    
    4,254
    
    
    
    6,283
    
    
    
    6,077New Definition drilling (feet)
    
    
    140,944
    
    
    
    179,845
    
    
    
    226,597
 
 (1)
    
    Based on one linear foot of excavation, 11 feet wide by 12 feet high (cross-section of 132
ft.2).   19




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##### Table of Contents



METALLURGICAL COMPLEX
 Smelter
    Base Metal Refinery
    20




---



##### Table of Contents



Mine
production revenues
  RECYCLING ACTIVITIES
   Advances on inventory purchases
     21




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##### Table of Contents



Advances on inventory
purchases
 OTHER PROPERTIES
  LONG-TERM FINANCING
 Convertible Debentures
    Accounting for Derivative Instruments and Hedging Activities, Accounting for Derivative Financial Instruments Indexed to, and Potentially Settled in, a Companys
Own Stock,
 Other
 22




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##### Table of Contents



noncurrent assets
  PGM SALES AND HEDGING ACTIVITIES
 Mine Production
    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
    
    Price2009
    
    
    100
    %
    
    $
    364
    
    
    
    20
    %
    
    $
    975
    
    
    
    70
    %
    
    $
    425
    
    
    
    14
    %
    
    $
    8502010
    
    
    100
    %
    
    $
    360
    
    
    
    20
    %
    
    $
    975
    
    
    
    70
    %
    
    $
    425
    
    
    
    14
    %
    
    $
    8502011
    
    
    20
    %
    
    $
    300
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2012
    
    
    20
    %
    
    $
    300
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
  23




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##### Table of Contents



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.
 Derivative Instruments
 Recycling Activities
 Advances on inventory purchases Advances on inventory purchases Business and Properties  Risk
Factors Recycling Activities.
   24




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##### Table of Contents



Derivative Instruments
 Other activities
  Palladium acquired in connection with Norilsk Nickel transaction
  TITLE AND ROYALTIES
   25




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##### Table of Contents



SAFETY
     EMPLOYEES
  Number ofEmployees atDecember 31,SITE
    
    2008
    
    
    2007Stillwater Mine
    
    
    869
    
    
    
    845East Boulder Mine
    
    
    261
    
    
    
    551Smelter and Refinery Complex
    
    
    169
    
    
    
    161Administrative Support
    
    
    65
    
    
    
    68Total
    
    
    1,364
    
    
    
    1,625
  26




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##### Table of Contents



Business and Properties  Risk Factors.
 REGULATORY AND ENVIRONMENTAL MATTERS
 General Business and Properties  Risk Factors
 Business and Properties
 Risk Factors
  Business and Properties  Risk Factors
 m m
 27




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##### Table of Contents



Permitting and Reclamation
 Managements Discussion and Analysis of Financial Condition and Results of Operations
    28




---



##### Table of Contents



MMC NORILSK NICKEL INVESTMENT
 Long-term Financing
 Debt Obligations
 COMPETITION: PALLADIUM AND PLATINUM MARKET
 GENERAL
  Global Supply Business and Properties  Risk Factors and
Managements Discussion and Analysis of Financial Condition and Results of Operations
 GLOBAL DEMAND
   29




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##### Table of Contents



Platinum 2008 Interim Review Report
    (BAR CHART)
    

(BAR CHART)
 Charts
reproduced from the Johnson Matthey Platinum 2008 Interim Review.
Permission to reproduce was neither sought nor obtained.
 30




---



##### Table of Contents



Business
and Properties  Risk Factors
 31




---



##### Table of Contents



GLOBAL SUPPLY
   (BAR CHART)
    
    (BAR CHART)
 Charts reproduced from the Johnson Matthey Platinum 2008 Interim Review. Permission to
reproduce was neither sought nor obtained.
    32




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##### Table of Contents



PRICES
 Managements Discussion
and Analysis of Financial Condition and Results of Operations  Revenue Factors That May
Affect Future Results and Financial Condition Business and Properties  Risk Factors  Vulnerability to metals price volatility  Changes in supply and demand could reduce market
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
    
    $
    582
    
    
    $
    164
    
    
    $
    352
    
    
    $
    2,273
    
    
    $
    763
    
    
    $
    1,5762009*
    
    $
    218
    
    
    $
    179
    
    
    $
    197
    
    
    $
    1,090
    
    
    $
    918
    
    
    $
    999
 
 *
    
    (Through March 6, 2009) AVAILABLE INFORMATION
 http://www.stillwatermining.com
 RISK FACTORS
  THE WORLDWIDE FINANCIAL AND CREDIT CRISES CREATES VULNERABILITY FOR THE COMPANY
    33




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##### Table of Contents



VULNERABILITY TO METALS PRICE VOLATILITY-CHANGES IN SUPPLY AND DEMAND COULD REDUCE MARKET PRICES
   
 34




---



##### Table of Contents



Business and Properties  Competition: Palladium and Platinum Market
 Risk Factors
 Users of PGMs May Reduce Their Consumption and Substitute Other Materials for Palladium and
Platinum
 35




---



##### Table of Contents



THE COMPANY DEPENDS UPON A FEW CUSTOMERS AND ITS SALES AND OPERATIONS COULD SUFFER IF IT LOSES ANY
OF THEM
 Business and Properties  Current Operations  PGM Sales and Hedging
Activities. Risk Factors  Hedging and
Long-term Sales Contracts Could Limit the Realization of Higher Metals Prices
    FAILURE TO RENEW LONG-TERM SALES CONTRACTS FOR OUNCES PRODUCED FROM MINE PRODUCTION COULD RESULT IN
CURTAILMENT OR CLOSURE OF OPERATIONS
  36




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##### Table of Contents



RELIANCE ON THIRD PARTIES FOR SOURCING OF RECYCLING MATERIALS AND THE CONCENTRATION OF RECYCLING
SOURCES CREATES THE POTENTIAL FOR LOSSES
  Advances on inventory purchases
 Advances on inventory purchases
  AN EXTENDED PERIOD OF LOW RECYCLING VOLUMES AND WEAK PGM PRICES COULD PUT THE COMPANYS OPERATIONS
AT ADDITIONAL RISK
   37




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##### Table of Contents



THE COMPANY IS A RELATIVELY HIGH COST PRIMARY PRODUCER
    ACHIEVEMENT OF THE COMPANYS PRODUCTION GOALS IS SUBJECT TO UNCERTAINTIES
   Risk Factors  Limited Availability of Additional Mining Personnel and
Uncertainty of Labor Relations May Affect the Companys Ability to Achieve Its Production Targets
  38




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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
   Ore Reserves
  Year endedDecember 31,
    
    2008
    
    2007
    
    2006
    
    2005
    
    2004
    
    2003
    
    2002
    
    2001
    
    2000
    
    1999
    
    1998(in percent)Stillwater Mine
    
    
    74
    
    
    
    68
    
    
    
    94
    
    
    
    101
    
    
    
    62
    
    
    
    52
    
    
    
    71
    
    
    
    104
    
    
    
    111
    
    
    
    66
    
    
    
    150East Boulder Mine (1)
    
    
    71
    
    
    
    107
    
    
    
    91
    
    
    
    110
    
    
    
    125
    
    
    
    86
    
    
    
    91
    
    
    
    88
    
    
    
    *
    
    
    
    *
    
    
    
    *
 
 (1)
    
    East Boulder Mine commenced full-time commercial production on January 1, 2002.  39




---



##### Table of Contents



AN EXTENDED PERIOD OF LOW PGM PRICES COULD RESULT IN A REDUCTION OF ORE RESERVES AND A POTENTIAL
FURTHER ASSET IMPAIRMENT CHARGE
   Business and Properties  Ore Reserves  Discussion
    40




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##### Table of Contents



USERS OF PGMS MAY REDUCE THEIR CONSUMPTION AND SUBSTITUTE OTHER MATERIALS FOR PALLADIUM AND
PLATINUM
   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
 41




---



##### Table of Contents




    
    availability and cost of critical materials, equipment and skilled manpower.
  HEDGING AND LONG-TERM SALES CONTRACTS COULD LIMIT THE REALIZATION OF HIGHER METAL PRICES
 Business and
Properties  Current Operations  PGM Sales and Hedging Activities
 Business and Properties  Current Operations 
PGM Sales and Hedging Activities
 CHANGES TO REGULATIONS AND COMPLIANCE WITH REGULATIONS COULD INCREASE COSTS AND CAUSE DELAYS
 Business and Properties  Current Operations  Regulatory and Environmental
Matters.
 Business and Properties  Current Operations 
Regulatory and Environmental Matters
  42




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##### Table of Contents



m m
  THE COMPANYS CREDIT RATING HAS BEEN DOWNGRADED, POTENTIALLY LIMITING FUTURE CREDIT AVAILABILITY
AND INCREASING POTENTIAL BORROWING COSTS
  LIMITED AVAILABILITY OF ADDITIONAL MINING PERSONNEL AND UNCERTAINTY OF LABOR RELATIONS MAY AFFECT
THE COMPANYS ABILITY TO ACHIEVE ITS PRODUCTION TARGETS
  43




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##### Table of Contents



UNCERTAINTY OF TITLE TO PROPERTIES  THE VALIDITY OF UNPATENTED MINING CLAIMS IS SUBJECT TO TITLE
RISK
 Business and
Properties  Current Operations Title and Royalties
 THE COMPLEXITY OF PROCESSING PLATINUM GROUP METALS POSES OPERATIONAL AND ENVIRONMENTAL RISKS IN
ADDITION TO TYPICAL MINING RISKS
  44




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##### Table of Contents



ITEM 3
 LEGAL PROCEEDINGS
  
 ITEM 4
 SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
  45




---



##### Table of Contents



PART II
 
 ITEM 5
 MARKET FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER
PURCHASES OF EQUITY SECURITIES
 PERFORMANCE GRAPH
  COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN*
 
 
 
 Cumulative Total Return
 12/31/04
    
    
    12/31/05
    
    
    12/31/06
    
    
    12/31/07
    
    
    12/31/08Stillwater Mining Company
    
    
    $
    117.66
    
    
    
    $
    120.90
    
    
    
    $
    130.51
    
    
    
    $
    100.94
    
    
    
    $
    51.62Peer Group
    
    
    
    91.42
    
    
    
    
    169.80
    
    
    
    
    287.10
    
    
    
    
    368.88
    
    
    
    
    146.82Russell 2000
    
    
    
    118.33
    
    
    
    
    123.72
    
    
    
    
    146.44
    
    
    
    
    144.15
    
    
    
    
    95.44
  46




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##### Table of Contents



ITEM 6
 SELECTED FINANCIAL DATA
 (in thousands, except per share and current ratio data)
    
    2008
    
    
    2007
    
    
    2006
    
    
    2005
    
    
    2004INCOME STATEMENT DATARevenuesMine production (2)
    
    $
    360,364
    
    
    $
    331,277
    
    
    $
    334,834
    
    
    $
    285,641
    
    
    $
    282,516PGM recycling
    
    
    475,388
    
    
    
    326,394
    
    
    
    269,941
    
    
    
    90,695
    
    
    
    76,388Sales of palladium received in Norilsk Nickel transaction
    
    
    
    
    
    
    
    
    
    
    17,637
    
    
    
    87,309
    
    
    
    85,952Other
    
    
    19,980
    
    
    
    15,365
    
    
    
    33,366
    
    
    
    65,252
    
    
    
    18,503Total revenues
    
    $
    855,732
    
    
    $
    673,036
    
    
    $
    655,778
    
    
    $
    528,897
    
    
    $
    463,359Costs and ExpensesCosts of metals sold:Mine production (2)
    
    
    283,793
    
    
    
    256,942
    
    
    
    242,612
    
    
    
    211,606
    
    
    
    189,403PGM recycling
    
    
    445,299
    
    
    
    307,137
    
    
    
    251,198
    
    
    
    85,582
    
    
    
    71,326Sales of palladium received in Norilsk Nickel transaction
    
    
    
    
    
    
    
    
    
    
    10,785
    
    
    
    74,542
    
    
    
    63,774Other
    
    
    19,892
    
    
    
    14,289
    
    
    
    32,300
    
    
    
    65,163
    
    
    
    18,628Total costs of metals sold
    
    
    748,984
    
    
    
    578,368
    
    
    
    536,895
    
    
    
    436,893
    
    
    
    343,131Depreciation and amortizationMine production
    
    
    82,792
    
    
    
    82,396
    
    
    
    83,583
    
    
    
    79,032
    
    
    
    57,321PGM recycling
    
    
    192
    
    
    
    142
    
    
    
    100
    
    
    
    55
    
    
    
    48Total depreciation and amortization
    
    
    82,984
    
    
    
    82,538
    
    
    
    83,683
    
    
    
    79,087
    
    
    
    57,369General and administrative
    
    
    70,816
    
    
    
    28,285
    
    
    
    28,018
    
    
    
    20,333
    
    
    
    19,739Impairment of property, plant and equipment
    
    
    67,254
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Operating income (loss)
    
    $
    (114,306
    )
    
    $
    (16,155
    )
    
    $
    7,182
    
    
    $
    (7,416
    )
    
    $
    39,480Total income tax benefit (provision)
    
    $
    32
    
    
    $
    
    
    
    $
    (10
    )
    
    $
    (13
    )
    
    $
    (3
    )Net income (loss)
    
    $
    (112,745
    )
    
    $
    (15,483
    )
    
    $
    7,175
    
    
    $
    (13,934
    )
    
    $
    29,838Other comprehensive income (loss), net of tax
    
    $
    5,865
    
    
    $
    9,578
    
    
    $
    1,799
    
    
    $
    (12,437
    )
    
    $
    (4,145
    )Comprehensive income (loss)
    
    $
    (106,880
    )
    
    $
    (5,905
    )
    
    $
    8,974
    
    
    $
    (26,371
    )
    
    $
    25,693Pro-forma net income (loss) assuming the new
amortization method
is applied retroactively (1)
    
    $
    (112,745
    )
    
    $
    (15,483
    )
    
    $
    7,175
    
    
    $
    (13,934
    )
    
    $
    23,803Weighted average common shares outstandingBasic
    
    
    93,025
    
    
    
    92,016
    
    
    
    91,260
    
    
    
    90,702
    
    
    
    90,180Diluted
    
    
    93,025
    
    
    
    92,016
    
    
    
    91,580
    
    
    
    90,702
    
    
    
    90,540Basic earnings (loss) per share
    
    $
    (1.21
    )
    
    $
    (0.17
    )
    
    $
    0.08
    
    
    $
    (0.15
    )
    
    $
    0.33Diluted earnings (loss) per share
    
    $
    (1.21
    )
    
    $
    (0.17
    )
    
    $
    0.08
    
    
    $
    (0.15
    )
    
    $
    0.33Pro-forma amounts assuming the new amortization method
is applied retroactively (1)Basic earnings (loss) per share
    
    $
    (1.21
    )
    
    $
    (0.17
    )
    
    $
    0.08
    
    
    $
    (0.15
    )
    
    $
    0.26Diluted earnings (loss) per share
    
    $
    (1.21
    )
    
    $
    (0.17
    )
    
    $
    0.08
    
    
    $
    (0.15
    )
    
    $
    0.26CASH FLOW DATANet cash provided by operating activities
    
    $
    114,243
    
    
    $
    56,422
    
    
    $
    96,963
    
    
    $
    141,134
    
    
    $
    136,840Net cash used in investing activities
    
    $
    (74,567
    )
    
    $
    (80,967
    )
    
    $
    (78,909
    )
    
    $
    (134,261
    )
    
    $
    (77,801
    )Net cash provided by (used in) financing activities
    
    $
    60,683
    
    
    $
    (2,379
    )
    
    $
    (9,954
    )
    
    $
    (22,665
    )
    
    $
    1,352
 
 (1)
    
    See Note 3 Change in Amortization Method for Mine
Development Assets to the Companys audited financial statements as filed in the
Companys 2006 Annual Report on Form 10-K.(2)
    
    See Note 2 Reclassifications to the Companys 2008 audited financial statements for
further information.Note:
    
    Costs from recycling activities have been revised to include additional
recycling rhodium costs for the years 2007, 2006 and 2005. See Note 3 Correction of Immaterial Errorto the
Companys 2008 audited financial statements for further information. 47




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##### Table of Contents



ITEM 6
 SELECTED FINANCIAL DATA
 (Continued)
 (in thousands, except per share and current ratio data)
    
    2008
    
    2007
    
    2006
    
    2005
    
    2004BALANCE SHEET DATACash and cash equivalents
    
    $
    161,795
    
    
    $
    61,436
    
    
    $
    88,360
    
    
    $
    80,260
    
    
    $
    96,052Inventories
    
    $
    73,413
    
    
    $
    116,623
    
    
    $
    106,081
    
    
    $
    86,574
    
    
    $
    159,942Total current assets
    
    $
    285,556
    
    
    $
    256,891
    
    
    $
    283,525
    
    
    $
    268,851
    
    
    $
    303,655Property, plant and equipment, net
    
    $
    393,412
    
    
    $
    465,054
    
    
    $
    460,328
    
    
    $
    445,199
    
    
    $
    434,924Total assets
    
    $
    724,264
    
    
    $
    740,367
    
    
    $
    755,209
    
    
    $
    721,397
    
    
    $
    744,718Current portion of long-term debt and capital lease obligations
    
    $
    97
    
    
    $
    1,209
    
    
    $
    1,674
    
    
    $
    1,776
    
    
    $
    1,986Portion of debt repayable upon liquidation of finished palladium
in inventory
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    7,324
    
    
    $
    19,076Total current liabilities
    
    $
    55,108
    
    
    $
    68,974
    
    
    $
    85,590
    
    
    $
    69,087
    
    
    $
    67,238Long-term debt and capital lease obligations
    
    $
    210,947
    
    
    $
    126,841
    
    
    $
    129,007
    
    
    $
    132,307
    
    
    $
    143,028Total liabilities
    
    $
    301,735
    
    
    $
    225,003
    
    
    $
    243,467
    
    
    $
    227,913
    
    
    $
    231,989Stockholders equity
    
    $
    422,529
    
    
    $
    515,364
    
    
    $
    511,742
    
    
    $
    493,484
    
    
    $
    512,729Working capital
    
    $
    230,448
    
    
    $
    187,917
    
    
    $
    197,935
    
    
    $
    199,764
    
    
    $
    236,417Current ratio
    
    
    5.2
    
    
    
    3.7
    
    
    
    3.3
    
    
    
    3.9
    
    
    
    4.5
 48




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##### Table of Contents



OPERATING AND COST DATA
 (in thousands, except per ounce and per ton costs)

    
    2008
    
    
    2007
    
    
    2006
    
    
    2005
    
    
    2004Consolidated:Ounces produced:Palladium
    
    
    384
    
    
    
    413
    
    
    
    463
    
    
    
    428
    
    
    
    439Platinum
    
    
    115
    
    
    
    124
    
    
    
    138
    
    
    
    126
    
    
    
    130Total
    
    
    499
    
    
    
    537
    
    
    
    601
    
    
    
    554
    
    
    
    569Tons milled
    
    
    1,060
    
    
    
    1,169
    
    
    
    1,289
    
    
    
    1,206
    
    
    
    1,212Mill head grade (ounce per ton)
    
    
    0.50
    
    
    
    0.50
    
    
    
    0.51
    
    
    
    0.50
    
    
    
    0.51Sub-grade tons milled (1)
    
    
    146
    
    
    
    75
    
    
    
    62
    
    
    
    80
    
    
    
    58Sub-grade mill head grade (ounce per ton)
    
    
    0.17
    
    
    
    0.12
    
    
    
    0.13
    
    
    
    0.15
    
    
    
    0.22Total tons milled (1)
    
    
    1,206
    
    
    
    1,244
    
    
    
    1,351
    
    
    
    1,286
    
    
    
    1,270Combined mill head grade (ounce per ton)
    
    
    0.46
    
    
    
    0.48
    
    
    
    0.49
    
    
    
    0.48
    
    
    
    0.50Total mill recovery (%)
    
    
    91
    
    
    
    91
    
    
    
    91
    
    
    
    91
    
    
    
    91Total operating costs per ounce (Non-GAAP) (2)(7)
    
    $
    328
    
    
    $
    269
    
    
    $
    241
    
    
    $
    278
    
    
    $
    254Total cash costs per ounce (Non-GAAP)(2)(7)
    
    $
    396
    
    
    $
    331
    
    
    $
    296
    
    
    $
    324
    
    
    $
    297Total production costs per ounce (Non-GAAP)(2)(7)
    
    $
    561
    
    
    $
    488
    
    
    $
    433
    
    
    $
    471
    
    
    $
    402Total operating costs per ton milled (Non-GAAP) (2)(7)
    
    $
    135
    
    
    $
    116
    
    
    $
    107
    
    
    $
    120
    
    
    $
    114Total cash costs per ton milled (Non-GAAP)(2)(7)
    
    $
    164
    
    
    $
    143
    
    
    $
    132
    
    
    $
    139
    
    
    $
    133Total production costs per ton milled (Non-GAAP)(2)(7)
    
    $
    232
    
    
    $
    211
    
    
    $
    193
    
    
    $
    203
    
    
    $
    180Stillwater Mine:Ounces produced:Palladium
    
    
    268
    
    
    
    274
    
    
    
    314
    
    
    
    293
    
    
    
    311Platinum
    
    
    81
    
    
    
    85
    
    
    
    95
    
    
    
    88
    
    
    
    94Total
    
    
    349
    
    
    
    359
    
    
    
    409
    
    
    
    381
    
    
    
    405Tons milled
    
    
    690
    
    
    
    640
    
    
    
    739
    
    
    
    710
    
    
    
    728Mill head grade (ounce per ton)
    
    
    0.54
    
    
    
    0.60
    
    
    
    0.60
    
    
    
    0.57
    
    
    
    0.59Sub-grade tons milled(1)
    
    
    78
    
    
    
    75
    
    
    
    62
    
    
    
    80
    
    
    
    58Sub-grade mill head grade (ounce per ton)
    
    
    0.16
    
    
    
    0.12
    
    
    
    0.13
    
    
    
    0.15
    
    
    
    0.22Total tons milled(1)
    
    
    768
    
    
    
    715
    
    
    
    801
    
    
    
    790
    
    
    
    786Combined mill head grade (ounce per ton)
    
    
    0.51
    
    
    
    0.55
    
    
    
    0.56
    
    
    
    0.53
    
    
    
    0.56Total mill recovery (%)
    
    
    91
    
    
    
    92
    
    
    
    92
    
    
    
    92
    
    
    
    92Total operating costs per ounce (Non-GAAP) (2)(7)
    
    $
    308
    
    
    $
    234
    
    
    $
    229
    
    
    $
    270
    
    
    $
    238Total cash costs per ounce (Non-GAAP)(2)(7)
    
    $
    373
    
    
    $
    294
    
    
    $
    282
    
    
    $
    314
    
    
    $
    278Total production costs per ounce (Non-GAAP)(2)(7)
    
    $
    511
    
    
    $
    426
    
    
    $
    402
    
    
    $
    454
    
    
    $
    366Total operating costs per ton milled (Non-GAAP) (2)(7)
    
    $
    140
    
    
    $
    118
    
    
    $
    117
    
    
    $
    130
    
    
    $
    123Total cash costs per ton milled (Non-GAAP)(2)(7)
    
    $
    170
    
    
    $
    148
    
    
    $
    144
    
    
    $
    152
    
    
    $
    143Total production costs per ton milled (Non-GAAP)(2)(7)
    
    $
    233
    
    
    $
    214
    
    
    $
    205
    
    
    $
    219
    
    
    $
    189East Boulder Mine:Ounces produced:Palladium
    
    
    116
    
    
    
    139
    
    
    
    149
    
    
    
    135
    
    
    
    128Platinum
    
    
    34
    
    
    
    39
    
    
    
    43
    
    
    
    38
    
    
    
    36Total
    
    
    150
    
    
    
    178
    
    
    
    192
    
    
    
    173
    
    
    
    164Tons milled
    
    
    370
    
    
    
    529
    
    
    
    550
    
    
    
    496
    
    
    
    484Mill head grade (ounce per ton)
    
    
    0.42
    
    
    
    0.38
    
    
    
    0.39
    
    
    
    0.40
    
    
    
    0.39Sub-grade tons milled (1)
    
    
    68
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Sub-grade mill head grade (ounce per ton)
    
    
    0.19
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Total tons milled (1)
    
    
    438
    
    
    
    529
    
    
    
    550
    
    
    
    496
    
    
    
    484Combined mill head grade (ounce per ton)
    
    
    0.38
    
    
    
    0.38
    
    
    
    0.39
    
    
    
    0.40
    
    
    
    0.39Total mill recovery (%)
    
    
    90
    
    
    
    90
    
    
    
    89
    
    
    
    89
    
    
    
    88Total operating costs per ounce (Non-GAAP) (2)(7)
    
    $
    373
    
    
    $
    339
    
    
    $
    266
    
    
    $
    296
    
    
    $
    294Total cash costs per ounce (Non-GAAP)(2)(7)
    
    $
    451
    
    
    $
    405
    
    
    $
    326
    
    
    $
    345
    
    
    $
    344Total production costs per ounce (Non-GAAP)(2)(7)
    
    $
    678
    
    
    $
    613
    
    
    $
    500
    
    
    $
    509
    
    
    $
    491Total operating costs per ton milled (Non-GAAP) (2)(7)
    
    $
    127
    
    
    $
    114
    
    
    $
    93
    
    
    $
    103
    
    
    $
    100Total cash costs per ton milled (Non-GAAP)(2)(7)
    
    $
    154
    
    
    $
    136
    
    
    $
    114
    
    
    $
    120
    
    
    $
    117Total production costs per ton milled (Non-GAAP)(2)(7)
    
    $
    231
    
    
    $
    206
    
    
    $
    175
    
    
    $
    178
    
    
    $
    167
 49




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##### Table of Contents



(in thousands, where noted)
    
    2008
    
    
    2007
    
    
    2006
    
    
    2005
    
    
    2004SALES AND PRICE DATAOunces sold (000)Mine production:Palladium (oz.)
    
    
    399
    
    
    
    425
    
    
    
    466
    
    
    
    431
    
    
    
    432Platinum (oz.)
    
    
    115
    
    
    
    120
    
    
    
    138
    
    
    
    135
    
    
    
    125Total
    
    
    514
    
    
    
    545
    
    
    
    604
    
    
    
    566
    
    
    
    557Other PGM activities:(5)Palladium (oz.)
    
    
    168
    
    
    
    146
    
    
    
    196
    
    
    
    502
    
    
    
    418Platinum (oz.)
    
    
    131
    
    
    
    119
    
    
    
    130
    
    
    
    81
    
    
    
    77Rhodium (oz.)
    
    
    25
    
    
    
    24
    
    
    
    28
    
    
    
    38
    
    
    
    21Total
    
    
    324
    
    
    
    289
    
    
    
    354
    
    
    
    621
    
    
    
    516By-products from mining: (6)Rhodium (oz.)
    
    
    2
    
    
    
    4
    
    
    
    4
    
    
    
    3
    
    
    
    3Gold (oz.)
    
    
    9
    
    
    
    11
    
    
    
    11
    
    
    
    11
    
    
    
    9Silver (oz.)
    
    
    10
    
    
    
    9
    
    
    
    6
    
    
    
    6
    
    
    
    10Copper (lb.)
    
    
    940
    
    
    
    942
    
    
    
    892
    
    
    
    911
    
    
    
    868Nickel (lb.)
    
    
    932
    
    
    
    1,171
    
    
    
    1,585
    
    
    
    1,307
    
    
    
    1,282Average realized price per ounce(3)Mine production:Palladium ($/oz.)
    
    $
    410
    
    
    $
    384
    
    
    $
    370
    
    
    $
    356
    
    
    $
    376Platinum ($/oz.)
    
    $
    1,387
    
    
    $
    953
    
    
    $
    868
    
    
    $
    821
    
    
    $
    839Combined ($/oz.) (4)
    
    $
    630
    
    
    $
    509
    
    
    $
    484
    
    
    $
    467
    
    
    $
    480Other PGM activities:(5)Palladium ($/oz.)
    
    $
    401
    
    
    $
    352
    
    
    $
    306
    
    
    $
    199
    
    
    $
    231Platinum ($/oz.)
    
    $
    1,735
    
    
    $
    1,247
    
    
    $
    1,122
    
    
    $
    876
    
    
    $
    817Rhodium ($/oz.)
    
    $
    7,807
    
    
    $
    5,732
    
    
    $
    4,111
    
    
    $
    1,861
    
    
    $
    1,032By-products from mining:(6)Rhodium ($/oz.)
    
    $
    7,939
    
    
    $
    6,217
    
    
    $
    4,516
    
    
    $
    2,155
    
    
    $
    952Gold ($/oz.)
    
    $
    877
    
    
    $
    699
    
    
    $
    603
    
    
    $
    444
    
    
    $
    410Silver ($/oz.)
    
    $
    14
    
    
    $
    13
    
    
    $
    12
    
    
    $
    7
    
    
    $
    5Copper ($/lb.)
    
    $
    2.94
    
    
    $
    3.34
    
    
    $
    2.91
    
    
    $
    1.55
    
    
    $
    1.19Nickel ($/lb.)
    
    $
    9.72
    
    
    $
    16.91
    
    
    $
    10.04
    
    
    $
    5.96
    
    
    $
    6.30Average market price per ounce(4)Palladium ($/oz.)
    
    $
    352
    
    
    $
    355
    
    
    $
    320
    
    
    $
    201
    
    
    $
    230Platinum ($/oz.)
    
    $
    1,578
    
    
    $
    1,303
    
    
    $
    1,143
    
    
    $
    897
    
    
    $
    846Combined ($/oz.)(4)
    
    $
    628
    
    
    $
    564
    
    
    $
    508
    
    
    $
    366
    
    
    $
    368
 
 (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 write-downs, gain or loss on
disposal of property, plant and equipment, restructuring costs, 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. 50




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##### Table of Contents



(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.(7)
    
    Costs per ounce/ton have been revised due to a correction of
an immaterial error in the costs of sales for recycled rhodium ounces
in 2007, 2006 and 2005. 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)
 51




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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)
 52




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##### Table of Contents



(in thousands, except per ounce and per ton data)
    
    2008
    
    
    2007
    
    
    2006
    
    
    2005
    
    
    2004Consolidated:Total operating costs (Non-GAAP)
    
    $
    163,462
    
    
    $
    144,368
    
    
    $
    144,898
    
    
    $
    154,199
    
    
    $
    144,589Total cash costs (Non-GAAP)
    
    $
    197,717
    
    
    $
    177,764
    
    
    $
    177,799
    
    
    $
    179,368
    
    
    $
    168,915Total production costs (Non-GAAP)
    
    $
    279,932
    
    
    $
    262,158
    
    
    $
    260,373
    
    
    $
    261,172
    
    
    $
    228,940Divided by total ounces
    
    
    499
    
    
    
    537
    
    
    
    601
    
    
    
    554
    
    
    
    569Divided by total tons milled
    
    
    1,206
    
    
    
    1,244
    
    
    
    1,351
    
    
    
    1,286
    
    
    
    1,270Total operating cost per ounce (Non-GAAP)
    
    $
    328
    
    
    $
    269
    
    
    $
    241
    
    
    $
    278
    
    
    $
    254Total cash cost per ounce (Non-GAAP)
    
    $
    396
    
    
    $
    331
    
    
    $
    296
    
    
    $
    324
    
    
    $
    297Total production cost per ounce (Non-GAAP)
    
    $
    561
    
    
    $
    488
    
    
    $
    433
    
    
    $
    471
    
    
    $
    402Total operating cost per ton milled (Non-GAAP)
    
    $
    135
    
    
    $
    116
    
    
    $
    107
    
    
    $
    120
    
    
    $
    114Total cash cost per ton milled (Non-GAAP)
    
    $
    164
    
    
    $
    143
    
    
    $
    132
    
    
    $
    139
    
    
    $
    133Total production cost per ton milled (Non-GAAP)
    
    $
    232
    
    
    $
    211
    
    
    $
    193
    
    
    $
    203
    
    
    $
    180Reconciliation to consolidated costs of
revenues:Total operating costs (Non-GAAP)
    
    $
    163,462
    
    
    $
    144,368
    
    
    $
    144,898
    
    
    $
    154,199
    
    
    $
    144,589Royalties, taxes and other
    
    
    34,255
    
    
    
    33,396
    
    
    
    32,901
    
    
    
    25,169
    
    
    
    24,326Total cash costs (Non-GAAP)
    
    $
    197,717
    
    
    $
    177,764
    
    
    $
    177,799
    
    
    $
    179,368
    
    
    $
    168,915Asset retirement costs
    
    
    885
    
    
    
    734
    
    
    
    650
    
    
    
    535
    
    
    
    457Depreciation and amortization
    
    
    82,792
    
    
    
    82,396
    
    
    
    83,583
    
    
    
    79,032
    
    
    
    57,321Depreciation and amortization (in inventory)
    
    
    (1,462
    )
    
    
    1,264
    
    
    
    (1,659
    )
    
    
    2,182
    
    
    
    2,247Total production costs (Non-GAAP)
    
    $
    279,932
    
    
    $
    262,158
    
    
    $
    260,373
    
    
    $
    261,117
    
    
    $
    228,940Change in product inventories
    
    
    32,916
    
    
    
    11,848
    
    
    
    41,642
    
    
    
    141,512
    
    
    
    78,260Costs of recycling activities
    
    
    445,299
    
    
    
    307,137
    
    
    
    251,198
    
    
    
    85,582
    
    
    
    71,325Recycling activities  depreciation
    
    
    192
    
    
    
    142
    
    
    
    100
    
    
    
    55
    
    
    
    48Add: Profit from recycling activities
    
    
    36,869
    
    
    
    25,800
    
    
    
    24,635
    
    
    
    6,279
    
    
    
    6,105Total consolidated costs of revenues (3)
    
    $
    795,208
    
    
    $
    607,085
    
    
    $
    577,948
    
    
    $
    494,545
    
    
    $
    384,678Stillwater Mine:Total operating costs (Non-GAAP)
    
    $
    107,698
    
    
    $
    84,043
    
    
    $
    93,751
    
    
    $
    102,971
    
    
    $
    96,381Total cash costs (Non-GAAP)
    
    $
    130,338
    
    
    $
    105,676
    
    
    $
    115,247
    
    
    $
    119,721
    
    
    $
    112,463Total production costs (Non-GAAP)
    
    $
    178,579
    
    
    $
    152,964
    
    
    $
    164,344
    
    
    $
    172,978
    
    
    $
    148,365Divided by total ounces
    
    
    349
    
    
    
    359
    
    
    
    409
    
    
    
    381
    
    
    
    405Divided by total tons milled
    
    
    768
    
    
    
    715
    
    
    
    801
    
    
    
    790
    
    
    
    786Total operating cost per ounce (Non-GAAP)
    
    $
    308
    
    
    $
    234
    
    
    $
    229
    
    
    $
    270
    
    
    $
    238Total cash cost per ounce (Non-GAAP)
    
    $
    373
    
    
    $
    294
    
    
    $
    282
    
    
    $
    314
    
    
    $
    278Total production cost per ounce (Non-GAAP)
    
    $
    511
    
    
    $
    426
    
    
    $
    402
    
    
    $
    454
    
    
    $
    366Total operating cost per ton milled (Non-GAAP)
    
    $
    140
    
    
    $
    118
    
    
    $
    117
    
    
    $
    130
    
    
    $
    123Total cash cost per ton milled (Non-GAAP)
    
    $
    170
    
    
    $
    148
    
    
    $
    144
    
    
    $
    152
    
    
    $
    143Total production cost per ton milled (Non-GAAP)
    
    $
    233
    
    
    $
    214
    
    
    $
    205
    
    
    $
    219
    
    
    $
    189
 53




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##### Table of Contents



(in thousands, per ounce and per ton data)
    
    2008
    
    
    2007
    
    
    2006
    
    
    2005
    
    
    2004Stillwater Mine continued:Reconciliation to costs of revenues:Total operating costs (Non-GAAP)
    
    $
    107,698
    
    
    $
    84,043
    
    
    $
    93,751
    
    
    $
    102,971
    
    
    $
    96,381Royalties, taxes and other
    
    
    22,640
    
    
    
    21,633
    
    
    
    21,496
    
    
    
    16,750
    
    
    
    16,082Total cash costs (Non-GAAP)
    
    $
    130,338
    
    
    $
    105,676
    
    
    $
    115,247
    
    
    $
    119,721
    
    
    $
    112,463Asset retirement costs
    
    
    645
    
    
    
    512
    
    
    
    470
    
    
    
    370
    
    
    
    305Depreciation and amortization
    
    
    47,748
    
    
    
    46,521
    
    
    
    49,620
    
    
    
    52,295
    
    
    
    33,955Depreciation and amortization (in inventory)
    
    
    (152
    )
    
    
    255
    
    
    
    (993
    )
    
    
    592
    
    
    
    1,642Total production costs (Non-GAAP)
    
    $
    178,579
    
    
    $
    152,964
    
    
    $
    164,344
    
    
    $
    172,978
    
    
    $
    148,365Change in product inventories
    
    
    7,524
    
    
    
    (2,872
    )
    
    
    1,882
    
    
    
    6,773
    
    
    
    (3,764
    )Add: Profit from recycling activities
    
    
    25,123
    
    
    
    17,014
    
    
    
    17,091
    
    
    
    4,304
    
    
    
    4,274Total costs of revenues
    
    $
    211,226
    
    
    $
    167,106
    
    
    $
    183,317
    
    
    $
    184,055
    
    
    $
    148,875East Boulder Mine(1)Total operating costs (Non-GAAP)
    
    $
    55,764
    
    
    $
    60,325
    
    
    $
    51,147
    
    
    $
    51,228
    
    
    $
    48,208Total cash costs (Non-GAAP)
    
    $
    67,379
    
    
    $
    72,088
    
    
    $
    62,552
    
    
    $
    59,647
    
    
    $
    56,452Total production costs (Non-GAAP)
    
    $
    101,353
    
    
    $
    109,194
    
    
    $
    96,029
    
    
    $
    88,140
    
    
    $
    80,575Divided by total ounces
    
    
    150
    
    
    
    178
    
    
    
    192
    
    
    
    173
    
    
    
    164Divided by total tons milled
    
    
    438
    
    
    
    529
    
    
    
    550
    
    
    
    496
    
    
    
    484Total operating cost per ounce (Non-GAAP)
    
    $
    373
    
    
    $
    339
    
    
    $
    266
    
    
    $
    296
    
    
    $
    294Total cash cost per ounce (Non-GAAP)
    
    $
    451
    
    
    $
    405
    
    
    $
    326
    
    
    $
    345
    
    
    $
    344Total production cost per ounce (Non-GAAP)
    
    $
    678
    
    
    $
    613
    
    
    $
    500
    
    
    $
    509
    
    
    $
    491Total operating cost per ton milled (Non-GAAP)
    
    $
    127
    
    
    $
    114
    
    
    $
    93
    
    
    $
    103
    
    
    $
    100Total cash cost per ton milled (Non-GAAP)
    
    $
    154
    
    
    $
    136
    
    
    $
    114
    
    
    $
    120
    
    
    $
    117Total production cost per ton milled (Non-GAAP)
    
    $
    231
    
    
    $
    206
    
    
    $
    175
    
    
    $
    178
    
    
    $
    167Reconciliation to costs of revenues:Total operating costs (Non-GAAP)
    
    $
    55,764
    
    
    $
    60,325
    
    
    $
    51,147
    
    
    $
    51,228
    
    
    $
    48,208Royalties, taxes and other
    
    
    11,615
    
    
    
    11,763
    
    
    
    11,405
    
    
    
    8,419
    
    
    
    8,244Total cash costs (Non-GAAP)
    
    $
    67,379
    
    
    $
    72,088
    
    
    $
    62,552
    
    
    $
    59,647
    
    
    $
    56,452Asset retirement costs
    
    
    240
    
    
    
    222
    
    
    
    180
    
    
    
    165
    
    
    
    152Depreciation and amortization
    
    
    35,044
    
    
    
    35,877
    
    
    
    33,963
    
    
    
    26,737
    
    
    
    23,366Depreciation and amortization (in inventory)
    
    
    (1,310
    )
    
    
    1,007
    
    
    
    (666
    )
    
    
    1,591
    
    
    
    605Total production costs (Non-GAAP)
    
    $
    101,353
    
    
    $
    109,194
    
    
    $
    96,029
    
    
    $
    88,140
    
    
    $
    80,575Change in product inventories
    
    
    5,500
    
    
    
    432
    
    
    
    (439
    )
    
    
    (4,967
    )
    
    
    (379
    )Add: Profit from recycling activities
    
    
    11,746
    
    
    
    8,786
    
    
    
    7,544
    
    
    
    1,975
    
    
    
    1,831Total costs of revenues
    
    $
    118,599
    
    
    $
    118,412
    
    
    $
    103,134
    
    
    $
    85,148
    
    
    $
    82,027Other PGM activities(2)Reconciliation to costs of revenues:Change in product inventories
    
    $
    19,892
    
    
    $
    14,288
    
    
    $
    40,199
    
    
    $
    139,705
    
    
    $
    82,402Recycling activities  depreciation
    
    
    192
    
    
    
    142
    
    
    
    100
    
    
    
    55
    
    
    
    48Costs of recycling activities
    
    
    445,299
    
    
    
    307,137
    
    
    
    251,198
    
    
    
    85,582
    
    
    
    71,325Total costs of revenues
    
    $
    465,383
    
    
    $
    321,567
    
    
    $
    291,497
    
    
    $
    225,342
    
    
    $
    153,775
 
 (1)
    
    East Boulder Mine commenced full-time commercial production on January 1, 2002.(2)
    
    Other PGM activities (2004 through 2006) include recycling and sales of palladium received
in the Norilsk Nickel transaction and other.(3)
    
    Revenue from the sale of mined by-products are credited against gross production costs
for Non-GAAP presentation. Revenue from the sale of mined by-products
are now being reported on the Companys financial statements as mined revenue and are
included in consolidated costs of revenues. Total costs of revenues in the above table have
been reduced by approximately $36.8 million, $53.8 million, $42.6 million, $21.4 million and
$15.8 million in the years 2008, 2007, 2006, 2005 and 2004, respectively.Note:
    
    Costs and profits from recycling activities have been revised to include additional
recycling rhodium costs. As a result, costs per ounce and costs per ton have been revised
for the years 2007, 2006 and 2005. See Note 3 Correction of Immaterial Errorto the
Companys 2008 audited financial statements for further information. 54




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##### Table of Contents



ITEM 7
 MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
 Selected Financial and Operating Data
 OVERVIEW
 PRINCIPAL FACTORS AFFECTING STILLWATER MINING COMPANY
  Business and Properties  Risk Factors  The
Company is a Relatively High Cost Primary Producer
 Business and Properties  Risk
Factors
   55




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##### Table of Contents



Business and Properties  Risk
Factors
 Business and Properties  Risk Factors  Reliance on Third Parties for
Sourcing of Recycling Materials and the Concentration of Recycling Sources Creates the Potential
for Losses
  56




---



##### Table of Contents



2008 RESULTS AND COMMENTARY
 Results of
Operations  Year Ended December 31, 2008, Compared to Year Ended December 31, 2007
      57




---



##### Table of Contents



Reconciliation of Non-GAAP measures to costs of revenues
     58




---



##### Table of Contents



Advances on
inventory purchases
       59




---



##### Table of Contents



Good Neighbor
Agreement
    60




---



##### Table of Contents



RESULTS OF OPERATIONS
 YEAR ENDED DECEMBER 31, 2008 COMPARED TO YEAR ENDED DECEMBER 31, 2007
 Revenues
     61




---



##### Table of Contents



Costs of Metals Sold 
    Depreciation and amortization
 Exploration 
 Marketing
 General and administrative
 Interest
income and expense
  Total income tax provision de minimis
 Other comprehensive income (loss), net of tax
 62




---



##### Table of Contents



YEAR ENDED DECEMBER 31, 2007 COMPARED TO YEAR ENDED DECEMBER 31, 2006
 Revenues
     Costs of Metals Sold 
   63




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##### Table of Contents



Revenues
 Depreciation and amortization
 Exploration 
 Marketing
 General and administrative
 Interest income and expense
 Total income tax provision de minimis
 Other comprehensive income (loss), net of tax
 LIQUIDITY AND CAPITAL RESOURCES
  64




---



##### Table of Contents



Property, Plant and
Equipment
   65




---



##### Table of Contents



Convertible Debentures
    Accounting for Derivative Instruments and Hedging Activities, Accounting for Derivative Financial Instruments Indexed to, and Potentially Settled in, a Companys
Own Stock,
 Other noncurrent assets
  66




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##### Table of Contents



CONTRACTUAL OBLIGATIONS
  (in thousands)
    
    2009
    
    
    2010
    
    
    2011
    
    
    2012
    
    
    2013
    
    
    Thereafter
    
    
    TotalConvertible
debentures
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    181,500
    
    
    $
    
    
    
    $
    181,500Special Industrial
Education Impact

Revenue Bonds
    
    
    97
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    97Exempt Facility
Revenue Bonds
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    30,000
    
    
    
    30,000Operating leases
    
    
    303
    
    
    
    303
    
    
    
    303
    
    
    
    297
    
    
    
    264
    
    
    
    233
    
    
    
    1,703Asset retirement
obligations
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    96,713
    
    
    
    96,713Payments of
interest (1)
    
    
    5,810
    
    
    
    5,803
    
    
    
    5,803
    
    
    
    5,803
    
    
    
    4,102
    
    
    
    15,600
    
    
    
    42,921Other noncurrent
liabilities
    
    
    
    
    
    
    11,209
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    11,209Total
    
    $
    6,210
    
    
    $
    17,315
    
    
    $
    6,106
    
    
    $
    6,100
    
    
    $
    185,866
    
    
    $
    142,546
    
    
    $
    364,143
 
 (1)
    
    Interest payments on the convertible debentures noted in the above table are calculated
up to March 15, 2013, the date the holders of the debentures can exercise their put
option.  FACTORS THAT MAY AFFECT FUTURE RESULTS AND FINANCIAL CONDITION
 Business and Properties
 Risk Factors
  CRITICAL ACCOUNTING POLICIES
 Mine Development Expenditures  Capitalization and Amortization
    67




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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, 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.
  Asset Impairment
 Accounting for
the Impairment or Disposal of Long-Lived Assets
  68




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##### Table of Contents



Income Taxes
 Accounting for Income Taxes
  Post-closure Reclamation Costs
 Accounting for
Asset Retirement Obligations
  Asset
Retirement Obligation
 Derivative Instruments
 Accounting for Derivative Instruments and Hedging Activities
 69




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##### Table of Contents



Derivative
Instruments
 
 ITEM 7A
 QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK
  COMMODITY PRICE RISK
  Business and Properties  Current Operations 
PGM Sales and Hedging Activities Derivative Instruments
    70




---



##### Table of Contents



Derivative Instruments
  PGM
Recycling:
 Platinum
    
    Palladium
    
    RhodiumSettlement Period
    
    Ounces
    
    Avg. Price
    
    Ounces
    
    Avg. Price
    
    Ounces
    
    Avg. PriceFirst Quarter 2009
    
    
    10,592
    
    
    $
    1,038
    
    
    
    7,770
    
    
    $
    249
    
    
    
    2,458
    
    
    $
    3,922Second Quarter 2009
    
    
    1,241
    
    
    $
    973
    
    
    
    362
    
    
    $
    271
    
    
    
    398
    
    
    $
    1,446
 INTEREST RATE RISK
   71




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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
  
 72




---



##### Table of Contents



Report of Independent Registered Public Accounting Firm
 
 Internal Control  Integrated Framework
     Internal ControlIntegrated Framework
  
 73




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##### Table of Contents



STILLWATER MINING COMPANY
 STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
 (in thousands, except per share data)
 Year ended December 31,
    
    2008
    
    
    2007
    
    
    2006REVENUESMine production
    
    $
    360,364
    
    
    $
    331,277
    
    
    $
    334,834PGM recycling
    
    
    475,388
    
    
    
    326,394
    
    
    
    269,941Sales of palladium received in Norilsk Nickel transaction
    
    
    
    
    
    
    
    
    
    
    17,637Other
    
    
    19,980
    
    
    
    15,365
    
    
    
    33,366Total revenues
    
    
    855,732
    
    
    
    673,036
    
    
    
    655,778COSTS AND EXPENSESCosts of metals sold:Mine production
    
    
    283,793
    
    
    
    256,942
    
    
    
    242,612PGM recycling
    
    
    445,299
    
    
    
    307,137
    
    
    
    251,198Sales of palladium received in Norilsk Nickel transaction
    
    
    
    
    
    
    
    
    
    
    10,785Other
    
    
    19,892
    
    
    
    14,289
    
    
    
    32,300Total costs of metals sold
    
    
    748,984
    
    
    
    578,368
    
    
    
    536,895Depreciation and amortization:Mine production
    
    
    82,792
    
    
    
    82,396
    
    
    
    83,583PGM recycling
    
    
    192
    
    
    
    142
    
    
    
    100Total depreciation and amortization
    
    
    82,984
    
    
    
    82,538
    
    
    
    83,683Total costs of revenues
    
    
    831,968
    
    
    
    660,906
    
    
    
    620,578Exploration
    
    
    2,525
    
    
    
    1,062
    
    
    
    332Marketing
    
    
    5,705
    
    
    
    5,586
    
    
    
    4,186General and administrative
    
    
    24,187
    
    
    
    21,817
    
    
    
    23,221Restructuring
    
    
    5,420
    
    
    
    
    
    
    
    Impairment of long-term investments
    
    
    3,374
    
    
    
    
    
    
    
    Loss on trade receivables
    
    
    3,410
    
    
    
    
    
    
    
    Loss on advances on inventory purchases
    
    
    25,999
    
    
    
    
    
    
    
    Impairment of plant, property and equipment
    
    
    67,254
    
    
    
    
    
    
    
    (Gain)/loss on disposal of property, plant and equipment
    
    
    196
    
    
    
    (180
    )
    
    
    279Total costs and expenses
    
    
    970,038
    
    
    
    689,191
    
    
    
    648,596OPERATING INCOME (LOSS)
    
    
    (114,306
    )
    
    
    (16,155
    )
    
    
    7,182OTHER INCOME (EXPENSE)Other
    
    
    144
    
    
    
    236
    
    
    
    94Interest income
    
    
    11,103
    
    
    
    11,705
    
    
    
    11,322Interest expense
    
    
    (9,718
    )
    
    
    (11,269
    )
    
    
    (11,413
    )INCOME (LOSS) BEFORE INCOME TAX BENEFIT (PROVISION)
    
    
    (112,777
    )
    
    
    (15,483
    )
    
    
    7,185Income tax benefit (provision)
    
    
    32
    
    
    
    
    
    
    
    (10
    )NET INCOME (LOSS)
    
    
    (112,745
    )
    
    
    (15,483
    )
    
    
    7,175Other comprehensive income, net of tax
    
    
    5,865
    
    
    
    9,578
    
    
    
    1,799COMPREHENSIVE INCOME (LOSS)
    
    $
    (106,880
    )
    
    $
    (5,905
    )
    
    $
    8,974
  74




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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,
    
    2008
    
    
    2007
    
    
    2006BASIC AND DILUTED EARNINGS (LOSS) PER SHARENet income (loss)
    
    $
    (112,745
    )
    
    $
    (15,483
    )
    
    $
    7,175Weighted average common shares outstandingBasic
    
    
    93,025
    
    
    
    92,016
    
    
    
    91,260Diluted
    
    
    93,025
    
    
    
    92,016
    
    
    
    91,580Basic earnings (loss) per shareNet income (loss)
    
    $
    (1.21
    )
    
    $
    (0.17
    )
    
    $
    0.08Diluted earnings (loss) per shareNet income (loss)
    
    $
    (1.21
    )
    
    $
    (0.17
    )
    
    $
    0.08
  75




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##### Table of Contents



STILLWATER MINING COMPANY
 BALANCE SHEETS
 (in thousands, except share and per share amounts)
 December 31,
    
    2008
    
    
    2007ASSETSCurrent assetsCash and cash equivalents
    
    $
    161,795
    
    
    $
    61,436Investments, at fair market value
    
    
    18,994
    
    
    
    27,603Inventories
    
    
    73,413
    
    
    
    116,623Advances on inventory purchases
    
    
    3,298
    
    
    
    28,396Trade receivables
    
    
    2,369
    
    
    
    12,144Deferred income taxes
    
    
    17,443
    
    
    
    4,597Other current assets
    
    
    8,244
    
    
    
    6,092Total current assets
    
    
    285,556
    
    
    
    256,891Property, plant and equipment, net
    
    
    393,412
    
    
    
    465,054Restricted cash
    
    
    35,595
    
    
    
    5,885Other noncurrent assets
    
    
    9,701
    
    
    
    12,537Total assets
    
    $
    724,264
    
    
    $
    740,367LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilitiesAccounts payable
    
    $
    14,662
    
    
    $
    17,937Accrued payroll and benefits
    
    
    24,111
    
    
    
    20,944Property, production and franchise taxes payable
    
    
    10,749
    
    
    
    10,528Current portion of long-term debt
    
    
    97
    
    
    
    1,209Fair value of derivative instruments
    
    
    
    
    
    
    6,424Other current liabilities
    
    
    5,489
    
    
    
    11,932Total current liabilities
    
    
    55,108
    
    
    
    68,974Long-term debt
    
    
    210,947
    
    
    
    126,841Deferred income taxes
    
    
    17,443
    
    
    
    4,597Accrued workers compensation
    
    
    6,761
    
    
    
    9,982Asset retirement obligation
    
    
    7,028
    
    
    
    10,506Other noncurrent liabilities
    
    
    4,448
    
    
    
    4,103Total liabilities
    
    $
    301,735
    
    
    $
    225,003Stockholders equityPreferred stock, $0.01 par value, 1,000,000 shares authorized, none issued
    
    
    
    
    
    
    Common stock, $0.01 par value, 200,000,000 shares authorized, 93,665,855 and
92,405,111 shares issued and outstanding
    
    
    937
    
    
    
    924Paid-in capital
    
    
    640,657
    
    
    
    626,625Accumulated deficit
    
    
    (218,905
    )
    
    
    (106,160
    )Accumulated other comprehensive loss
    
    
    (160
    )
    
    
    (6,025
    )Total stockholders equity
    
    
    422,529
    
    
    
    515,364Total liabilities and stockholders equity
    
    $
    724,264
    
    
    $
    740,367
  76




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##### Table of Contents



STILLWATER MINING COMPANY
 STATEMENTS OF CASH FLOWS
 (in thousands)
 Year ended December 31,
    
    2008
    
    
    2007
    
    
    2006CASH FLOWS FROM OPERATING ACTIVITIESNet income (loss)
    
    $
    (112,745
    )
    
    $
    (15,483
    )
    
    $
    7,175Adjustments to reconcile net income (loss) to net cash
provided by operating activities:Depreciation and amortization
    
    
    82,984
    
    
    
    82,538
    
    
    
    83,683Lower of cost or market inventory adjustment
    
    
    16,623
    
    
    
    6,013
    
    
    
    2,519Restructuring costs
    
    
    5,420
    
    
    
    
    
    
    
    Impairment of long-term investments
    
    
    3,374
    
    
    
    
    
    
    
    Impairment of property, plant, and equipment
    
    
    67,254
    
    
    
    
    
    
    
    Loss on trade receivables
    
    
    3,410
    
    
    
    
    
    
    
    Loss on advances on inventory purchases
    
    
    25,999
    
    
    
    
    
    
    
    (Gain)/loss on disposal of property, plant and equipment
    
    
    196
    
    
    
    (180
    )
    
    
    279Asset retirement obligation
    
    
    885
    
    
    
    734
    
    
    
    650Stock issued under employee benefit plans
    
    
    5,992
    
    
    
    5,470
    
    
    
    4,910Amortization of debt issuance costs
    
    
    3,214
    
    
    
    500
    
    
    
    783Share based compensation
    
    
    5,063
    
    
    
    3,805
    
    
    
    3,549Changes in operating assets and liabilities:Inventories
    
    
    25,125
    
    
    
    (15,292
    )
    
    
    (23,686
    )Advances on inventory purchases
    
    
    (901
    )
    
    
    (4,205
    )
    
    
    (17,241
    )Trade receivables
    
    
    6,365
    
    
    
    3,864
    
    
    
    11,279Employee compensation and benefits
    
    
    (1,968
    )
    
    
    596
    
    
    
    2,547Accounts payable
    
    
    (3,560
    )
    
    
    (6,896
    )
    
    
    10,426Property, production and franchise taxes payable
    
    
    566
    
    
    
    (780
    )
    
    
    1,581Workers compensation
    
    
    (3,221
    )
    
    
    (272
    )
    
    
    4,400Restricted cash
    
    
    (9,540
    )
    
    
    (2,100
    )
    
    
    (1,100
    )Estimated final payments on recycled material
    
    
    (3,451
    )
    
    
    72
    
    
    
    5,410Forward hedges
    
    
    (2,812
    )
    
    
    747
    
    
    
    683Other
    
    
    (29
    )
    
    
    (2,709
    )
    
    
    (884
    )NET CASH PROVIDED BY OPERATING ACTIVITIES
    
    
    114,243
    
    
    
    56,422
    
    
    
    96,963CASH FLOWS FROM INVESTING ACTIVITIESCapital expenditures
    
    
    (82,277
    )
    
    
    (87,876
    )
    
    
    (97,802
    )Purchases of long-term investments
    
    
    (948
    )
    
    
    (1,687
    )
    
    
    (1,869
    )Proceeds from disposal of property, plant and equipment
    
    
    329
    
    
    
    396
    
    
    
    615Purchases of investments
    
    
    (41,095
    )
    
    
    (64,925
    )
    
    
    (106,287
    )Proceeds from maturities of investments
    
    
    49,424
    
    
    
    73,125
    
    
    
    126,434NET CASH USED IN INVESTING ACTIVITIES
    
    
    (74,567
    )
    
    
    (80,967
    )
    
    
    (78,909
    )CASH FLOWS FROM FINANCING ACTIVITIESPayments on long-term debt and capital lease obligations
    
    
    (98,539
    )
    
    
    (2,631
    )
    
    
    (10,726
    )Payments for debt issuance costs
    
    
    (5,098
    )
    
    
    
    
    
    
    (579
    )Proceeds from issuance of convertible debentures
    
    
    181,500
    
    
    
    
    
    
    
    Issuance of common stock
    
    
    2,990
    
    
    
    252
    
    
    
    825Restricted cash
    
    
    (20,170
    )
    
    
    
    
    
    
    Other
    
    
    
    
    
    
    
    
    
    
    526NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES
    
    
    60,683
    
    
    
    (2,379
    )
    
    
    (9,954
    )CASH AND CASH EQUIVALENTSNet increase (decrease)
    
    
    100,359
    
    
    
    (26,924
    )
    
    
    8,100Balance at beginning of year
    
    
    61,436
    
    
    
    88,360
    
    
    
    80,260BALANCE AT END OF YEAR
    
    $
    161,795
    
    
    $
    61,436
    
    
    $
    88,360
  77




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##### Table of Contents



STILLWATER MINING COMPANY
 STATEMENTS OF CHANGES IN STOCKHOLDERS EQUITY
 (in thousands)
 Retained Earnings
    
    
    
    
    
    
    TotalShares
    
    
    Common
    
    
    
    
    
    
    (Accumulated
    
    
    Accumulated Other
    
    
    StockholdersOutstanding
    
    
    Stock
    
    
    Paid-in Capital
    
    
    Deficit)
    
    
    Comprehensive Loss
    
    
    EquityBALANCE AT DECEMBER
31, 2005
    
    
    90,992
    
    
    $
    910
    
    
    $
    607,828
    
    
    $
    (97,852
    )
    
    $
    (17,402
    )
    
    $
    493,484Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    7,175
    
    
    
    
    
    
    
    7,175Change 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
    
    
    $
    (90,677
    )
    
    $
    (15,603
    )
    
    $
    511,742Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (15,483
    )
    
    
    
    
    
    
    (15,483
    )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
    
    
    $
    (106,160
    )
    
    $
    (6,025
    )
    
    $
    515,364Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (112,745
    )
    
    
    
    
    
    
    (112,745
    )Change in net
unrealized gains on
derivative
financial
instruments, net of
tax
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    6,533
    
    
    
    6,533Change in fair market
value of securities
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (668
    )
    
    
    (668
    )Common stock issued
under employee
benefit plans
    
    
    815
    
    
    
    8
    
    
    
    5,984
    
    
    
    
    
    
    
    
    
    
    
    5,992Stock option expense
    
    
    
    
    
    
    
    
    
    
    380
    
    
    
    
    
    
    
    
    
    
    
    380Common stock issued
under stock plans
    
    
    237
    
    
    
    3
    
    
    
    2,987
    
    
    
    
    
    
    
    
    
    
    
    2,990Common stock issued
under Directors
deferral plan
    
    
    8
    
    
    
    2
    
    
    
    59
    
    
    
    
    
    
    
    
    
    
    
    61Nonvested shares of
common stock granted
to
officers and employees
    
    
    201
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Amortization of
unearned nonvested
stock
    
    
    
    
    
    
    
    
    
    
    4,654
    
    
    
    
    
    
    
    
    
    
    
    4,654Forfeiture of
nonvested stock
    
    
    
    
    
    
    
    
    
    
    (32
    )
    
    
    
    
    
    
    
    
    
    
    (32
    )BALANCE AT DECEMBER
31, 2008
    
    
    93,666
    
    
    $
    937
    
    
    $
    640,657
    
    
    $
    (218,905
    )
    
    $
    (160
    )
    
    $
    422,529
  78




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##### Table of Contents



STILLWATER MINING COMPANY
 NOTES TO THE FINANCIAL STATEMENTS
 NOTE 1
NATURE OF OPERATIONS
    Risk of continuing depressed PGM prices
  Risk associated with loss of long-term sales contracts
  Risk associated with recycling segment
  79




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##### Table of Contents



NOTE 2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
 CASH AND CASH EQUIVALENTS
  RESTRICTED CASH
  INVESTMENTS
 Accounting for Certain Investments in Debt and Equity Securities
 The Equity Method of Accounting for Investments in Common Stock.
 INVENTORIES
  RECEIVABLES
  80




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##### Table of Contents



PROPERTY, PLANT AND EQUIPMENT
      LEASES
 Accounting for Leases.
 ASSET IMPAIRMENT
 Accounting for the Impairment or Disposal of Long-Lived
Assets.
 81




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##### Table of Contents



FAIR VALUE OF FINANCIAL INSTRUMENTS
   Fair Value Measurements
  REVENUE RECOGNITION
  Revenue Recognition
 82




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##### Table of Contents



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
   INCOME TAXES
 Accounting for Income Taxes
  83




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##### Table of Contents



Accounting for Uncertainty in Income Taxes
 STOCK-BASED COMPENSATION
 Share-Based Payment.
 EARNINGS (LOSS) PER COMMON SHARE
  COMPREHENSIVE INCOME (LOSS)
  DEBT ISSUANCE COSTS
  USE OF ESTIMATES
  RECLASSIFICATIONS
 Mine production revenues
 84




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##### Table of Contents



NOTE 3
CORRECTION OF IMMATERIAL ERROR
    For the Quarter Ended
    
    For the Quarter Ended
    
    For the Quarter EndedSeptember 30, 2008
    
    June 30, 2008
    
    March 31, 2008As
    
    As
    
    As
    
    As
    
    As
    
    As(in thousands)
    
    Reported
    
    Revised
    
    Reported
    
    Revised
    
    Reported
    
    RevisedPGM recycling costs of goods sold
    
    $
    152,383
    
    
    $
    151,967
    
    
    $
    101,491
    
    
    $
    102,352
    
    
    $
    82,083
    
    
    $
    82,486Net income (loss)
    
    
    (335
    )
    
    
    81
    
    
    
    17,173
    
    
    
    16,312
    
    
    
    3,212
    
    
    
    2,809Comprehensive income (loss)
    
    
    (407
    )
    
    
    9
    
    
    
    23,077
    
    
    
    22,216
    
    
    
    3,300
    
    
    
    2,897Inventory
    
    
    163,795
    
    
    
    160,907
    
    
    
    182,763
    
    
    
    179,459
    
    
    
    122,309
    
    
    
    119,866Accumulated deficit
    
    
    (84,070
    )
    
    
    (86,958
    )
    
    
    (83,735
    )
    
    
    (87,039
    )
    
    
    (100,908
    )
    
    
    (103,351
    )Total shareholders equity
    
    
    554,476
    
    
    
    551,588
    
    
    
    552,096
    
    
    
    548,792
    
    
    
    526,102
    
    
    
    523,659
 For the Year Ended
    
    For the Year EndedDecember 31, 2007
    
    December 31, 2006As
    
    As
    
    As
    
    As(in thousands)
    
    Reported
    
    Revised
    
    Reported
    
    RevisedPGM recycling costs of goods sold
    
    $
    305,911
    
    
    $
    307,137
    
    
    $
    250,444
    
    
    $
    251,198Operating income (loss)
    
    
    (14,929
    )
    
    
    (16,155
    )
    
    
    7,936
    
    
    
    7,182Net income (loss)
    
    
    (14,257
    )
    
    
    (15,483
    )
    
    
    7,929
    
    
    
    7,175Comprehensive income (loss)
    
    
    (4,679
    )
    
    
    (5,905
    )
    
    
    9,728
    
    
    
    8,974Inventory
    
    
    118,663
    
    
    
    116,623
    
    
    
    106,895
    
    
    
    106,081Accumulated deficit
    
    
    (104,120
    )
    
    
    (106,160
    )
    
    
    (89,863
    )
    
    
    (90,677
    )Total shareholders equity
    
    
    517,404
    
    
    
    515,364
    
    
    
    512,556
    
    
    
    511,742
 NOTE 4
ASSET IMPAIRMENT
  85




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##### Table of Contents



NOTE 5
SALES
 Mine Production
    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
    
    Price2009
    
    
    100
    %
    
    $
    364
    
    
    
    20
    %
    
    $
    975
    
    
    
    
    70
    %
    
    $
    425
    
    
    
    14
    %
    
    $
    8502010
    
    
    100
    %
    
    $
    360
    
    
    
    20
    %
    
    $
    975
    
    
    
    
    70
    %
    
    $
    425
    
    
    
    14
    %
    
    $
    8502011
    
    
    20
    %
    
    $
    300
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2012
    
    
    20
    %
    
    $
    300
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
  86




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##### Table of Contents



PGM Recycling
  Advances on inventory purchases Inventories Unearned income Other current liabilities
 Advances on inventory purchases Advances on inventory purchases
  Other activities
  NOTE 6
DERIVATIVE INSTRUMENTS
  Commodity Derivatives
  87




---



##### Table of Contents



Mine Production
   PGM Recycling
    PGM
Recycling:
 Fixed Forwards
 Platinum
    
    Palladium
    
    RhodiumSettlement Period
    
    Ounces
    
    Avg. Price
    
    Ounces
    
    Avg. Price
    
    Ounces
    
    Avg. PriceFirst Quarter 2009
    
    
    10,592
    
    
    $
    1,038
    
    
    
    7,770
    
    
    $
    249
    
    
    
    2,458
    
    
    $
    3,922Second Quarter 2009
    
    
    1,241
    
    
    $
    973
    
    
    
    362
    
    
    $
    271
    
    
    
    398
    
    
    $
    1,446
 Interest Rate Derivatives
  88




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##### Table of Contents



NOTE 7
SHARE-BASED PAYMENTS
 STOCK PLANS
    89




---



##### Table of Contents



Nonvested Shares:
  Nonvested
    
    
    MarketShares
    
    
    Value on
    
    
    Compensation ExpenseGrant Date
    
    Vesting Date
    
    Granted
    
    
    Grant Date
    
    
    2008
    
    
    2007
    
    
    2006May 7, 2004
    
    May 7, 2007
    
    
    348,170
    
    
    $
    4,460,058
    
    
    $
    
    
    
    $
    495,562
    
    
    $
    1,486,686May 3, 2005
    
    May 3, 2008
    
    
    225,346
    
    
    $
    1,654,040
    
    
    
    147,446
    
    
    
    260,656
    (2)
    
    
    551,347April 27, 2006
    
    April 27, 2009
    
    
    288,331
    
    
    $
    4,731,512
    
    
    
    1,264,571
    
    
    
    1,056,171
    (2)
    
    
    1,051,447April 27, 2006
    
    October 26, 2006
    
    
    9,752
    
    
    $
    160,030
    
    
    
    
    
    
    
    
    
    
    
    160,030
    (1)February 22, 2007
    
    February 22, 2010
    
    
    426,514
    
    
    $
    5,433,788
    
    
    
    1,420,002
    (3)
    
    
    1,242,863
    (2)
    
    
    May 3, 2007
    
    November 3, 2007
    
    
    17,654
    
    
    $
    280,000
    
    
    
    
    
    
    
    280,000
    
    
    
    February 4, 2008
    
    February 4, 2011
    
    
    16,741
    
    
    $
    225,000
    
    
    
    68,098
    
    
    
    
    
    
    
    March 6, 2008
    
    March 6, 2011
    
    
    287,592
    
    
    $
    5,283,065
    
    
    
    1,435,344
    (3)
    
    
    
    
    
    
    May 8, 2008
    
    November 8, 2008
    
    
    19,719
    
    
    $
    280,010
    
    
    
    280,010
    
    
    
    
    
    
    
    December 9,2008
    
    June 9, 2009
    
    
    12,987
    
    
    $
    40,000
    
    
    
    6,667
    
    
    
    
    
    
    
    Total compensation expense of nonvested shares
    
    
    
    
    
    
    
    
    
    $
    4,622,138
    
    
    $
    3,335,252
    
    
    $
    3,249,510
 
 (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 2007.(3)
    
    Compensation expense in 2008 was reduced by approximately $32,400 for forfeiture of
approximately 7,600 nonvested shares granted in 2008 and 2007 to certain members of management
and other employees who terminated employment in 2008. Deferral Plans:
 Omnibus Opinion  1967 Accounting for Deferred Compensation Arrangements Where Amounts Earned are Held in a Rabbi Trust
and Invested
 Omnibus Opinion 1967
 90




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##### Table of Contents



Accounting for Deferred
Compensation Arrangements Where Amounts Earned are Held in a Rabbi Trust and Invested
 Stock Options:
   Year ended December 31,
    
    2008
    
    2007
    
    2006Weighted average expected lives (years)
    
    
    3.8
    
    
    
    3.9
    
    
    
    3.8Interest rate
    
    
    2.6
    %
    
    
    4.5
    %
    
    
    4.8
    %Volatility
    
    
    58
    %
    
    
    56
    %
    
    
    58
    %Dividend yield
    
    
    0
    
    
    
    0
    
    
    
    0
  Weighted-AverageWeighted Average
    
    
    Grant-Date FairShares
    
    
    Exercise Price
    
    
    ValueOptions 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
    
    
    73,450
    
    
    
    11.59
    
    
    $
    5.44Options exercised
    
    
    (29,375
    )
    
    
    9.14Options canceled/forfeited
    
    
    (118,961
    )
    
    
    16.01Options outstanding at December
31, 2007
    
    
    1,276,025
    
    
    $
    20.16Options exercisable at December
31, 2007
    
    
    1,149,830
    
    
    
    21.112008 ActivityOptions granted
    
    
    87,100
    
    
    
    11.72
    
    
    $
    5.35Options exercised
    
    
    (236,690
    )
    
    
    12.75Options canceled/forfeited
    
    
    (96,275
    )
    
    
    16.27Options outstanding at December
31, 2008
    
    
    1,030,160
    
    
    $
    21.51Options exercisable at December
31, 2008
    
    
    905,266
    
    
    
    22.90
  91




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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
    
    
    13,417
    
    
    
    7.1
    
    
    $
    3.70
    
    
    
    5,917
    
    
    $
    2.76$  4.67    $  9.33
    
    
    99,798
    
    
    
    6.4
    
    
    $
    7.17
    
    
    
    70,918
    
    
    $
    6.91$  9.34    $13.99
    
    
    118,550
    
    
    
    7.6
    
    
    $
    11.75
    
    
    
    57,912
    
    
    $
    11.75$14.00    $18.65
    
    
    99,658
    
    
    
    5.5
    
    
    $
    15.61
    
    
    
    77,107
    
    
    $
    15.58$18.66    $23.31
    
    
    270,537
    
    
    
    3.0
    
    
    $
    19.37
    
    
    
    265,212
    
    
    $
    19.34$23.32    $27.98
    
    
    177,825
    
    
    
    0.3
    
    
    $
    26.51
    
    
    
    177,825
    
    
    $
    26.51$27.99    $32.64
    
    
    88,675
    
    
    
    1.0
    
    
    $
    30.49
    
    
    
    88,675
    
    
    $
    30.49$32.65    $37.30
    
    
    110,200
    
    
    
    1.9
    
    
    $
    34.65
    
    
    
    110,200
    
    
    $
    34.65$37.31    $41.96
    
    
    51,500
    
    
    
    1.9
    
    
    $
    38.33
    
    
    
    51,500
    
    
    $
    38.331,030,160
    
    
    
    3.3
    
    
    $
    21.51
    
    
    
    905,266
    
    
    $
    22.90
  Weighted-AverageGrant-Date FairNonvested Options
    
    Options
    
    ValueNonvested options at January 1, 2008
    
    
    126,195
    
    
    $
    5.37Options granted
    
    
    87,100
    
    
    
    5.35Options vested
    
    
    (52,852
    )
    
    
    5.25Options forfeited
    
    
    (35,549
    )
    
    
    5.78Nonvested options at December 31, 2008
    
    
    124,894
    
    
    $
    5.29
  Employee Benefit Plans:
  92




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##### Table of Contents



NOTE 8
INCOME TAXES
  December 31, (in thousands)
    
    2008
    
    
    2007Mine development costs
    
    $
    76,138
    
    
    $
    89,077Inventory
    
    
    1,550
    
    
    
    2,190Total deferred tax liabilities
    
    
    77,688
    
    
    
    91,267Noncurrent liabilities
    
    
    (8,829
    )
    
    
    (7,619
    )Property and equipment
    
    
    (27,373
    )
    
    
    (19,921
    )Current liabilities
    
    
    (18,994
    )
    
    
    (6,788
    )Long-term investments
    
    
    (1,329
    )
    
    
    Net operating loss and other carryforwards
    
    
    (136,112
    )
    
    
    (127,194
    )Total deferred tax assets
    
    
    (192,637
    )
    
    
    (161,522
    )Valuation allowance
    
    
    114,949
    
    
    
    70,255Net deferred tax assets
    
    
    (77,688
    )
    
    
    (91,267
    )Net deferred tax liabilities
    
    $
    
    
    
    $
    
   Year ended December 31, (in thousands)
    
    2008
    
    
    2007 (1)
    
    
    2006 (1)Income (loss) before income taxes
    
    $
    (112,777
    )
    
    $
    (15,483
    )
    
    $
    7,185Income tax (benefit) or expense at statutory
rate of 35%
    
    $
    (39,472
    )
    
    $
    (5,419
    )
    
    $
    2,515State income tax benefit, net of federal benefit
    
    
    (4,948
    )
    
    
    (679
    )
    
    
    315Change in valuation allowance
    
    
    44,694
    
    
    
    6,108
    
    
    
    (2,748
    )Other
    
    
    (306
    )
    
    
    (10
    )
    
    
    (72
    )Net income tax provision
    
    $
    (32
    )
    
    $
    
    
    
    $
    10
 
 (1)
    
    Prior amounts have been revised due to immaterial correction of an error as described
in Note 3   Accounting for Uncertainties in Income Taxes, an Interpretation of FASB Statement No. 109
 93




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##### Table of Contents



Income tax
provision
 NOTE 9
COMPREHENSIVE INCOME (LOSS)
    AccumulatedAvailable for
    
    
    
    
    
    
    OtherSale
    
    
    Commodity
    
    
    Comprehensive(in thousands)
    
    Securities
    
    
    Instruments
    
    
    LossBalance 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
    )Reclassification to
earnings
    
    
    6
    
    
    
    12,794
    
    
    
    12,800Change in value
    
    
    (674
    )
    
    
    (6,261
    )
    
    
    (6,935
    )Comprehensive
income (loss)
    
    $
    (668
    )
    
    $
    6,533
    
    
    $
    5,865Balance at December
31, 2008
    
    $
    (160
    )
    
    $
    
    
    
    $
    (160
    )
 NOTE 10
SEGMENT INFORMATION
   94




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##### Table of Contents



(in thousands)
    
    Mine
    
    PGM
    
    AllYear ended December 31, 2008
    
    Production
    
    Recycling
    
    Other
    
    TotalRevenues
    
    $
    360,364
    
    
    $
    475,388
    
    
    $
    19,980
    
    
    $
    855,732Depreciation and amortization
    
    $
    82,792
    
    
    $
    192
    
    
    $
    
    
    
    $
    82,984Interest income
    
    $
    
    
    
    $
    6,979
    
    
    $
    4,124
    
    
    $
    11,103Interest expense
    
    $
    
    
    
    $
    1
    
    
    $
    9,717
    
    
    $
    9,718Income
(loss) before impairment charge
    
    $
    (6,413
    )
    
    $
    36,869
    
    
    $
    (43,196
    )
    
    $
    (12,740
    )Impairment charge
    
    $
    67,254
    
    
    $
    25,999
    
    
    $
    6,784
    
    
    $
    100,037Income (loss) after impairment
charge, before income taxes
    
    $
    (73,667
    )
    
    $
    10,870
    
    
    $
    (49,980
    )
    
    $
    (112,777
    )Capital expenditures
    
    $
    81,657
    
    
    $
    306
    
    
    $
    314
    
    
    $
    82,277Total assets
    
    $
    448,312
    
    
    $
    24,559
    
    
    $
    251,393
    
    
    $
    724,264
 (in thousands)
    
    Mine
    
    PGM
    
    AllYear ended December 31, 2007
    
    Production
    
    Recycling
    
    Other
    
    TotalRevenues
    
    $
    331,277
    
    
    $
    326,394
    
    
    $
    15,365
    
    
    $
    673,036Depreciation 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
    )
    
    $
    25,799
    
    
    $
    (33,439
    )
    
    $
    (15,483
    )Capital expenditures
    
    $
    87,257
    
    
    $
    382
    
    
    $
    237
    
    
    $
    87,876Total assets
    
    $
    516,308
    
    
    $
    86,548
    
    
    $
    137,511
    
    
    $
    740,367
 (in thousands)
    
    Mine
    
    PGM
    
    AllYear ended December 31, 2006
    
    Production
    
    Recycling
    
    Other
    
    TotalRevenues
    
    $
    334,834
    
    
    $
    269,941
    
    
    $
    51,003
    
    
    $
    655,778Depreciation 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
    
    
    $
    24,580
    
    
    $
    (25,806
    )
    
    $
    7,185Capital expenditures
    
    $
    97,284
    
    
    $
    209
    
    
    $
    309
    
    
    $
    97,802Total assets
    
    $
    512,128
    
    
    $
    70,773
    
    
    $
    172,308
    
    
    $
    755,209
 95




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##### Table of Contents



NOTE 11

INVESTMENTS
  Gross
    
    
    Grossunrealized
    
    
    unrealized
    
    
    Fair(in thousands)
    
    
    Cost
    
    
    gains
    
    
    losses
    
    
    market value2008Federal agency notes
    
    $
    17,926
    
    
    $
    69
    
    
    $
    
    
    
    $
    17,995Commercial paper
    
    
    998
    
    
    
    1
    
    
    
    
    
    
    
    999Mutual funds
    
    
    579
    
    
    
    
    
    
    
    230
    
    
    
    349Total
    
    $
    19,503
    
    
    $
    70
    
    
    $
    230
    
    
    $
    19,3432007Federal agency notes
    
    $
    24,154
    
    
    $
    466
    
    
    $
    
    
    
    $
    24,620Commercial paper
    
    
    2,965
    
    
    
    18
    
    
    
    
    
    
    
    2,983Mutual funds
    
    
    511
    
    
    
    24
    
    
    
    
    
    
    
    535Total
    
    $
    27,630
    
    
    $
    508
    
    
    $
    
    
    
    $
    28,138
 Other noncurrent
assets
 NOTE 12
INVENTORIES
    (in thousands)
    
    2008
    
    
    2007Metals inventoryRaw ore
    
    $
    1,050
    
    
    $
    1,061Concentrate and in-process
    
    
    14,892
    
    
    
    36,933Finished goods
    
    
    36,486
    
    
    
    60,89352,428
    
    
    
    98,887Materials and supplies
    
    
    20,985
    
    
    
    17,736Total inventory
    
    $
    73,413
    
    
    $
    116,623
 96




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##### Table of Contents



NOTE 13
EARNINGS (LOSS) PER COMMON SHARE
     NOTE 14
DEBT OBLIGATIONS
 Convertible Debentures
    Accounting for Derivative Instruments and Hedging Activities, Accounting for Derivative Financial Instruments Indexed to, and Potentially Settled in, a Companys Own Stock,
 97




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##### Table of Contents



Other noncurrent assets
  EQUIPMENT LEASE AGREEMENTS
  EXEMPT FACILITY REVENUE BONDS
  SPECIAL INDUSTRIAL EDUCATION IMPACT REVENUE BONDS
  CASH PAID FOR INTEREST
  98




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##### Table of Contents



NOTE 15
PROPERTY, PLANT AND EQUIPMENT
  (in thousands)
    
    2008
    
    
    2007Machinery and equipment
    
    $
    42,346
    
    
    $
    71,905Buildings and structural components
    
    
    111,202
    
    
    
    150,064Mine development
    
    
    387,207
    
    
    
    452,244Land
    
    
    6,403
    
    
    
    7,721Construction-in-progress:Stillwater Mine
    
    
    47,516
    
    
    
    47,072East Boulder Mine
    
    
    14,085
    
    
    
    33,358Other
    
    
    16,765
    
    
    
    3,902625,524
    
    
    
    766,266Less accumulated depreciation and amortization
    
    
    (232,112
    )
    
    
    (301,212
    )Total property, plant, and equipment
    
    $
    393,412
    
    
    $
    465,054
  (in thousands)
    
    2008
    
    
    2007
    
    
    2006Stillwater Mine
    
    $
    46,513
    
    
    $
    47,864
    
    
    $
    53,650East Boulder Mine
    
    
    19,097
    
    
    
    33,991
    
    
    
    41,173Other
    
    
    16,667
    
    
    
    6,021
    
    
    
    2,979Total capital expenditures
    
    $
    82,277
    
    
    $
    87,876
    
    
    $
    97,802
 NOTE 16
RESTRUCTURING COSTS
   TotalContract
    
    
    Employee
    
    
    Restructuring(in thousands)
    
    Terminations
    
    
    Terminations
    
    
    AccrualRestructuring accrual
    
    $
    285
    
    
    $
    5,135
    
    
    $
    5,420Cash paid for restructuring costs
    
    
    (81
    )
    
    
    (2,342
    )
    
    
    (2,423
    )Balance at December 31, 2008
    
    $
    204
    
    
    $
    2,793
    
    
    $
    2,997
 99




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##### Table of Contents



NOTE 17
ASSET RETIREMENT OBLIGATION
  Stillwater
    
    
    East Boulder(in thousands)
    
    Mine
    
    
    Mine
    
    
    TotalBalance 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
    
    
    $
    10,506Liabilities incurred
    
    
    
    
    
    
    
    
    
    
    Accretion expense
    
    
    644
    
    
    
    241
    
    
    
    885Revision of mine life
    
    
    (2,301
    )
    
    
    (2,062
    )
    
    
    (4,363
    )Balance at December 31, 2008
    
    $
    5,893
    
    
    $
    1,135
    
    
    $
    7,028
  $
 NOTE 18
FAIR VALUE MEASUREMENTS
 Fair Value Measurements
  100




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##### Table of Contents



Fair Value Measurements(in thousands)
    
    Total
    
    Level I
    
    Level 2
    
    Level 3Mutual funds
    
    $
    349
    
    
    $
    
    
    
    $
    349
    
    
    $
    Investments
    
    $
    18,994
    
    
    $
    
    
    
    $
    18,994
    
    
    $
    
   Fair Value Measurements(in thousands)
    
    Total
    
    Level 1
    
    Level 2
    
    Level 3Property, plant & equipment, net
    
    $
    161,400
    
    
    $
    
    
    
    $
    
    
    
    $
    161,400Convertible debentures
    
    $
    81,675
    
    
    $
    
    
    
    $
    81,675
    
    
    $
    Exempt facility revenue bonds
    
    $
    13,767
    
    
    $
    
    
    
    $
    
    
    
    $
    13,767Long-term investments
    
    $
    1,130
    
    
    $
    
    
    
    $
    1,130
    
    
    $
    
   NOTE 19
RELATED PARTIES
  NOTE 20
COMMITMENTS AND CONTINGENCIES
  REFINING AGREEMENTS
  101




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##### Table of Contents



PURCHASE COMMITMENT
 Advances on inventory purchases Unearned
income Other current liabilities Advances on inventory purchases
 OPERATING LEASES
   Minimum LeaseYear ended (in thousands)
    
    Payment2009
    
    $
    3032010
    
    
    3032011
    
    
    3032012
    
    
    297Thereafter
    
    
    497Total
    
    $
    1,703
 SIGNIFICANT CUSTOMERS
  2008
    
    
    
    2007
    
    
    
    2006Customer A
    
    
    31
    %
    
    
    36
    %
    
    
    36
    %Customer B
    
    
    25
    %
    
    
    28
    %
    
    
    18
    %Customer C
    
    
    13
    %
    
    
    *
    
    
    
    *Customer D
    
    
    12
    %
    
    
    *
    
    
    
    *Customer E
    
    
    *
    
    
    
    *
    
    
    
    11
    %81
    %
    
    
    64
    %
    
    
    65
    %
 
 *
    
    Represents less than 10% of total revenues LABOR UNION CONTRACTS
  LEGAL PROCEEDINGS
  102




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REGULATIONS AND COMPLIANCE
 m  m
  103




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##### Table of Contents



NOTE 21
QUARTERLY DATA (UNAUDITED)
  (in thousands, except per share data)
    
    2008 Quarter EndedMarch 31
    
    June 30
    
    September 30
    
    December 31Revenue
    
    $
    186,364
    
    
    $
    233,150
    
    
    $
    254,182
    
    
    $
    182,036Depreciation and amortization
    
    $
    20,695
    
    
    $
    21,795
    
    
    $
    19,000
    
    
    $
    21,494Operating income (loss)
    
    $
    4,252
    
    
    $
    15,346
    
    
    $
    (1,453
    )
    
    $
    (132,451
    )Net income (loss)
    
    $
    2,809
    
    
    $
    16,312
    
    
    $
    81
    
    
    $
    (131,947
    )Comprehensive income (loss)
    
    $
    2,897
    
    
    $
    22,216
    
    
    $
    9
    
    
    $
    (132,002
    )Basic earnings per share (loss)
    
    $
    0.03
    
    
    $
    0.18
    
    
    $
    
    
    
    $
    (1.41
    )Diluted earnings per share (loss)
    
    $
    0.03
    
    
    $
    0.18
    
    
    $
    
    
    
    $
    (1.41
    )2007 Quarter EndedMarch 31
    
    June 30
    
    September 30
    
    December 31Revenue
    
    $
    160,379
    
    
    $
    175,436
    
    
    $
    174,870
    
    
    $
    162,351Depreciation and amortization
    
    $
    20,438
    
    
    $
    21,656
    
    
    $
    20,146
    
    
    $
    20,320Operating income (loss)
    
    $
    (1,485
    )
    
    $
    (3,111
    )
    
    $
    (11,504
    )
    
    $
    (55
    )Net income (loss)
    
    $
    (1,349
    )
    
    $
    (2,854
    )
    
    $
    (11,351
    )
    
    $
    71Comprehensive income (loss)
    
    $
    (6,524
    )
    
    $
    2,592
    
    
    $
    (7,801
    )
    
    $
    5,828Basic earnings per share (loss)
    
    $
    (0.01
    )
    
    $
    (0.03
    )
    
    $
    (0.12
    )
    
    $
    Diluted earnings per share (loss)
    
    $
    (0.01
    )
    
    $
    (0.03
    )
    
    $
    (0.12
    )
    
    $
    
 104




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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)
    
    Evaluation of Disclosure Controls and Procedures.
  (b)
    
    Managements Report on Internal Control over Financial Reporting.
  
    
    pertain to the maintenance of records that, in reasonable detail, accurately and fairly
reflect the transactions and dispositions of the assets of the Company;
    
    provide reasonable assurance that transactions are recorded as necessary to permit
preparation of financial statements in accordance with generally accepted accounting
principles, and that receipts and expenditures of the Company are being made only in
accordance with authorizations of management and directors of the Company; and
    
    provide reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use or disposition of the Companys assets that could have a material effect on
the financial statements.
  Internal Control  Integrated Framework
  Inadequate control over recycling cost of goods sold calculation.
 105




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##### Table of Contents



(c)
    
    Changes in Internal Control over Financial Reporting.
  ü
    
    The Company modified its inventory valuation process to include a control
requiring regular determination of lower-of-cost-or-market valuation for each stage
of its recycling inventory;ü
    
    The Company revised its process for estimating the final settlement liability and
the corresponding inventory asset for transactions awaiting final assay results.
   ü
    
    Expansion of the monthly recycling production reconciliation report to include
recycled rhodiumü
    
    Monthly review of inventory volumes by an analyst in the recycling groupü
    
    Monthly reconciliation of production reports with accounting sales information
 106




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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
    
    
    66
    
    
    Chairman of the Board and Chief Executive OfficerGreg R. Struble
    
    
    51
    
    
    Executive Vice President and Chief Operating OfficerJohn R. Stark
    
    
    56
    
    
    Vice President, Human Resources, Secretary and Corporate CounselGregory A Wing
    
    
    59
    
    
    Vice President and Chief Financial OfficerTerrell I. Ackerman
    
    
    55
    
    
    Vice President, General Manager East Boulder Operations
  EXECUTIVE OFFICERS
 Francis R. McAllister (age 66)
 Greg R. Struble (age 51)
 107




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##### Table of Contents



John R. Stark (age 56)
 Gregory A. Wing (age 59)
 Terrell I. Ackerman (age 55)
  Audit Committee Financial Expert
  New Directors of the Company
 Michael E. McGuire, Jr
  108




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##### Table of Contents



Michael Schiavone
  Code of Ethics
 http://www.stillwatermining.com
 Corporate Governance
 http://www.stillwatermining.com
 NYSE CEO Certification
  
 ITEM 11
EXECUTIVE COMPENSATION
  
 ITEM 12
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT AND RELATED STOCKHOLDERS MATTERS
  109




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##### Table of Contents



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
    
    72Statements of Operations and Comprehensive Income (Loss)
    
    74Balance Sheets
    
    76Statements of Cash Flow
    
    77Statements of Changes in Stockholders Equity
    
    78Notes to Financial Statements
    
    79
    110




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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).
 111




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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).
 112




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##### Table of Contents



Number
    
    Description10.38
    
    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).10.39
    
    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).10.43
    
    First Amendment Agreement to Palladium and Rhodium Sales Agreement between Stillwater Mining Company
and General Motors Corporation, dated December 9, 2008 (portions of the agreement have been omitted
pursuant to a confidential treatment request), (filed herewith).10.44
    
    Memorandum of Understanding between Stillwater Mining Company East Boulder Operation and United Steel
Workers International Union, Local 11-001, East Boulder Unit, dated December 1, 2008, (filed
herewith).10.45
    
    Form of 1.875% Convertible Senior Note due 2028 (incorporated by reference to Exhibit 4.2 to the
Registrants form 8-K, dated March 14, 2008).10.46
    
    Amendment No. 1 to Stockholders Agreement, dated March 10, among Stillwater Mining Company, MMC
Norilsk Nickel, and Norimet Limited (incorporated by reference to Exhibit 10.1 to the Registrants
form 8-K, dated March 14, 2008).10.47
    
    Indenture, dated as of March 12, 2008, among Stillwater Mining Company, Law Debenture Trust Company
of New York, and Deutsche Bank Trust Company Americas. (incorporated by reference to Exhibit 4.1 to
the Registrants form 8-K, dated March 14, 2008).10.48
    
    Registration Rights Agreement, dated as of March 12, 2008, between Stillwater Mining Company and
Deutsche Bank. (incorporated by reference to Exhibit 4.3 to the Registrants form 8-K, dated March
14, 2008).10.49
    
    Amended and Restated Secondary Materials Processing Agreement, dated as of June 7, 2005, among
Stillwater Mining Company and Power Mount Incorporated (incorporated by reference to Exhibit 10.1 to
the Registrants form 8-K, dated December 9, 2008) (portions of the agreement have been omitted
pursuant to a confidential treatment request).10.50
    
    Purchase Agreement, Stillwater Mining Company and Deutsche Bank, dated March 6, 2008. (incorporated
by reference to Exhibit 99.1 to the Registrants form 8-K, dated March 7, 2008)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).
 113




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##### Table of Contents



SIGNATURES
  STILLWATER MINING COMPANY
(Registrant)Dated: March 16, 2009
    By:
    /s/ Francis R. McAllisterFrancis R. McAllister
Chairman and Chief Executive Officer  Signature and Title
    
    Date/s/ Francis R. McAllister

Francis R. McAllister

Chairman, Chief Executive Officer and Director

(Principal Executive Officer)
    
    March 16, 2009/s/ Gregory A. Wing

Gregory A. Wing
    
    March 16, 2009Vice President and Chief Financial Officer(Principal Accounting Officer)/s/ Craig L. Fuller

Craig L. Fuller, Director
    
    March 16, 2009/s/ Patrick M. James

Patrick M. James, Director
    
    March 16, 2009/s/ Steven S. Lucas

Steven S. Lucas, Director
    
    March 16, 2009/s/ Joseph P. Mazurek

Joseph P. Mazurek, Director
    
    March 16, 2009/s/ Sheryl K. Pressler

Sheryl K. Pressler, Director
    
    March 16, 2009/s/ Donald W. Riegle Jr.

Donald W. Riegle Jr., Director
    
    March 16, 2009/s/ Michael E. McGuire, Jr.

Michael E. McGuire, Jr., Director
    
    March 16, 2009/s/ Michael Schiavone

Michael Schiavone, Director
    
    March 16, 2009
 114