<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON SEPTEMBER 20, 1996
REGISTRATION NO. 333
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
---------------------
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
---------------------
STILLWATER MINING COMPANY
(Exact Name of Registrant as Specified in its Charter)
---------------------
<TABLE>
<S> <C> <C>
DELAWARE 1090 81-0480654
(State or Other Jurisdiction of (Primary Standard Industrial (I.R.S. Employer
Incorporation or Organization) Classification Code Number) Identification Number)
</TABLE>
536 EAST PIKE AVENUE
COLUMBUS, MONTANA 59019
(303) 978-2525
(Address and telephone number of principal executive offices and principal place
of business)
---------------------
CHARLES R. ENGLES
CHAIRMAN AND CHIEF EXECUTIVE OFFICER
536 EAST PIKE AVENUE
COLUMBUS, MONTANA 59019
(303) 978-2525
(Name, Address, and Telephone Number of Agent for Service)
---------------------
Copies to:
NESA E. HASSANEIN, ESQ.
MORRISON & FOERSTER LLP
370 17TH STREET, SUITE 5200
DENVER, COLORADO 80202-5638
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as
practicable after this Registration Statement becomes effective.
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. / /
If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, check the following box. /X/
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / /
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /
---------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
========================================================================================================
PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF
TITLE OF SECURITIES AMOUNT TO BE OFFERING PRICE AGGREGATE REGISTRATION
TO BE REGISTERED REGISTERED PER SHARE(1) OFFERING PRICE(1) FEE
- --------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, $.01 par value,
including the rights to purchase
shares of Series A Preferred Stock,
par value $.01 per share, associated
therewith........................... 100,000 shares $20.50 $2,050,000 $706.90
========================================================================================================
</TABLE>
(1) Estimated solely for purposes of calculating the registration fee pursuant
to Rule 457(c) of the Securities Act of 1933, as amended. Pursuant to Rule
457(c) the maximum offering price per share of $20.50 represents the average
of the high and low prices for a share of the Common Stock as reported on
the Nasdaq National Market on September 18, 1996 and the maximum aggregate
offering price is the product of $20.50 and 100,000.
---------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE> 2
EXPLANATORY NOTE
This Registration Statement will be amended to relate to that number of
previously issued and unregistered shares of Stillwater Mining Company (the
"Company") that holders thereof desire to include herein for resale. Although
the total number of previously issued and unregistered shares of Common Stock is
approximately 10,054,953, consisting of those which may be sold pursuant to Rule
144 under the Securities Act of 1933, as amended, and those which may not be so
sold, the actual number of shares that will be registered for sale pursuant to
this Registration Statement has not been determined since the Company is in the
process of contacting holders of unregistered shares to determine their desire
to participate in this Registration Statement.
<PAGE> 3
***************************************************************************
* *
* INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A *
* REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED *
* WITH THE SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT *
* BE SOLD NOR MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE *
* REGISTRATION STATEMENT BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT *
* CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY *
* NOR SHALL THERE BE ANY SALE OF THESE SECURITIES IN ANY STATE IN WHICH *
* SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO *
* REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH *
* STATE. *
* *
***************************************************************************
SUBJECT TO COMPLETION, DATED SEPTEMBER 20, 1996
PROSPECTUS
, 1996
STILLWATER MINING COMPANY
COMMON STOCK
This Prospectus relates to the public offering by the Selling Security
Holders ("the Selling Security Holders") of up to shares of common
stock, par value $.01 per share (the "Common Stock"), of Stillwater Mining
Company, a Delaware Corporation (the "Company"). The shares of Common
Stock (collectively, the "Shares"), when sold, will be sold by and for the
account of the Selling Security Holders named herein. The Company will not
receive any of the proceeds from the sale of the Shares pursuant to this
Prospectus. The Shares were initially sold by the Company in a private placement
transaction on September 16, 1994 or were sold by Manville Corporation to
investors pursuant to Rule 144A and Regulation S under the Securities Act of
1933, as amended (the "Securities Act"). The Common Stock of the Company is
traded on the Nasdaq National Market where prices are reported under the symbol
"PGMS."
The Common Stock may be sold by the Selling Security Holders from time to
time directly to purchasers or through agents, underwriters or dealers. See
"Plan of Distribution." If required, the names of any such agents or
underwriters involved in the sale of the Common Stock in respect of which this
Prospectus is being delivered and the applicable agent's commission, dealer's
purchase price or underwriter's discount, if any, will be set forth in an
accompanying supplement to this Prospectus (the "Prospectus Supplement").
The Selling Security Holders will receive all of the net proceeds from the
sale of the Common Stock and will pay all underwriting discounts and selling
commissions, if any, applicable to the sale of the Common Stock. The Company is
responsible for payment of all other expenses incident to the offer and sale of
the Common Stock.
The Selling Security Holders and any broker-dealers, agents or underwriters
which participate in the distribution of the Common Stock may be deemed to be
"underwriters" within the meaning of the Securities Act and any commission
received by them and any profit on the resale of the Common Stock purchased by
them may be deemed to be underwriting commissions or discounts under the
Securities Act. See "Plan of Distribution" for a description of indemnification
arrangements.
---------------------
SEE "RISK FACTORS" BEGINNING ON PAGE 8, FOR A DISCUSSION OF CERTAIN FACTORS THAT
SHOULD BE CONSIDERED BY PROSPECTIVE PURCHASERS OF THE SHARES.
---------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this Prospectus is , 1996
<PAGE> 4
AVAILABLE INFORMATION
The Company is currently subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith files reports, proxy statements, information statements and
other information with the Securities and Exchange Commission (the
"Commission"). Any reports, proxy statements, information statements and other
information filed by the Company with the Commission may be inspected and copied
at the public reference facilities maintained by the Commission at Room 1024,
Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549, and at the
Commission's Regional Offices located at Suite 1400, Northwestern Atrium Center,
500 West Madison Street, Chicago, Illinois 60661 and 13th Floor, Seven World
Trade Center, New York, New York 10048, and copies of such material may also be
obtained by mail from the Public Reference Section of the Commission at 450
Fifth Street, N.W., Washington, D.C. 20549, at prescribed rates. The Commission
also maintains a site on the World Wide Web, the address of which is
http://www.sec.gov, that contains reports, proxy and information statements and
other information regarding the Company, which has filed electronically with the
Commission since May 6, 1996. The Company's Common Stock is quoted on the Nasdaq
National Market and reports, proxy statements and other information concerning
the Company also may be inspected at the offices of the Nasdaq Stock Market,
Reports Section, at 1735 K Street, Washington, D.C. 20006.
This Prospectus constitutes a part of a Registration Statement on Form S-3
(herein, together with all amendments, schedules and exhibits, referred to as
the "Registration Statement") filed by the Company with the Commission under the
Securities Act of 1933, as amended. This Prospectus does not contain all of the
information set forth in the Registration Statement and certain parts are
omitted in accordance with the rules and regulations of the Commission. For
further information with respect to the Company and the Common Stock offered
hereby, reference is made to such Registration Statement. Statements contained
in this Prospectus as to the contents of any contract or other document referred
to are not necessarily complete, and in each instance, reference is made to the
copy of such contract or other document filed as an exhibit or incorporated by
reference to the Registration Statement of which this Prospectus forms a part,
each such statement being qualified in all respects by such reference.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Company with the Commission are hereby
incorporated by reference in this Prospectus:
(i) The Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1995;
(ii) The Company's Proxy Statement for its 1996 Annual Meeting of
Stockholders, dated March 15, 1996;
(iii) The Company's Quarterly Report on Form 10-Q for the quarter ended
March 31, 1996;
(iv) The Company's Quarterly Report on Form 10-Q for the quarter ended
June 30, 1996;
(v) The Company's Current Report on Form 8-K dated April 29, 1996;
(vi) The Company's Registration Statement on Form 8-A dated November 3,
1994; and
(vii) The Company's Registration Statement on Form 8-A dated October 30,
1995.
All reports and other documents subsequently filed by the Company pursuant
to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this
Prospectus and prior to the termination of the offering of the Shares by the
Selling Security Holders shall be deemed to be incorporated by reference into
this Prospectus and to be a part hereof from the respective dates of filing of
such documents. Any statement contained in a document incorporated or deemed to
be incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Prospectus to the extent that a statement contained herein,
or in any subsequently filed document that also is or is modified to be
incorporated by reference herein, modifies or supersedes such statement. Any
such statement so modified or superseded shall not be deemed, except as so
modified or superseded, to constitute a part of this Prospectus. The Company
will provide without charge to each person, including any beneficial owner, to
whom this Prospectus is delivered, upon the written or oral request of such
person, a copy of any and all of the documents that are incorporated herein by
reference (other than exhibits to such documents, unless such exhibits are
specifically incorporated by reference into such documents). Requests for such
documents should be directed to Cindy L. Donelson, Stillwater Mining Company,
717 Seventeenth Street, Suite 1480, Denver, Colorado 80202, telephone number
(303) 978-2525.
2
<PAGE> 5
PROSPECTUS SUMMARY
The following summary is qualified in its entirety by the more detailed
information and financial statements (including the notes thereto) appearing
elsewhere or incorporated by reference in this Prospectus.
THE COMPANY
Stillwater Mining Company (the "Company") is engaged in the exploration,
development, mining and production of platinum, palladium and associated metals
from the Stillwater Complex in southern Montana, which the Company believes is
the only significant primary source of platinum and palladium outside the
Republic of South Africa. The Stillwater Complex includes an extensive
mineralized zone containing platinum group metals ("PGMs") known as the J-M Reef
which has been traced on the surface for approximately 28 miles and which
extends downward over one mile to unknown depths. The Stillwater Complex has
been prospected for gold, copper, nickel and chromium since the late 1880s. The
Company currently owns or has the rights to 995 claims covering substantially
all of the presently identified PGM mineralized zone.
The Company began mining operations in 1986 with an underground mine
located in the Stillwater Valley. The Stillwater Mine currently accesses only a
small segment of the ore body approximately five miles long between the
elevations of 6,700 and 4,200 feet above sea level. The physical configuration
of the J-M Reef with its 50 degree to 90 degree dip and relatively wide mining
widths in comparison with South Africa's Bushveld Complex makes it amenable to
various gravity assisted, mechanized mining methods. At December 31, 1995, the
Stillwater Mine had 24 active stopes, all of which are accessed by horizontal
adits and drifts. At January 1, 1996, the Company had proven and probable
reserves of approximately 22.6 million tons of ore with approximately 18.2
million contained ounces of platinum and palladium (or approximately 8.9 million
total gold equivalent ounces) in a ratio of 3.5 parts palladium to one part
platinum. In 1995, the Company produced approximately 51,000 ounces of platinum
and 169,000 ounces of palladium (or approximately 109,000 total gold equivalent
ounces) from mining and processing 398,000 tons of ore at its one developed
underground mine.
BACKGROUND
Platinum and palladium were discovered in the Stillwater Complex by
Schuller Corporation (formerly called Manville Corporation) geologists in the
early 1970s. In 1979, an affiliate of Manville Mining Company (such affiliate,
together with Manville Mining Company, is herein referred to as "Manville"), a
wholly-owned subsidiary of Schuller Corporation, entered into a joint venture
agreement with Chevron U.S.A. Inc. ("Chevron") to develop PGMs discovered in the
Stillwater Complex, forming the Stillwater PGM Resources partnership ("SPGMR")
which leased from Manville all its claims held in the Stillwater area. In 1984,
Chevron and Manville entered into the Stillwater Mining Company partnership
("SMC") with Anaconda Minerals, Inc. ("Anaconda") covering a 30,000 foot section
traversing the Stillwater Valley towards the eastern end of the Stillwater
Complex. Each partner owned an undivided one-third interest in this partnership.
In 1986, Anaconda sold its one-third interest in SMC to LAC Minerals Ltd.
("LAC"), and in late 1988, LAC sold its interest back to Chevron and Manville,
each company taking half of LAC's one-third interest, which brought their
respective ownership up to a 50% interest in both partnerships.
In 1992, the Company was incorporated as a Delaware corporation, and as of
October 1, 1993, Chevron and Manville transferred substantially all assets,
liabilities and operations of SPGMR and SMC to the new Company. The Company was
formed to continue the exploration, development, mining and production of PGMs
from the Stillwater Complex and to become an independently operated and financed
entity. On September 16, 1994, the Company redeemed Chevron's entire 50%
ownership interest for $44 million, the funding for which was raised in a
private placement of 7,500,000 shares of Common Stock at $5.87 per share and a
$25 million subordinated credit facility with warrants. The credit facility was
terminated and the warrants were exercised upon the Company's initial public
offering of Common Stock which closed on December 22, 1994. In the initial
public offering, the Company received net proceeds of $53.7 million from the
sale of 4,500,000 shares of Common Stock at $13.00 per share. Manville also sold
2,112,500 shares in the
3
<PAGE> 6
initial public offering, reducing its ownership percentage to approximately 27%
of the issued and outstanding Common Stock. On August 23, 1995, Manville sold
its remaining ownership interest in the Company to a group of institutional
investors.
EXPANSION PLAN
The Company believes its current operations are sub-scale in relation to
its major South African competitors and in relation to the magnitude of its
current reserve base, which contributes materially to the Company's relatively
high operating costs. As part of the Company's long-term strategy to expand its
operations and improve its operating economics, the Company has undertaken an
expansion plan (the "Expansion Plan") designed to significantly increase
production at the Stillwater Mine and associated processing facilities in 1997.
The Expansion Plan includes the sinking of a 1,950 foot vertical shaft,
underground development on new levels accessed by the shaft, increasing the
capacity of the Company's concentrator, adding a second convertor to the
Company's smelter, constructing a base metals refinery ("BMR") and replacement
and standardization of the Company's mine equipment fleet. Construction work for
this expansion began in May 1994 and the Company has substantially completed all
minesite surface facilities, the BMR, concentrator modifications and the
vertical shaft.
The principal steps in the Expansion Plan which have yet to be completed
are underground development on new levels accessed by the vertical shaft, the
planned modifications to the smelter and additional equipment purchases.
Underground development on new levels was begun in the second quarter of 1996
with the assistance of an independent contractor, and production from these new
levels is expected to begin in 1997. Expansion of the smelter is expected to be
completed early in 1997. Moreover, design upgrades and modifications to the
processing facilities have been implemented in order to accommodate potential
future increases in production beyond those anticipated by the Expansion Plan.
The Company anticipates the Expansion Plan will be completed and production
capacity will have reached 2,000 tons per day ("TPD") in 1997, a doubling from
1994 production levels. These anticipated results assume, among other things,
the identification of sufficient proven reserves in close proximity to the
vertical shaft and the recruitment of sufficient numbers of individuals skilled
in underground mining. No assurance can be given that the Expansion Plan will be
completed on a timely basis or that the expanded operations will achieve the
anticipated production capacity. See "Risk Factors." Depending upon the success
of the Expansion Plan, the Company will evaluate further expansion of the
Stillwater Mine.
EAST BOULDER SITE
The next significant increment of growth, after the completion of the
Expansion Plan at the Stillwater Mine, will likely be the development of the
East Boulder site which is approximately 13 miles west of the Stillwater Mine
along the strike length of the J-M Reef. On January 1, 1996, the Company had
probable reserves of approximately 11.5 million tons of ore, and no proven
reserves, in the area of the proposed East Boulder mine site.
As presently envisioned, the proposed development of the East Boulder site
will entail 18 to 24 months to access the ore body before major capital spending
would be required. A three mile tunnel to gain access to the ore body and test
drilling will be performed to determine appropriate mining methods in the area.
A preliminary feasibility study for a 2,000 TPD mining operation at East Boulder
was undertaken by the Company in 1992 and permitting for such an operation is
substantially complete, although the Company is seeking a clarification of
permissible nitrate loadings in surface waters in the area around East Boulder.
Development of the East Boulder site is contingent on numerous factors,
including demonstration of economic viability, adequate financing and continued
progress on the Expansion Plan. See "Risk Factors -- Exploration and Development
Risks."
4
<PAGE> 7
RISK FACTORS
See "Risk Factors" for a discussion of certain risks involved in the
purchase of the Common Stock.
THE OFFERING
Shares offered hereby Up to shares (the "Shares") of
the Company's Common Stock, par value $.01 per share.
CONCURRENT OFFERING
Concurrently with the filing of the Registration Statement of which this
Prospectus is a part, the Company has filed a shelf Registration Statement
relating to $51,450,000 principal amount of its 7% Convertible Subordinated
Notes Due 2003 (the "Notes") which were issued in a private placement
transaction on April 29, 1996 and May 14, 1996. The Notes are convertible into
shares of Common Stock at a conversion price of $26.80 per share, subject to
adjustment.
5
<PAGE> 8
SUMMARY FINANCIAL AND OPERATING INFORMATION
The following table sets forth the Company's overall ounces of platinum and
palladium produced; the Company's average realized prices and average costs per
ounce of platinum and palladium and per ton of ore produced; the Company's total
production of platinum and palladium in platinum equivalent and in gold
equivalent ounces; and certain information regarding the Company's results of
operations and financial position for the periods indicated.
<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30, YEAR ENDED DECEMBER 31,
----------------- --------------------------------------------
1996 1995 1995 1994 1993 1992 1991
-------- ----- ------ ------ ----- ----- ------
<S> <C> <C> <C> <C> <C> <C> <C>
PRODUCTION DATA (in thousands)
Tons milled(1)...................... 203 199 398 373 363 345 306
Head grade (ounces/ton of ore
milled)........................... 0.67 0.67 0.67 0.80 0.87 0.73 0.78
Ounces of platinum produced(2)...... 27 24 51 63 66 53 48
Ounces of palladium produced(2)..... 90 81 169 207 218 175 167
-------- ----- ------ ------ ----- ----- ------
Total ounces
produced(2)............. 117 105 220 270 284 228 215
Platinum equivalent ounces
produced(3)....................... 59 57 105 145 147 109 103
Gold equivalent ounces
produced(3)....................... 61 64 109 153 153 114 107
PRICE AND COST DATA(4)
Average realized price per platinum
ounce............................. $ 418 $ 430 $ 425 $ 399 $ 376 $ 360 $ 369
Average realized price per palladium
ounce............................. 148 163 157 138 125 89 88
Combined average realized price per
ounce............................. 219 239 231 210 200 173 181
Cash costs per ounce................ $ 195 $ 240 $ 227 $ 186 $ 177 $ 191 $ 201
Total costs per ounce............... 225 267 252 204 194 217 227
Cash costs per ton.................. 112 126 126 134 138 126 141
Total costs per ton................. 129 140 139 148 152 143 159
INCOME STATEMENT DATA (in millions,
except per share data)
Revenues............................ $ 25.7 $32.1 $ 54.1 $ 58.6 $53.8 $46.2 $ 45.4
Cost of metals sold(5).............. 22.6 29.2 48.5 49.5 45.2 45.5 53.5
Operating income (loss)............. (1.3) (0.7) (2.3) 2.9 2.5 (5.3) (14.6)
Net income (loss)................... 13.2 0.5 0.1 2.0 (5.6) (5.4) (14.7)
Pro forma net income(6)............. 1.1 1.5
Income (loss) per common share(7)... $ 0.64 $0.03 -- $ 0.07 $0.09
CASH FLOW DATA (in millions)
Net cash provided by operations..... $ 0.2 $ 5.4 $ 6.0 $ 9.2 $ 4.5 $ 0.8 $ 3.9
Depreciation and amortization....... 3.6 2.8 5.7 5.2 4.9 4.8 4.8
Capital expenditures(8)............. 25.4 18.6 46.1 9.3 2.0 2.4 3.4
</TABLE>
<TABLE>
<CAPTION>
DECEMBER 31,
JUNE 30, --------------------------------------------
1996 1995 1994 1993 1992 1991
-------- ------ ------ ----- ----- ------
<S> <C> <C> <C> <C> <C> <C> <C>
BALANCE SHEET DATA (in millions)
Current assets...................... $ 74.3 $ 45.0 $ 77.2 $22.1 $16.1 $ 16.1
Long-term debt and capital lease
obligation........................ 62.0 8.7 1.7 1.8 1.9 1.9
Stockholders' equity(5)............. 145.6 132.3 132.2 74.1 80.3 83.9
Working capital..................... 62.9 34.6 67.8 15.3 9.7 8.1
</TABLE>
- ---------------
(1) Tons milled represents the number of grade-bearing short tons of ore fed to
the concentrator.
(2) Ounces produced is defined as the number of ounces produced from the
concentrator during the period reduced by losses expected to be incurred in
subsequent smelting and refining processes. Differences in
6
<PAGE> 9
ounces produced and ounces sold are caused by the length of time required by
the smelting and refining processes.
(3) Platinum and gold equivalent ounces have been calculated by dividing the
total market value of metals produced during the given period by the average
market prices of platinum and gold, respectively, for each period.
(4) Realized prices include hedging gains and losses. Total costs per ounce
consist of all current operating costs including mining and processing
costs. Depreciation and amortization as well as other non-cash expenses such
as gains (losses) on the sale of assets are removed from total costs per
ounce to compute cash costs per ounce. Income taxes and interest income and
expense are not included in either total or cash costs per ounce.
(5) Beginning with the first quarter of 1996, the Company implemented a change
in its accounting policy for the capitalization of mine development costs.
Previously, certain direct and indirect mining costs, which supported
production and development activities, were reflected as production costs.
Under the revised policy, the portion of these costs attributable to
development activities will be capitalized. This change provides a better
matching of revenues and production costs and follows practices which are
prevalent in the mining industry.
(6) Pro forma information is presented for purposes of comparability assuming
the Company was a taxable entity for all periods presented. No pro forma
benefit for income taxes has been presented for 1992 or 1991 because the
Chevron/Manville partnerships incurred operating losses in those years which
could never be utilized by the Company.
(7) The Company's historical capital structure and taxable status are not
indicative of its current structure and, accordingly, historical earnings
per share have not been presented for 1992 and 1991. Income (loss) per
common share is calculated based on common shares and common stock
equivalent shares outstanding and is presented on a pro forma basis for 1994
and 1993 for purposes of comparability.
(8) In 1995 and 1994, $39.5 million and $5.2 million, respectively, were
capitalized in connection with the Expansion Plan.
7
<PAGE> 10
The Company cautions investors that its business is subject to significant
risks and uncertainties. Throughout this Prospectus and in the documents
incorporated herein by reference, the Company has made certain estimates and
projections relating to, among other things, the timing, costs and scope of the
Expansion Plan, the level of production after completion of the Expansion Plan,
the anticipated reduction in operating costs from the Expansion Plan and the
timing of gaining access to, and the further evaluation and development of, the
East Boulder site. These forward-looking statements are principally located in
this Prospectus in the summary section titled "The Company;" and in
"Business -- Expansion Plan," "Business -- East Boulder Site" and "Management's
Discussion and Analysis of Financial Condition and Results of Operations," of
the documents incorporated herein by reference. While sometimes presented with
numerical specificity, such forward-looking statements are based upon a variety
of assumptions relating to the business of the Company, which, although
considered reasonable by the Company, may not be realized, and are subject to
significant uncertainties and contingencies that are beyond the control of the
Company. Consequently, the inclusion of forward-looking statements should not be
regarded as a representation by the Company or any other person that these
estimates and projections will be realized, and actual results may vary
materially. These forward-looking statements are based on current expectations,
and the Company assumes no obligation to update this information. An investment
in the Common Stock involves the following risks, which together with other
matters set forth or incorporated in this Prospectus, should be carefully
reviewed by investors prior to any purchase of the Shares of Common Stock.
RISK FACTORS
METAL PRICE VOLATILITY
Since the Company's sole source of revenue is the sale of PGMs, the
profitability of the Company's operations can be significantly affected by
changes in the market prices of PGMs. For 1991, 1992 and 1995, the market prices
of PGMs were below the Company's total costs of production and the Company
experienced operating losses. PGM prices fluctuate widely and are influenced by
numerous factors beyond the Company's control, including such factors as
expectations for inflation, global demand, consumption patterns, speculative
activities, international economic trends, political and economic conditions and
production amounts and costs in the other PGM producing countries, including the
Republic of South Africa and Russia. Since some of the world supply of platinum
and palladium is a by-product of the mining of nickel and copper, a portion of
the worldwide production of platinum and palladium is unrelated to the demand
for such metals; as a result, ordinary market balancing mechanisms may be less
effective. In order to mitigate some of the risks associated with fluctuating
PGM prices, the Company has utilized various price hedging techniques to lock in
forward delivery prices on a portion of its production. However, there are no
assurances that the use of price hedging techniques will always benefit the
Company. There is the possibility that the Company will lock in forward
deliveries at prices lower than the market price at the time of delivery. The
market prices of PGMs could fall below the Company's production costs and remain
at such levels for a sustained period, causing the Company to experience
operating losses and to curtail or suspend some or all of its mining activities.
The following table shows the annual high, low and average per ounce prices
of platinum and palladium for the periods indicated:
<TABLE>
<CAPTION>
PLATINUM PALLADIUM
------------------------- -------------------------
YEAR HIGH LOW AVERAGE HIGH LOW AVERAGE
------------------------- ---- ---- ------- ---- ---- -------
<S> <C> <C> <C> <C> <C> <C>
1991..................... $424 $330 $ 376 $103 $ 78 $ 88
1992..................... 392 331 360 114 79 88
1993..................... 419 340 376 146 100 123
1994..................... 428 379 405 161 123 143
1995..................... 461 398 424 178 128 151
1996(1).................. 434 389 408 150 125 135
</TABLE>
- ---------------
(1) Through August 31, 1996.
Source: Johnson Matthey and CPM Group
8
<PAGE> 11
RESERVE ESTIMATES
While the Company's 1996 ore reserves have been affirmed and verified by
independent consultants, the ore reserve estimates incorporated by reference in
this Prospectus are necessarily imprecise and depend to some extent on
statistical inferences drawn from limited drilling, which may, on occasion,
prove unreliable. Reserve estimates are expressions of judgment based on
knowledge, experience and industry practice. Although the Company believes its
estimated ore reserves are well established, there can be no assurance that its
estimated ore reserves are accurate, and future production experience could
differ materially from such estimates. Should the Company encounter
mineralization or formations at any of its mines or projects different from
those predicted by drilling, sampling and similar examinations, reserve
estimates may have to be adjusted and mining plans may have to be altered in a
way that might adversely affect the Company's operations. Declines in the market
prices of PGMs may render the mining of some or all of the Company's ore
reserves uneconomic. No assurance can be given that any particular level of PGMs
may be recovered from the ore reserves and the grade of ore may vary
significantly from time to time. Moreover, short-term factors relating to the
ore reserves, such as the need for additional development of the ore body or the
processing of new or different grades, may impair the profitability of the
Company in any particular accounting period.
EXPANSION PLAN RISKS
Although the Company anticipates that the Expansion Plan will be
successfully completed and that the resulting operations will be in full
production in 1997, no assurance can be given that the remainder of the
Expansion Plan will be completed on a timely basis, that the expanded operations
will achieve the anticipated production capacity, that the construction costs
associated with the Expansion Plan will not be higher than anticipated or that
the expected operating cost reductions will be achieved. The anticipated timing
and production results of the Expansion Plan assume, among other things, (i) the
identification of sufficient proven reserves in close proximity to the vertical
shaft and (ii) the recruitment of sufficient numbers of individuals skilled in
underground mining. See "Competition" below.
The construction of expanded mining operations involves a number of
uncertainties, including factors beyond the Company's control. Failure to
complete the Expansion Plan on a timely basis or unexpected cost increases could
have a material adverse effect on the Company's future results of operations and
financial condition. If the capital expenditures required to complete the
Expansion Plan or to achieve the anticipated production capacity are
significantly higher than expected, there is no assurance that the Company's
capital resources would be sufficient to cover such costs or that the Company
would be able to obtain alternative sources of financing to cover such costs.
COMPETITION
The Company competes with other suppliers of PGMs, some of which are
significantly larger than the Company and have access to greater mineral
reserves and financial and commercial resources. These suppliers include
Rustenburg Platinum Holdings, Ltd., Impala Platinum Holdings, Ltd. and other
South African producers who mine the Bushveld Complex in the Republic of South
Africa, which is the world's principal source of PGMs. PGMs are also produced as
a by-product of large nickel and copper operations in Russia and Canada. The
vast majority of the world's 1995 supply of PGMs came from the Republic of South
Africa and Russia. Additional mines may open in the Republic of South Africa or
elsewhere over the next several years, including the Hartley Platinum and Mimosa
projects on the Great Dyke in Zimbabwe, resulting in increased global
production. Furthermore, in certain industrialized countries, an industry has
developed for the recovery of PGMs from scrap sources, mostly from spent
automotive and industrial catalysts. There can be no assurance that the Company
will be successful in competing with these existing and emerging PGM producers.
Moreover, there can be no assurance that a less expensive alternative alloy or
synthetic material which has the same characteristics as PGMs will not be
developed to replace PGMs in a number of key technological or industrial
applications.
9
<PAGE> 12
In addition, the Company must compete for individuals skilled in the
operation and development of PGM mining properties. The number of such persons
is limited, and significant competition exists to obtain their skills. As a
result of this competition, the Company may find it difficult to attract and
retain skilled individuals to conduct its PGM mining operations.
EXPLORATION AND DEVELOPMENT RISKS
The degree of profitability of the Company's operations will be affected by
the costs and results of its continued exploration and development programs. The
Company is seeking to expand its reserves only through exploration and
development within its controlled claims which are located in the Stillwater
Complex. Mineral exploration, particularly for platinum and palladium, is highly
speculative in nature, involves many risks, and frequently is nonproductive.
There can be no assurance that the Company's mineral exploration efforts will be
successful. Once mineralization is discovered, it usually takes a number of
years from the initial phases of exploration until production is possible,
during which time the economic feasibility of production may change. Substantial
expenditures are required to establish ore reserves through drilling, to
determine metallurgical processes to extract the metal from the ore and, in the
case of new properties, to construct mining and processing facilities. As a
result of these uncertainties, no assurance can be given that the Company's
exploration programs will result in the replacement of existing reserves, some
of which are being depleted by current production.
Depending upon the success of the Expansion Plan, the Company will evaluate
further expansion of the Stillwater Mine by possibly extending mining operations
to depths below those currently contemplated. The Company has begun the initial
access stage of development at the East Boulder mine site. Additional
development projects have no operating history upon which to base estimates of
future cash operating costs. Particularly for development projects, estimates of
reserves and cash operating costs are, to a large extent, based upon the
interpretation of geologic data obtained from drill holes and other sampling
techniques, and feasibility studies which derive estimates of cash operating
costs based upon anticipated tonnage and grades of ore to be mined and
processed, the configuration of the ore body, expected recovery rates of the
PGMs from the ore, comparable facility and equipment operating costs,
anticipated climatic conditions, and other factors. As a result, it is possible
that actual cash operating costs and economic returns may differ significantly
from those currently estimated. It is not unusual in new mining operations to
experience unexpected problems during the start-up phase. Furthermore, in the
event that the anticipated results from the Expansion Plan are not realized
within the expected time periods, the initial access phase for the East Boulder
site may be halted on a temporary or permanent basis.
There are a number of uncertainties inherent in any PGM development
program, including the location of an economic reef package, development of
appropriate metallurgical processes, receipt of necessary governmental permits
and the construction of mining and processing facilities. In addition,
substantial expenditures may be required to pursue such development activities.
The Company has been accelerating its development efforts with the objective of
establishing a developed reserve equivalent to a minimum of 18 months of
production. Currently, reserves are developed and available to support
production at the planned rate for approximately 12 months.
MINING RISKS AND INSURANCE
Underground mining and the Company's milling and smelter operations involve
a number of risks and hazards, including environmental hazards, industrial
accidents, unusual and unexpected rock formations, cave-ins, flooding and
periodic interruptions due to inclement or hazardous weather conditions or other
acts of God. Such risks could result in damage to, or destruction of, mineral
properties or production facilities, personal injury or death, environmental
damage, delays in mining, monetary losses and possible legal liability. The Mine
Safety and Health Administration conducts periodic safety inspections of the
Company. Six fatalities have occurred at the Company's mine since operations
began in 1986, the latest occurring in August 1995. There can be no assurance
that industrial accidents or new safety regulations by state, Federal or local
authorities will not have a material adverse effect on the Company's business
and operations. Although the Company believes that it maintains insurance within
ranges of coverage consistent with industry practice,
10
<PAGE> 13
there can be no assurance that this insurance will cover the risks associated
with mining or that the Company will be able to maintain insurance to cover
these risks at economically feasible premiums. The Company might also become
subject to liability for pollution or other hazards which it cannot insure
against or which it may elect not to insure against because of premium costs or
other reasons.
ENVIRONMENTAL RISKS
The Company's business is subject to extensive Federal, state and local
controls and regulations related to the environment, including the regulation of
discharge of materials into the environment, disturbance of lands, threatened or
endangered species and other environmental matters. These laws are continually
changing and, as a general matter, are becoming more restrictive. Generally,
compliance with these regulations requires the Company to obtain permits issued
by Federal, state and local regulatory agencies. Certain permits require
periodic renewal or review of their conditions. The Company cannot predict
whether it will be able to renew such permits or whether material changes in
permit conditions will be imposed. Nonrenewal of permits or the imposition of
additional conditions could have a material adverse effect on the Company's
financial condition or results of operations.
REGULATIONS AND MINING LEGISLATION
The Company's activities are also subject to extensive Federal, state and
local laws and regulations governing matters relating to mine safety,
occupational health, labor standards, prospecting, exploration, production,
exports and taxes. The Company has not experienced any material difficulty
emanating from these extensive laws and regulations in the past, nor does it
have any basis to expect any material difficulty relating to existing laws and
regulations in the future. The Company believes that it has successfully
complied in all material respects with all Federal, state and local requirements
for the current operations and planned expansion of its mining activities at the
Stillwater Mine. Compliance with these and other laws and regulations could
require significant capital outlays. New laws and regulations, amendments to
existing laws and regulations, or more stringent enforcement of existing laws
and regulations, could have a material adverse impact on the Company's results
of operations and financial condition and, in the worst case, could render the
Company's mining operations uneconomic.
DEPENDENCE ON A SINGLE MINE
All of the Company's revenues are currently derived from its mining and
milling operations at the Stillwater Mine. Although the Company has not
experienced any serious production interruption since production began in 1987,
if the operations at the Stillwater Mine or at any of the Company's processing
facilities were to be reduced, interrupted or curtailed, the Company's ability
to generate revenues and profits in the future would be materially adversely
affected.
TITLE TO PROPERTIES
The validity of unpatented mining claims on public lands, which constitute
most of the property holdings of the Company, is often uncertain and may be
contested and subject to title defects. While the Company has obtained various
reports, opinions and certificates of title with respect to certain of the
claims it owns or to which it has the rights in accordance with what the Company
believes is industry practice, there can be no assurance that the title to any
of its claims may not be defective.
WORKERS COMPENSATION
The Company has been allowed by the Employment Relations Division of the
Montana Department of Labor and Industry to self-insure its obligations under
the Montana Workers Compensation Act through July 31, 1997, by posting a surety
bond in the amount of $1.3 million. The Employment Relations Division has the
authority to grant, deny or revoke applications to be self-insured for workers'
compensation obligations, and there can be no assurance that the company will be
allowed to maintain its self-insured status indefinitely. Failure to maintain
its self-insured status for workers compensation obligations would have a
material adverse impact on the Company and could render the Company's operations
uneconomic.
11
<PAGE> 14
DESCRIPTION OF COMMON STOCK
COMMON STOCK
General. The Company's authorized capital stock includes 50,000,000 shares
of Common Stock, par value $.01 per share, of which 20,080,724 shares of Common
Stock were outstanding as of June 30, 1996. All shares of Common Stock are
entitled to share equally in dividends from sources legally available therefor,
when, as and if declared by the Board of Directors and, upon liquidation or
dissolution of the Company whether voluntary or involuntary, to share equally in
the assets of the Company available for distribution to stockholders. All shares
to be sold and issued as contemplated hereby will be fully paid and
nonassessable. The Board of Directors is authorized to issue additional shares
of Common Stock, but not to exceed the amount authorized by the Company's
Certificate of Incorporation, and to issue options and warrants for the purchase
of such shares without further stockholder action, subject, in the case of stock
option grants to employees, to the terms of the 1994 Stock Plan.
Registration Rights Agreement. The Shareholders Agreement, dated September
16, 1994, among the Company and certain stockholders of the Company was amended
and restated on August 23, 1995 and renamed a "Registration Rights Agreement."
All voting and other provisions were terminated. As of August 23, 1995,
stockholders owning 15,387,500 shares of Common Stock were parties to the
Registration Rights Agreement. Transferees of such restricted shares, however,
are not entitled to the registration rights provided in the Registration Rights
Agreement. As a result of transfers that have been made since August 23, 1995,
not all the shares which may be included in this Registration Statement are
subject to the terms of the Registration Rights Agreement, including the
indemnification and contribution provisions thereof. See "Plan of Distribution"
for a description of such indemnification terms.
The Registration Rights Agreement provides that stockholders owning in the
aggregate at least 1,687,500 shares of Common Stock may exercise up to three
demands for registration, provided that the minimum gross proceeds from any such
offering will be $10 million. All demand rights provided in the Registration
Rights Agreement are subject to the ability of a managing underwriter to reduce
the number of shares offered, and thereby exclude some or all of the shares
sought to be included by a stockholder, if deemed necessary for successful
marketing efforts, in the event the Company decides to sell Common Stock in the
offering. The Registration Rights Agreement also provides for unlimited
opportunities for piggyback registration rights, subject to the same underwriter
offering size reduction provisions. The Registration Rights Agreement expires
and is of no further force and effect on and after September 16, 2001.
STOCKHOLDERS RIGHTS PLAN
In October 1995, the Board of Directors of the Company adopted a Rights
Agreement under which Stillwater stockholders of record as of November 15, 1995
received a dividend in the form of Preferred Stock Purchase Rights (the
"Rights"). Upon the terms and subject to the conditions of the Rights Agreement,
a holder of a Right is entitled to purchase one one-thousandth of a share (a
"Unit") of Series A Preferred Stock, par value $.01 per share (the "Preferred
Stock"), at a purchase price of $80 per Unit, subject to adjustment. The Rights
are currently represented by the certificates for the Common Stock and are not
transferable apart therefrom. Transferable Rights certificates will be issued
upon the earlier of: (i) ten business days following a public announcement that
a person or group of affiliated or associated persons has acquired or otherwise
obtained beneficial ownership of 15% or more of the then outstanding shares of
Common Stock (an "Acquiring Person"), and (ii) ten business days (or such later
date as may be determined by action of the Board of Directors prior to such time
as any person becomes an Acquiring Person) following the commencement of a
tender offer or exchange offer that would result in a person or group
beneficially owning 15% or more of the then outstanding shares of Common Stock.
The purchase price payable, and the number of Units of Preferred Stock
issuable, upon exercise of the Rights are subject to adjustment from time to
time to prevent dilution (i) in the event of a stock dividend on, or a
subdivision, combination or reclassification of, the Preferred Stock, (ii) if
holders of the Preferred Stock are granted certain rights or warrants to
subscribe for Preferred Stock or convertible securities at less than the
12
<PAGE> 15
current market price of the Preferred Stock, or (iii) upon the distribution to
the holders of the Preferred Stock of evidences of indebtedness, cash or assets
(excluding regular quarterly cash dividends) or of subscription rights or
warrants (other than those referred to above).
All the outstanding Rights may be redeemed by the Company at $.01 per Right
at any time until the close of business on the tenth day (or such later date as
described above) after a person or group has obtained beneficial ownership of
15% or more of the voting stock. The Rights will expire on October 26, 2005
unless earlier redeemed.
As long as the Rights are attached to and evidenced by the certificates
representing the Common Stock, the Company will continue to issue one Right with
each share of Common Stock that shall become outstanding. A right is presently
attached to each issued and outstanding share of Common Stock. So long as the
Rights are outstanding, the Company will issue one Right with each new share of
Common Stock issued.
The Rights have certain anti-takeover effects. The Rights will cause
substantial dilution to a person or group who attempts to acquire the Company on
terms not approved by the Board of Directors of the Company. The Rights should
not interfere with any merger or other business combination approved by the
Board since they may be redeemed by the Company at $.01 per Right at any time
until the close of business on the tenth day (or such later date as described
above) after a person or group has obtained beneficial ownership of 15% or more
of the voting stock.
The Company may at any time after there is an Acquiring Person, by action
of a majority of the Board of Directors (including a majority of the independent
directors), exchange all or part of the then outstanding and exercisable Rights
(other than Rights that shall have become null and void) for Units of Preferred
Stock or shares of Common Stock pursuant to a one-for-one exchange ratio, as
adjusted.
The Rights Agreement is attached as an exhibit to the Company's
Registration Statement on Form 8-A dated October 26, 1995. The description of
the Rights contained in Form 8-A has been incorporated by reference herein and
copies of such Form 8-A can be obtained in the manner set forth under "Available
Information."
SELLING SECURITY HOLDERS
The Shares offered hereby may be offered for sale from time to time by the
Selling Security Holders. The following table provides certain information with
respect to the shares of Common Stock of the Company (including the Shares) held
by each Selling Security Holder as of , 1996.
<TABLE>
<CAPTION>
NUMBER OF SHARES
NUMBER OF SHARES REGISTERED FOR SALE
NAME OF SELLING SECURITY HOLDER BENEFICIALLY OWNED HEREBY
- ----------------------------------------------------------- ------------------ -------------------
<S> <C> <C>
[TO BE COMPLETED BY AMENDMENT]
</TABLE>
13
<PAGE> 16
PLAN OF DISTRIBUTION
The Common Stock offered hereby may be sold from time to time to purchasers
directly by the Selling Security Holders. Alternatively, the Selling Security
Holders may from time to time offer the Common Stock to or through underwriters,
broker/dealers or agents, who may receive compensation in the form of
underwriting discounts, concessions or commissions from the Selling Security
Holders or the purchasers of Common Stock for whom they may act as agents. The
Selling Security Holders and any underwriters, broker/dealers or agents that
participate in the distribution of Common Stock may be deemed to be
"underwriters" within the meaning of the Securities Act and any profit on the
sale of Common Stock by them and any discounts, commissions, concessions or
other compensation received by any such underwriter, broker/dealer or agent may
be deemed to be underwriting discounts and commissions under the Securities Act.
The Common Stock may be sold by the Selling Security Holders from time to
time, in one or more transactions at fixed prices, at prevailing market prices
at the time of sale, at varying prices determined at the time of sale or at
negotiated prices. Such prices will be determined by the Selling Security
Holders. The sale of the Common Stock may be effected in transactions (which may
involve crosses or block transactions) on any national securities exchange or
quotation service on which the Common Stock may be listed or quoted at the time
of sale, (ii) in the over-the-counter market, (iii) in transactions otherwise
than on such exchanges or in the over-the-counter market or (iv) through the
writing of options. At the time a particular offering of Common Stock is made,
if required, a prospectus supplement will be distributed which will set forth
the names of the Selling Security Holders, the aggregate amount of Common Stock
being offered, the number of such securities owned prior to and after the
completion of any such offering, and, to the extent required, the terms of the
offering, including the name or names of any underwriters, broker/dealers or
agents, any discounts, commissions and other terms constituting compensation
from the Selling Security Holders and any discounts, commissions or concessions
allowed or reallowed or paid to broker/dealers.
To comply with the securities laws of certain jurisdictions, if applicable,
the Common Stock will be offered or sold in such jurisdictions only through
registered or licensed brokers or dealers. In addition, in certain jurisdictions
the Common Stock may not be offered or sold unless it has been registered or
qualified for sale in such jurisdictions or any exemption from registration or
qualification is available and is complied with.
Under applicable rules and regulations under the Exchange Act, any person
engaged in a distribution of the Common Stock may be limited in its ability to
engage in market activities with respect to the Common Stock. In addition and
without limiting the foregoing, each Selling Security Holder will be subject to
applicable provisions of the Exchange Act and the rules and regulations
thereunder, which provisions may limit the timing of purchases and sales of the
Common Stock by the Selling Security Holders. All of the foregoing may affect
the marketability of the Common Stock.
All expenses of the registration of the Common Stock will be paid by the
Company, including, without limitation, Commission filing fees and expenses of
compliance with state securities or "blue sky" laws; provided, however, that the
Selling Security Holders will pay all underwriting discounts and selling
commissions, if any. The Selling Security Holders that have shares that are
subject to the terms of the Registration Rights Agreement will be indemnified by
the Company against certain civil liabilities, including certain liabilities
under the Securities Act, or will be entitled to contribution in connection
therewith. The Company will be indemnified by such Selling Security Holders
against certain civil liabilities, including certain liabilities under the
Securities Act, or will be entitled to contribution in connection therewith.
LEGAL MATTERS
The validity of the Common Stock offered hereby will be passed upon for the
Company by Morrison & Foerster LLP, Denver, Colorado.
14
<PAGE> 17
EXPERTS
The financial statements incorporated in this Prospectus by reference to
the Annual Report on Form 10-K as of December 31, 1995 and 1994 and for each of
the three years in the period ended December 31, 1995, have been so incorporated
in reliance on the report of Price Waterhouse LLP, independent accountants,
given on the authority of said firm as experts in auditing and accounting.
INDEPENDENT ENGINEERS
The Company's ore reserves as of January 1, 1996, January 1, 1994, July 1,
1992 and January 1, 1990 have been affirmed and verified by the independent
engineering firm of Behre Dolbear & Company, Inc., and are incorporated herein
in reliance upon the authority of said firm as an expert in such matters.
15
<PAGE> 18
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
No dealer, salesperson or other person has been authorized to give any
information or to make any representations not contained in this Prospectus in
connection with the offering covered by this Prospectus. If given or made, such
information or representations must not be relied upon as having been authorized
by the Company or any Selling Security Holder. This Prospectus does not
constitute an offer to sell or a solicitation of an offer to buy by anyone in
any jurisdiction in which such offer or solicitation is not authorized. Neither
the delivery of this Prospectus nor any sale made hereunder shall, under any
circumstances, create any implication that the information contained herein is
correct as of any time subsequent to the date hereof or that there has been no
change in the affairs of the Company since the date hereof.
---------------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Available Information................. 2
Incorporation of Certain Documents by
Reference........................... 2
Prospectus Summary.................... 3
Risk Factors.......................... 8
Description of Common Stock........... 12
Selling Security Holders.............. 13
Plan of Distribution.................. 14
Legal Matters......................... 14
Experts............................... 15
Independent Engineers................. 15
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SHARES
STILLWATER MINING
COMPANY
[STILLWATER LOGO]
COMMON STOCK
---------------------
PROSPECTUS
---------------------
, 1996
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE> 19
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following table sets forth the costs and expenses payable in connection
with the sale and distribution of the securities being registered. All amounts
are estimated except the Commission registration fees. Unless otherwise
indicated, all of the expenses below will be paid by the Company.
<TABLE>
<CAPTION>
ITEM AMOUNT TO BE PAID
-------------------------------------------------------------------- -----------------
<S> <C>
Registration fee.................................................... $706.90
Nasdaq listing fee.................................................. *
Blue Sky fees and expenses.......................................... *
Printing expenses................................................... *
Legal fees and expenses............................................. *
Miscellaneous expenses.............................................. *
-------
Total............................................................. $
=======
</TABLE>
- ---------------
* To be completed by amendment.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The indemnification and liability of the Company's directors and officers
are governed by Delaware law.
Under Section 145 of the General Corporation Law of the State of Delaware,
the Registrant has broad powers to indemnify its directors and officers against
liabilities that may incur in such capacities, including liabilities under the
Securities Act of 1933, as amended (the "Securities Act"). The Registrant's
Bylaws also provide for mandatory indemnification of its directors and executive
officers, and permissive indemnification of its employees and agents, to the
fullest extent permissible under Delaware law.
The Registrant's Certificate of Incorporation provides that the liability
of its directors for monetary damages shall be eliminated to the fullest extent
permissible under Delaware law. Pursuant to Delaware law, this includes
elimination of liability for monetary damages for breach of the directors'
fiduciary duty of care to the Registrant and its stockholders. These provisions
do not eliminate the directors' duty of care and, in appropriate circumstances,
equitable remedies such as injunctive or other forms of non-monetary relief will
remain available under Delaware law. In addition, each director will continue to
be subject to liability for breach of the director's duty of loyalty to the
Registrant, for acts of omissions not in good faith or involving intentional
misconduct, for knowing violations of law, for any transaction from which the
director derived an improper personal benefit, and for payment of dividends or
approval of stock repurchases or redemptions that are unlawful under Delaware
law. The provision also does not affect a director's responsibilities under any
other laws, such as the federal securities laws or state or federal
environmental laws.
The Registrant has entered into agreements with its directors and its
executive officers that require the Registrant to indemnify such persons against
expenses, judgments, fines, settlements and other amounts actually and
reasonably incurred (including expenses of a derivative action) in connection
with any proceeding, whether actual or threatened, to which any such person may
be made a party by reason of the fact that such person is or was a director or
officer of the Registrant or any of its affiliated enterprises, provided such
person acted in good faith and in a manner such person reasonably believed to be
in or not opposed to the best interests of the Registrant and, with respect to
any criminal proceeding, had no reasonable cause to believe his or her conduct
was unlawful. The indemnification agreement also sets forth certain procedures
that will apply in the event of a claim for indemnification thereunder.
The Registrant has obtained a policy of directors' and officers' liability
insurance that insures the Company's directors and officers against the cost of
defense, settlement or payment of a judgment under certain circumstances.
II-1
<PAGE> 20
ITEM 16. EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF EXHIBIT
- -------------------- ------------------------------------------------------------------------
<C> <S>
4.1 -- Form of Indenture, dated as of April 29, 1996, between Stillwater
Mining Company and Colorado National Bank, as Trustee, with respect
to the Company's 7% Convertible Subordinated Notes Due 2003,
including form of Convertible Note (incorporated herein by reference
to Exhibit 4.1 of the Company's Form 8-K dated April 29, 1996).
4.2 -- Form of Registration Agreement, dated April 29, 1996, by and between
Stillwater Mining Company and Salomon Brothers Inc, with respect to
the Company's 7% Convertible Subordinated Notes Due 2003
(incorporated herein by reference to Exhibit 4.2 of the Company's
Form 8-K dated April 29, 1996).
5.1 -- Opinion of Morrison & Foerster LLP.*
10.13 -- Shareholders Agreement dated September 16, 1994 (incorporated by
reference to Exhibit 10.13 to the 1994 S-1).
10.13.1 -- Registration Rights Agreement dated August 23, 1995, amending
Shareholders Agreement (incorporated by reference to Exhibit 4.1 to
Form 8-K filed on August 28, 1995).
23.1 -- Consent of Morrison & Foerster LLP. Reference is made to Exhibit
5.1.*
23.2 -- Consent of Price Waterhouse LLP.
23.3 -- Consent of Behre Dolbear & Company, Inc.
24.1 -- Power of Attorney (incorporated in the signature page hereto).
</TABLE>
- ---------------
* To be filed by amendment.
ITEM 17. UNDERTAKINGS
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the registrant of expenses incurred
or paid by a director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
The undersigned registrant hereby undertakes that:
(1) For purposes of determining any liability under the Securities Act
of 1933, the information omitted from the form of prospectus filed as part
of this registration statement in reliance upon Rule 430A and contained in
a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or
(4) or 497(h) under the Securities Act shall be deemed to be part of this
registration statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities
Act of 1933, each post-effective amendment that contains a form of
prospectus shall be deemed to be a new registration statement relating to
the securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
II-2
<PAGE> 21
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934 (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Securities Exchange Act of
1934) that is incorporated by reference in the registration statement shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
II-3
<PAGE> 22
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
CERTIFIES THAT IT HAS REASONABLE GROUNDS TO BELIEVE THAT IT MEETS ALL OF THE
REQUIREMENTS FOR FILING ON FORM S-3 AND HAS DULY CAUSED THIS REGISTRATION
STATEMENT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY
AUTHORIZED, IN THE CITY OF DENVER, STATE OF COLORADO, ON THIS 20TH DAY OF
SEPTEMBER, 1996.
STILLWATER MINING COMPANY
By: /s/ CHARLES R. ENGLES
------------------------------------
Charles R. Engles
Chairman and Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each of the undersigned officers and
directors of the Company, by virtue of his signature to this Registration
Statement appearing below, hereby constitutes and appoints Charles R. Engles and
John E. Andrews, or any one of them, with full power of substitution, as
attorneys-in-fact in his name, place and stead to execute any and all amendments
to this Registration Statement, and to file the same, with all exhibits thereto,
and other documents in connection therewith, with the Securities and Exchange
Commission, granting unto said attorney-in-fact and agent full power and
authority to do and perform each and every act and thing requisite and necessary
to be done in and about the premises, as fully to all intents and purposes as he
might or could do in person, in the capacities set forth opposite his name and
hereby ratifies all that said attorneys-in-fact may do by virtue hereof.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES AND ON THE DATES INDICATED.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
- ------------------------------------------ ---------------------------- --------------------
<C> <S> <C>
/s/ CHARLES R. ENGLES Chairman and Chief Executive September 20, 1996
- ------------------------------------------ Officer (Principal
Charles R. Engles Executive Officer)
/s/ R. DANIEL WILLIAMS Vice President and Chief September 20, 1996
- ------------------------------------------ Financial Officer
R. Daniel Williams (Principal Financial
Officer)
/s/ CARL W. McSPADDEN Controller (Principal September 20, 1996
- ------------------------------------------ Accounting Officer)
Carl W. McSpadden
/s/ RAY W. BALLMER Director September 20, 1996
- ------------------------------------------
Ray W. Ballmer
/s/ JOHN W. ESCHENLOHR Director September 20, 1996
- ------------------------------------------
John W. Eschenlohr
/s/ SHARON M. MEADOWS Director September 20, 1996
- ------------------------------------------
Sharon M. Meadows
/s/ TED SCHWINDEN Director September 20, 1996
- ------------------------------------------
Ted Schwinden
Director
- ------------------------------------------
Peter Steen
Director
- ------------------------------------------
W. Thomas Stephens
/s/ RICHARD B. VON WALD Director September 20, 1996
- ------------------------------------------
Richard B. Von Wald
</TABLE>
II-4
<PAGE> 23
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF EXHIBIT
- -------------------- ------------------------------------------------------------------------
<C> <S>
4.1 -- Form of Indenture, dated as of April 29, 1996, between Stillwater
Mining Company and Colorado National Bank, as Trustee, with respect
to the Company's 7% Convertible Subordinated Notes Due 2003,
including form of Convertible Note (incorporated herein by reference
to Exhibit 4.1 of the Company's Form 8-K dated April 29, 1996).
4.2 -- Form of Registration Agreement, dated April 29, 1996, by and between
Stillwater Mining Company and Salomon Brothers Inc, with respect to
the Company's 7% Convertible Subordinated Notes Due 2003
(incorporated herein by reference to Exhibit 4.2 of the Company's
Form 8-K dated April 29, 1996).
5.1 -- Opinion of Morrison & Foerster LLP.*
10.13 -- Shareholders Agreement dated September 16, 1994 (incorporated by
reference to Exhibit 10.13 to the 1994 S-1).
10.13.1 -- Registration Rights Agreement dated August 23, 1995, amending
Shareholders Agreement (incorporated by reference to Exhibit 4.1 to
Form 8-K filed on August 28, 1995).
23.1 -- Consent of Morrison & Foerster LLP. Reference is made to Exhibit
5.1.*
23.2 -- Consent of Price Waterhouse LLP.
23.3 -- Consent of Behre Dolbear & Company, Inc.
24.1 -- Power of Attorney (incorporated in the signature page hereto).
</TABLE>
- ---------------
* To be filed by amendment.
<PAGE> 1
Exhibit 23.2
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Prospectus
constituting part of this Registration Statement on Form S-3 of our report
dated January 25, 1996 appearing on page 27 of Stillwater Mining Company's
Annual Report on Form 10-K for the year ended December 31, 1995. We also
consent to the reference to us under the heading "Experts" in such Prospectus.
PRICE WATERHOUSE LLP
/s/ Price Waterhouse LLP
Denver, Colorado
September 20, 1996
<PAGE> 1
Exhibit 23.3
CONSENT OF INDEPENDENT ENGINEERS
We hereby consent to the use of our name in the section entitled "Independent
Engineers" in the Prospectus constituting part of this Registration Statement
on Form S-3 and to references to Behre Dolbear & Company, Inc. as independent
engineers who have verified and affirmed the ore reserves of Stillwater Mining
Company as of January 1, 1996, January 1, 1994, July 1, 1992, and January 1,
1990 which references are incorporated in such Prospectus by reference.
BEHRE DOLBEAR & COMPANY, INC.
/s/ Behre Dolbear & Company, Inc.
New York, New York
September 20, 1996
