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Exhibit 10.6  

  
 

  

   

   

   

  

 
 

NEENAH PAPER
  SUPPLEMENTAL RETIREMENT
  CONTRIBUTION PLAN    
    

   

   

   

   

   

  

  

THIS DOCUMENT CONSTITUTES THE OFFICIAL PLAN DOCUMENT AS

WELL AS THE SUMMARY PLAN DESCRIPTION OF THIS PLAN.

   

   

 

 
NEENAH PAPER SUPPLEMENTAL RETIREMENT

CONTRIBUTION PLAN  

 
 

TABLE OF CONTENTS    
    

	 
	 	 
	 	Page

	ARTICLE I    INTRODUCTION	 	1
	 	1.1	 	Establishment of the Plan	 	1
	 	1.2	 	Background	 	1
	 	1.3	 	Purpose	 	1
	 	1.4	 	Type of Plan	 	1
	 	1.5	 	Effective Date	 	1
	
ARTICLE II    DEFINITIONS	
 	

1
	 	2.1	 	Account	 	1
	 	2.2	 	Affiliate	 	1
	 	2.3	 	Beneficiary	 	1
	 	2.4	 	Board	 	2
	 	2.5	 	Change of Control	 	2
	 	2.6	 	Code	 	3
	 	2.7	 	Company	 	3
	 	2.8	 	Distribution Date	 	3
	 	2.9	 	Earnings	 	3
	 	2.10	 	Effective Date	 	3
	 	2.11	 	Employee	 	3
	 	2.12	 	Employer	 	3
	 	2.13	 	ERISA	 	3
	 	2.14	 	Excess Contribution	 	3
	 	2.15	 	Excess Benefit	 	3
	 	2.16	 	Investment Funds	 	3
	 	2.17	 	Participant	 	3
	 	2.18	 	Participating Employer	 	3
	 	2.19	 	Plan	 	3
	 	2.20	 	Plan Administrative Committee	 	3
	 	2.21	 	RCP	 	3
	 	2.22	 	RCP Contribution	 	3
	 	2.23	 	Retirement Date	 	4
	 	2.24	 	Spouse	 	4
	 	2.25	 	Supplemental Benefit	 	4
	 	2.26	 	Supplemental Contribution	 	4
	 	2.27	 	Termination of Employment	 	4
	 	2.28	 	Year of Service	 	4
	
ARTICLE III    ELIGIBILITY	
 	

4
	 	3.1	 	Eligibility for Excess Benefit	 	4
	 	3.2	 	Eligibility for Supplemental Benefit	 	4
	
ARTICLE IV    CONTRIBUTIONS, INVESTMENT AND VESTING	
 	

4
	 	4.1	 	Establishment of Accounts	 	4
	 	4.2	 	Company Contributions	 	5
	 	4.3	 	Investment Elections	 	5
	 	 	 	 	 

i

 

	 	4.4	 	Investment Changes	 	5
	 	4.5	 	Account Credit	 	5
	 	4.6	 	Valuation of Accounts	 	5
	 	4.7	 	Vesting	 	5
	
ARTICLE V    DISTRIBUTIONS	
 	

5
	 	5.1	 	Eligibility to Receive a Distribution	 	5
	 	5.2	 	Form of Benefit Payment	 	6
	 	5.3	 	Limitations on the Annual Amount Paid to a Participant	 	6
	 	5.4	 	Tax Withholding	 	6
	 	5.5	 	Commencement of Payments	 	6
	 	5.6	 	Recipients of Payments; Designation of Beneficiary	 	6
	
ARTICLE VI    PLAN ADMINISTRATIVE COMMITTEE	
 	

7
	 	6.1	 	Plan Administrative Committee	 	7
	 	6.2	 	Committee Membership	 	7
	 	6.3	 	Powers	 	7
	 	6.4	 	Organization and Procedures	 	7
	 	6.5	 	Rules and Decisions	 	8
	 	6.6	 	Authorization of Payments	 	8
	 	6.7	 	Books and Records	 	8
	 	6.8	 	Perpetuation of the Plan Administrative Committee	 	8
	 	6.9	 	Claims Procedure	 	8
	 	6.10	 	Allocation or Reallocation of Responsibilities	 	9
	 	6.11	 	Service of Process	 	10
	
ARTICLE VII    Miscellaneous	
 	

10
	 	7.1	 	Funding	 	10
	 	7.2	 	Amendment and Termination	 	10
	 	7.3	 	Termination of RCP	 	10
	 	7.4	 	Effect of Plan	 	10
	 	7.5	 	Offset	 	10
	 	7.6	 	Amounts Payable	 	10
	 	7.7	 	Rights and Obligations	 	10
	 	7.8	 	Notice	 	10
	 	7.9	 	Governing Law	 	10
	 	7.10	 	Assignment of Rights	 	10
	 	7.11	 	Liability	 	11
	 	7.12	 	Coordination with RCP	 	11
	 	7.13	 	Plan Sponsor	 	11
	
ARTICLE VIII    ERISA RIGHTS	
 	

11
	
ARTICLE IX    GENERAL PLAN INFORMATION	
 	

12
	 	9.1	 	General Plan Information.	 	12

ii

 
 

NEENAH PAPER
  SUPPLEMENTAL RETIREMENT CONTRIBUTION PLAN    
    

 
 

ARTICLE I    
    
    INTRODUCTION    
    

	1.1
	Establishment of the Plan. Neenah Paper, Inc. (the "Company") hereby establishes a supplemental retirement benefit plan for
certain Employees, to be known as the Neenah Paper Supplemental Retirement Contribution Plan (the "Plan"), as set forth in this document.

	1.2
	Background. Effective as of November 30, 2004 (the "Distribution Date"), a spinoff of the Company, then a subsidiary of
Kimberly-Clark Corporation, was effectuated by the distribution of Company shares to Kimberly-Clark Corporation's shareholders. In connection with the spinoff transaction, the Company agreed to
establish a supplemental benefit plan similar to the Kimberly-Clark Corporation Retirement Contribution Plan Excess Program for the benefit of certain employees who were hired by the Company.

	1.3
	Purpose. In recognition of the valuable services provided to the Company, and its Affiliates, by its employees, the Board wishes to
provide additional retirement benefits to those individuals whose benefits under the Neenah Paper Retirement Contribution Plan (the "RCP") are restricted by the operation of the provisions of the
Code. It is the intent of the Company to provide these benefits under the terms and conditions hereinafter set forth.

	1.4
	Type of Plan. This Plan is intended to encompass two types of benefit: (i) an "excess benefit plan" within the meaning of
Section 3(36) of the Employee Retirement Income Security Act of 1974, as amended ("ERISA"), and, as such, to be exempt from all of the provisions of ERISA pursuant to Section 4(b)(5)
thereof; and (ii) a nonqualified supplemental retirement plan, which is unfunded and maintained primarily for the purpose of providing deferred compensation for a select group of management or
highly compensated employees of the Company, pursuant to Sections 201, 301 and 401 of ERISA and, as such, exempt from the provisions of Parts II, III and IV of Title I of ERISA.

	1.5
	Effective Date. The effective date of the Plan is December 1, 2004. 

 
 

ARTICLE II    
    
    DEFINITIONS    
    

        Each term that is used in this Plan and also used in the RCP shall have the same meaning herein as the RCP. Notwithstanding the above, for purposes of this Plan,
where the following words and phrases appear in this Plan, they shall have the respective meanings set forth below unless the context clearly indicates otherwise: 

	2.1
	Account. The individual account established pursuant to Article IV of this Plan to credit Excess Contributions or Supplemental
Contributions.

	2.2
	Affiliate. The Company and any company, person or organization which, on the date of determination, (A) is a member of a
controlled group of corporations (as defined in Code section 414(b)) which includes the Company; (B) is a trade or business (whether or not incorporated) which controls, is controlled by
or is under common control with (within the meaning of Code section 414(c)) the Company; (C) is a member of an affiliated service group (as defined in Code section 414(m)) which
includes the Company; or (D) is otherwise required to be aggregated with the Company pursuant to Code section 414(o) and regulations promulgated thereunder.

	2.3
	Beneficiary. The person or persons who, under this Plan, become entitled to receive a Participant's interest in the event of the
Participant's death. 

 
	2.4
	Board. The Board of Directors of the Company.

	2.5
	Change of Control. A Change of Control shall be deemed to have taken place if:

	(A)
	Acquisition of Substantial Percentage. The acquisition by any Person of Beneficial Ownership of thirty percent (30%) or more of the
combined voting power of the then outstanding voting securities of the Company entitled to vote generally in the election of Directors (the "Outstanding Company Voting Securities"); provided, however,
that for purposes of this Section, the following acquisitions shall not constitute a Change in Control: (i) any acquisition by a Person who on the Effective Date is the Beneficial Owner of
thirty percent (30%) or more of the Outstanding Company Voting Securities, (ii) any acquisition directly from the Company, including without limitation, a public offering of securities,
(iii) any acquisition by the Company, (iv) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any of its Affiliates, or
(v) any acquisition by any corporation pursuant to a transaction which complies with subparagraphs (i), (ii), and (iii) of Section 2.5(C) hereof;

	(B)
	Change in Majority of Board Members. During any period of two consecutive years, individuals who at the beginning of such period
constitute the Board (the "Incumbent Board") cease for any reason to constitute at least a majority of the Board, provided that any individual becoming a Director whose election, or nomination for
election by the Company's shareholders, was approved by a vote of at least a majority of the Directors then comprising the Incumbent Board shall be considered as though such individual were a member
of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office is in connection with an actual or threatened election contest relating to the election
or removal of the Directors of the Company or other actual or threatened solicitation of proxies of consents by or on behalf of a Person other than the Board;

	(C)
	Reorganization, Merger or Consolidation. Consummation of a reorganization, merger, or consolidation to which the Company is a party or
a sale or other disposition of all or substantially all of the assets of the Company (a "Business Combination"), in each case unless, following such Business Combination: (i) all or
substantially all of the individuals and entities who were the Beneficial Owners of Outstanding Company Voting Securities immediately prior to such Business Combination beneficially own, directly or
indirectly, more than sixty percent (60%) of the combined voting power of the outstanding voting securities entitled to vote generally in the election of Directors of the Company resulting from the
Business Combination (including, without limitation, a corporation which as a result of such transaction owns the Company or all or substantially all of the Company's assets either directly or through
one or more Affiliates) (the "Successor Entity") in substantially the same proportions as their ownership immediately prior to such Business Combination of the Outstanding Company Voting Securities;
and (ii) no Person (excluding any Successor Entity or any employee benefit plan, or related trust, of the Company or such Successor Entity) beneficially owns, directly or indirectly, thirty
percent (30%) or more of the combined voting power of the then outstanding voting securities of the Successor Entity, except to the extent that such ownership existed prior to the Business
Combination; and (iii) at least a majority of the members of the board of directors of the Successor Entity were members of the Incumbent Board (including persons deemed to be members of the
Incumbent Board by reason of the proviso to paragraph (b) of this Section) at the time of the execution of the initial Participation Agreement or of the action of the Board providing for such
Business Combination; or

	(D)
	Liquidation or Dissolution. Approval by the shareholders of the Company of a complete liquidation or dissolution of the Company. 

2

 

	2.6
	Code. The Internal Revenue Code for 1986, as amended from time to time, and as construed and interpreted by valid regulations and
rulings issued thereunder.

	2.7
	Company. Neenah Paper, Inc., a Delaware corporation.

	2.8
	Distribution Date. November 30, 2004, the date upon which a spinoff of the Company, then a subsidiary of Kimberly-Clark
Corporation, was effected through the distribution of Company shares to Kimberly-Clark Corporation's shareholders.

	2.9
	Earnings. Earnings shall have the same meaning herein as under the RCP; provided, however, that for the purposes of this Plan, the
limitations on compensation provided under Code Section 401(a)(17) shall not apply. Notwithstanding the foregoing, Earnings shall not include any remuneration paid to a Participant after
payment of such individual's Account commences in accordance with Section 5.5 following the Participant's Termination of Employment.

	2.10
	Effective Date. December 1, 2004, or with respect to a particular Affiliate, such later date as of which the Plan
Administrative Committee deems such Affiliate to be a Participating Employer in the Plan.

	2.11
	Employee. A common law employee of an Employer, as reflected in the payroll records of the Employer.

	2.12
	Employer. The Company and each Affiliate that the Plan Administrative Committee shall from time to time designate as a Participating
Employer for purposes of the Plan.

	2.13
	ERISA. The Employee Retirement Income Security Act of 1974, as amended from time to time, and as construed and interpreted by valid
regulations and rulings issued thereunder.

	2.14
	Excess Contribution. The amount contributed for a Participant under the Excess Benefit portion of the Plan that would have been
contributed for such a Participant under the RCP if it were not for the limitation on benefits imposed by Section 415 of the Code; such amount shall be calculated using Earnings as defined in
this Plan, but only to the extent that such amount exceeds such limitations.

	2.15
	Excess Benefit. The benefit provided under this Plan for Participants whose RCP Contributions to the RCP are limited solely by Code
Section 415.

	2.16
	Investment Funds. The phantom investment funds established under this Plan which will accrue earnings and losses as if the
Participant's Account were invested in the actual Investment Funds as offered under the RCP from time to time.

	2.17
	Participant. Any Employee who satisfies the eligibility requirements set forth in Article III for participation in the Plan. In
the event of the death or incompetency of a Participant, the term shall mean the executor or administrator of the Participant's estate or the Participant's legal guardian.

	2.18
	Participating Employer. An Affiliate that has been approved by the Plan Administrative Committee as an Employer participating in the
Plan.

	2.19
	Plan. The Neenah Paper Supplemental Retirement Contribution Plan as set forth herein and as amended from time to time.

	2.20
	Plan Administrative Committee. The committee appointed by the Board to administer and regulate the Plan as provided in
Article VI, which shall be the same committee appointed to administer and regulate the RCP.

	2.21
	RCP. The Neenah Paper Retirement Contribution Plan, as amended from time to time.

	2.22
	RCP Contribution. Employer contributions made pursuant to the RCP. 

3

 
	2.23
	Retirement Date. The date of Termination of Employment of the Participant on or after he attains age 55 and has completed five
(5) Years of Service with the Company.

	2.24
	Spouse. The Employee's husband or wife (as applicable) pursuant to a legal marriage, as defined under the laws of the state of the
Employee's residence.

	2.25
	Supplemental Benefit. The benefit established as part of this Plan for Participants whose RCP Contributions to the RCP are limited by
the application of the rules or regulations of Code Section 401(a)(4) or the limitations of Code Section 401(a)(17), or whose Earnings are not fully taken into account in determining the
Employee's RCP Contributions to the RCP.

	2.26
	Supplemental Contribution. The amount contributed for a Participant under the Supplemental Benefit portion of the Plan that would have
been contributed for a Participant under the RCP if it were not for the limitations on benefits imposed by Code Sections 401(a)(17) and/or 401(a)(4), and calculated using Earnings as defined in this
Plan, but only to the extent that such amount exceeds the RCP Contributions under the RCP.

	2.27
	Termination of Employment. The Participant's cessation of his employment with the Company for any reason whatsoever, whether
voluntarily or involuntarily, including by reasons of retirement or death.

	2.28
	Year of Service. Year of Service shall have the same meaning herein as under the RCP. 

        Construction.    Where appearing in the Plan, the masculine shall include the feminine and the plural shall include the
singular, unless the context clearly indicates otherwise. The words "hereof," "herein," "hereunder" and other similar compounds of the word "here" shall mean and refer to the entire Plan and not to
any particular Section or subsection. 

 
 

ARTICLE III    
    
    ELIGIBILITY    
    

	3.1
	Eligibility for Excess Benefit. An Employee shall participate in the Excess Benefit under this Plan only if:

	(A)
	such
Employee is a Participant in the RCP; and

	(B)
	such
Employee's RCP Contributions to the RCP are limited solely by Code Section 415.

	3.2
	Eligibility for Supplemental Benefit. An Employee shall participate in the Supplemental Benefit under the Plan only if:

	(A)
	such
Employee is a Participant in the RCP;

	(B)
	the
Employee's RCP Contributions to the RCP are limited by the application of the rules or regulations of Code Section 401(a)(4) and/or the limitations of Code
Section 401(a)(17), or whose Earnings are not fully taken into account in determining the Employee's RCP Contributions to the RCP; and

	(C)
	such
Employee is a member of a select group of management or highly compensated Employees of the Company. 

 
 

ARTICLE IV    
    
    CONTRIBUTIONS, INVESTMENT AND VESTING    
    

	4.1
	Establishment of Accounts. The Company shall create and maintain an unfunded individual Account for each Participant eligible to
participate in either the Excess Benefit or the 

4

 

Supplemental
Benefit, as applicable, to each of which it shall credit the amounts described in this Article IV. 

	4.2
	Company Contributions. Excess Contributions and Supplemental Contributions, as applicable, shall be made for each Participant on the
same terms and conditions, at the same times, and pursuant to the same elections made by the Participant as they would have been if paid under the RCP were it not for Code limitations on benefits or
Earnings.

	4.3
	Investment Elections. Each Participant's Excess Contributions, Supplemental Contributions, and Accounts under this Plan shall be
considered allocated among the Investment Funds in accordance with the Participant's actual investment elections under the RCP.

	4.4
	Investment Changes. Reallocations between Investment Funds in this Plan shall be considered made according to the Participant's
elections under the RCP.

	4.5
	Account Credit. The Company shall credit each Participant's Account with earnings, gains and losses as if such Accounts were actually
invested among the Investment Funds according to the Participant's elections under the RCP.

	4.6
	Valuation of Accounts. In accordance with the provisions regarding the valuation of accounts under the RCP, each Participant's Account
shall be valued and adjusted each business day as if such Participant's Account was actually invested in the applicable Investment Funds according to the Participant's elections under the RCP.

	4.7
	Vesting. The balance of a Participant's Account shall become 100% vested at the same time as if the amounts had been credited to the
Participant's Account under the RCP. 

 
 

ARTICLE V    
    
    DISTRIBUTIONS    
    

	5.1
	Eligibility to Receive a Distribution.

	(A)
	Retirement Benefit: Subject to Section 5.3 below, upon a Participant's Retirement Date, he shall be entitled to receive the
amount of his Account. The form of benefit payment, and the time of commencement of such benefit, shall be as provided in Sections 5.2 and 5.5.

	(B)
	Termination Benefit: Upon the Termination of Employment of a Participant prior to his Retirement Date for reasons other than death, the
Company shall pay to the Participant a benefit equal to his Account. 

Unless
otherwise directed by the Plan Administrative Committee, the benefit payable upon termination shall be payable in a lump sum as a cash distribution as set forth in Section 5.2 following
the Participant's Termination of Employment. Upon payment following a Termination of Employment, the Participant shall immediately cease to be eligible for any other benefit provided under this Plan. 

	(C)
	Death Benefits: Upon the death of a Participant, the Beneficiary of such Participant shall receive all of the Participant's remaining
Account. Payment of a Participant's remaining Account shall be made in accordance with Section 5.2.

	(D)
	Change of Control:

	(1)
	If
there is a Change of Control, notwithstanding any other provision of this Plan, any Participant who has an Account hereunder shall, following a Change of Control, receive an
immediate lump sum payment of the balance of his Account, reduced by a penalty equal to ten percent (10%) of the Participant's Account as of the last business day of the 

5

 

month
preceding the date of the Change of Control. The ten percent (10%) penalty shall be permanently forfeited and shall not be paid to, or in respect of, the Participant. 

	(2)
	If
there is a Change of Control, notwithstanding any other provision of this Plan, any retired Participant, or Beneficiary, who has an Account hereunder shall, following a Change of
Control, receive an immediate lump sum payment of the balance of his Account, reduced by a penalty equal to five percent (5%) of the Participant's Account as of the last business day of the month
preceding the date of the Change of Control. The five percent (5%) penalty of the retired Participant's or Beneficiary's Account shall be permanently forfeited and shall not be paid to, or in respect
of, the retired Participant or Beneficiary.

	5.2
	Form of Benefit Payment. Upon the happening of an event described in Section 5.1, the Company shall pay to the Participant the
amount specified therein in a lump sum cash distribution.

	5.3
	Limitations on the Annual Amount Paid to a Participant. Notwithstanding any other provisions of this Plan to the contrary, in the event
that a portion of the payments due a Participant pursuant to Sections 5.1 (A) -(D) would not be deductible by the Company pursuant to Section 162(m) of the Code, the Company, at its
discretion, may postpone payment of such amounts to the Participant until such time that the payments would be deductible by the Company; provided, however, that no payment postponed pursuant to this
Section 5.3 shall be postponed beyond the first anniversary of such Participant's Termination of Employment.

	5.4
	Tax Withholding. To the extent required by law, the Company shall withhold any taxes required to be withheld by any Federal, State or
local government.

	5.5
	Commencement of Payments. Commencement of payments under Section 5.1 (A)-(C) of this Plan from a Participant's Account shall be
payable in the first calendar quarter of the year following the Plan Year in which the Participant terminates employment from the Company for any reason (but in no event earlier than six
(6) months following the Participant's termination of employment). Commencement of payments pursuant to a Change of Control under Section 5.1 (D) of this Plan from a Participant's
Account shall be as soon as administratively feasible on or after the last business day of the month following a Change of Control event which entitles a Participant or a Beneficiary to payments under
this Plan (or such later date as legally required).

	5.6
	Recipients of Payments; Designation of Beneficiary. All payments to be made by the Company under the Plan shall be made to the
Participant during his lifetime, provided that if the Participant dies prior to the completion of such payments, then all subsequent payments under the Plan shall be made by the Company to the
Beneficiary determined in accordance with this Section. The Participant may designate a Beneficiary by filing a written notice of such designation with the Plan Administrative Committee in such form
as the Plan Administrative Committee requires and may include contingent Beneficiaries. The Participant may from time-to-time change the designated Beneficiary by filing a new
designation in writing with the Plan Administrative Committee. If a married Participant designates a Beneficiary or Beneficiaries other than his Spouse at the time of such designation, such
designation shall not be effective (and the Participant's Spouse shall be the Beneficiary) unless:

	(A)
	the
Spouse consents in writing to such designation;

	(B)
	the
Spouse's consent acknowledges the effect of such designation, which consent shall be irrevocable; and

	(C)
	the
Spouse executes the consent in the presence of either a Plan representative designated by the Plan Administrative Committee or a notary public. 

6

 

Notwithstanding
the foregoing, such consent shall not be required if the Participant establishes to the satisfaction of the Plan Administrative Committee that such consent cannot be obtained because
(i) there is no Spouse; (ii) the Spouse cannot be located after reasonable efforts have been made; or (iii) other circumstances exist to excuse spousal consent as determined by
the Plan Administrative Committee. If no designation is in effect at the time when any benefits payable under this Plan shall
become due, the Beneficiary shall be the Spouse of the Participant, or if no Spouse is then living, the representatives of the Participant's estate. 

 
 

ARTICLE VI    
    
    PLAN ADMINISTRATIVE COMMITTEE    
    

	6.1
	Plan Administrative Committee. The Company may designate one or more persons to serve on the Plan Administrative Committee to carry out
its fiduciary responsibility and authority under the Plan (other than to manage and control Plan assets and investment of the assets) and its duties as the plan administrator. The members of the Plan
Administrative Committee for this Plan shall be the same as the members of the Plan Administrative Committee for the RCP.

	6.2
	Committee Membership.

	(A)
	The
Plan Administrative Committee shall consist of at least three (3) persons who shall be appointed by and serve at the pleasure of the Board.

	(B)
	The
Board shall have the right to remove any member of the Plan Administrative Committee at any time. A member may resign at any time by written resignation to the Board. If a vacancy
in the Plan Administrative Committee should occur, a successor may be appointed by the Board.

	6.3
	Powers. The Plan Administrative Committee shall have all powers specified in the Plan in addition to all others as may be necessary to
discharge its duties hereunder, including, but not by way of limitation, the power to construe or interpret the Plan, to determine all questions of eligibility hereunder, to determine the method of
payment of any Account hereunder, to adopt rules relating to the giving of timely notice, and to perform such other duties as may from time to time be delegated to it by the Board. The Plan
Administrative Committee may take such voluntary correction action as it considers necessary or appropriate to remedy any inequity that results from incorrect information received or communicated in
good faith or as a consequence of administrative or operational error, including but not limited to reallocation of plan assets, adjustments in amounts of future payments to Participants or
beneficiaries and institution of prosecution of actions to recover benefit payments made in error or on the basis of incorrect or incomplete information. The Plan Administrative Committee may
prescribe such forms and systems and adopt such rules and actuarial methods and tables as it deems advisable. It may employ such agents, attorneys, accountants, actuaries, medical advisors, or
clerical assistants (none of whom need be members of the Plan Administrative Committee) as it deems necessary for the effective exercise of its duties, and may delegate to such agents any power and
duties both ministerial and discretionary, as it may deem necessary and appropriate. The compensation of such agents who are not full-time employees of an Employer shall be fixed by the
Plan Administrative Committee within limits set by the Board and shall be paid by the Company as determined by the Plan Administrative Committee.

	6.4
	Organization and Procedures. The Plan Administrative Committee shall elect one of its members as chairman. Its members shall serve as
such without compensation. Plan Administrative Committee expenses shall be paid by the Company. A majority of the Plan Administrative Committee members shall constitute a quorum. The Plan
Administrative Committee may take any action upon a majority vote at any meeting at which a quorum is present, and may take any action without a 

7

 

meeting
upon the unanimous written consent of all members. All action by the Plan Administrative Committee shall be evidenced by a certificate signed by a member of the Plan Administrative Committee.
The Plan Administrative Committee shall appoint a secretary to the Plan Administrative Committee who need not be a member of the Plan Administrative Committee, and all acts and determinations of the
Plan Administrative Committee shall be recorded by the secretary, or under his supervision. All such records, together with such other documents as may be necessary for the administration of the Plan,
shall be preserved in the custody of the secretary. 

	6.5
	Rules and Decisions. The Plan Administrative Committee shall have absolute discretion in carrying out its duties under the Plan and its
decisions shall be final and binding.

	6.6
	Authorization of Payments. If the Board authorizes the establishment of a trust to serve as the funding vehicle for the benefits
described herein, subject to the provisions hereof, it shall be the duty of the Plan Administrative Committee to furnish the trustee of such trust with all facts and directions necessary or pertinent
to the proper disbursement of the trust funds.

	6.7
	Books and Records. The records of the Employers shall be conclusive evidence as to all information contained therein with respect to
the basis for participation in the Plan and for the calculation of Excess Contributions and Supplemental Contributions. The Plan Administrative Committee shall keep all individual and group records
relating to Participants and Beneficiaries and all other records necessary for the proper operation of the Plan. Such records shall be made available to the Employers and to each Participant and
Beneficiary for examination during normal business hours except that a Participant or Beneficiary shall examine only such records as pertain exclusively to the examining Participant or Beneficiary and
the Plan. The Plan Administrative Committee shall prepare and shall file as required by law or regulation all reports, forms, documents and other items required by ERISA, the Code and every other
relevant statute, each as amended, and all regulations thereunder. This provision shall not be construed as imposing upon the Plan Administrative Committee the responsibility or authority for the
preparation, preservation, publication or filing of any document required to be prepared, preserved or filed by any other named fiduciary to whom such responsibilities are delegated by law or by the
Plan.

	6.8
	Perpetuation of the Plan Administrative Committee. In the event that the Company shall for any reason cease to exist, then, unless the
Plan is adopted and continued by a successor, the members of the Plan Administrative Committee at that time shall remain in office until the final termination of the Plan, and any vacancies in the
membership of the Plan Administrative Committee caused by death, resignation, disability or other cause, shall be filled by the remaining member or members of the Plan Administrative Committee.

	6.9
	Claims Procedure.

	(A)
	Authorized Representative. A Participant or Beneficiary under the Plan may name an authorized representative to act on his or her
behalf under the claims procedures of the Plan, by providing written documentation of such authorization in such form as is acceptable to the Plan Administrative Committee.

	(B)
	Procedure for Making Initial Claims. Claims for benefits under the Plan may be made by submitting forms to the Plan Administrative
Committee pursuant to procedures established by the Plan Administrative Committee from time to time.

	(C)
	Review of Claims for Benefits.

	(1)
	Determination Regarding Initial Claims. If a claim for Plan benefits is denied, the Plan Administrative Committee shall provide a
written notice within 90 days to the claimant that contains (i) specific reasons for the denial, (ii) specific references to Plan provisions on which the Plan Administrative
Committee based its denial, (iii) a description of any 

8

 

additional
material or information necessary for the claimant to perfect the claim and an explanation of why such material or information is necessary and (iv) a description of the Plan's
review procedures and time limits applicable to such procedures, including a statement of the claimant's right to bring a civil action under section 502(a) of ERISA following an adverse benefit
determination on review. 

The
notice shall also contain a statement that the claimant may (i) request a review upon written application to the Plan Administrative Committee within 60 days, (ii) submit
written comments, documents, records and other information relating to the claim, and (iii) request copies of all documents, records, and other information relevant to the claimant's claim. If
a claim is denied because of incomplete information, the notice shall also indicate what additional information is required. 

If
additional time is required to make a decision on the claim, the Plan Administrative Committee shall notify the claimant of the delay within the original 90 day period. This notice will also
indicate the special circumstances requiring the extension and the date by which a decision is expected. This extension period may not exceed 90 days beyond the end of the first
90-day period. 

	(2)
	Appeals. The claimant may appeal a denied claim by submitting a written request for an appeal review to the Plan Administrative
Committee. The appeal request must, however, be made within 60 days after the claimant's receipt of notice of the denial of the claim. Pertinent documents may be reviewed in preparing an
appeal, and issues and comments may be submitted in writing. The claimant shall be provided, upon request and free of charge, reasonable access to, and copies of, all documents, records and other
information relevant to the claimant's claim for benefits (as determined under applicable regulations). An appeal shall be given a complete review by the Plan Administrative Committee, taking into
account all comments, documents, records and other information submitted by the claimant without regard to whether such information was submitted or considered in the initial benefit determination. 

The
Plan Administrative Committee shall review an appeal of a denied claim no later than the date of the next Plan Administrative Committee meeting immediately following such request for review,
unless the request for review is filed within 30 days preceding the date of such meeting. In such case, a benefit determination may be made by no later than the date of the second meeting
following the Plan Administrative Committee's receipt of a request for review. If special circumstances require a further extension of time for processing, a benefit determination shall be rendered no
later than the third meeting of the Plan Administrative Committee following the Plan Administrative Committee's receipt of the request for review. If such an extension of time for review is required
because of special circumstances, the Plan Administrative Committee shall provide the claimant with written notice of the extension, describing the special circumstances and the date as of which the
benefit determination will be made, prior to the commencement of the extension. The Plan Administrative Committee shall notify the claimant of the benefit determination as soon as possible, but not
later than 5 days after the benefit determination is made. 

	6.10
	Allocation or Reallocation of Responsibilities. The Plan Administrative Committee may allocate their responsibilities under the Plan
among themselves. Any such allocation, reallocation, or designation shall be in writing and shall be filed with and retained by the secretary of the Plan Administrative Committee with the records of
the Plan Administrative Committee. If applicable, notwithstanding the foregoing, no reallocation of the responsibilities provided in a trust to manage or control the trust assets shall be made other
than by an amendment to the trust. 

9

 
	6.11
	Service of Process. The Company shall be the designated recipient of service of process with respect to legal actions regarding the
Plan. 

 
 

ARTICLE VII    
    
    MISCELLANEOUS    
    

	7.1
	Funding. The Board may, but shall not be required to, authorize the establishment of a trust by the Company to serve as the funding
vehicle for the benefits described herein. In any event, the Company's obligations hereunder shall constitute a general, unsecured obligation, payable solely out of its general assets, and no
Participant shall have any right to any specific assets of the Company. Nothing contained in the Plan constitutes a guarantee by the Company that the assets of the Company shall be sufficient to pay
any benefit to any person.

	7.2
	Amendment and Termination. The Company, by action of the Board, shall have the right at any time to amend this Plan in any respect, or
to terminate this Plan; provided, however, that no such amendment or termination shall operate to reduce the benefit that has accrued for any Participant who is participating in the Plan nor the
payment due to a terminated Participant at the time the amendment or termination is adopted. Continuance of the Plan is completely voluntary and is not assumed as a contractual obligation of the
Company.

	7.3
	Termination of RCP. Notwithstanding the foregoing, this Plan shall terminate when the RCP terminates.

	7.4
	Effect of Plan. Nothing contained herein (a) shall be deemed to exclude a Participant from any compensation, bonus, pension,
insurance, termination pay or other benefit to which he otherwise is or might become entitled to as an Employee or (b) shall be construed as conferring upon an Employee the right to continue in
the employ of the Company as an executive or in any other capacity.

	7.5
	Offset. If, at the time payments are to be made hereunder, the Participant or the Beneficiary is indebted or obligated to the Company,
then the payments remaining to be made to the Participant or the Beneficiary may, at the discretion of the Company, be reduced by the amount of such indebtedness or obligation, provided, however, that
an election by the Company not to reduce any such payment or payments shall not constitute a waiver of its claim for such indebtedness or obligation.

	7.6
	Amounts Payable. Any amounts payable by the Company hereunder shall not be deemed salary or other compensation to a Participant for the
purposes of computing benefits to which the Participant may be entitled under any other arrangement established by the Company for the benefit of its Employees.

	7.7
	Rights and Obligations. The rights and obligations created hereunder shall be binding on a Participant's heirs, executors and
administrators and on the successors and assigns of the Company.

	7.8
	Notice. Any notice required or permitted to be given under the Plan shall be sufficient if in writing and hand delivered, or sent by
registered or certified mail, and if given to the Company, delivered to the principal office of the Company, directed to the attention of the Plan Administrative Committee. Such notice shall be deemed
given as of the date of delivery or, if delivery is made by mail, as of the date shown on the postmark or the receipt for registration or certification.

	7.9
	Governing Law. The Plan shall be construed and governed by the laws of the State of Wisconsin.

	7.10
	Assignment of Rights. The rights of any Participant under this Plan are personal and may not be assigned, transferred, pledged or
encumbered. Any attempt to do so shall be void. 

10

 
	7.11
	Liability. Neither the Company, its Employees, agents, any member of the Board, the plan administrator nor the Plan Administrative
Committee shall be responsible or liable in any manner to any Participant, Beneficiary, or any person claiming through them for any benefit or action taken or omitted in connection with the granting
of benefits, the continuation of benefits or the interpretation and administration of this Plan.

	7.12
	Coordination with RCP. An application or claim for a benefit under the RCP shall constitute a claim for a benefit under this Plan.

	7.13
	Plan Sponsor. The Company is the Plan Sponsor and Named Fiduciary of the Plan, within the meaning of ERISA. 

 
 

ARTICLE VIII    
    
    ERISA RIGHTS    
    

        Participants in the Plan are entitled to certain rights and protections under the Employee Retirement Income Security Act of 1974 (ERISA). ERISA provides that all
Plan participants shall be entitled to: 

 Receive Information About Your Plan and Benefits  

	•
	Examine,
without charge, at the office of the Plan Administrator and at other specific locations such as worksites and union halls, all documents governing the Plan.

	•
	Obtain,
upon written request to the Plan Administrator, copies of documents governing the operation of the Plan and an updated summary plan description. The Plan
Administrator may request a reasonable charge for the copies. 

 Prudent Action by Plan Fiduciaries  

In
addition to creating rights for Plan participants, ERISA imposes duties upon the people who are responsible for the operation of the Plan. The people who operate the Plan, called "fiduciaries" of
the Plan, have a duty to do so prudently and in the interest of Plan participants and beneficiaries. No one, including the employer, a union, or any other person, may fire a participant or otherwise
discriminate against a participant in any way to prevent that participant from obtaining a pension benefit or exercising your rights under ERISA. 

 Enforce Your Rights  

If
a claim for a benefit is denied or ignored, in whole or in part, the participant has a right to know why this was done, to obtain copies of documents relating to the decision without charge, and to
appeal any denial, all within certain time schedules. 

Under
ERISA, there are steps the participant can take to enforce the above rights. For instance, if you request a copy of Plan documents or the latest annual report from the Plan and do not receive
them within 30 days, you may file suit in a Federal court. In such a case, the court may require the Plan Administrator to provide the materials and pay you up to $110 a day until you receive
the materials, unless the materials were not sent because of reasons beyond the control of the Plan Administrator. If you have a claim for benefits which is denied or ignored, in whole or in part, you
may file suit in a state or Federal court (although you may be required to complete the Plan's appeals process before a court will hear your claim). In addition, if you disagree with the Plan's
decision or lack thereof concerning the qualified status of a domestic relations order, you may file suit in a Federal court. If it should happen that Plan fiduciaries misuse the Plan's money, or if
you are discriminated against for asserting your rights, you may seek assistance from the U.S. 

11

 

Department
of Labor, or you may file suit in a Federal court. The court will decide who should pay court costs and legal fees. If you are successful, the court may order the person you have sued to
pay these costs and fees. If you lose, the court may order you to pay these costs and fees; for example, if it finds your claim is frivolous. 

 Assistance with Your Questions  

If
you have any questions about your Plan, you should contact the Plan Administrator. If you have any questions about this statement or about your rights under ERISA, or if you need assistance in
obtaining documents from the Plan Administrator, you should contact the nearest office of the Pension and Welfare Benefits Administration, U.S. Department of Labor, listed in your telephone directory
or the Division of Technical Assistance and Inquiries, Pension and Welfare Benefits Administration, U.S. Department of Labor, 200 Constitution Avenue N.W., Washington, D.C. 20210. You may also obtain
certain publications about your rights and responsibilities under ERISA by calling the publications hotline of the Pension and Welfare Benefits Administration. 

 
 

ARTICLE IX    
    
    GENERAL PLAN INFORMATION    
    

	9.1
	General Plan Information.

	(A)
	Name,
address and telephone number of Plan Sponsor (the Company): 

Neenah
Paper, Inc.

3460 Preston Ridge Road

Preston Ridge III, Suite 600

Alpharetta, GA 30005 

	(B)
	Employer
identification number of Plan Sponsor: 20-1308307

	(C)
	Plan
number assigned to the Plan: N02

	(D)
	Type
of plan: Excess benefit plan and a nonqualified supplemental retirement plan.

	(E)
	Form
of Plan Administration: Self-administered by the Plan Sponsor.

	(F)
	Name,
address and telephone number of the Plan Administrator: 

Neenah
Paper, Inc.

Plan Administrative Committee

3460 Preston Ridge Road

Preston Ridge III, Suite 600

Alpharetta, GA 30005 

	(G)
	Service
of legal process may also be made upon the Plan Administrator.

	(H)
	Funding
Medium: Benefits under the Plan are paid from the general assets of the Employer. 

12

 

        IN
WITNESS WHEREOF, the Company has caused this Plan to be executed by its duly authorized officer. 

	 	 	NEENAH PAPER, INC.
	

 	
 	
By:	

/s/  RICHARD F. READ      

	

 	
 	

Name:	

Richard F. Read

	

 	
 	

Title:	

Vice President of Human Resources

	

 	
 	

Date:	

12/1/2004

13

QuickLinks

NEENAH PAPER SUPPLEMENTAL RETIREMENT CONTRIBUTION PLAN

TABLE OF CONTENTS

NEENAH PAPER SUPPLEMENTAL RETIREMENT CONTRIBUTION PLAN

ARTICLE I INTRODUCTION

ARTICLE II DEFINITIONS

ARTICLE III ELIGIBILITY

ARTICLE IV CONTRIBUTIONS, INVESTMENT AND VESTING

ARTICLE V DISTRIBUTIONS

ARTICLE VI PLAN ADMINISTRATIVE COMMITTEE

ARTICLE VII MISCELLANEOUS

ARTICLE VIII ERISA RIGHTS

ARTICLE IX GENERAL PLAN INFORMATIONQuickLinks
 -- Click here to rapidly navigate through this document

 

Exhibit 10.7  

  
 

  

   

   

   

   

 
 

NEENAH PAPER    
    
    EXECUTIVE SEVERANCE PLAN    
    

  

   

   

   

   

   

  

THIS DOCUMENT CONSTITUTES THE OFFICIAL PLAN DOCUMENT AS

WELL AS THE SUMMARY PLAN DESCRIPTION OF THIS PLAN.

  

   

 

 
NEENAH PAPER

EXECUTIVE SEVERANCE PLAN  

 
 

TABLE OF CONTENTS    
    

	 
	 	 
	 	Page

	ARTICLE I    ESTABLISHMENT AND PURPOSE OF THE PLAN	 	1
	 	1.1	 	Establishment of the Plan	 	1
	 	1.2	 	Background	 	1
	 	1.3	 	Purpose of Plan	 	1
	 	1.4	 	Type of Plan	 	1
	 	1.5	 	Effective Date	 	1
	
ARTICLE II    DEFINITIONS	
 	

1
	 	2.1	 	Accounting Firm	 	1
	 	2.2	 	Affiliate	 	1
	 	2.3	 	Annual Bonus Amount	 	1
	 	2.4	 	Board	 	2
	 	2.5	 	Cause	 	2
	 	2.6	 	Change of Control	 	2
	 	2.7	 	Code	 	3
	 	2.8	 	Committee	 	3
	 	2.9	 	Company	 	3
	 	2.10	 	Eligible Executive	 	3
	 	2.11	 	Equity Plan	 	3
	 	2.12	 	Excise Tax	 	3
	 	2.13	 	Good Reason	 	3
	 	2.14	 	Net After-Tax Receipt	 	4
	 	2.15	 	Parachute Value	 	4
	 	2.16	 	Participant	 	4
	 	2.17	 	Payment	 	5
	 	2.18	 	Plan Year	 	5
	 	2.19	 	Qualified Termination of Employment	 	5
	 	2.20	 	Reduced Amount	 	5
	 	2.21	 	Relevant Date	 	5
	 	2.22	 	Separation Payment	 	5
	 	2.23	 	Severance Period	 	5
	 	2.24	 	Value	 	5
	
ARTICLE III    PARTICIPATION	
 	

5
	 	3.1	 	Participation	 	5
	
ARTICLE IV    TERMINATION OF EMPLOYMENT OF PARTICIPANTS	
 	

6
	 	4.1	 	Termination of Employment of Participants	 	6
	
ARTICLE V    PAYMENTS UPON QUALIFIED TERMINATION OF EMPLOYMENT	
 	

6
	 	5.1	 	Cash Severance Payment	 	6
	 	5.2	 	Outplacement Services	 	7
	
ARTICLE VI    CERTAIN REDUCTION OF PAYMENTS BY THE COMPANY	
 	

7
	 	6.1	 	Determination of Need for Reduction	 	7
	 	6.2	 	Participant Election of Reduced Payments	 	7
	 	 	 	 	 

i

 

	
ARTICLE VII    CERTAIN ADDITIONAL PAYMENTS BY THE COMPANY	
 	

8
	 	7.1	 	Gross-Up Payment	 	9
	 	7.2	 	Determinations by Accounting Firm	 	9
	 	7.3	 	Timing of Gross-Up Payment	 	9
	 	7.4	 	Claims by Internal Revenue Service	 	9
	 	7.5	 	Refunds of Excise Taxes	 	10
	 	7.6	 	Tax Withholding	 	10
	
ARTICLE VIII    RELEASE AND RESTRICTIVE COVENANTS	
 	

10
	
ARTICLE IX    OTHER TERMS AND CONDITIONS	
 	

11
	
ARTICLE X    NONASSIGNABILITY	
 	

11
	
ARTICLE XI    UNFUNDED PLAN	
 	

11
	
ARTICLE XII    MITIGATION AND SETTLEMENT OF CLAIMS	
 	

11
	 	12.1	 	No Duty to Mitigate	 	11
	 	12.2	 	Full Settlement	 	11
	
ARTICLE XIII    TERMINATION AND AMENDMENT OF THIS PLAN	
 	

11
	
ARTICLE XIV    SUCCESSORS	
 	

12
	
ARTICLE XV    ERISA RIGHTS	
 	

12
	
ARTICLE XVI    MISCELLANEOUS	
 	

13
	 	16.1	 	General Plan Information	 	13
	
EXHIBIT "A"	
 	

15
	
EXHIBIT "B"	
 	

16

ii

 
 

NEENAH PAPER
  EXECUTIVE SEVERANCE PLAN    
    

 
 

ARTICLE I    
    
    ESTABLISHMENT AND PURPOSE OF THE PLAN    
    

	1.1
	Establishment of the Plan. Neenah Paper, Inc. (the "Company") hereby establishes a flexible benefits plan for its Eligible
Employees, to be known as the Neenah Paper Executive Severance Plan (the "Plan"), as set forth in this document.

	1.2
	Background. Effective as of November 30, 2004 (the "Distribution Date"), a spin-off of the Company, then an
affiliate of Kimberly-Clark Corporation ("KC"), was effectuated by the distribution of Company shares to Kimberly-Clark Corporation's shareholders. In connection with the spin-off
transaction, the Company agreed to establish an executive severance plan similar to the Kimberly-Clark Corporation Executive Severance Plan (the "KC Plan") for the benefit of certain key executives of
the Company.

	1.3
	Purpose of Plan. The purpose of this Plan is to assure the Company that it will have the continued dedication of, and the availability
of objective advice and counsel from, key executives of the Company notwithstanding the possibility, threat or occurrence of a change of control of the Company. In the event the Company receives any
proposal from a third person concerning a possible business combination with the Company, or acquisition of the Company's equity securities, or otherwise considers or pursues a transaction that could
lead to a change of control, the Board of Directors of the Company believes it imperative that the Company and the Board be able to rely upon key executives to continue in their positions and be
available for advice, if requested, without concern that those individuals might be distracted by the personal uncertainties and risks created by such a possibility. Should the Company receive or
consider any such proposal or transaction, in addition to their regular duties, such key executives may be called upon to assist in the assessment of the proposal or transaction, to advise management
and the Board as to whether the proposal or transaction would be in the best interest of the Company and its stockholders, and to take such other actions as the Board might determine to be
appropriate.

	1.4
	Type of Plan. This Plan is intended to be an employee welfare benefit plan for severance benefits within the meaning of
Section 3(1) of the Employee Retirement Income Security Act of 1974, as amended.

	1.5
	Effective Date. The effective date of the Plan is December 1, 2004. 

 
 

ARTICLE II    
    
    DEFINITIONS    
    

        As used in this plan, the following terms shall have the following respective meanings: 

	2.1
	Accounting Firm. Deloitte & Touche LLP or such other certified public accounting firm designated by the Company.

	2.2
	Affiliate. The Company and any company, person or organization which, on the date of determination, (A) is a member of a
controlled group of corporations (as defined in Code section 414(b)) which includes the Company; (B) is a trade or business (whether or not incorporated) which controls, is controlled by
or is under common control with (within the meaning of Code section 414(c)) the Company; (C) is a member of an affiliated service group (as defined in Code section 414(m)) which
includes the Company; or (D) is otherwise required to be aggregated with the Company pursuant to Code section 414(o) and regulations promulgated thereunder.

	2.3
	Annual Bonus Amount. For any Participant, the target-level award payable to the Participant for the year in which the Relevant Date
occurred (or, if such target-level award has not been 

 

established
at that time, for the preceding year) or, if higher, for any subsequent year that begins before the Qualified Termination of Employment, under the Neenah Paper, Inc. Management
Incentive Program, as applicable, or any successor or additional annual bonus plan. 

	2.4
	Board. The Board of Directors of the Company.

	2.5
	Cause. Any of the following:

	(A)
	Willful
failure to perform his duties and responsibilities;

	(B)
	Embezzlement,
fraud, or misappropriation against or with respect to the Company, its subsidiaries and/or their assets;

	(C)
	Conviction
of a felony charge or a plea of guilty or nolo contendre to a felony charge;

	(D)
	Use
of alcohol and/or drugs (whether prescription or nonprescription) which impairs the Participant's ability to perform his duties and responsibilities;

	(E)
	Unlawful
trading in the securities of any corporation (including the Company) based on information gained as a result of the Participant's performance of services for the Company;

	(F)
	Violation
of any of the corporate policies, work rules or standards of the Company, including but not limited to the Code of Conduct, sexual harassment policy and insider trading
policy, or violation of any applicable statute, regulation, or rule, or provision of any applicable code of professional ethics; or

	(G)
	Willful
disclosure to unauthorized persons of confidential information or trade secrets of the Company.

	2.6
	Change of Control. Any of the following events:

	(A)
	Acquisition of Substantial Percentage. The acquisition by any Person of Beneficial Ownership of thirty percent (30%) or more of the
combined voting power of the then outstanding voting securities of the Company entitled to vote generally in the election of Directors (the "Outstanding Company Voting Securities"); provided, however,
that for purposes of this Section, the following acquisitions shall not constitute a Change in Control: (i) any acquisition by a Person who on the Effective Date is the Beneficial Owner of
thirty percent (30%) or more of the Outstanding Company Voting Securities, (ii) any acquisition directly from the Company, including without limitation, a public offering of securities,
(iii) any acquisition by the Company, (iv) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any of its Affiliates, or
(v) any acquisition by any corporation pursuant to a transaction which complies with subparagraphs (i), (ii), and (iii) of Section 2.6(C) hereof;

	(B)
	Change in Majority of Board Members. During any period of two consecutive years, individuals who at the beginning of such period
constitute the Board (the "Incumbent Board") cease for any reason to constitute at least a majority of the Board, provided that any individual becoming a Director whose election, or nomination for
election by the Company's shareholders, was approved by a vote of at least a majority of the Directors then comprising the Incumbent Board shall be considered as though such individual were a member
of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office is in connection with an actual or threatened election contest relating to the election
or removal of the Directors of the Company or other actual or threatened solicitation of proxies of consents by or on behalf of a Person other than the Board;

	(C)
	Reorganization, Merger or Consolidation. Consummation of a reorganization, merger, or consolidation to which the Company is a party or
a sale or other disposition of all or 

2

 

substantially
all of the assets of the Company (a "Business Combination"), in each case unless, following such Business Combination: (i) all or substantially all of the individuals and entities
who were the Beneficial Owners of Outstanding Company Voting Securities immediately prior to such Business Combination beneficially own, directly or indirectly, more than sixty percent (60%) of the
combined voting power of the outstanding voting securities entitled to vote generally in the election of Directors of the Company resulting from the Business Combination (including, without
limitation, a corporation which as a result of such transaction owns the Company or all or substantially all of the Company's assets either directly or through one or more Affiliates) (the "Successor
Entity") in substantially the same proportions as their ownership immediately prior to such Business Combination of the Outstanding Company Voting Securities; and (ii) no Person (excluding any
Successor Entity or any employee benefit plan, or related trust, of the Company or such Successor Entity) beneficially owns, directly or indirectly, thirty percent (30%) or more of the combined voting
power of the then outstanding voting securities of the Successor Entity, except to the extent that such ownership existed prior to the Business Combination; and (iii) at least a majority of the
members of the board of directors of the Successor Entity were members of the Incumbent Board (including persons deemed to be members of the Incumbent Board by reason of the proviso to
paragraph (b) of this Section) at the time of the execution of the initial Participation Agreement or of the action of the Board providing for such Business Combination; or 

	(D)
	Liquidation or Dissolution. Approval by the shareholders of the Company of a complete liquidation or dissolution of the Company.

	2.7
	Code. The Internal Revenue Code of 1986, as amended from time to time, and as construed and interpreted by valid regulations or rulings
issued thereunder.

	2.8
	Committee. The Compensation Committee of the Board.

	2.9
	Company. Neenah Paper, Inc., a Delaware corporation.

	2.10
	Eligible Executive. Those key executives of the Company and its Affiliates who are from time to time designated by the Chief Executive
Officer as eligible to participate in the Plan and are so designated on Exhibit "A" hereto. Notwithstanding the above, the Committee may approve criteria for the Chief Executive Officer to use for
eligibility purposes of the Plan and shall approve participation in the Plan by the executive officers of the Company.

	2.11
	Equity Plan. The Neenah Paper, Inc. 2004 Omnibus Stock and Incentive Plan, and any successor or additional plans under which a
Participant receives stock options, restricted stock or other equity-based compensation.

	2.12
	Excise Tax. The excise tax imposed by Section 4999 of the Code, together with any interest or penalties imposed with respect to
such excise tax.

	2.13
	Good Reason. Any of the following:

	(A)
	the
assignment to the Participant of any duties inconsistent with the Participant's position as a key executive officer of the Company or a substantial adverse alteration in the
nature of the Participant's responsibilities and position from those in effect immediately prior to the Change of Control, other than such alteration primarily attributable to the fact that the
Company is no longer a public company;

	(B)
	a
reduction by the Company of the Participant's annual base salary by five percent (5%) or more as in effect immediately prior to the Change of Control, except for
across-the-board salary reductions similarly affecting all key executives of the Company; 

3

 

	(C)
	without
the express written agreement of the Participant, any assignment or change in duties that would require the relocation of the Participant's work place to a location that is
more than fifty (50) miles from the Participant's work place immediately prior to a Change in Control of the Company; provided however, the relocation of the Participant's work place must also
increase the regular commute distance between the Participant's residence and work place by more than fifty miles (one-way).

	(D)
	the
failure of the Company to pay as soon as administratively feasible, after notice from the Participant, any portion of the Participant's current compensation;

	(E)
	the
failure of the Company to continue in effect any compensation plan in which the Participant participates immediately prior to the Change of Control which is material to the
Participant's total compensation, including but not limited to the Company's stock option, incentive compensation, and bonus plans, or any substitute plans adopted prior to the Change of Control,
unless an equitable arrangement (which is embodied in an ongoing substitute or alternative plan but which need not provide the Participant with equity-based incentives) has been made with respect to
such plan, or the failure by the Company to continue the Participant's participation therein (or in such substitute or alternative plan) on a basis not materially less favorable than the benefits
provided to other participants;

	(F)
	the
failure by the Company to continue to provide the Participant with benefits substantially similar to those enjoyed by the Participant under any of the Company's pension, life
insurance, medical, health and accident, or disability plans in which the Participant was participating at the time of the Change of Control, the taking of any action by the Company which would
directly or indirectly materially reduce any of such benefits or deprive the Participant of any material fringe benefit enjoyed by the Participant at the time of the Change of Control, or the failure
by the Company to provide the Participant with the number of paid vacation days to which the Participant is entitled on the basis of years of service with the Company in accordance with the Company's
normal vacation policy in effect at the time of the Change of Control. 

The
Participant's right to terminate the Participant's employment for Good Reason shall not be affected by the Participant's incapacity due to physical or mental illness. However, in order to
terminate employment for Good Reason, (1) the Participant must give the Company a notice setting forth the circumstances of the act or failure to act alleged to constitute Good Reason within
30 days after the Participant first has actual notice of such act or failure, and stating that the Participant has determined that such act or failure constitutes "Good Reason" hereunder,
(2) the Company must fail to correct such act or failure within 30 days after it receives such notice from the Participant, and (3) the Participant must actually terminate his or
her employment during the period of 30 days beginning 30 days after the Company receives such notice. 

	2.14
	Net After-Tax Receipt. The Value of a Payment, net of all taxes imposed on a Participant with respect thereto under
Sections 1 and 4999 of the Code, determined by applying the highest marginal rate under Section 1 of the Code which applied to the Participant's taxable income for the immediately preceding
taxable year.

	2.15
	Parachute Value. With respect to a Payment, the present value as of the date of the Change of Control for purposes of Code
Section 280G of the portion of such Payment that constitutes a "parachute payment" under Code Section 280G(b)(2), as determined by the Accounting Firm for purposes of determining whether
and to what extent the Excise Tax will apply to such Payment.

	2.16
	Participant. An Eligible Executive who is a party to a Participation Agreement which has not been terminated in accordance with the
terms of this Plan. 

4

 
	2.17
	Payment. Any payment or distribution in the nature of compensation (within the meaning of Code Section 280G(b)(2)) to or for
the benefit of a Participant, whether paid or payable pursuant to this Plan or otherwise.

	2.18
	Plan Year. The short period beginning on the Effective Date and ending on December 31, 2004; and thereafter, each twelve
calendar month period beginning on January 1 and ending on the following December 31.

	2.19
	Qualified Termination of Employment. The termination of a Participant's employment with the Company and/or its Affiliates either:

	(A)
	within
the two (2) year period following a Change of Control of the Company due to the following: (i) by the Company without Cause, or (ii) by the Participant
with Good Reason;

	(B)
	by
the Company without Cause before a Change of Control, if a Change of Control occurs within one year after such termination and it is reasonably demonstrated by the Participant that
such termination of employment was at the request of a third party that had taken steps reasonably calculated to effect a Change of Control or otherwise arose in connection with or in anticipation of
a Change of Control. 

A
transfer of employment for administrative purposes among the Company and its Affiliates shall not be deemed a Qualified Termination of Employment, but if such a transfer results in the occurrence of
Good Reason, the affected Participant shall have the right to terminate employment for Good Reason and such termination shall be a Qualified Termination of Employment. 

	2.20
	Reduced Amount. With respect to a Participant, the greatest aggregate amount of Separation Payments which (a) is less than the
sum of all Separation Payments and (b) results in aggregate Net After Tax Receipts which are equal to or greater than the Net After Tax Receipts which would result if the Participant were paid
the sum of all Separation Payments.

	2.21
	Relevant Date. In the case of a Qualified Termination of Employment as described in subsection (B) of the definition of
"Qualified Termination of Employment," the date of such Qualified Termination of Employment, and, in all other cases, the date of the Change of Control.

	2.22
	Separation Payment. With respect to a Participant, a Payment paid or payable to the Participant pursuant to this Plan (disregarding
Article VII of this Plan).

	2.23
	Severance Period. The period of two (2) years beginning on the date of the Qualified Termination of Employment.

	2.24
	Value. With respect to a Payment, the economic present value of a Payment as of the date of the Change of Control for purposes of Code
Section 280G, as determined by the Accounting Firm using the discount rate required by Code Section 280G(d)(4). 

 
 

ARTICLE III    
    
    PARTICIPATION    
    

	3.1
	Participation. Upon designation as an Eligible Executive, the Executive shall be offered a Participation Agreement in the Plan (in the
form shown as Exhibit B hereto) and upon execution and delivery thereof by the Eligible Executive evidencing such Eligible Executive's agreement not to voluntarily leave the employ of the
Company and its Affiliates and to continue to render services during the period of any threatened Change of Control of the Company, such Eligible Executive shall become a Participant in the Plan. A
Participant shall cease to be a Participant in the Plan upon the termination of the Participant's Participation Agreement or the termination of the Plan. 

5

 
 
 

ARTICLE IV    
    
    TERMINATION OF EMPLOYMENT OF PARTICIPANTS    
    

	4.1
	Termination of Employment of Participants. Nothing in this Plan shall be deemed to entitle a Participant to continued employment with
the Company and its Affiliates and the rights of the Company to terminate the employment of a Participant shall continue as fully as though this Plan were not in effect, provided that any Qualified
Termination of Employment shall entitle the Participant to the benefits herein provided. In addition, nothing in this Plan shall be deemed to entitle a Participant under this Plan to any rights, or to
payments under this Plan, with respect to any plan in which the Participant was not a participant prior to a Qualified Termination of Employment. 

 
 

ARTICLE V    
    
    PAYMENTS UPON QUALIFIED TERMINATION OF EMPLOYMENT    
    

	5.1
	Cash Severance Payment. Subject to Article VIII hereof, in the event of a Qualified Termination of Employment of a Participant,
a lump sum cash payment shall be made to such Participant as compensation for services rendered, in an amount (subject to any applicable payroll or other taxes required to be withheld) equal to the
sum of the amounts specified in subsections (A) through (F) below. Payment shall be made to the Participant within fifteen (15) days following the last day of employment with the
Company, except (i) to the extent any amount is not then calculable, such portion shall be paid as soon as practicable following the ability to calculate the amount; (ii) to the extent
amounts are payable under subsections (C), (D) and/or (E), such amounts shall not be payable until the date following six (6) months after the last day of employment; and (iii) to
the extent otherwise as may be required by law:

	(A)
	Salary Plus Incentive Compensation. A lump sum amount equal to two (2) times the sum of (a) the Participant's annual base
salary at the rate in effect immediately prior to the Relevant Date or, if higher, immediately before the Qualified Termination of Employment, plus (b) the Annual Bonus Amount;

	(B)
	Equity Plan. All grants and awards that were granted to the Participant under the Company's Equity Plan, including but not limited to
any substitute plans adopted prior to the Relevant Date (or any successor or additional plan), that were outstanding both on the Relevant Date and on the date immediately before the Qualified
Termination of Employment, shall be governed by and subject to the provisions of the Equity Plan.

	(C)
	Neenah Paper 401(k) Retirement Plan. A lump sum amount equal to any benefits under the Neenah Paper 401(k) Retirement Plan (or any
successor or additional plan) that the Participant forfeits as a result of his or her termination of employment, based upon the value of the Participant's account as of the most recent valuation date
before the date of the Qualified Termination of Employment; provided that this benefit shall be payable from the general assets of the Company;

	(D)
	Neenah Paper Retirement Contribution Plan. A lump sum amount equal to (a) in the case of a Participant, the Participant's annual
Retirement Contributions under the Neenah Paper Company Retirement Contribution Plan (or any successor or additional plans) and the Neenah Paper Supplemental Retirement Contribution Plan (or any
successor or additional plans) (collectively, the "Retirement Contribution Plan") to which the Participant would have been entitled if he had remained employed by the Company for the Severance Period
at the rate of annual compensation specified in Section 5.1(A) above except that the Annual Bonus Amount shall be treated as earned for the year in which termination occurred and the balance of
the Severance Period and no award actually earned in, and paid for, the year in which 

6

 

termination
occurred shall be considered, plus (b) for all Participants, an amount equal to any benefits under the Retirement Contribution Plan (or any successor or additional plan) that the
Participant forfeits as a result of his or her termination of employment, based upon the value of the Participant's account as of the most recent valuation date before the date of the Qualified
Termination of Employment, provided that this benefit shall be payable from the general assets of the Company; 

	(E)
	Neenah Paper Pension Plan. In the case of a Participant who participates in the Neenah Paper Pension Plan, a lump sum retirement
benefit, in addition to any benefits received under the to the Neenah Paper Supplemental Pension Plan (or any successor or additional plans) and (the "Supplemental Plan") and the Neenah Paper Pension
Plan (or any successor or additional plans) (the "Pension Plan"), in an amount equal to the difference between (a) the benefits under the Pension Plan and the Supplemental Plan to which the
Participant would have been entitled if such Participant had remained employed by the Company for the Severance Period, at the rate of annual compensation specified in Section 5.1
(A) above except that the Annual Bonus Amount shall be treated as earned for the year in which termination occurred and the balance of the Severance Period and no award actually earned in, and
paid for, the year in which termination occurred shall be considered, minus (b) the benefits to which the Participant would actually have been entitled under the Pension Plan and the
Supplemental Plan; provided that this benefit shall be equal to the actuarial present value of a straight life annuity without level income option; and provided further that this benefit shall be
payable from the general assets of the Company; and

	(F)
	Medical and Dental Benefits. A lump sum amount equal to the amount of the monthly premiums that the Participant would be required to
pay, if he or she elected "COBRA" continuation coverage under the medical and dental plans of the Company in which the Participant was participating immediately before the Qualified Termination of
Employment, based upon the premium rates in effect as of the date of the Qualified Termination of Employment, times 24. In addition, the Participant shall receive a cash payment for his or her accrued
retiree medical credits (with no additional age or service provided and no additional enhanced access to retiree medical).

	5.2
	Outplacement Services. In addition to the cash Payments described in Section 5.1, the Participant shall be entitled to receive
professional outplacement services for up to the lesser of (i) two (2) years or (ii) a total of $50,000 cost, by an outplacement service provider selected by the Company. 

 
 

ARTICLE VI    
    
    CERTAIN REDUCTION OF PAYMENTS BY THE COMPANY    
    

	6.1
	Determination of Need for Reduction. Notwithstanding anything in this Plan or any Participation Agreement to the contrary, in the event
that the Accounting Firm shall be determined that (i) any Payment to a Participant would be subject to the Excise Tax, but (ii) the Parachute Value of all Payments to the Participant
does not exceed 110% of the Safe Harbor Amount, then the Accounting Firm shall determine the amount of the necessary reduction of the Participant's Separation Payments in order to meet the definition
of a Reduced Amount. All fees payable to the Accounting Firm with respect to this Section shall be paid solely by the Company.

	6.2
	Participant Election of Reduced Payments.

	(A)
	Notice and Election by Participant. If the Accounting Firm determines that aggregate Separation Payments should be reduced to the
Reduced Amount, the Company shall promptly give the Participant notice to that effect and a copy of the detailed calculation thereof, and 

7

 

the
Participant may then elect, in his or her sole discretion, which and how much of the Separation Payments shall be eliminated or reduced (as long as after such election the Value of the aggregate
Separation Payments equals the Reduced Amount), and shall advise the Company in writing of his or her election within ten (10) days of his receipt of notice. 

	(B)
	Failure of Participant to Make Election. If no such election is made by the Participant within such ten-day period, the
Company shall elect which of such Separation Payments shall be eliminated or reduced (as long as after such election the Value of the aggregate Separation Payments equals the Reduced Amount) and shall
notify the Participant promptly of such election.

	(C)
	Binding Determinations by Accounting Firm. All determinations made by the Accounting Firm under this Section shall be binding upon the
Company and the Participant and shall be made within sixty (60) days of a termination of employment of the Participant.

	(D)
	Timing of Payment. As promptly as practicable following such determination of the Reduced Amount, the Company shall pay to or
distribute for the benefit of the Participant such Separation Payments as are then due to the Participant under this Plan.

	(E)
	Overpayments and Underpayments. While it is the intention of the Company to reduce the amounts payable or distributable to a
Participant hereunder only if the aggregate Net After Tax Receipts to the Participant would thereby be increased, as a result of the uncertainty in the application of Code Section 4999 at the
time of the initial determination by the Accounting Firm hereunder, it is possible that amounts will have been paid or distributed by the Company to or for the benefit of a Participant pursuant to
this Plan which should not have been so paid or distributed ("Overpayment") or that additional amounts which will have not been paid or distributed by the Company to or for the benefit of a
Participant pursuant to this Plan could have been so paid or distributed ("Underpayment"), in each case, consistent with the calculation of the Reduced Amount hereunder.

	(F)
	Overpayment. In the event that the Accounting Firm determines that an Overpayment has been made, based upon the assertion of a
deficiency by the Internal Revenue Service against the Company or the Participant which the Accounting Firm believes has a high probability of success, any such benefit of a Participant shall be
treated for all purposes as a loan to the Participant which the Participant shall repay to the Company together with interest at the applicable federal rate provided for in Code
Section 7872(f)(2); provided, however, that no such loan shall be deemed to have been made and no amount shall be payable by a Participant to the Company if and to the extent (i) such
deemed loan and payment would not either reduce the amount on which the Participant is subject to tax under Code Sections 1 and 4999 or generate a refund of such taxes, or (ii) such deemed loan
would violate any applicable laws or regulations.

	(G)
	Underpayment. In the event that the Accounting Firm, based upon controlling precedent or substantial authority, determines that an
Underpayment has occurred, any such Underpayment shall be promptly paid by the Company to or for the benefit of the Participant together with interest at the applicable federal rate provided for in
Code Section 7872(f)(2). 

 
 

ARTICLE VII    
    
    CERTAIN ADDITIONAL PAYMENTS BY THE COMPANY    
    

	7.1
	Gross-Up Payment. Notwithstanding anything in this Plan or any Participation Agreement to the contrary, in the event that
the Accounting Firm shall determine that (i) any Payment to a Participant would be subject to the Excise Tax, and (ii) the Parachute Value of all Payments to the Participant exceeds 110%
of the Safe Harbor Amount, then the Participant shall be entitled to 

8

 

receive
an additional payment (the "Gross-Up Payment") in an amount such that, after payment by the Participant of all taxes (and any interest or penalties imposed with respect to such
taxes), including, without limitation, any income taxes and Excise Tax imposed upon the Gross-Up Payment, the Participant retains an amount of the Gross-Up Payment equal to the
Excise Tax imposed upon the Payments. If it shall be determined that (i) any Payment to a Participant would be subject to the Excise Tax, but the Parachute Value of all Payments does not exceed
110% of the Safe Harbor Amount, then no Gross-Up Payment shall be made to the Participant and the provisions of Article VI of this Plan shall apply to that Participant. The
Company's obligation to make Gross-Up Payments under this Article VII shall be conditioned upon the Participant's termination of employment. 

	7.2
	Determinations by Accounting Firm. Subject to the provisions of Section 7.4, all determinations required to be made under this
Article VII, including whether and when a Gross-Up Payment is required, the amount of such Gross-Up Payment and the assumptions to be utilized in arriving at such
determination, shall be made by the Accounting Firm. The Accounting Firm shall provide detailed supporting calculations both to the Company and the Participant within fifteen (15) business days
of the receipt of notice from the Participant that there has been a Payment or such earlier time as is requested by the Company. All fees and expenses of the Accounting Firm shall be borne solely by
the Company. Any determination by the Accounting Firm shall be binding upon the Company and the Participant. As a result of the uncertainty in the application of Section 4999 of the Code at the
time of the initial determination by the Accounting Firm hereunder, it is possible that Gross-Up Payments that will not have been made by the Company should have been made (an
"Underpayment"), consistent with the calculations required to be made hereunder. In the event the Company exhausts its remedies pursuant to Section 7.4 and the Participant thereafter is
required to make a payment of any Excise Tax, the Accounting Firm shall determine the amount of the Underpayment that has occurred and any such Underpayment shall be promptly paid by the Company to or
for the benefit of the Participant.

	7.3
	Timing of Gross-Up Payment. Any Gross-Up Payment, as determined pursuant to this Article, shall be paid by the
Company to or for the benefit of the applicable Participant within five (5) days of the receipt of the Accounting Firm's determination.

	7.4
	Claims by Internal Revenue Service. Each Participant shall notify the Company in writing of any claim by the Internal Revenue Service
that, if successful, would require the payment by the Company of the Gross-Up Payment. Such notification shall be given as soon as practicable, but no later than ten (10) business
days after the Participant is informed in writing of such claim. The Participant shall apprise the Company of the nature of such claim and the date on which such claim is requested to be paid. The
Participant shall not pay such claim prior to the expiration of the 30-day period following the date on which the Participant gives such notice to the Company (or such shorter period
ending on the date that any payment of taxes with respect to such claim is due). If the Company notifies the Participant in writing prior to the expiration of such period that the Company desires to
contest such claim, the Participant shall:

	(A)
	give
the Company any information reasonably requested by the Company relating to such claim,

	(B)
	take
such action in connection with contesting such claim as the Company shall reasonably request in writing from time to time, including, without limitation, accepting legal
representation with respect to such claim by an attorney reasonably selected by the Company,

	(C)
	cooperate
with the Company in good faith in order effectively to contest such claim, and

	(D)
	permit
the Company to participate in any proceedings relating to such claim; provided, however, that the Company shall bear and pay directly all costs and expenses (including 

9

 

additional
interest and penalties) incurred in connection with such contest, and shall indemnify and hold the Participant harmless, on an after-tax basis, for any Excise Tax or income tax
(including interest and penalties) imposed as a result of such representation and payment of costs and expenses. Without limitation of the foregoing provisions of this Section 7.4, the Company
shall control all proceedings taken in connection with such contest, and, at its sole discretion, may pursue or forgo any and all administrative appeals, proceedings, hearings and conferences with the
applicable taxing authority in respect of such claim and may, at its sole discretion, either pay the tax claimed to the appropriate taxing authority on behalf of the Participant and direct the
Participant to sue for a refund or contest the claim in any permissible manner, and the Participant agrees to prosecute such contest to a determination before any administrative tribunal, in a court
of initial jurisdiction and in one or more appellate courts, as the Company shall determine; provided, however, that, if the Company directs the Participant to pay such claim and directs the
Participant to sue for a refund, the Company shall indemnify and hold the Participant harmless, on an after-tax basis, from any Excise Tax or income tax (including interest or penalties)
imposed with respect to such payment or with respect to any imputed income in connection with such payment; and provided, further, that any extension of the statute of limitations relating to payment
of taxes for the taxable year of the Participant with respect to which such contested amount is claimed to be due is limited solely to such contested amount. Furthermore, the Company's control of the
contest shall be limited to issues with respect to which the Gross-Up Payment would be payable hereunder, and the Participant shall be entitled to settle or contest, as the case may be,
any other issue raised by the Internal Revenue Service or any other taxing authority. 

	7.5
	Refunds of Excise Taxes. If, after the receipt by a Participant of a Gross-Up Payment or payment by the Company of an
amount on the Participant's behalf pursuant to Section 7.4, the Participant becomes entitled to receive any refund with respect to the Excise Tax to which such Gross-Up Payment
relates or with respect to such claim, the Participant shall (subject to the Company's complying with the requirements of Section 7.4, if applicable) promptly pay to the Company the amount of
such refund (together with any interest paid or credited thereon after taxes applicable thereto). If, after payment by the Company of an amount on the Participant's behalf pursuant to
Section 7.4, a determination is made that the Participant shall not be entitled to any refund with respect to such claim and the Company does not notify the Participant in writing of its intent
to contest such denial of refund prior to the expiration of thirty (30) days after such determination, then the amount of such payment shall offset, to the extent thereof, the amount of
Gross-Up Payment required to be paid.

	7.6
	Tax Withholding. Notwithstanding any other provision of this Plan, the Company may, in its sole discretion, withhold and pay over to
the Internal Revenue Service or any other applicable taxing authority, for the benefit of a Participant, all or any portion of any Gross-Up Payment, and by signing an Participation
Agreement, the Participant shall consent to such withholding. 

 
 

ARTICLE VIII    
    
    RELEASE AND RESTRICTIVE COVENANTS    
    

        Any and all Payments and other benefits provided under this Plan are contingent upon, and shall not become payable until, the Participant executes an agreement
providing for a general release of all claims against the Company, as well as noncompete, nondisclosure, nonsolicitation of customers and employers and nondisparagement provisions upon his or her
termination of employment. 

10

 

 
 

ARTICLE IX    
    
    OTHER TERMS AND CONDITIONS    
    

        The Participation Agreement to be entered into pursuant to this Plan shall contain such other terms, provisions and conditions not inconsistent with this Plan as
shall be determined by the Board. Where appearing in this Plan or the Participation Agreement, the masculine shall include the feminine and the plural shall include the singular, unless the context
clearly indicates otherwise. 

 
 

ARTICLE X    
    
    NONASSIGNABILITY    
    

        Each Participant's rights under this Plan shall be nontransferable except by will or by the laws of descent and distribution. 

 
 

ARTICLE XI    
    
    UNFUNDED PLAN    
    

        The Plan shall be unfunded and all costs of the Plan shall be paid from the Company's general assets. Neither the Company nor the Board shall be required to
segregate any assets that may at any time be represented by benefits under the Plan. Neither the Company nor the Board shall be deemed to be a trustee of any amounts to be paid under the Plan. Any
liability of the Company to any Participant with respect to any benefit shall be based solely upon any contractual obligations created by the Plan and the Participation Agreement; no such obligation
shall be deemed to be secured by any pledge or any encumbrance on any property of the Company. 

 
 

ARTICLE XII    
    
    MITIGATION AND SETTLEMENT OF CLAIMS    
    

	12.1
	No Duty to Mitigate. In no event shall any Participant be obligated to seek other employment or take any other action by way of
mitigation of the amounts payable to the Participant under any of the provisions of this Plan, and such amounts shall not be reduced whether or not the Participant obtains other employment.

	12.2
	Full Settlement. In the event that a Participant contests the Company's interpretation of any provision of this Plan or the value of
any Payment hereunder, and such Participant prevails through legal arbitration proceedings on at least a major point or significant portion of such contest, the Company agrees to reimburse the
Participant, to the full extent permitted by law, all legal fees reasonably incurred by the Participant in such contest, up to a maximum of $50,000. 

 
 

ARTICLE XIII    
    
    TERMINATION AND AMENDMENT OF THIS PLAN    
    

        The Board shall have power at any time, in its discretion, to amend or terminate this Plan, in whole or in part; except that no amendment or termination shall
impair or abridge the obligations of the Company under any Participation Agreements previously entered into pursuant to this Plan except as expressly permitted by the terms of such Participation
Agreements. 

11

 

 
 

ARTICLE XIV    
    
    SUCCESSORS    
    

        The Company shall require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of its business
and/or assets to assume expressly and agree to perform this Plan and the Participation Agreements in the same manner and to the same extent that the Company would be required to perform them if no
such succession had taken place. 

 
 

ARTICLE XV    
    
    ERISA RIGHTS    
    

        Participants in the Plan are entitled to certain rights and protections under the Employee Retirement Income Security Act of 1974 (ERISA). ERISA provides that all
Plan participants shall be entitled to: 

Receive Information About Your Plan and Benefits  

	•
	Examine,
without charge, at the office of the Plan Administrator and at other specific locations such as worksites and union halls, all documents governing the Plan, and a
copy of the latest annual report (Form 5500 Series) filed by the Plan with the U. S. Department of Labor and available at the Public Disclosure Room of the Pension and Welfare Benefit
Administration.

	•
	Obtain,
upon written request to the Plan Administrator, copies of documents governing the operation of the Plan, and copies of the latest annual report (Form 5500
Series) and updated summary plan description. The Plan Administrator may request a reasonable charge for the copies.

	•
	Receive
a summary of the Plan's annual financial report. The Plan Administrator is required by law to furnish each participant with a copy of this summary annual report. 

Prudent Action by Plan Fiduciaries  

In
addition to creating rights for Plan participants, ERISA imposes duties upon the people who are responsible for the operation of the Plan. The people who operate the Plan, called "fiduciaries" of
the Plan, have a duty to do so prudently and in the interest of Plan participants and beneficiaries. No one, including the employer, a union, or any other person, may fire a participant or otherwise
discriminate against a participant in any way to prevent that participant from obtaining a pension benefit or exercising your rights under ERISA. 

Enforce Your Rights  

If
a claim for a benefit is denied or ignored, in whole or in part, the participant has a right to know why this was done, to obtain copies of documents relating to the decision without charge, and to
appeal any denial, all within certain time schedules. 

Under
ERISA, there are steps the participant can take to enforce the above rights. For instance, if you request a copy of Plan documents or the latest annual report from the Plan and do not receive
them within 30 days, you may file suit in a Federal court. In such a case, the court may require the Plan Administrator to provide the materials and pay you up to $110 a day until you receive
the materials, unless the materials were not sent because of reasons beyond the control of the Plan Administrator. If you have a claim for benefits which is denied or ignored, in whole or in part, you
may file suit in a state or Federal court (although you may be required to complete the Plan's appeals process before a court will hear your claim). In addition, if you disagree with the Plan's
decision or lack thereof concerning the qualified status of a domestic relations order, you may file 

12

 

suit
in a Federal court. If it should happen that Plan fiduciaries misuse the Plan's money, or if you are discriminated against for asserting your rights, you may seek assistance from the U.S.
Department of Labor, or you may file suit in a Federal court. The court will decide who should pay court costs and legal fees. If you are successful, the court may order the person you have sued to
pay these costs and fees. If you lose, the court may order you to pay these costs and fees; for example, if it finds your claim is frivolous. 

Assistance with Your Questions  

If
you have any questions about your Plan, you should contact the Plan Administrator. If you have any questions about this statement or about your rights under ERISA, or if you need assistance in
obtaining documents from the Plan Administrator, you should contact the nearest office of the Pension and Welfare Benefits Administration, U.S. Department of Labor, listed in your telephone directory
or the Division of Technical Assistance and Inquiries, Pension and Welfare Benefits Administration, U.S. Department of Labor, 200 Constitution Avenue N.W., Washington, D.C. 20210. You may also obtain
certain publications about your rights and responsibilities under ERISA by calling the publications hotline of the Pension and Welfare Benefits Administration. 

 
 

ARTICLE XVI    
    
    MISCELLANEOUS    
    

	16.1
	General Plan Information.

	(A)
	Name,
address and telephone number of Plan Sponsor (the Company): 

Neenah
Paper, Inc.

3460 Preston Ridge Road

Preston Ridge III, Suite 600

Alpharetta, GA 30005 

	(B)
	Employer
identification number of Plan Sponsor: 20-1308307

	(C)
	Plan
number assigned to the Plan: 513

	(D)
	Type
of plan: Welfare benefit severance plan.

	(E)
	Form
of Plan Administration: Self-administered by the Plan Sponsor.

	(F)
	Name,
address and telephone number of the Plan Administrator: 

Neenah
Paper, Inc.

Plan Administrative Committee

3460 Preston Ridge Road

Preston Ridge III, Suite 600

Alpharetta, GA 30005 

	(G)
	Service
of legal process may also be made upon the Plan Administrator.

	(H)
	Funding
Medium: Benefits under the Plan are paid from the general assets of the Employer. 

13

 

        IN
WITNESS WHEREOF, the Company has caused this Plan to be executed by its duly authorized officer. 

	 	 	NEENAH PAPER, INC.
	

 	
 	
By:	

/s/  SEAN T. ERWIN      

	

 	
 	

Name:	

Sean T. Erwin

	

 	
 	

Title:	

President and Chief Executive Officer

	

 	
 	

Date:	

12/1/2004

14

  

 
 

EXHIBIT "A"    
    
    NEENAH PAPER
  EXECUTIVE SEVERANCE PLAN    
    

	Name Of Participant
 
	 	Title
	 	Effective Date Of

Participation

	Sean T. Erwin	 	President and Chief Executive Officer	 	December 1, 2004
	

Bonnie J. Cruickshank-Lind	
 	

Chief Financial Officer	
 	

December 1, 2004
	

Steven S. Heinrichs	
 	

Vice President and General Counsel	
 	

December 1, 2004
	

William K. O'Connor	
 	

President, Paper Business	
 	

December 1, 2004
	

James R. Piedmonte	
 	

Vice President, Operations	
 	

December 1, 2004
	

Jon C. Wall	
 	

Vice President, Research & Development	
 	

December 1, 2004
	

Richard F. Read	
 	

Vice President, Human Resources	
 	

December 1, 2004
	

Dennis P. Runsten	
 	

Vice President, Supply and IT	
 	

December 1, 2004
	

William B. McCarthy	
 	

Vice President, Investor Relations and Analysis	
 	

December 1, 2004
	

John J. Herson	
 	

Vice President, Tax	
 	

December 1, 2004
	

Lawrence Brownlee	
 	

Vice President and Controller	
 	

December 1, 2004

   

	 	

Approved by:	

/s/  SEAN T. ERWIN      
 Sean T. Erwin

Chief Executive Officer	

 

15

 
 
 

EXHIBIT "B"    
    
    FORM OF PARTICIPATION AGREEMENT    
    

        I hereby agree to become a Participant in the Neenah Paper Executive Severance Plan, effective as
of                        , 200  . I acknowledge that I have
received a copy of the Executive Severance Plan document. 

        As
part of my participation in the Plan and in consideration for the benefits that I may become entitled to thereunder, I hereby agree that I will not voluntarily terminate my employment
with Neenah Paper, Inc. and its Affiliates (the "Company") during any period of a threatened Change in Control of the Company. 

        If
I should voluntarily terminate my employment with the Company for any reason at any time, I hereby acknowledge and agree that I will immediately cease participation in the Executive
Severance Plan and shall not be eligible for any payments or benefits under the Executive Severance Plan. 

	 	 	    
 Signature of Participant

	

 	
 	

Name of Participant:	

    

	

 	
 	

Title:	

    

	

 	
 	

Date:	

    

16

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NEENAH PAPER EXECUTIVE SEVERANCE PLAN

TABLE OF CONTENTS

NEENAH PAPER EXECUTIVE SEVERANCE PLAN

ARTICLE I ESTABLISHMENT AND PURPOSE OF THE PLAN

ARTICLE II DEFINITIONS

ARTICLE III PARTICIPATION

ARTICLE IV TERMINATION OF EMPLOYMENT OF PARTICIPANTS

ARTICLE V PAYMENTS UPON QUALIFIED TERMINATION OF EMPLOYMENT

ARTICLE VI CERTAIN REDUCTION OF PAYMENTS BY THE COMPANY

ARTICLE VII CERTAIN ADDITIONAL PAYMENTS BY THE COMPANY

ARTICLE VIII RELEASE AND RESTRICTIVE COVENANTS

ARTICLE IX OTHER TERMS AND CONDITIONS

ARTICLE X NONASSIGNABILITY

ARTICLE XI UNFUNDED PLAN

ARTICLE XII MITIGATION AND SETTLEMENT OF CLAIMS

ARTICLE XIII TERMINATION AND AMENDMENT OF THIS PLAN

ARTICLE XIV SUCCESSORS

ARTICLE XV ERISA RIGHTS

ARTICLE XVI MISCELLANEOUS

EXHIBIT "A" NEENAH PAPER EXECUTIVE SEVERANCE PLAN

EXHIBIT "B" FORM OF PARTICIPATION AGREEMENT

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