Neenah Paper (NP)

Base Salary

        Base salary is a critical element of executive compensation because it provides our executives with a base level of monthly income. Individual base salaries for our named executive officers are generally determined by targeting total compensation opportunities at a level close to the median of similar positions within the Peer Group as discussed above. Salary increases, if any, are reviewed and approved by the Compensation Committee on an annual basis. Factors considered in base salary increases include the Company's performance over the past year, changes in individual executive responsibility and any shift in the median of base salary as indicated by our analysis of peer companies.

        This approach to base salary supports our compensation philosophy in that the Compensation Committee has determined that setting the salary at this level allows Neenah to be competitive in attracting and retaining talent, while at the same time a substantial portion of the executive's overall compensation is performance based, thus aligning the executive's and stockholders' interests.

Base Salary

        Base salary is a critical element of executive compensation in that it provides our executives with a base level of monthly income. Individual base salaries for our named executive officers are generally determined by first targeting total pay opportunities at a level close to the median of similar positions within the Peer Group as discussed above, and then providing up to 50% of this value in the form of base salary and at least 50% in performance-based compensation (annual cash incentive awards and long-term equity awards). Salary increases, if any, are reviewed and approved by the Compensation Committee on an annual basis. Factors considered in base salary increases include the Company's performance over the past year, changes in individual executive responsibility and any shift in the median of base salary as indicated by our analysis of peer companies.

        This approach to base salary supports our compensation philosophy in that the Compensation Committee has determined that setting the salary at this level allows Neenah to be competitive in attracting and retaining talent, while at the same time requiring that a substantial portion of the executive's overall compensation be performance based, thus aligning the executive's and stockholders' interests.

Base Salary

In January of 2007 the Compensation Committee approved the following base salary increases for our named executive officers, effective January 1, 2007. Mr. Erwin’s annual base salary was increased to $615,000; Mr. Heinrichs’ base salary was increased to $255,000; Ms. Lind’s base salary was increased to $295,000; Mr. O’Connor’s base salary was increased to $240,000; and Mr. Piedmonte’s base salary was increased to $235,000. These increases were based on Neenah’s performance in 2006 relative to peer companies, the realized increase in shareholder value and an adjustment to approximate the median for base salaries as detailed in the Proxy Study.

Individual base salaries of our named executive officers are set at a level close to median of similar positions at the peer companies. The Compensation Committee reviews and approves base salary increases for the named executive officers on an annual basis.

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Base Salary

        Individual base salaries of our named executive officers are set at a level close to median of similar positions at the peer companies noted above. The Committee reviews and approves base salary increases for the named executive officers on an annual basis.