Administrator considers necessary or appropriate if the Plan Administrator reasonably determines in good faith that such exclusion or further action is necessary in order for the Plan to qualify for, or to continue to qualify for, the ERISA exemption.

ARTICLE II
DEFINITIONS

As used within this document, the following words and phrases have the meanings described in this Article II unless a different meaning is required by the context.  Some of the words and phrases used in the Plan are not defined in this Article II, but for convenience, are defined as they are introduced into the text.  Words in the masculine gender shall be deemed to include the feminine gender.  Any headings used are included for ease of reference only, and are not to be construed so as to alter any of the terms of the Plan.

2.1           AIP Awards .  The cash awards, if any, that may be earned by participants in the Corporation’s Annual Incentive Plan.

2.2           Annual Deferral.   The amount of Base Salary, AIP Awards and/or LTIP Awards which the Participant elects to defer in each Deferral Period pursuant to Section 4.1 of the Plan Document.

2.3           Base Salary.   A Participant’s base annual salary for the applicable Plan Year.

2.4           Beneficiary.   An individual or entity designated by a Participant in accordance with Section 13.6.

2.5           Board or Board of Directors.   The Board of Directors of the Corporation.

2.6           Change of Control.   For the purposes of this Plan, a Change of Control shall mean the condition that exists if at any time any of the following events shall have occurred with respect to the Corporation:  (a) “change in the ownership” of the Corporation; (b) a “change in the effective control” of the Corporation; or (c) a “change of the ownership of a substantial portion of the assets” of the Corporation, all as defined in Treasury Regulations § 1.409A-3(i)(5).  Notwithstanding any other provision herein, a change in the ownership, a change in the effective control, or a change in the ownership of a substantial portion of the assets, of the Corporation or another Employer shall not constitute a “Change in Control,” for purposes of this Plan, unless such transaction also represents a change in the ownership, a change in the effective control, or a change in the ownership of a substantial portion of the assets, of Schweitzer-Mauduit International, Inc.

2.7           Code.   The Internal Revenue Code of 1986.  Reference to a section of the Code shall include that section and any comparable section or sections of any future legislation that amends, supplements or supersedes such section.

2.8           Committee.   The Compensation Committee of the Corporation’s Board of Directors.

2.9           Corporation.   Schweitzer-Mauduit International, Inc.

2.10         Deferral Account.   The account established for a Participant pursuant to Section 5.1 of the Plan Document.

2.11         Deferral Election.   The election made by the Participant pursuant to Section 4.1 of the Plan Document.

2.12         Deferral Period.   The Plan Year, or in the case of a newly hired or promoted employee who becomes an Eligible Employee during a Plan Year, the remaining portion of the Plan Year.  In the case of the first Plan Year, the Deferral Period commences January 1, 2005 and ends December 31, 2005.

2.13         Disability.   A Participant shall be considered to have experienced a “Disability” or to be disabled, for purposes of this Plan, if the Participant (i) is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than 12 months, or (ii) is, by reasons of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than 12 months, receiving income replacement benefits for a period of not less than 3 months under an accident and health plan covering employees of the Corporation.

2.14         Effective Date.   January 1, 2005.

2.15         Eligible Employee.   An employee of the Corporation who is designated by the Plan Administrator as being eligible to participate in the Plan or who is a member of a class of employees that the Plan Administrator has designated as being eligible to participate in the Plan. The employee shall remain eligible to participate in the Plan for such period as is designated by the Plan Administrator.

2.16         Employer .  The Corporation and any related entity that becomes a participating employer in the Plan, in accordance with Section 12.2.

2.17         ERISA .  The Employee Retirement Income Security Act of 1974, as amended.

2.18         IRS .  The Internal Revenue Service.

2.19         Internal Revenue Service . Limits means any of the limitations on the amounts of contributions to or benefits under a qualified retirement plan required by Code sections 401(a)(4), 401(a)(17), 410(b), or 415.

2.20         LTIP Awards.   The cash awards, if any, that may be earned by participants in the Corporation’s Long-Term Incentive Plan.

2.21         Participant.   Any Eligible Employee who is designated by the Plan Administrator to participate in the Plan pursuant to Article III of the Plan Document commencing as of such time and for such period as is designated by the Plan Administrator. The list of Participants is set forth in Appendix A hereto, as amended from time to time.

2.22         Participant Agreement.   The written agreement, including a Deferral and Investment Election Form, to defer Base Salary, AIP Awards and/or LTIP Awards made by the Participant and investment directions as to any discretionary corporate contributions made on the Participant’s

behalf.  Such written agreement and Deferral and Investment Election Form shall be in the format designated by the Corporation, attached hereto.

2.23         Plan.   The Schweitzer-Mauduit International, Inc. Deferred Compensation Plan No. 2.

2.24         Plan Administrator.   The Corporation’s Human Resources Committee.

2.25         Plan Year.  “Plan Year” means the 12-month period beginning each January 1 and ending on the following December 31.

2.26         Rabbi Trust.   The Rabbi Trust, which the Corporation may, in its discretion, establish for the Schweitzer-Mauduit International, Inc. Deferred Compensation Plan No. 2, as amended from time to time.

2.27         Specified Age.   Age 55 or a later age chosen by the Participant on his Participation Agreement and Deferral Election Form at which time the vested credits in the Participant’s Deferral Account shall be paid out as benefits in accordance with the payment method selected by the Participant in accordance with the Plan terms, unless the Plan Administrator has begun to pay-out benefits at an earlier date, as provided in Article VII of this Plan.

2.28         A Specified Employee .  Shall have the meaning given to such term in Code Section 409A.

2.29         Unforeseeable Emergency .  A severe financial hardship to the Participant resulting from an illness or accident of the Participant, the Participant’s spouse, or a dependent (as defined in Code section 152(a) without regard to section 152(b)(1), (b)(2), and (d)(1)(B)) of the Participant, loss of the Participant’s property due to casualty, or other similar extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the Participant ( e.g. , the imminent foreclosure of the mortgage on the Participant’s primary residence or eviction from the Participant’s primary residence, the need to pay for medical expenses, including non-refundable deductibles and the costs of prescription drug medication, and funeral expenses of a spouse, a Beneficiary, or a dependent (as defined above).  A withdrawal on account of an Unforeseeable Emergency may be paid to the Participant only if the amounts distributed with respect to an emergency do not exceed the amounts necessary to satisfy such emergency plus amounts necessary to pay taxes reasonably anticipated as a result of the distribution, after taking into account the extent to which such hardship is or may be relieved through reimbursement or compensation by insurance or otherwise or by liquidation of the Participant’s assets (to the extent the liquidation of such assets would not itself cause severe financial hardship) or (effective as of January 1, 2008) by cessation of deferrals under this Plan.  This section shall be interpreted in a manner consistent with Code section 409A and applicable provisions of the Treasury Regulations.

2.30         Separation from Service.  Shall have the meaning assigned to such term in Code Section 409 A, Treasury Regulations Section 1.409A-1(h), as amended, and other applicable regulatory guidance of the IRS.

2.31         Valuation Date.   Each business day of the Plan Year.

2.32         Year of Service.   Each consecutive twelve (12) month period during which a Participant is continuously and actively employed by the Corporation.

ARTICLE III
ELIGIBILITY AND PARTICIPATION

3.1           Participation –Eligibility and Initial Period .  Participation in the Plan is open only to Eligible Employees of the Corporation.  Each Eligible Employee of the Corporation, as of the Effective Date, may become a Participant for the Deferral Period from January 1, 2005 through December 31, 2005 (“Initial Period”) if he submits a properly completed Participation Agreement and Deferral Election Form to the Plan Administrator prior to December 31, 2004.  Following the Initial Period, a Participant must submit a Deferral Election Form by December 15 of the year preceding the Plan Year for which the Deferral Election was made. Any employee becoming an Eligible Employee after the Effective Date, e.g., new hires or promoted employees, may become a Participant with respect to services performed subsequent to the filing of the Deferral Election Form for the current Deferral Period if he submits a properly completed Participation Agreement and Deferral Election Form within thirty (30) days after becoming eligible for participation; provided, however, that in this case the election shall apply only to compensation (Base Salary, AIP Awards and/or LTIP Awards) paid for services to be performed after the election; provided, further, that, with respect to compensation for services performed on and after January 1, 2008, in the case of compensation that is based upon a specified performance period ( e.g. , an AIP Award) where a deferral election is made in the first year of eligibility but after the beginning of the performance period, the election shall apply to no more than an amount equal to (i) total amount of the compensation for the performance period multiplied by (ii) a fraction the numerator of which is the number of days remaining in the performance period after the election and the denominator of which is the total number of days in the performance period.

3.2           Participation –Subsequent Entry into Plan.   An Eligible Employee who does not elect to participate at the time of initial eligibility as set forth in Section 3.1 shall remain eligible to become a Participant in subsequent Plan Years as long as he continues his status as an Eligible Employee.  In such event, the Eligible Employee may become a Participant by submitting a properly executed Participation Agreement and Deferral Election Form on or prior to December 15 of the year preceding the Plan Year for which it is to be effective.

3.3           Determination of Non-Eligibility to Participate.   If, at any time, an Eligible Employee or Participant is determined or reasonably believed, based on a judicial or administrative determination or opinion of counsel, or based (effective as of January 1, 2008) on a determination by the Plan Administrator, not to qualify as “management” or a “highly compensated employee” under ERISA Sections 201(2), 301 (a) (3), and 401 (a) (1), the employee shall cease active participation in the Plan as of the last day of the Plan Year in which such determination is made.

ARTICLE IV
CONTRIBUTIONS

4.1           Deferral Election.   On or before the 15th day of December preceding the first day of each Plan Year, a Participant may file with the Plan Administrator, a Participation Agreement and Deferral Election Form indicating the amount of Base Salary, AIP Award and/or LTIP Award to be deferred for that Plan Year.  A Participant shall not be obligated to make a Deferral Election in

each Plan Year to remain a participant in the Plan.  After a Plan Year commences, such Deferral Election shall continue for the entire Plan Year.

4.2           Maximum Deferral Election.   A Participant may elect to defer up to 25% of Base Salary and/or up to 50% of AIP Awards and/or LTIP Awards earned during the corresponding Deferral Period.  The amount of deferral may be stated as a flat dollar amount or as a percent. A Deferral Election may be automatically reduced if the Plan Administrator determines that such action is necessary to meet Federal or State tax withholding obligations.

4.3           Minimum Deferral Election.   A Participant who wishes to defer a portion of his qualifying compensation must elect to defer at least $1,200 during the Deferral Period from Base Salary, AIP Awards, LTIP Awards or a combination of Base Salary, AIP Awards and LTIP Awards.  The Participant may also elect not to make any deferral for a Plan Year.

4.4           Employer Contributions.   The Corporation, with the Committee’s prior approval, may, in its sole discretion, make a contribution to any one or more of the Participants’ Deferral Accounts.  Employer Contributions may also be mandated by the terms of the AIP and/or LTIP if a participant in one or more of those plans is also a “Covered Employee,” as such term is defined in Code Section 162(m) and the total amount of non-exempt compensation payable to such participant in any tax year exceeds the Code Section 162(m) limits .  Also, the amount by which any cash balance benefit formula amount under the Schweitzer-Mauduit International, Inc. Retirement Plan exceeds applicable Internal Revenue Service Limits (hereinafter an “Excess Retirement Benefit”) shall be made as an Employer Contribution to the Deferred Compensation Plan for the account of such participant.

4.5           Insurance.   The Corporation may insure the lives of Participants.  A Participant whose deferral is approved shall, as a condition of his deferral, cooperate in providing any information or submitting to any necessary examinations that may be requested by the Corporation in connection with its application for such insurance policies.  The Corporation shall be the applicant, owner and beneficiary of such policies.  The Participant shall have no interest in any policies nor will the Participant be able to look to an insurance carrier for benefits under any such policies.

ARTICLE V
ACCOUNTS

5.1           Deferral Accounts.   Solely for recordkeeping purposes, The Plan Administrator shall establish a Deferral Account for each Participant.  A Participant’s Deferral Account shall be credited with the contributions made by him or on his behalf by the Corporation under Section 4.4 and shall be credited (or charged, as the case may be) with the hypothetical or deemed investment earnings and losses determined pursuant to Section 5.3, and charged with distributions made to or with respect to him on deferrals of Base Salary, AIP Award and/or LTIP Award, dividends on stock units , and Corporate Contributions.

5.2           Crediting of Deferral Accounts.   Salary contributions under Section 4.1 shall be credited to a Participant’s Deferral Account as of the date on which such contributions were withheld from his Base Annual Salary.  AIP Award and LTIP Award contributions under Section 4.1 shall be credited to a Participant’s Deferral Account as of the date on which the contribution would have

otherwise been paid in cash.  Contributions under Section 4.4 shall be credited to the Participant’s Deferral Account as of the date declared by the Corporation or in accordance with the AIP Award and/or LTIP Award provisions hereinabove, if applicable.  Dividends deemed to be earned on the stock units shall be credited as of the dividend payment date on the Corporation’s common stock.  Excess Retirement Benefit contributions shall be credited in accordance with the crediting provisions of the Retirement Plan.  Any distribution with respect to a Deferral Account shall be charged to that Account as of the date the Corporation or the trustee of any Rabbi Trust established for the Plan makes such payment.

5.3           Earning Credits or Losses.   Amounts credited to a Deferral Account shall be credited with deemed net income, gain and loss on Deferred Base Salary, AIP Awards, LTIP Awards and deemed dividends on stock units, including the deemed net unrealized gain and loss based on hypothetical investment directions made by the Participant with respect to this Deferral Account on a form designated by the Plan Administrator, in accordance with investment options and procedures adopted by the Plan Administrator in its sole discretion, from time to time.  Excess Retirement Benefit contributions shall be