10-K

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-K

þ	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.
	For the fiscal year ended September 30, 2007.
o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.
	For the transition period from          to          .

Commisson	Name of Registrant, State of Incorporation,	IRS Employer
File No.	Address of Principal Executive Offices, and Telephone No.	Identification No.
000-52681	NEENAH ENTERPRISES, INC.	25-1618281
	(a Delaware Corporation) 2121 Brooks Avenue P.O. Box 729 Neenah, WI 54957 (920) 725-7000
333-28751	NEENAH FOUNDRY COMPANY	39-1580331
	(a Wisconsin Corporation) 2121 Brooks Avenue P.O. Box 729 Neenah, WI 54957 (920) 725-7000

Securities registered pursuant to Section 12(b) of the Act: None

Securities registered pursuant to section 12(g) of the Act: Neenah Enterprises, Inc., Common Stock, par value $0.01 per share

Indicate by check mark if the registrants are well-known seasoned issuers, as defined in Rule 405 of the Securities Act.  Yes o     No þ

Indicate by check mark if the registrants are not required to file reports pursuant to Section 13 or Section 15(d) of the Act.  Yes o     No þ

Indicate by check mark whether the registrants (1) have filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrants were required to file such reports), and (2) have been subject to such filing requirements for the past 90 days.  Yes þ     No o

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrants’ knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.  þ

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act.

	Neenah Enterprises, Inc.	Neenah Foundry Company
Large accelerated filer	o	o
Accelerated filer	o	o
Non-accelerated filer	þ	þ

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).

Neenah Enterprises, Inc.  Yes o     No þ

Neenah Foundry Company  Yes o     No þ

State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrant’s most recently completed second fiscal quarter.

Neenah Enterprises, Inc.	Since there was no established market for the common stock as of March 30, 2007, there was no market value for the shares of such stock held by non-affiliates of the registrant as of such date.
Neenah Foundry Company	The aggregate market value of the common equity of Neenah Foundry Company held by non-affiliates as of March 30, 2007 was zero. All of the common stock of Neenah Foundry Company is held by NFC Castings, Inc., a wholly owned subsidiary of Neenah Enterprises, Inc.

Indicate by check mark whether the registrants have filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court.  Yes þ     No o

Neenah Enterprises, Inc.	As of December 7, 2007, Neenah Enterprises, Inc. had 13,741,337 shares of common stock outstanding.
Neenah Foundry Company	As of December 7, 2007, Neenah Foundry Company had 1,000 shares of common stock outstanding, all of which were owned by NFC Castings, Inc, a wholly owned subsidiary of Neenah Enterprises, Inc.

Documents Incorporated by Reference

Certain portions of Neenah Enterprises, Inc.’s Proxy Statement to be filed for its Annual Meeting of Stockholders to be held on January 24, 2008 are incorporated by reference into Part III of this Form 10-K.

NEENAH ENTERPRISES, INC.
NEENAH FOUNDRY COMPANY

FISCAL YEAR 2007
FORM 10-K

ANNUAL REPORT

TABLE OF CONTENTS

Item			Page
		Filing Format		1
		Special Note Regarding Forward-Looking Statements		1
		Introduction		2
PART I
	1.	Business		2
	1A.	Risk Factors		13
	1B.	Unresolved Staff Comments		21
	2.	Properties		21
	3.	Legal Proceedings		22
	4.	Submission of Matters to a Vote of Security Holders		22
		Executive Officers of the Registrant		23
PART II
	5.	Market For Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities		24
	6.	Selected Financial Data		24
	7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		26
	7A.	Quantitative and Qualitative Disclosures About Market Risk		34
	8.	Financial Statements and Supplementary Data		34
	9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure		34
	9A.	Controls and Procedures		34
	9B.	Other Information		35
PART III
	10.	Directors, Executive Officers and Corporate Governance		35
	11.	Executive Compensation		35
	12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters		35
	13.	Certain Relationships and Related Transactions, and Director Independence		35
	14.	Principal Accountant Fees and Services		35
PART IV
	15.	Exhibits and Financial Statement Schedules		36
		Signatures		93
		Supplemental information to be furnished with reports filed pursuant to Section 15(d) of the Act by registrants which have not registered securities pursuant to Section 12 of the Act		94
		Exhibit Index		95
Amended Bylaws of Neenah Foundry Company
Agreement for Payment of Supplemental Benefits
Neenah Foundry Company Amended and Restated 2003 Severance and Change of Control Plan
Ratio of Earnings to Fixed Charges
Subsidiaries of Neenah Enterprises, Inc.
Certification of CEO of Neenah Enterprises, Inc. Pursuant to Section 302
Certification of CFO of Neenah Enterprises, Inc. Pursuant to Section 302
Certification of CEO of Neenah Foundry Company Pursuant to Section 302
Certification of CFO of Neenah Foundry Company Pursuant to Section 302
Certification of CEO and CFO of Neenah Enterprises, Inc. Pursuant to Section 906
Certification of CEO and CFO of Neenah Foundry Company Pursuant to Section 906

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Filing Format

This combined Form 10-K is being filed separately by Neenah Enterprises, Inc. (“NEI”) and Neenah Foundry Company (“Neenah”). NEI (formerly ACP Holding Company) has no business activity other than its ownership of NFC Castings, Inc. Neenah is a wholly owned subsidiary of NFC Castings, Inc.

Special Note Regarding Forward-Looking Statements

Our disclosure and analysis in this Annual Report on Form 10-K include some forward-looking statements. Forward-looking statements give our current expectations or forecasts of future events. All statements other than statements of current or historical fact contained in this Annual Report on Form 10-K, including statements regarding our future financial position, business strategy, budgets, projected costs and plans and objectives of management for future operations, are forward-looking statements. The words “anticipate,” “believe,” “continue,” “estimate,” “expect,” “intend,” “may,” “plan,” “seek,” “will” and similar expressions, as they relate to us, are intended to identify forward-looking statements. In particular, these include, among other things, statements relating to:

•  our significant indebtedness;

•  our future cash flow and earnings;

•  our ability to meet our debt obligations;

•  the effects of general industry and economic conditions;

•  our ability to retain our significant customers and rely on our significant suppliers;

•  our ability to compete with competitors in our industry;

•  the outcome of any litigation and labor disturbances in which we may be involved; and

•  our ability to attract and retain qualified personnel.

We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy and financial needs. They can be affected by inaccurate assumptions we might make or by known or unknown risks, uncertainties and assumptions, including the risks, uncertainties and assumptions described in Item 1A, “Risk Factors,” and in Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” In light of these risks, uncertainties and assumptions, the forward-looking statements in this Annual Report on Form 10-K may not occur and actual results could differ materially from those anticipated or implied in the forward-looking statements. In particular, the factors that could cause our results to differ materially from current expectations include, among others, material disruptions to the major industries we serve; continued price fluctuations in the scrap metal market; increases in price or interruptions in the availability of metallurgical coke; regulatory restrictions or requirements; developments affecting the valuation or prospects of the casting and forging industries generally or our business in particular; and the outcome of legal proceedings in which we are involved. When you consider these forward-looking statements, you should keep in mind these risk factors and other cautionary statements in this Annual Report on Form 10-K.

Our forward-looking statements speak only as of the date of this filing.

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Introduction

On August 3, 2007, NEI recapitalized and we took steps intended to facilitate the development of a market in NEI common stock, but there can be no assurance that we will be successful in developing such a market. Specifically, we have registered NEI’s common stock under Section 12(g) of the Securities Exchange Act of 1934, by filing a Form 10 registration statement with the Securities and Exchange Commission, and we amended NEI’s certificate of incorporation and bylaws in several respects. The amendments to the certificate of incorporation include:

•  a change of the name from ACP Holding Company to Neenah Enterprises, Inc.;

•  a reverse stock split in which each five of the outstanding shares of NEI’s common stock have been converted into one share of new common stock, with corresponding adjustments to NEI’s outstanding warrants to purchase shares of NEI’s common stock;

•  a change of NEI’s authorized capital stock to 36 million shares, consisting of 35 million shares of common stock and one million shares of preferred stock, with the preferred stock having such rights and being issuable in one or more classes or series as determined by the board of directors;

•  a provision that NEI’s board of directors will consist of no less than three nor more than nine directors (prior to the recapitalization the bylaws provided for a board of between two and seven directors) as fixed from time to time by a resolution approved by the vote of a majority of the directors then in office at a meeting at which a quorum is present, plus any directors that may be elected pursuant to the terms of any preferred stock that may be issued and outstanding from time to time; and

•  a prohibition of NEI stockholder action by written consent in lieu of a meeting and a requirement that special meetings of stockholders can be called only by the board of directors or the chairman of the board or upon the written request of stockholders owning not less than 50% of the outstanding shares of common stock.

In addition, the bylaw amendments include a requirement that NEI receive advance notice and other specified information regarding any nominees for director and any other business to be brought before a stockholders’ meeting by any stockholder.

PART I

Item 1.   Business

As used in this report, except as the context otherwise requires, the terms “NEI,” “ACP,” “Company,” “we,” “our,” “ours,” and “us” refers to Neenah Enterprises, Inc. (formerly ACP Holding Company) and its direct and indirect subsidiaries, collectively and individually, as appropriate from the context. Except as the context otherwise requires, “Neenah” refers to our indirect subsidiary, Neenah Foundry Company, and its wholly-owned subsidiaries, Deeter Foundry, Inc. (“Deeter”), Mercer Forge Corporation (“Mercer”), Dalton Corporation (“Dalton”), Advanced Cast Products, Inc. (“Advanced Cast Products”), Gregg Industries, Inc. (“Gregg”), Neenah Transport, Inc. (“Transport”) and Cast Alloys, Inc. (“Cast Alloys”), which is inactive, and their respective subsidiaries. “NFC” refers to NFC Castings, Inc., which is a wholly owned subsidiary of NEI and the parent of Neenah. NEI does not have any material assets or liabilities other than its indirect ownership of Neenah and Neenah’s subsidiaries. Neenah and Neenah’s subsidiaries (rather than NEI) are obligors or guarantors under our bank credit agreement and outstanding notes. Our fiscal year ends on September 30.

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Our organizational chart is as follows:

Overview

We are one of the largest independent foundry companies in the United States, and we believe we are one of only two national suppliers of castings to the heavy municipal market. Our broad range of heavy municipal iron castings includes manhole covers and frames, storm sewer frames and grates, heavy-duty airport castings, specialized trench drain castings and ornamental tree grates. We sell these municipal castings throughout the United States to state and local government entities, utility companies, precast concrete manhole structure

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producers and contractors for both new construction and infrastructure replacement. We are also a leading manufacturer of a wide range of complex industrial iron castings and steel forgings, including specialized castings and forgings for the heavy-duty truck industry, a broad range of iron castings and steel forgings for the construction equipment and farm equipment industries, and iron castings used in heating, ventilation and air conditioning, or HVAC, systems.

We have been able to achieve significant market shares in the major markets we serve. Each of our 10 manufacturing or machining facilities has unique capabilities to effectively serve our market niches.

We believe that the following factors have contributed to our success.

•  Leadership position in a relatively stable municipal market.  We are one of the leading suppliers of castings to the domestic municipal products market and, we believe, one of only two national suppliers, with approximately 15,000 customers in all 50 states and over 6,000 part numbers shipped every year. Approximately 40% of the individual part numbers we shipped last year for the municipal market were in quantities of fewer than 10 pieces, which we believe creates a significant barrier to entry. We also believe that we are the only manufacturer that has invested in the unique patterns required to make many of these specific products, resulting in significant barriers to entry.

•  Significant customer dependence on Neenah.  The patterns for municipal products seldom become obsolete and have been developed to various state and municipality specifications. These patterns are 100% owned by Neenah. As a market leader, our municipal castings are often specified as the standard in municipal contracts. Although the patterns for industrial castings are owned by the customer and not the foundry, industrial patterns are not readily transferable to other foundries without, in most cases, significant additional investment. We estimate that we have historically retained throughout the product life cycle over 95% of the patterns that we have been awarded. We believe we have the only tooling for a significant majority of our industrial products by net sales.

•  Large and experienced sales and marketing force.  Neenah has one of the largest sales and marketing forces serving the U.S. heavy municipal end-user market. We also employ a dedicated industrial casting sales force organized by facility. Our sales force supports ongoing customer relationships, and works with customers’ engineers and procurement representatives as well as our own engineers, manufacturing management and quality assurance representatives throughout all stages of the production process to ensure that the final product consistently meets or exceeds the specifications of our customers. This team approach, consisting of sales, marketing, manufacturing, engineering and quality assurance efforts, is an integral part of our marketing strategy. In addition, our 14 distribution and sales centers around the U.S. provide our municipal products customers with readily available castings to meet their needs.

•  Focused manufacturing facilities with an emphasis on quality and implementation of lean manufacturing concepts.  We operate 10 focused manufacturing and/or machining facilities in six states. We focus our facilities on the specific markets and market segments that they are best suited to serve, creating what we believe to be an efficient process flow which enables us to provide superior products to each of our chosen markets. We continuously focus on productivity gains by improving upon the individual steps of the casting process, which enables us to produce castings in low and medium volume quantities on high volume, cost-effective molding equipment. With a major focus on implementing lean manufacturing and Six Sigma, we are continuously striving for improvement of operations and personnel, emphasizing defect prevention, safety and the reduction of variation and waste in all areas.

•  Value-added machining capabilities.  Through our four machining facilities, we are able to deliver a machined product to many of our customers, capturing a greater share of the value chain and ensuring a loser working relationship. The casting machining process can contribute significantly to the value of the end-product, in particular in certain custom situations where high-value specialized machining is required. We continually evaluate opportunities to increase our value-added machining services.

•  Experienced and well-respected senior management team.  Our senior management team provides a depth and continuity of experience in the casting industry.

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Background

Our business was founded in 1872 and operated for 125 years by the founding family. In 1997, Neenah Corporation (Neenah’s parent holding company at that time) was acquired by NFC, a wholly owned subsidiary of ACP. A short time later Neenah Foundry Company merged with and into Neenah Corporation and the surviving company changed its name to Neenah Foundry Company.

In 1998, Neenah acquired all the capital stock of Deeter, Mercer and Dalton. ACP already owned Advanced Cast Products prior to the time ACP acquired its interest in Neenah. In 1999, Neenah acquired Gregg.

Since 1945, Deeter has been producing gray iron castings for the heavy municipal market. The municipal casting product line of Deeter includes manhole frames and covers, storm sewer inlet frames, grates and curbs, trench grating and tree grates. Deeter also produces a wide variety of special application construction castings. These products are utilized in waste treatment plants, airports, telephone and electrical construction projects.

Founded in 1954, Mercer produces complex-shaped forged components for use in transportation, railroad, mining and heavy industrial applications. Mercer is also a producer of microalloy forgings.

Dalton manufactures and sells gray iron castings for refrigeration systems, air conditioners, heavy equipment, engines, gear boxes, stationary transmissions, heavy-duty truck transmissions and other automotive parts.

Advanced Cast Products manufactures ductile iron castings, primarily for companies in the heavy-duty truck, construction equipment and railroad industries. Advanced Cast Products’ production capabilities also include a range of finishing operations including austempering and machining.

Gregg manufactures gray and ductile iron castings, primarily for engine turbo-chargers and heavy-duty truck applications.

Prior to 2003, Neenah also purchased and either sold or discontinued several other operations, including Cast Alloys, a manufacturer of investment-cast titanium and stainless steel golf clubheads; Hartley Controls Corporation, a manufacturer of foundry sand control equipment; Peerless Corporation, which machined roller bearing adaptors for the railroad industry; and Belcher Corporation, a malleable iron green sand foundry. See Item 1, “Business,” for an organizational chart of the Company.

Beginning in 2000, several trends converged to create an extremely difficult operating environment for the Company. First, there were dramatic cyclical declines in some of our most important markets including trucks, railroad, construction and agriculture equipment. Second, there was a major inventory adjustment by manufacturers in the residential segment of the HVAC equipment industry, resulting in fewer orders for Dalton’s HVAC castings. Third, domestic foundries had been suffering from underutilized capacity, significantly increased foreign competition, continued price reduction pressure from customers and other competitors, and increased costs associated with heightened safety and environmental regulations. These factors caused and to some extent continue to cause a substantial number of foundries to cease operations or file for bankruptcy protection.

Beginning in May 2000, we took aggressive steps to offset the impact of the decline in sales and earnings and improve cash flow in the difficult market environment, including an executive management change, sales of non-core assets, a reduction in our labor force, a slowdown in capital expenditures, and selected price increases. Despite these steps, the credit rating agencies began to downgrade Neenah’s outstanding debt obligations in early 2000. On July 1, 2003, we launched a pre-petition solicitation of acceptances with respect to an alternative joint plan of reorganization that was ultimately approved. On August 5, 2003, ACP, Neenah and all of our other wholly-owned domestic subsidiaries filed voluntary petitions for relief under Chapter 11 of the United States Bankruptcy Code. By order dated September 26, 2003, the Bankruptcy Court confirmed our Plan of Reorganization and the Plan of Reorganization became effective on October 8, 2003. The Plan of Reorganization allowed us to emerge from bankruptcy with an improved capital structure and, because we had arranged to continue paying our trade debt on a timely basis during the pendency of the Chapter 11 case, at the time of emergence, we had sufficient trade credit to continue operations in the ordinary course of business.

On July 29, 2005, ACP and Neenah announced that an investment banking firm had been engaged to assist in exploring the potential sale or merger of Neenah or ACP or a significant portion of their assets or capital stock. On

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November 29, 2005, we announced that our board of directors, which is also the board of directors of Neenah, had unanimously voted to end the sale or merger process and turn our focus to successfully implementing our business plan.

On May 25, 2006, we experienced a change of control when Tontine Capital Partners, L.P. (“TCP”) became the beneficial owner of a majority of the outstanding shares, on a fully-diluted basis, of ACP. As a result of subsequent transactions completed by June 12, 2007, as of that date, TCP and an affiliate, Tontine Capital Overseas Master Fund, L.P. (“TCO” and, together with TCP, “Tontine”) beneficially owned, in the aggregate, 45,328,488 shares of ACP common stock (9,065,697 shares after our subsequent 1-for-5 reverse stock split), representing approximately 56% of all shares outstanding of ACP on a fully-diluted basis and approximately 67% of the 68,113,822 shares then actually outstanding (approximately 13,622,764 shares after our subsequent 1-for-5 reverse stock split).

Industry Overview

There are approximately 2,200 independent foundries in the United States with 80% of them employing fewer than 100 employees. Only a small portion compete regularly with us, along with a number of foreign foundries. The iron foundry industry has gone through significant consolidation over the past 20 years, which has resulted in a significant reduction in the number of foundries and a rise in the share of production by the remaining foundries. We have gained business as a result of ongoing consolidation. Metal casting has historically been a cyclical industry with performance generally correlated with overall economic conditions and also directly affected by government (including environmental) regulation, foreign imports, and energy costs.

Most manufactured goods either contain or are made on equipment containing one or more cast components. Metal castings are prevalent in most major market segments, including pipes and fittings, air conditioners, automobiles, trucks, construction equipment and agricultural equipment as well as within streets and highways. While general economic conditions have a directional effect on the foundry industry as a whole, the strength of a particular end-market has a significant effect on the performance of particular foundries serving those markets. The historic stability of the heavy municipal market has helped mitigate the effects of downturns in our more cyclical industrial end-markets, such as the heavy-duty truck market.

Business Strategy

We are focused on increasing stakeholder value through continued growth and refinement of our business, improvement of our profit margins and continually providing our customers with the highest levels of product quality and customer service. Key elements of our strategy are outlined below.

•  Continued penetration of core markets.  We seek to optimize our competitive position in heavy municipal and industrial castings through separate strategies tailored to the specific needs of each business. We expect to grow and leverage the strength and stability of the municipal business by continuing to expand our participation in markets already served and by augmenting our cost competitive capacity through the installation of a new state-of-the-art mold line for larger, low volume castings, which we expect will enhance production efficiencies, increase capacity and provide expanded molding capabilities. We intend to further develop selected areas of the industrial business, such as construction and agricultural products, and further our relationships with existing customers through production of more complex industrial castings, while seeking out selected new customers. Additionally, industry consolidation has resulted in a significant reduction in the number of foundries and a rise in the share of production by the remaining foundries. We continue to capitalize on on-going consolidation by taking advantage of opportunities created by the closing of weak, inefficient foundries.

•  Deepen and expand customer relationships.  We focus on creating close working relationships with our customers by developing multiple points of contact throughout their organizations. In addition to supporting on-going customer relationships, our sales force also works with customers’ engineers and procurement representatives as well as with our own engineers, manufacturing managers and quality assurance representatives throughout all stages of the production process to ensure that the final product consistently meets or exceeds the specifications of our customers. Since we are the sole-source supplier for the majority of the products that we provide to our industrial customers, we intend to expand those relationships by continuing

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to participate in the development and production of more complex industrial castings, while seeking out selected new customers who would value our capabilities and performance reputation, technical ability and high level of quality and service.

•  Value-added focus.  Our ability to provide value-added machining enhances the value of the products we produce and is a competitive advantage as it positions us as a vital link in each customer’s supply chain by providing customers with a single source alternative that reduces supply chain costs and shortens lead times. Customers are increasingly requesting that foundries supply machined components as it reduces handling as well as their cost to process. We focus on value-added precision machined components involving highly specialized and complex processes and, in some cases, difficult to machine materials. We are currently working to further increase our market position by expanding our value-adding machining capacity and our austempered ductile iron capabilities.

•  Continuous efficiency gains and cost reductions.  We continually seek ways to reduce our operating costs and increase our manufacturing productivity. We believe that a combination of pricing adjustments and cost savings has mitigated the impact of cost creep over the last two years. To further this objective, we have undertaken the following:

•  Installation of a new mold line at Neenah to replace our 40-year-old line.  We are continuing to invest in a $54 million capital project to install a state-of-the-art mold line to replace a 40-year-old mold line at our Neenah facility. We believe this new mold line, which is expected to be operational in the spring of 2008, will substantially improve our cost position on selected new and existing municipal parts, will substantially increase our capacity and molding capabilities, and will be one of the most capable mold lines for parts of this nature in North America.

•  Fully integrate lean manufacturing concepts.  We have incorporated and expect to continue to incorporate efficiencies in our operations through the implementation of lean manufacturing.

•  Centralized procurement of major raw materials and certain services through our head office in order to generate purchasing economies of scale.  We work closely with companies that are cost competitive and with which we have long-term relationships, providing us with competitive pricing and helping to assure us supply when raw material availability is limited.

•  Pursue selected acquisitions and internal growth opportunities.  We will continue to evaluate and may pursue selected acquisition and internal growth opportunities to enhance our position in our existing markets or to provide access to new markets and/or capabilities.

Business Segments — Overview

We have two reportable segments, castings and forgings. The castings segment manufactures and sells various grades of gray and ductile iron castings for the heavy municipal and industrial markets, while the forgings segment manufactures and sells steel forged components for the industrial market. The segments were determined based upon the production process utilized and the type of product manufactured. Approximately 92% of our net sales for fiscal 2007 was derived from our castings segment, with approximately 8% from our forgings segment.

Financial information about our reportable segments and geographic areas is contained in Note 10 in the Notes to Consolidated Financial Statements.

Castings Segment

We are a leading producer of iron castings for use in heavy municipal and industrial applications. We sell directly to state and local municipalities, contractors, precasters, supply houses, original equipment manufacturers (“OEMs”) and tier-one suppliers, as well as to other industrial end-users.

Products, Customers and Markets

The castings segment provides a variety of products to both the heavy municipal and industrial markets. Our broad range of heavy municipal iron castings include storm and sanitary sewer castings, manhole covers and

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frames, storm sewer frames and grates, heavy-duty airport castings, specialized trench drain castings, specialty flood control castings and ornamental tree grates. Customers for these products include state and local government entities, utility companies, precast concrete structure producers and contractors. Sales to the industrial market are comprised of differential carriers and differential cases, transmissions, gear and axle housings, yokes, planting and harvesting equipment parts, track drive and fifth wheel components, and compressor components. Markets for these products include medium and heavy-duty truck, construction and agricultural equipment and HVAC manufacturers.

A few large customers generate a significant amount of our net sales. See Item 1A, “Risk Factors — A relatively small number of customers account for a substantial portion of our revenues. The loss of one or more of them could adversely affect our net sales.”

Heavy Municipal

Our broad line of heavy municipal products consists of “standard” and “specialty” castings. Standard castings principally consist of storm and sanitary sewer castings that are consistent with pre-existing dimensional and strength specifications established by local authorities. Standard castings are generally higher volume items that are routinely used in new construction and infrastructure replacement. Specialty castings are generally lower volume products, such as heavy-duty airport castings, trench drain castings, flood control castings, special manhole and inlet castings and ornamental tree grates. These specialty items are frequently selected and/or specified from our municipal product catalog and tree grate catalog, which together encompass thousands of pattern combinations. For many of these products, we believe that we are the only manufacturer with existing patterns to produce such a particular casting.

Our municipal customers generally make purchase decisions based on a number of criteria, including acceptability of the product per local specification, quality, availability, price and the customer’s relationship with the foundry. We supply our municipal customers with anywhere from one up to thousands of municipal castings in any given year.

During the over 70 years that we have manufactured municipal products, we have emphasized servicing specific market needs and believe that we have built a strong reputation for customer service. We believe that we are one of the leaders in U.S. heavy municipal casting production and that we have strong name recognition. We have one of the largest sales and marketing forces of any foundry serving the heavy municipal market. Our dedicated sales force works out of regional sales offices and distribution yards to market municipal castings to contractors and state and local governmental entities throughout the United States. We operate 14 regional distribution and sales centers throughout the United States. We believe that this regional approach enhances our vast knowledge of local specifications and our leadership position in the heavy municipal market.

Industrial

Industrial castings are generally more complex and usually are produced in higher volumes than municipal castings. Complexity in the industrial market is determined by the intricacy of a casting’s shape, the thinness of its walls and the amount of processing by a customer required before a part is suitable for use. OEMs and their tier-one suppliers have been demanding more complex parts principally to reduce their own labor costs by using fewer parts to manufacture the same finished product or assembly and by using parts that require less subsequent processing before being considered a finished product.

We primarily sell our industrial castings to OEMs and tier-one suppliers with whom we have established close working relationships. These customers base their purchasing decisions on, among other things, our technical ability, price, service, quality assurance systems, facility capabilities and reputation. Our assistance in product engineering plays an important role in winning bids for industrial castings. For the average industrial casting, 12 to 18 months typically elapse between the completed design phase and full production. The product life cycle of a typical industrial casting in the markets we serve is quite long, in many cases over 10 years. Although the patterns for industrial castings are owned by the customer and not the foundry, industrial patterns are not readily transferable to other foundries without, in most cases, significant additional investment. Foundries, including our company, generally do not design industrial castings. Nevertheless, a close working relationship between the foundry and the customer during a product launch is critical to reduce potential production problems and minimize the customer’s

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risk of incurring lost sales or damage to its reputation due to a delayed launch. Involvement by a foundry early in the design process generally increases the likelihood that the customer will design a casting within the manufacturing capabilities of that foundry and also improves the likelihood that the foundry will be awarded the casting for full production.

We employ a dedicated industrial casting sales force organized by facility with a central repository for quote follow through. Our sales forces support ongoing customer relationships and work with customers’ engineers and procurement representatives as well as our own engineers, manufacturing management and quality assurance representatives throughout all stages of the production process to ensure that the final product consistently meets or exceeds the specifications of our customers. This team approach, consisting of sales, marketing, manufacturing, engineering and quality assurance efforts, is an integral part of our marketing strategy.

Manufacturing Process

Our foundries manufacture gray and ductile iron and cast it into intricate shapes according to customer metallurgical and dimensional specifications. We continually invest in upgrading our manufacturing capacity and in the improvement of process controls and believe that these investments and our significant experience in the industry have made us one of the more efficient manufacturers of industrial and heavy municipal casting products.

The sand casting process we employ involves using metal, wood or urethane patterns to make an impression of a desired shape in a mold made primarily of sand. Cores, also made primarily of sand, are used to make the internal cavities and openings in a casting. Once the casting impression is made in the mold, the cores are set into the mold and the mold is closed. Molten metal is then poured into the mold, which fills the mold cavity and takes on the shape of the desired casting. Once the iron has solidified and cooled, the mold sand is separated from the casting and the sand is recycled. The selection of the appropriate casting method, pattern, core-making equipment and sand, and other raw materials depends on the final product and its complexity, specifications and function as well as the intended production volumes. Because the casting process involves many critical variables, such as choice of raw materials, design and production of tooling, iron chemistry and metallurgy and core and molding sand properties, it is important to monitor the process parameters closely to ensure dimensional precision and metallurgical consistency. We continually seek out ways to expand the capabilities of existing technology to improve our manufacturing processes.

Through incorporation of lean manufacturing concepts, we continuously focus on productivity gains by improving upon the individual steps of the casting process such as reducing the amount of time required to make a pattern change or to produce a different casting product. Such improvements enable us to produce castings in low and medium volume quantities on high volume, cost-effective molding equipment. Additionally, our extensive effort in real time process controls permits us to produce a consistent, dimensionally accurate casting, which saves time and effort in the final processing stages of production. This dimensional accuracy contributes significantly to our manufacturing efficiency.

Continual testing and monitoring of the manufacturing process is important to maintain product quality. We, therefore, have adopted sophisticated quality assurance techniques and Six Sigma for our manufacturing operations. During and after the casting process, we perform numerous tests, including tensile, proof-load, radiography, ultrasonic, magnetic particle and chemical analysis. We utilize statistical process data to evaluate and control significant process variables and casting dimensions. We document the results of this testing in metallurgical certifications that are sometimes included with each shipment to our industrial customers. We strive to maintain systems that provide for continual improvement of operations and personnel, emphasizing defect prevention, safety and the reduction of variation and waste in all areas.

Raw Materials

The primary raw materials we use to manufacture ductile and gray iron castings are steel scrap, pig iron, metallurgical coke and sand (core sand and molding sand). While there are multiple suppliers for each of these commodities, we have generally elected to maintain single-source arrangements with our suppliers for most of these major raw materials. Due to long standing relationships with each of our suppliers, we believe that we will continue to be able to secure the proper amount and type of raw materials in the quantities required and at competitive prices,

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even when raw materials are in short supply. Our major supplier of metallurgical coke, a key raw material used in our iron melting process, ceased coking production and operations at its plant in May, 2007. We have secured other alternatives to ensure coke supply to our foundries. Increases in price or interruptions in the availability of coke could reduce our profits. See Item 1A, “Risk Factors — Increases in the price or interruptions in the availability of raw materials and energy could reduce our profits.”

Although the prices of the raw materials used vary, fluctuations in the cost of steel scrap are the most significant to us. We generally have arrangements with our industrial customers that enable us to adjust prices to reflect steel scrap cost fluctuations. In periods of rapidly rising or falling steel scrap costs, these adjustments will lag behind the current cost of steel scrap reflected in our casting price because they are generally based on average market prices for prior periods. Such prior periods vary by customer, but are generally no longer than one month. We generally recover steel scrap cost increases for municipal products through periodic price increases. However, castings are sometimes sold to the heavy municipal market on a bid basis and, after a bid is won, the price for the municipal casting generally is not adjusted for increases in the costs of raw materials. Rapidly fluctuating steel scrap costs may, therefore, have an adverse or positive effect on our business, financial condition and results of operations.

Seasonality and Cyclicality

We experience seasonality in our municipal business where sales tend to be higher during the construction season, which occurs during the warmer months, generally the third and fourth quarters of our fiscal year. We attempt to maintain level production throughout the year in anticipation of such seasonality and therefore do not experience significant production volume fluctuations. We build inventory in anticipation of the construction season. This inventory build-up has a negative impact on working capital and increases our liquidity needs during the second quarter. We have not historically experienced significant seasonality in industrial casting sales.

We have historically experienced some cyclicality in the heavy municipal market as sales of municipal products are influenced by, among other things, public spending and the state of the new housing market. There is generally not a large backlog of business in the municipal market due to the nature of the market. In the industrial market, we experience cyclicality in sales resulting from fluctuations in our markets, including the medium and heavy-duty truck and the construction and farm equipment markets, which are subject to general economic trends, and in recent years, the changes in Corporate Average Fuel Economy (CAFE) requirements.

Competition

The markets for our products are highly competitive. Competition is based mainly on price, but also on quality of product, range of capability, level of service and reliability of delivery. We compete with numerous domestic foundries, as well as with some foreign iron foundries. We also compete with several large domestic manufacturers whose products are made with materials other than ductile and gray iron, such as steel or aluminum. Industry consolidation over the past 20 years has resulted in a significant reduction in the number of foundries and a rise in the share of production by the remaining foundries, some of which have significantly greater financial resources than do we. Competition from foreign foundries has had an ongoing presence in the industrial and heavy municipal market and continues to be a factor.

Forgings Segment

Our forgings segment, operated by Mercer, produces complex-shaped forged steel and micro alloy components for use in transportation, railroad, mining and heavy industrial applications. Mercer sells directly to OEMs and tier-one suppliers, as well as to industrial end-users. Mercer’s subsidiary, A&M Specialties, Inc., machines forgings and castings for Mercer and various industrial customers.

Products, Customers and Markets

Mercer produces hundreds of individually forged components and has developed specialized expertise in forgings of micro alloy steel. Mercer currently operates mechanical press lines, from 1,300 tons to 4,000 tons. Mercer’s primary customers include manufacturers of components and assemblies for heavy-duty trucks, railroad equipment and construction equipment.

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Mercer’s in-house sales organization is integrated with NEI and sells directly to end-users and OEMs. A key element of Mercer’s sales strategy is its ability to develop strong customer relationships through responsive engineering capability, dependable quality and reliable delivery performance.

Demand for forged products closely follows the general business cycles of the various market segments and the demand level for capital goods. While there is a more consistent base level of demand for the replacement parts portion of the business, the strongest expansions in the forging industry coincide with the periods of industrial segment economic growth.

Manufacturing Process

In forging, metal is pressed, pounded or squeezed under great pressure, with or without the use of heat, into parts that retain the metal’s original grain flow, imparting high strength. Forging usually entails one of four principal processes: impression die; open die; cold; and seamless rolled ring forging. Impression die forging, commonly referred to as “closed die” forging, is the principal process employed by Mercer, and involves bringing two or more dies containing “impressions” of the part shape together under extreme pressure, causing the bar stock to take the desired shape. Because the metal flow is restricted by the die, this process can yield more complex shapes and closer tolerances than the “open die” forging process. Impression die forging is used to produce products such as military and off-highway track and drive train parts; automotive and truck drive train and suspension parts; railroad engine, coupling and suspension parts; military ordinance parts and other items where close tolerances are required.

Once a rough forging is shaped, regardless of the forging process, it must generally still be machined. This process, known as “finishing” or “conversion,” smoothes the component’s exterior and mating surfaces and adds any required specification, such as groves, threads and bolt holes. The finishing process can contribute significantly to the value of the end product, in particular in certain custom situations where high value specialized machining is required. Machining can be performed either in-house by the forger, by a machine shop which performs this process exclusively or by the end-user.

Mercer’s internal staff of engineers designs impression dies to meet customer specifications incorporating computer assisted design workstations for the design. Management believes that Mercer is an industry leader in forging techniques using micro alloy steel which produces parts which are lighter and stronger than those forged from conventional carbon steel.

Raw Materials

The principal raw materials used in Mercer’s products are carbon and micro alloy steel. Mercer purchases substantially all of its carbon steel from four principal sources. While Mercer has never suffered any significant interruption of materials supply, management believes that, in the event of any disruption from any individual source, adequate alternative sources of supply are available within the immediate vicinity.

Seasonality and Cyclicality

Mercer experiences only minimal seasonality in its business. Mercer has experienced cyclicality in sales resulting from fluctuations in the medium and heavy-duty truck market and the heavy industrial market, which are subject to general economic trends.

Competition

Mercer competes primarily in a highly fragmented industry which includes several dozen other press forgers and hammer forge shops. Hammer shops cannot typically match press forgers for high volume, single component manufacturing or close tolerance production. Competition in the forging industry has also historically been determined both by product and geography, with a large number of relatively small forgers across the country carving out their own product and customer niches. In addition, most end-users manufacture some forgings internally, often maintaining a critical minimum level of production in-house and contracting out the balance. The primary basis of competition in the forging industry is price, but engineering, quality and dependability are also important, particularly with respect to building and maintaining customer relationships. Some of Mercer’s

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competitors have significantly greater resources than Mercer. There can be no assurance that Mercer will be able to maintain or improve its competitive position in the markets in which it competes.

Employees

As of September 30, 2007, we had 2,757 full time employees, of whom 2,205 were hourly employees and 552 were salaried employees. Approximately 80% of our hourly employees are represented by unions. Nearly all of the hourly employees at Neenah, Dalton, Advanced Cast Products and Mercer are members of either the United Steelworkers of America or the Glass, Molders, Pottery, Plastics and Allied Workers International Union. A collective bargaining agreement is negotiated every two to five years. The material agreements expire as follows: Neenah, December 2011; Dalton-Warsaw, April 2008; Dalton-Kendallville, June 2009; Advanced Cast Products-Meadville, October 2010; and Mercer, June 2008. All employees at Deeter and Gregg are non-union. We believe that we have a good relationship with our employees.

Environmental Matters

Our facilities are subject to federal, state and local laws and regulations relating to the protection of the environment and worker health and safety, including those relating to discharges to air, water and land, the generation, handling and disposal of solid and hazardous waste, the cleanup of properties affected by hazardous substances, and the health and safety of our employees. Such laws include the Federal Clean Air Act, the Clean Water Act, the Resource Conservation and Recovery Act, the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, and the Occupational Health and Safety Act. Under certain environmental laws, we could be held responsible for all of the costs relating to any contamination at our past or present facilities and at third party waste disposal sites. We could also be held liable for any and all consequences arising out of human exposure to such substances or other environmental damage.

We had been operating our Gregg facility under the terms of an order for abatement with the California South Coast Air Quality Management District (SCAQMD), which expired on September 20, 2007. See Item 3, “Legal Proceedings.”

We believe we have no liabilities relating to environmental matters which would have a material adverse effect on our operations, financial condition or competitive position. However, the risk of environmental liability is inherent in the manufacture of castings and forgings. Any of our businesses might in the future incur significant costs to meet current or more stringent compliance, cleanup or other obligations pursuant to environmental requirements. Such costs may include expenditures related to remediation of historical releases of hazardous substances or clean-up of physical structures prior to decommissioning. We have incurred in the past, and expect to incur in the future, capital and other expenditures related to environmental compliance. Such expenditures are generally included in our overall capital and operating budgets and are not separately accounted for. However, we do not anticipate that compliance with existing environmental laws will have a material adverse effect on our capital expenditures, earnings or competitive position.

Under the Federal Clean Air Act Amendments of 1990, the Environmental Protection Agency is directed to establish maximum achievable control technology (MACT) standards for certain industrial operations that are major sources of hazardous air pollutants. The iron foundry industry was required to comply with the MACT requirements by April 23, 2007. Our Neenah foundry and both Dalton foundries are subject to this requirement (due to their size). Our Dalton facilities received one-year extensions, which requires them to be in compliance by April 23, 2008. A majority of the capital expenditures necessary to bring these three facilities into compliance with MACT requirements has already been made. We expect our Neenah facility to be in a position to demonstrate compliance with the requirements and we expect our Dalton facilities will demonstrate MACT compliance by the applicable deadline.

The Clean Water Act requires point dischargers to obtain storm water discharge permits. In Wisconsin, Neenah is covered by the state’s General Permit to Discharge Storm Water Associated with Industrial Activity. The Wisconsin Department of Natural Resources, which is authorized to administer the storm water program, has adopted new benchmark values for various storm water contaminants. In fiscal year 2007, Neenah substantially

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completed a $1.5 million project for storm water treatment devices that will allow it to achieve compliance with the new benchmarks.

Intellectual Property

We have registered, or are in the process of registering, various trademarks and service marks with the U.S. Patent and Trademark Office.

Item 1A.   Risk Factors

Owning our securities involves a high degree of risk. The risks described below are not the only risks facing us. Additional risks and uncertainties not currently known to us or those we currently view to be immaterial may also materially and adversely affect our business, financial condition or results of operations. If any of the following risks materialize, our business, financial condition or results of operations could be materially and adversely affected. In that case, security holders may lose some or all of their investment.

A relatively small number of customers account for a substantial portion of our revenues. The loss of one or more of them could adversely affect our net sales.

A few large customers generate a significant amount of our net sales.

•  Sales to our largest customer and suppliers of that customer accounted for approximately 9% of our total net sales for the fiscal year ended September 30, 2007.

•  Sales to our top five customers and suppliers of those customers accounted for approximately 30% of our total net sales for the fiscal year ended September 30, 2007.

The loss of one or more of these large customers, therefore, could adversely affect our net sales. We do not generally have long-term contracts with our customers and we also do not own the patterns used to produce industrial castings. As a result, our customers could switch to other suppliers at any time. If our customers should move production of their products outside the United States, they would likely attempt to find local suppliers for the components they purchase from us.

Certain of our largest industrial customers, particularly in the heavy-duty truck market, are experiencing financial challenges. The loss of any of our major customers could adversely affect our net sales, financial condition and results of operations.

Decreases in demand for heavy-duty trucks, HVAC equipment, construction or farm equipment or other end markets could have a significant impact on our profitability, cash flows and ability to service our indebtedness.

Our Company has historically experienced industry cyclicality in most of our industrial markets, including the truck and farm equipment markets. These industries and markets fluctuate in response to factors that are beyond our control, such as general economic conditions, interest rates, federal and state regulations, consumer spending, fuel costs and our customers’ inventory levels and production rates. These major markets will likely continue to experience such fluctuations. A downturn in one or more of these markets could reduce demand for, and prices of, our products. Such a downturn in one or more of these major markets could have a significant negative impact on sales of our products, which could lower our profitability, cash flows, and ability to service our indebtedness. Historically, our heavy municipal business has been less cyclical than our industrial markets. We have historically experienced some cyclicality in the heavy municipal market as sales of municipal products are influenced by, among other things, public spending and the state of the new housing market. We experienced such a downturn in several of these markets for the year ended September 30, 2007, which adversely impacted our sales.

Due to new emissions standards that took effect on January 1, 2007, heavy-duty truck production declined significantly beginning early in calendar 2007, as many customers accelerated purchases to 2006, artificially increasing 2006 sales in the heavy-duty truck market. Additional emissions regulations are scheduled to take effect in calendar 2010, which may have a similar effect of accelerating sales to 2009. In addition, housing starts declined

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in calendar 2007, reflecting softness in the overall housing sector. As a result, we experienced a decline in our sales into these end-markets which adversely impacted our profitability and cash flows.

Our market share may be adversely impacted at any time by a significant number of competitors.

The markets in which we compete are highly competitive and are expected to remain so. The foundry industry overall has excess capacity, which exerts downward pressure on prices of our products. We may be unable to maintain or improve our competitive position in the markets in which we compete. Although quality of product, range of capability, level of service and reliability of delivery are important factors in selecting foundry suppliers, we are also forced to compete on price. We compete with numerous domestic and some foreign foundries. Although our castings are manufactured from ductile and gray iron, we also compete in our industrial markets with several manufacturers whose products are made with other materials, such as steel or aluminum. Industry consolidation over the past 20 years has significantly reduced the number of foundries operating in the United States. While such consolidation has translated into greater market share for the remaining foundries, some of these remaining foundries have significantly greater financial resources than we do and may be better able to sustain periods of decreased demand or increased pricing pressure. At the same time, the prices of products imported from foreign foundries, particularly from China, India, Mexico and South America, are generally lower than the prices we charge to our customers. Countervailing duties and/or anti-dumping orders on imports currently apply to China, Brazil, Mexico and Canada, and any reduction thereof could increase foreign competition. Furthermore, despite the reduction in the number of domestic operating foundries, total production capacity continues to exceed demand. Any of these factors could impede our ability to remain competitive in the markets in which we operate.

International economic and political factors could affect demand for products which could impact our financial condition and results of operations.

Our operations may be affected by actions of foreign governments and global or regional economic developments. Global economic events, such as foreign countries’ import/export policies, the cost of complying with environmental regulations or currency fluctuations, could also affect the level of U.S. imports and exports, thereby affecting our sales. Foreign subsidies, foreign trade agreements and each country’s adherence to the terms of such agreements can raise or lower demand for castings produced by us and other U.S. foundries. National and international boycotts and embargoes of other countries’ or U.S. imports and/or exports together with the raising or lowering of tariff rates could affect the level of competition between us and our foreign competitors. If the value of the U.S. dollar strengthens against other currencies, imports to the United States may increase and put downward pressure on the prices of our products, which may adversely affect our sales, margins and profitability. Such actions or developments could have a material adverse effect on our business, financial condition and results of operations.

Increases in the price or interruptions in the availability of raw materials and energy could reduce our profits.

The costs and availability of raw materials and energy represent significant factors in the operations of our business. As a result of domestic and international events, the prices and availability of our key raw materials and energy fluctuate. We have single-source, just-in-time arrangements with many of our suppliers for the major raw materials that we use. If a single-source supplier were to become unable or unwilling to furnish us with essential materials for any reason, that could impair our ability to manufacture some of our products. Potential causes of such interruptions could include, among others, any casualty, labor unrest, or regulatory problems of the supplier, or a change in ownership of a supplier leading to subsequent business decisions that do not align with our own business interests. Also, the failure of these single-source arrangements to result in the most highly competitive prices for raw materials could increase our cost of sales and lower our profit. If our raw material or energy costs increase, we may not be able to pass these higher costs on to our customers in full or at all. Our major supplier of metallurgical coke, a key raw material used in our iron melting process, ceased coking production and operations at its plant in May, 2007. We have secured other alternatives to ensure coke supply to our foundries. Increases in price or interruptions in the availability of coke could reduce our profits.

Of all the varying costs of raw materials, fluctuations in the cost of steel scrap impact our business the most. The cost for steel scrap is subject to market forces that are unpredictable and largely beyond our control, including

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demand by U.S. and international foundries, freight costs and speculation. Although we have arrangements with our industrial customers that enable us to adjust industrial casting prices to reflect steel scrap cost fluctuations, these adjustments lag behind the current cost of steel scrap during periods of rapidly rising or falling steel scrap costs because these adjustments are generally based on average market costs for prior periods. We generally recover steel scrap cost increases for municipal products through periodic price increases. However, castings are sometimes sold to the heavy municipal market on a bid basis and, after a bid is won, the price for the municipal casting generally is not adjusted for increases in the costs of raw materials. Rapidly fluctuating steel scrap costs may, therefore, have an adverse or positive effect on our business, financial condition and results of operations.

We may incur potential product liability and recall costs.

We are subject to the risk of exposure to product liability and product recall claims in the event any of our products results in property damage, personal injury or death, or does not conform to specifications. We may not be able to continue to maintain suitable and adequate insurance on acceptable terms that will provide adequate protection against potential liabilities. In addition, if any of our products proves to be defective, we may be required to participate in a recall involving such products. A successful claim brought against us in excess of available insurance coverage, if any, or a requirement to participate in a major product recall, could have a material adverse effect on our business, results of operations or financial condition.

Litigation against us could be costly and time consuming to defend.

We and our subsidiaries are regularly subject to legal proceedings and claims that arise in the ordinary course of business. We are also subject to workers’ compensation claims (including those related to silicosis), employment disputes, unfair labor practice charges, customer and supplier disputes, product liability claims and contractual disputes related to warranties and guarantees arising out of the conduct of our business. Litigation may result in substantial costs and may divert management’s attention and resources, which could adversely affect our business, results of operations or financial condition.

The departure of key personnel could adversely affect our operations.

The success of our business depends upon our senior management closely supervising all aspects of our business. We believe our senior management has technological and manufacturing experience that is important to the metal casting and forging business. The loss of such key personnel could have a material adverse effect on our operations if we were unable to attract and retain qualified replacements.

In addition, we have from time to time experienced difficulty hiring enough skilled employees with the necessary expertise to build the products ordered by our customers in the metal casting and forging business. An inability to hire and retain such employees could have a material adverse effect on our operations.

The seasonal nature of our business could impact our business, financial condition and results of operations.

Our municipal business is seasonal. Therefore, our quarterly revenues and profits historically have been lower during the first and second fiscal quarters of the year (October through March) and higher during the third and fourth fiscal quarters (April through September). In addition, our working capital requirements fluctuate throughout the year. Adverse market or operating conditions during any seasonal part of the fiscal year could have a material adverse effect on our business, financial condition and results of operations.

We face the risk of work stoppages or other labor disruptions that could impact our results of operations negatively.

As of September 30, 2007, approximately 80% of our workforce consisted of hourly employees, and of those approximately 80% are represented by unions. Nearly all of the hourly employees at Neenah, Dalton, Advanced Cast Products and Mercer are members of either the United Steelworkers of America or the Glass, Molders, Pottery, Plastics and Allied Workers International Union. As a result, we could experience work stoppages or other labor disruptions. If this were to occur, we may not be able to satisfy our customers’ orders on a timely basis.

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The nature of our business exposes us to liability for violations of environmental regulations and releases of hazardous substances.

The risk of environmental liability is inherent in the manufacturing of casting and forging products. We are subject to numerous laws and regulations governing, among other things: discharges to air, water and land; the generation, handling and disposal of solid and hazardous waste; the cleanup of properties affected by hazardous substances; and the health and safety of our employees. Changes in environmental laws and regulations, or the discovery of previously unknown contamination or other liabilities relating to our properties and operations, could require us to sustain significant environmental liabilities which could make it difficult to pay the interest or principal amount of the notes when due. In addition, we might incur significant capital and other costs to comply with increasingly stringent emission control laws and enforcement policies which could decrease our cash flow available to service our indebtedness. We are also required to obtain permits from governmental authorities for certain operations. We cannot assure you that we have been or will be at all times in complete compliance with such laws, regulations and permits. If we violate or fail to comply with these laws, regulations or permits, we could be fined or otherwise sanctioned by regulators.

Under certain environmental laws, we could be held responsible for all of the costs relating to any contamination at our past or present facilities and at third party waste disposal sites. We could also be held liable for any and all consequences arising out of human exposure to such substances or other environmental damage.

Environmental laws are complex, change frequently and have tended to become increasingly stringent over time. We incur operating costs and capital expenditures on an ongoing basis to ensure our compliance with applicable environmental laws and regulations. We cannot assure you that our costs of complying with current and future environmental and health and safety laws and regulations, and our liabilities arising from past or future releases of, or exposure to, hazardous substances will not adversely affect our business, results of operations or financial condition. See Item 1, “Business” under the heading “Environmental Matters.”

Failure to raise necessary capital could restrict our ability to operate and further develop our business.

Our capital resources may be insufficient to enable us to maintain operating profitability. Failure to generate or raise sufficient funds may require us to delay or abandon some expansion plans or expenditures, which could harm our business and competitive position.

We estimate that our aggregate capital expenditures and debt service requirements in fiscal 2008 will include the following:

•  approximately $25.0 million primarily for necessary maintenance capital expenditures and selected strategic capital investments required to maintain optimum operating efficiencies, not including the new mold line described elsewhere herein;

•  approximately $24.4 million for Neenah’s new mold line (the remaining portion of the total cost of approximately $54 million); and

•  approximately $30.8 million for debt service on Neenah’s 91/2% Senior Secured Notes due 2017 (the “91/2% Notes”) and Neenah’s 121/2% Senior Subordinated Notes due 2013 (the “121/2% Notes”) plus any additional interest expense from amounts outstanding under Neenah’s $100 million revolving loan and security agreement (the “2006 Credit Facility”).

In addition, we will require funds for general corporate expenses, other expenses (including pension funding discussed in Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Contractual Obligations”), certain environmental capital expenditures and for working capital needs.

On December 29, 2006, we closed on the refinancing transactions described in Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Recent Developments — Refinancing Transactions.” We may choose to meet any additional financial needs by borrowing additional funds under the 2006 Credit Facility or from other sources. As of September 30, 2007, we had approximately $17.2 million outstanding and approximately $78.7 million of availability under Neenah’s 2006 Credit Facility. Our ability to issue debt securities, borrow funds from additional lenders and participate in vendor financing programs are

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restricted under the terms of the 2006 Credit Facility, the indenture governing Neenah’s 91/2% Notes and Neenah’s 121/2% Notes. Furthermore, the lenders may not waive these restrictions if additional financing is needed beyond that which is currently permitted.

We may not achieve the expected benefits of Neenah’s new mold line on a timely basis or at all.

As part of our business strategy, we are proceeding with a $54 million capital project to replace an existing mold line at our Neenah facility. We expect the new mold line to become operational in the spring of 2008. We believe we have access to sufficient funds to support this project. However, similar to other large capital expenditure projects, we are at risk to many factors beyond our control that may prevent or hinder our implementation of the new mold line or lead to cost overruns, including new or more expensive obligations to comply with environmental regulations, technical or mechanical problems, construction delays, shortages of equipment, materials or skilled labor, lack of available capital and other factors. Even if we effectively implement this project, we may not be able to capitalize on the additional capacity the mold line will provide, which may result in sales or profitability at lower levels than anticipated. Failure to successfully implement this business strategy on a timely basis or at all may adversely affect our business prospects and results of operations.

If we are unable to integrate acquired businesses, that may adversely affect operations.

As part of our business strategy, we will continue to evaluate and may pursue selected acquisition opportunities that we believe may provide us with certain operating and financial benefits. If we complete any such acquisitions, they may require integration into Neenah’s existing business with respect to administrative, financial, sales and marketing, manufacturing and other functions to realize these benefits. If we are unable to successfully integrate an acquisition, we may not realize the benefits identified in our due diligence process, and our financial results may be negatively impacted. Additionally, significant unexpected liabilities may arise after completion of an acquisition.

Our controlling stockholders may have interests that differ from the interests of other investors.

A majority of our outstanding stock on both an actual and a fully-diluted basis is owned by two affiliated investment funds, Tontine Capital Partners, L.P. (“TCP”) and Tontine Capital Overseas Master Fund, L.P. (“TCO” and, together with TCP, “Tontine”). As a result, Tontine controls our affairs, including the election of directors who in turn appoint management. Tontine controls any action requiring the approval of the holders of stock, including adoption of amendments to our corporate charter and approval of a merger or sale of all or substantially all assets. It also controls decisions affecting our capital structure, such as decisions regarding the issuance of additional capital stock, the implementation of stock repurchase programs and the declaration of dividends. The interests of Tontine may not in all cases be aligned with the interests of other investors. Additionally, Tontine is in the business of investing in companies and may, from time to time, acquire and hold interests in businesses that compete directly or indirectly with us. Tontine may also pursue acquisition opportunities that may be complementary to our business and, as a result, those acquisition opportunities may not be available to us.

Terrorist attacks could adversely affect our results of operations, our ability to raise capital or our future growth.

The impact that terrorist attacks, such as those carried out on September 11, 2001, and the war in Iraq, as well as events occurring in response to or in connection with them, may have on our industry in general, and on us in particular, is unknown at this time. Such attacks, and the uncertainty surrounding them, may impact our operations in unpredictable ways, including disruptions of rail lines, highways and fuel supplies and the possibility that our facilities could be direct targets of, or indirect casualties of, an act of terror. In addition, war or risk of war may also have an adverse effect on the economy. A decline in economic activity could adversely affect our revenues or restrict our future growth. Instability in the financial markets as a result of terrorism or war could also affect our ability to raise capital. Such attacks may lead to increased volatility in fuel costs and availability and could affect the results of operations. In addition, the insurance premiums charged for some or all of the coverages we currently maintain could increase dramatically, or the coverages could be unavailable in the future.

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Our substantial indebtedness could adversely affect our financial health.

We have a significant amount of indebtedness. At September 30, 2007, Neenah and its subsidiaries had approximately $226.4 million of secured indebtedness outstanding consisting of approximately $1.4 million of capital lease obligations and $225.0 million of 91/2% Notes. Neenah also had $75.0 million of 121/2% Notes outstanding (which are unsecured senior subordinated notes). In addition, at September 30, 2007, Neenah had approximately $17.2 million of secured borrowings outstanding under the 2006 Credit Facility and had unused availability of $78.7 million. We expect to further increase our overall debt during the next 6 months to fund the new mold line.

Our substantial indebtedness could have important consequences to our stockholders. For example, it could:

•  make it more difficult for us to satisfy our obligations with respect to our outstanding notes;

•  increase our vulnerability to general adverse economic and industry conditions;

•  require us to dedicate a substantial portion of our cash flow from operations to payments on our indebtedness, thereby reducing the availability of our cash flow to fund working capital, capital expenditures, research and development efforts and other general corporate purposes;

•  increase our vulnerability to and limit our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate;

•  expose us to the risk of increased interest rates as borrowings under our 2006 Credit Facility will be subject to variable rates of interest;

•  place us at a competitive disadvantage compared to our competitors that have less debt; and

•  limit our ability to borrow additional funds.

In addition, the indenture for Neenah’s 91/2% Notes, Neenah’s 121/2% Notes and Neenah’s 2006 Credit Facility contain financial and other restrictive covenants that limit our ability to engage in activities that may be in our long-term best interests. Our failure to comply with those covenants could result in an event of default which, if not cured or waived, could result in the acceleration of all of our debts.

Despite our current substantial indebtedness levels, we and our subsidiaries may still be able to incur substantially more debt. This could intensify the risks associated with our substantial leverage.

We and our subsidiaries may be able to incur substantial additional indebtedness in the future because the terms of the indenture governing Neenah’s 91/2% Notes, Neenah’s 121/2% Notes and Neenah’s 2006 Credit Facility do not fully prohibit us or our subsidiaries from doing so. In addition, subject to covenant compliance and certain conditions, Neenah’s 2006 Credit Facility would have permitted additional borrowings of approximately $78.7 million as of September 30, 2007. If new indebtedness is added to the current debt levels of Neenah and our other subsidiaries, the related risks that we and they now face could intensify.

To service our indebtedness, we will require a significant amount of cash. Our ability to generate cash depends on many factors beyond our control.

Our ability to make payments on and to refinance our indebtedness and to fund planned capital expenditures, research and development efforts and other cash needs will depend on our ability to generate cash in the future. This, to a certain extent, is subject to general economic, financial, competitive, legislative, regulatory and other factors that are beyond our control.

We cannot assure you that our business will generate sufficient cash flow from operations or that future borrowings will be available to us under Neenah’s 2006 Credit Facility or otherwise in an amount sufficient to enable us to pay our indebtedness, including our outstanding notes, or to fund our other liquidity needs. We may need to refinance all or a portion of our indebtedness on or before the maturity thereof. We cannot assure stockholders that we will be able to refinance any of our indebtedness on commercially reasonable terms or at all. If we cannot service our indebtedness, we may have to take actions such as selling assets, seeking additional equity or

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reducing or delaying capital expenditures, strategic acquisitions, investments and alliances. We cannot assure stockholders that any such actions, if necessary, could be effected on commercially reasonable terms or at all.

The terms of Neenah’s debt impose restrictions on us that may affect our ability to successfully operate our business.

Neenah’s 2006 Credit Facility, the indenture governing the 91/2% Notes and the 121/2% Notes contain covenants that limit our actions. These covenants could materially and adversely affect our ability to finance our future operations or capital needs or to engage in other business activities that may be in our best interests. The covenants limit our ability to, among other things:

•  incur or guarantee additional indebtedness;

•  pay dividends or make other distributions on capital stock;

•  repurchase capital stock;

•  make loans and investments;

•  enter into agreements restricting our subsidiaries’ ability to pay dividends;

•  create liens;

•  sell or otherwise dispose of assets;

•  enter new lines of business;

•  merge or consolidate with other entities; and

•  engage in transactions with affiliates.

Neenah’s 2006 Credit Facility also contains financial covenants. Our ability to comply with these covenants and requirements may be affected by events beyond our control, such as prevailing economic conditions and changes in regulations, and if such events occur, we cannot be sure that we will be able to comply. A breach of these covenants could result in a default under the indenture governing the 91/2% Notes, under the 121/2% Notes and/or the 2006 Credit Facility. If there were an event of default under the indenture for the 91/2% Notes, under the 121/2% Notes and/or the 2006 Credit Facility, holders of such defaulted debt could cause all amounts borrowed under these instruments to be due and payable immediately and the lenders under the 2006 Credit Facility could terminate their commitments to lend. We cannot assure stockholders that our assets or cash flow will be sufficient to repay borrowings under the outstanding debt instruments in the event of a default thereunder.

Our financial information before October 1, 2003 is not directly comparable to our financial information after that date.

As a result of the consummation of the Plan of Reorganization on October 8, 2003 (the “Effective Date”), we began operating our business under a new capital structure and became subject to the fresh-start reporting rules. Fresh-start reporting required that we establish a “fair value” basis for the carrying value of the assets and liabilities of our reorganized company. We implemented fresh-start reporting as of October 1, 2003. Accordingly, our financial condition and results of operations before October 1, 2003 are not directly comparable to the financial condition or results of operations after that date that are contained in this Annual Report on Form 10-K. See Item 6, “Selected Financial Data.”

Risks Relating to Our Common Stock

There is no history of public trading for our shares and an active trading market for our common stock may not develop.

Historically, there has been no public market for our shares of common stock. We have registered our common stock under Section 12(g) of the Securities Exchange Act of 1934 and our shares of common stock are quoted on the OTC Bulletin Board. In addition, in the future, we anticipate that we will seek to have our shares of common stock

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listed on The Nasdaq Stock Market if and when we satisfy the eligibility requirements, but there is no assurance that we will be successful in doing so. Despite our expectations to have our common stock listed for trading, an active trading market for our shares may not develop or be sustained. Accordingly, stockholders may not be able to sell their shares quickly or at the market price if trading in our stock is not active.

Our charter documents contain provisions that may discourage, delay or prevent a change of control.

Some provisions of our certificate of incorporation and bylaws could make it more difficult for a third party to acquire control of us, even if the change in control would be beneficial to stockholders. As described in the “Introduction” section of this registration statement, our certificate of incorporation and bylaws include the following:

•  ability of our board of directors to authorize the issuance of preferred stock in series without stockholder approval;

•  vesting of exclusive authority in the board of directors to determine the size of the board and to fill vacancies (within specified limits);

•  advance notice requirements for stockholder proposals and nominations for election to the board of directors; and

•  prohibitions on our stockholders from acting by written consent and limitations on calling special meetings of stockholders.

We do not expect to pay any dividends for the foreseeable future.

We do not anticipate paying any dividends to our stockholders for the foreseeable future. Neenah’s 2006 Credit Facility and the indenture for Neenah’s 91/2% Notes and its 121/2% Notes also restrict our ability to pay dividends, with limited exceptions. Any determination to pay dividends in the future will be made at the discretion of our board of directors and will depend on our results of operations, financial conditions, contractual restrictions, restrictions imposed by applicable law and other factors our board of directors deems relevant.

The price of our common stock may fluctuate significantly, which could lead to losses for stockholders.

The trading prices of the stock of newly public companies can experience extreme price and volume fluctuations. These fluctuations often can be unrelated or out of proportion to the operating performance of these companies. We expect our stock price to be similarly volatile. These broad market fluctuations may continue and could harm our stock price. Any negative change in the public’s perception of the prospects of U.S. foundry companies or of the markets into which we sell our castings and forgings could also depress our stock price, regardless of our actual results.

Factors affecting the trading price of our common stock will include (among others):

•  variations in our operating results;

•  expenses associated with accounting and internal control requirements applicable to public companies;

•  announcements of strategic alliances or significant agreements by us or by our competitors;

•  recruitment or departure of key personnel;

•  changes in the estimates of our operating results or changes in recommendations by any securities analyst that elects to follow our common stock;

•  market conditions in our industry, the industries of our customers and the economy as a whole;

•  sales of large blocks of our common stock; and

•  changes in accounting principles or changes in interpretations of existing principles, which could affect our financial results.

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Substantial sales of our common stock by our stockholders could depress our stock price regardless of our operating results.

As of December 7, 2007, we had 13,741,337 shares of common stock outstanding, and we had warrants outstanding that are exercisable for an additional 2,468,658 shares of common stock at an exercise price of $0.05 per share. Substantially all of these shares of our common stock will be eligible for resale, in some cases subject to volume restrictions. As of December 7, 2007, Tontine beneficially owned 9,065,697 shares of our common stock, which represents approximately 56% of our common stock on a fully-diluted basis and approximately 66% of the shares actually outstanding. In addition, two other institutions each own in excess of 5% of our common stock actually outstanding and on a fully-diluted basis. Sales of substantial amounts of our common stock in the public market by Tontine, these other large holders or by our other stockholders could reduce the prevailing market prices for our common stock.

If equity research analysts do not publish research or reports about our business or if they issue unfavorable commentary or downgrade our common stock, the price of our common stock could decline.

The trading market for our common stock may rely in part on whether there are research and reports that equity research analysts publish about us and our business. We do not control the opinions of these analysts. The price of our stock could decline if one or more equity analysts downgrade our stock or if those analysts issue other unfavorable commentary or cease publishing reports about us or our business.

The availability of shares for issuance in the future could reduce the market price of our common stock.

In the future, we may issue securities to raise cash for acquisitions or other corporate purposes. We may also acquire interests in outside companies by using a combination of cash and our common stock or just our common stock. We may also issue securities convertible into our common stock. Any of these events may dilute our stockholders’ ownership interests in our company and have an adverse impact on the price of our common stock.

In addition, sales of a substantial amount of our common stock in the public market, or the perception that these sales may occur, could reduce the market price of our common stock. This could also impair our ability to raise additional capital through the sale of our securities.

We will incur significant increased costs as a result of operating as a public company, and our management will be required to devote substantial time to new compliance initiatives.

As a public company, we will incur significant legal, accounting and other expenses that we have not incurred as a private company. The Sarbanes-Oxley Act of 2002, as well as new rules subsequently implemented by the Securities and Exchange Commission, have imposed various new requirements on public companies, including requiring changes in corporate governance practices. Our management and other personnel will need to devote a substantial amount of time to these new compliance initiatives. Moreover, these rules and regulations will increase our legal and financial compliance costs and will make some activities more time-consuming and costly. For example, these new rules and regulations could make it more difficult and more expensive for us to obtain director and officer liability insurance and we may be required to incur substantial costs to maintain the same or similar coverage.

Item 1B.   Unresolved Staff Comments

None.

Item 2.   Properties

We maintain the following manufacturing, machining and office facilities. We own all of the facilities except Mercer’s machining facility, which we lease.

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Entity	Location	Purpose	Sq. Feet
Castings Segment
Neenah Foundry Company	Neenah, WI	2 manufacturing facilities and office facility		550,000
Dalton Corporation	Warsaw, IN	Manufacturing and office facilities		375,000
	Kendallville, IN	Manufacturing facility		250,000
	Stryker, OH	Machining facility		45,000
Advanced Cast Products, Inc.	Meadville, PA	Manufacturing, machining and office facility		229,000
Deeter Foundry, Inc.	Lincoln, NE	Manufacturing and office facility		75,000
Gregg Industries, Inc.	El Monte, CA	Manufacturing, machining and office facility		200,000
Forgings Segment
Mercer Forge Corporation	Mercer, PA	Manufacturing, machining and office facility		130,000
	Wheatland, PA	Machining facility		18,000

The principal equipment at the facilities consists of foundry equipment used to make castings, such as melting furnaces, core making machines and mold lines, including ancillary equipment needed to support a foundry operation and presses used to make forgings. We regard our plant and equipment as appropriately maintained and adequate for our needs. We are proceeding with a major capital project to install a new mold line at our Neenah location. This project will result in a building expansion that will add approximately 75,000 square feet of manufacturing area to the plant. In addition to the facilities described above, we operate 14 distribution and sales centers. We own six of those properties and lease eight of them.

Substantially all of our tangible and intangible assets are pledged to secure our existing credit facility and our 91/2% Notes. See Note 5 in the Notes to Consolidated Financial Statements in this report.

Item 3.   Legal Proceedings

We are involved in various claims and litigation in the normal course of business. In the judgment of management, the ultimate resolution of these matters is not likely to materially affect our consolidated financial statements.

Due to neighborhood complaints, we were operating the Gregg facility under the terms of an order for abatement with the California South Coast Air Quality Management District (SCAQMD). Despite being in compliance with federal and state emission laws, the order required us to comply with certain operating parameters in an effort to reduce odors. Failure to operate within such criteria could have resulted in the SCAQMD terminating operations at the Gregg facility. The order expired on September 20, 2007 and Gregg is currently negotiating settlements with the SCAQMD regarding outstanding notices of violation (NOV’s). Gregg does not expect any issues in settling the NOV’s and is expecting to conclude negotiations in January 2008. We believe we are in compliance with all other operating requirements and that our actions have resulted in a substantial reduction in the intensity and frequency of downwind odors.

In fiscal 2007, we settled a previously disclosed claim from an investment bank for $3.34 million in fees allegedly arising from Tontine’s acquisition of control of the Company in May 2006. We paid $1.5 million to settle the claim.

Item 4.   Submission of Matters to a Vote of Security Holders

There were no matters submitted to a vote of security holders during the quarter ended September 30, 2007.

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Executive Officers of the Registrant

Set forth below are the names, ages, positions and experience of our executive officers. All executive officers are appointed by the board of directors.

Name	Age		Position
Robert E. Ostendorf, Jr.		57	President and Chief Executive Officer
Gary W. LaChey		62	Corporate Vice President — Finance, Treasurer, Secretary and Chief Financial Officer
James V. Ackerman		64	Division President — Mercer Forge Corporation
John H. Andrews		62	Neenah Corporate Vice President — Manufacturing, Chief Operating Officer of Manufacturing Operations
Louis E. Fratarcangeli		57	Neenah Corporate Vice President — Industrial Products Sales
Frank Headington		58	Neenah Corporate Vice President — Technology
Timothy Koller		58	Neenah Vice President — Municipal Products Sales and Engineering

Mr. Ostendorf joined Neenah in July 2007 as President, Chief Executive Officer and a director. Prior to joining the Company, Mr. Ostendorf was Chief Executive Officer since 2004 of Amcan Consolidated Technology Corp. (ACT), a supplier of cast components to the automotive industry and the Canadian subsidiary of Honsel International Technologies SA (HIT). Mr. Ostendorf was also a director of HIT. HIT disposed of various portions of ACT and following Mr. Ostendorf’s departure from ACT in June 2007, HIT reassigned certain of ACT’s operations to a Mexican affiliate, and ACT subsequently filed for protection under Canada’s Companies Creditor Arrangement Act in September 2007. Prior to his involvement with HIT, Mr. Ostendorf was President of the Morgan Corporation, a truck body manufacturer, from 1999 to 2004. Prior to Morgan, Mr. Ostendorf was President of Cambridge Industries’ Truck Group from 1998 to 1999, President of American Sunroof Corporation from 1995 to 1998 and President and CEO of VMC Fiberglass from 1988 to 1995.

Mr. LaChey has served as our Corporate Vice President — Finance and Chief Financial Officer since June 2000. Mr. LaChey joined us in 1971 and has served in a variety of positions of increasing responsibility in the finance department.

Mr. Ackerman has served as the Division President of Mercer since 2000. Previously, Mr. Ackerman served as the Vice President/CFO of Mercer Forge since 1990. Prior to joining Mercer in 1990, Mr. Ackerman worked for Sheet Metal Coating & Litho as its Controller, Dunlop Industrial/Angus Fire Armour Corp. as its Controller and Ajax Magnethermic Corporation as its Vice President-Finance (CFO).

Mr. Andrews has served as Neenah’s Corporate Vice President — Manufacturing since August 2003 and as Neenah’s Chief Operating Officer of Manufacturing Operations since November 2005. Mr. Andrews joined us in 1988 and has served in a variety of manufacturing positions with increasing responsibility. Prior to joining Neenah, Mr. Andrews was Division Manager for Dayton Walther Corporation’s Camden Casting Center from 1986 to 1988 and served as Manufacturing Manager and then Plant Manager for Waupaca Foundry’s Marinette Plant from 1973 to 1986.

Mr. Fratarcangeli joined Neenah as Corporate Vice President — Industrial Products Sales in December 2007. From May 2003 to October 2007, Mr. Fratarcangeli was Executive Vice President of Amcan Consolidated Technology Corp. (ACT), a supplier of cast components to the automotive industry and the Canadian division of Honsel International Technologies SA. ACT filed for protection under Canada’s Companies Creditor Arrangement Act in September 2007. Prior to ACT, from 2000 to 2003, Mr. Fratarcangeli was the Vice President of Sales and Marketing for Morgan Olson, a truck body manufacturer and a division of the Morgan Corporation. From 1993 to 2000, Mr. Fratarcangeli was the Vice President of Sales for the Commercial Truck division of Cambridge Industries.

Mr. Headington has served as Neenah’s Corporate Vice President — Technology since August 2003. Previously, Mr. Headington was Neenah’s Manager of Technical Services and Director of Product Reliability since January 1989. Prior to joining the Company, Mr. Headington co-founded and operated Sintered Precision

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Components, a powdered metal company. Prior to his involvement with Precision Components, he was employed by Wagner Casting Company as Quality Manager.

Mr. Koller has served as Neenah’s Vice President — Municipal Products Sales and Engineering since May 1998. Mr. Koller has worked within our Municipal products area for the last 27 years serving with increasing responsibility as Sales Representative, Specifications Manager, and General Sales Manager.

PART II

Item 5.   Market For Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Historically, there has been no public trading market for NEI’s common stock or warrants. As of October 9, 2007 shares of NEI’s common stock are quoted on the OTC Bulletin Board. In addition, in the future, we anticipate that we will seek to have NEI’s shares of common stock listed on The Nasdaq Stock Market if and when we satisfy the eligibility requirements, but there is no assurance that we will be successful in doing so. There is currently no public trading market for NEI’s stock warrants. Neenah has 1,000 shares of common stock outstanding, all of which are owned by NFC Castings, Inc, a wholly owned subsidiary of NEI.

We have not declared or paid any cash dividends on NEI’s common stock, and we do not anticipate doing so in the foreseeable future. We currently intend to retain future earnings, if any, to operate our business and finance future growth strategies. The loan covenants under Neenah’s 2006 Credit Facility, the indenture for Neenah’s 91/2% Notes and Neenah’s 121/2% Notes restrict the payment of cash dividends, with certain limited exceptions. As of December 7, 2007, there were fewer than 75 holders of record of NEI’s common stock.

As of December 7, 2007 Tontine beneficially owned 9,065,697 shares of NEI’s common stock. As of December 7, 2007, there were:

•  35,000,000 authorized shares of NEI common stock and 1,000,000 authorized shares of preferred stock, of which 13,741,337 shares of common stock and no shares of preferred stock were outstanding; and

•  outstanding warrants to purchase 2,468,658 shares of NEI common stock.

Performance Graph.  No performance graph has been included since there was no public trading market for shares of NEI common stock between August 2007, when NEI’s common stock was registered under Section 12 of the Exchange Act, and the end of fiscal 2007.

Item 6.   Selected Financial Data

The following table sets forth NEI’s selected historical consolidated financial data as of and for the years ended September 30, 2007, 2006, 2005, 2004 and 2003, which have been derived from NEI’s audited consolidated financial statements, except for 2003, which is unaudited. The historical results presented below are not necessarily indicative of financial results to be achieved in future periods.

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The information contained in the following table should also be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and NEI’s historical consolidated financial statements and related notes included elsewhere in this document.

	Reorganized										Predecessor(1)
				Fiscal Year Ended September 30,
	2007			2006		2005		2004			2003(2)
	(In thousands)
Statement of Operations Data:
Net sales	$	483,623		$	542,452	$	541,772	$	450,942		$	375,063
Cost of sales		408,904			442,558		440,818		375,124			321,834
Gross profit		74,719			99,894		100,954		75,818			53,229
Selling, general and administrative expenses		38,119			34,314		34,467		27,374			26,132
Litigation settlement		—			—		6,500		—			—
Amortization expense		7,121			7,120		7,124		7,121			3,819
Other expenses		453			127		953		465			195
Operating income		29,026			58,333		51,910		40,858			23,083
Interest expense, net		31,344			33,327		33,406		33,363			47,429
Debt refinancing costs		20,429			—		—		—			—
Reorganization expense		—			—		—		—			7,874
Income (loss) from continuing operations before income taxes		(22,747	)		25,006		18,504		7,495			(32,220	)
Provision (credit) for income taxes		(8,819	)		8,857		3,409		3,881			(8,217	)
Income (loss) from continuing operations		(13,928	)		16,149		15,095		3,614			(24,003	)
Loss from discontinued operations, net of income taxes		—			—		—		(359	)		(1,095	)
Loss on sale of discontinued operations, net of income taxes		—			—		—		—			(1,596	)
Net income (loss)	$	(13,928	)	$	16,149	$	15,095	$	3,255		$	(26,694	)
Earnings (Loss) Per Share:
Basic	$	(1.31	)	$	1.72	$	1.71	$	.45			N/M
Diluted	$	(1.31	)	$	.99	$	.94	$	.23			N/M
Balance Sheet Data (at end of period):
Cash and cash equivalents	$	—		$	910	$	3,484	$	—		$	24,356
Working capital		90,507			74,061		62,979		49,927			99,257
Total assets		443,974			410,920		412,555		407,440			536,834
Total debt		318,587			265,416		271,754		283,801			446,103
Total stockholders’ equity (deficit)		30,565			39,228		17,395		8,793			(47,927	)
Other Financial Data:
Capital expenditures		48,733			17,803		17,572		12,713			11,900
Supplemental Data:
Ratio of earnings to fixed charges(3)		N/A			1.73		1.54		1.22			N/A

(1) On August 5, 2003, ACP, NFC, and Neenah filed for bankruptcy protection. They emerged from bankruptcy on October 8, 2003. Although the Plan of Reorganization became effective on October 8, 2003 (the “Effective Date”), due to the immateriality of the results of operations for the period between October 1, 2003 and the Effective Date, for financial reporting purposes we recorded the fresh-start adjustments necessitated by the American Institute of Certified Public Accountants Statement of Position 90-7, “Financial Reporting by Entities in Reorganization under the Bankruptcy Code,” (“SOP 90-7”) on October 1, 2003. As a result of the gain on extinguishment of debt and adjustments to the fair value of assets and liabilities, we recognized a

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	$52.9 million reorganization gain on October 1, 2003. As a result of our emergence from Chapter 11 bankruptcy and the application of fresh-start reporting, our consolidated financial statements for the periods commencing on October 1, 2003 are referred to as the “Reorganized Company” and are not comparable with any periods prior to October 1, 2003, which are referred to as the “Predecessor Company”. All references to the years ended September 30, 2007, 2006, 2005 and 2004 are to the Reorganized Company. All references to the year ended September 30, 2003 are to the Predecessor Company.
(2)	During the year ended September 30, 2003, we sold substantially all of the assets of Belcher Corporation. The results of Belcher Corporation have been reported separately as discontinued operations for all periods presented.
(3)	For purposes of computing the ratio of earnings to fixed charges, earnings consist of income before income taxes plus fixed charges. Fixed charges consist of interest expense, amortization of deferred financing fees and a portion of rental expense that management believes is representative of the interest component of rental expense. Earnings were insufficient to cover fixed charges for the years ended September 30, 2007 and 2003 by $22.7 million, and $31.4 million, respectively. The ratio of earnings to fixed charges for NEI and Neenah are the same for both entities.

Item 7.   Management’s Discussion and Analysis of Financial Condition and Results of Operations

Overview

We derive substantially all of our revenue from manufacturing and marketing a wide range of iron castings and steel forgings for the heavy municipal market and selected segments of the industrial market. We have two reportable segments, castings and forgings. Through our castings segment, we are a leading producer of iron castings for use in heavy municipal and industrial applications. For heavy municipal market applications, we sell to state and local municipalities, contractors, precasters and supply houses. We primarily sell our industrial castings directly to original equipment manufacturers, or OEMs, and tier-one suppliers with whom we have established close working relationships. Through our forgings segment, operated by Mercer, we produce complex-shaped forged steel and micro alloy components for use in transportation, railroad, mining and heavy industrial applications. Mercer sells directly to OEMs, as well as to industrial end-users. Mercer’s subsidiary, A&M Specialties, Inc., machines forgings and castings for Mercer and various industrial customers. Restructuring charges and certain other expenses, such as income taxes, general corporate expenses and financing costs, are not allocated between our two operating segments.

Recent Developments

Cost Reduction Actions.  On November 16, 2007, we announced a restructuring plan intended to reduce costs and improve general operating efficiencies. The restructuring will primarily consist of salaried headcount reductions at the Company’s operating facilities. In connection with the restructuring plan, the Company expects to incur employee termination costs of approximately $1.25 million to $1.75 million, on a pretax basis, which will be recognized as a charge during the first quarter of fiscal 2008.

Reverse Stock Split.  On August 3, 2007, an amendment to NEI’s certificate of incorporation effected a 1-for-5 reverse stock split, among other things. All of the share and per share amounts in this filing have been retroactively restated to adjust for the reverse stock split.

Refinancing Transactions.  On December 29, 2006, we repaid our outstanding indebtedness under Neenah’s then existing credit facility, repurchased all $133.1 million of Neenah’s outstanding 11% Senior Secured Notes due 2010 through an issuer tender offer, retired $75 million of Neenah’s outstanding 13% Senior Subordinated Notes due 2013 (the “13% Notes”) by exchanging them for $75 million of new 121/2% Senior Subordinated Notes due 2013 (the “121/2% Notes”) in a private transaction, and called for redemption all $25 million of Neenah’s 13% Notes that remained outstanding after the exchange for 121/2% Notes. Those remaining 13% Notes were redeemed on February 2, 2007. To fund these payments and to provide cash for our capital expenditures, ongoing working capital requirements and general corporate purposes, Neenah (a) issued $225 million of new 91/2% Senior Secured Notes due 2017 (the “91/2% Notes”) and the $75 million of 121/2% Notes and (b) entered into an amended and restated credit facility (the “2006 Credit Facility”) providing for borrowings in an amount of up to $100 million. The 91/2% Notes

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were initially issued in a private offering that was not registered under the Securities Act, and were subsequently registered pursuant to an exchange offer in which the unregistered notes were exchanged for freely transferable notes. That exchange offer was completed on April 18, 2007. We refer to these actions collectively as the “Refinancing Transactions.”

New Mold Line.  We are continuing to invest in a $54 million capital project to replace a 40-year-old mold line at our Neenah facility. Our new state-of-the-art mold line is expected to significantly enhance operating efficiencies, increase capacity and provide expanded molding capabilities for our heavy municipal products. As of September 30, 2007, $29.6 million (excluding capitalized interest of $1.0 million) had been spent on the new mold line project with approximately $24.4 million remaining to be spent to complete the project. Based on our current and projected level of operations, we anticipate that our operating cash flows and borrowings under the 2006 Credit Facility will be sufficient to fund this and other anticipated operational investments, including working capital and capital expenditure needs, over the remaining construction timeframe. We expect the new mold line to become operational in spring of 2008.

Order of Abatement at Gregg Facility.  Due to neighborhood complaints, we were operating the Gregg facility under the terms of an order for abatement with the California South Coast Air Quality Management District (SCAQMD). Despite being in compliance with federal and state emission laws, the order required us to comply with certain operating parameters in an effort to reduce odors. Failure to operate within such criteria could have resulted in the SCAQMD terminating operations at the Gregg facility. The order expired on September 20, 2007 and Gregg is currently negotiating settlements with the SCAQMD regarding outstanding notices of violation (NOV’s). Gregg does not expect any issues in settling the NOV’s and is expecting to conclude negotiations in January 2008. We believe we are in compliance with all other operating requirements and that our actions have resulted in a substantial reduction in the intensity and frequency of downwind odors.

Coke Supplier Ceases Operations.  Our major supplier of metallurgical coke, a key raw material used in our iron melting process, ceased coking production and operations at its plant in May, 2007. We have secured other alternatives to ensure coke supply to our foundries. Increases in price or interruptions in the availability of coke could reduce our profits.

RESULTS OF OPERATIONS

FISCAL YEAR ENDED SEPTEMBER 30, 2007 COMPARED TO THE FISCAL YEAR ENDED SEPTEMBER 30, 2006

Net Sales.  Net sales for the year ended September 30, 2007 were $483.6 million, which was $58.9 million or 10.9% lower than the year ended September 30, 2006. The decrease was primarily due to reduced shipments of municipal products, components shipped to heating, ventilation and air conditioning (HVAC) customers and heavy-duty truck components. New housing starts declined in fiscal 2007 from 2006 levels, reflecting softness in the overall housing sector. As a result of this and other related factors, sales of municipal products are down approximately $12.8 million in the year ended September 30, 2007 compared to the year ended September 30, 2006 and sales to the HVAC market are down approximately $9.2 million in the year ended September 30, 2007 compared to the year ended September 30, 2006. Also, due to new emission standards that took effect January 1, 2007, heavy-duty truck sales have declined significantly as many customers accelerated purchases in 2006, artificially increasing 2006 sales. As a result, sales of heavy-duty truck products are down approximately $26.4 million for the year ended September 30, 2007 compared to the year ended September 30, 2006. Sales to other markets, primarily automotive and light truck (including heads, blocks and motor frames) are down approximately $10.5 million for the year ended September 30, 2007 compared to the year ended September 30, 2006 due to the downturn experienced in the automotive market.

Cost of Sales.  Cost of sales was $408.9 million for the year ended September 30, 2007, which was $33.7 million or 7.6% lower than the year ended September 30, 2006. Cost of sales as a percentage of net sales increased to 84.6% during the year ended September 30, 2007 from 81.6% for the fiscal year ended September 30, 2006, primarily as a result of an approximately 4% increase in raw material costs, principally in the price of steel scrap (increases of $60 to $100 per ton depending on the grade used), and a decreased ability to absorb fixed costs due to lower production levels.

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Gross Profit.  Gross profit was $74.7 million for the year ended September 30, 2007, which was $25.2 million or 25.2% lower than the year ended September 30, 2006. Gross profit as a percentage of net sales decreased to 15.4% during the year ended September 30, 2007 from 18.4% for the fiscal year ended September 30, 2006, primarily as a result of the increased raw material costs and a decreased ability to absorb fixed costs due to lower production levels as discussed above.

Selling, General and Administrative Expenses.  Selling, general and administrative expenses for the year ended September 30, 2007 were $38.1 million, an increase of $3.8 million from the $34.3 million for the year ended September 30, 2006. As a percentage of net sales, selling, general and administrative expenses increased to 7.9% for the year ended September 30, 2007 from 6.3% for the fiscal year ended September 30, 2006. The increase in selling, general and administrative expenses is due mainly to a decrease in the rebate received from countervailing duties assessed on imported products, increased costs incurred to comply with the order of abatement at the Gregg facility, an additional $0.95 million of expense recognized for the settlement of a disputed claim from an investment bank and $0.65 million of expense for the settlement of an employment related lawsuit.

Amortization of Intangible Assets.  Amortization of intangible assets was $7.1 million for each of the years ended September 30, 2007 and September 30, 2006.

Other Expenses.  Other expenses for the years ended September 30, 2007 and 2006 consist of losses of $0.5 million and $0.1 million, respectively, for the disposal of long-lived assets in the ordinary course of business.

Operating Income.  Operating income was $29.0 million for the year ended September 30, 2007, a decrease of $29.3 million or 50.3% from the year ended September 30, 2006. As a percentage of net sales, operating income decreased from 10.7% for the year ended September 30, 2006 to 6.0% for the year ended September 30, 2007. The decrease in operating income was primarily due to the reduced sales volume, the increases in raw material costs and increased costs associated with the settlement of claims discussed above.

Net Interest Expense.  Net interest expense was $31.3 million and $33.3 million for the years ended September 30, 2007 and 2006, respectively. The decrease in interest expense was the result of capitalizing interest incurred on borrowings used to finance the new mold line, lower interest rates on borrowings in the year ended September 30, 2007 and the termination of bond discount amortization as a result of the Refinancing Transactions.

Debt Refinancing Costs.  The Company recorded $20.4 million of debt refinancing costs for the year ended September 30, 2007 related to the Refinancing Transactions. This amount consisted of a $12.9 million tender premium paid to repurchase Neenah’s 11% Senior Secured Notes due 2010, $5.9 million to write off the unamortized portion of discount on Neenah’s 11% Senior Secured Notes and $1.6 million to write off the unamortized portion of deferred financing costs on Neenah’s old indebtedness.

Provision for Income Taxes.  The effective tax rate for years ended September 30, 2007 and 2006 was 39% and 35%, respectively. The effective tax rate for the year ended September 30, 2006 includes the favorable impact of the Production Activities Deduction as permitted under the American Jobs Creation Act of 2004.

Net Income (Loss) and Earnings (Loss) Per Share.  As a result of the items described above, the net loss was $13.9 million for the year ended September 30, 2007, compared to net income of $16.1 million for the year ended September 30, 2006. On a diluted basis, the net loss per share was $1.31 for the year ended September 30, 2007, compared to net earnings per share of $0.99 for the year ended September 30, 2006.

FISCAL YEAR ENDED SEPTEMBER 30, 2006 COMPARED TO THE FISCAL YEAR ENDED SEPTEMBER 30, 2005

Net Sales.  Net sales for the year ended September 30, 2006 were $542.5 million, which was $0.7 million or 0.1% higher than the year ended September 30, 2005. The increase was due to increased shipments of heavy duty truck and municipal products, somewhat offset by reduced shipments of products to the HVAC (heating, ventilation and air conditioning) market and various normal mix changes within the remaining market segments of our business.

Cost of Sales.  Cost of sales was $442.6 million for the year ended September 30, 2006, which was $1.8 million or 0.4% higher than the year ended September 30, 2005. Cost of sales as a percentage of net sales

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increased to 81.6% during the year ended September 30, 2006 from 81.4% for the fiscal year ended September 30, 2005. The increase in cost of sales was due to a slightly less favorable mix of products sold throughout the Company and operating inefficiencies at two of our locations.

Gross Profit.  Gross profit was $99.9 million for the year ended September 30, 2006, which was $1.1 million or 1.1% lower than the year ended September 30, 2005. Gross profit as a percentage of net sales decreased to 18.4% during the year ended September 30, 2006 from 18.6% for the fiscal year ended September 30, 2005. The decrease in gross profit resulted from a slightly less favorable mix of products sold throughout the Company and operating inefficiencies at two of our locations.

Selling, General and Administrative Expenses.  Selling, general and administrative expenses for the year ended September 30, 2006 were $34.3 million, a decrease of $0.2 million from the $34.5 million for the year ended September 30, 2005. As a percentage of net sales, selling, general and administrative expenses decreased to 6.3% for the year ended September 30, 2006 from 6.4% for the fiscal year ended September 30, 2005.

Amortization of Intangible Assets.  Amortization of intangible assets was $7.1 million for each of the years ended September 30, 2006 and September 30, 2005.

Other Expenses.  Other expenses for the years ended September 30, 2006 and 2005 consist of losses of $0.1 million and $1.0 million, respectively, for the disposal of long-lived assets in the ordinary course of business.

Operating Income.  Operating income was $58.3 million for the year ended September 30, 2006 an increase of $6.4 million or 12.3% from the year ended September 30, 2005. The increase was due to the $6.5 million litigation settlement incurred in the year ended September 30, 2005. As a percentage of net sales, operating income increased from 9.6% for the year ended September 30, 2005 to 10.7% for the year ended September 30, 2006.

Net Interest Expense.  Net interest expense was $33.3 million and $33.4 million for the years ended September 30, 2006 and 2005, respectively.

Provision for Income Taxes.  The effective tax rate for years ended September 30, 2006 and 2005 was 35% and 18%, respectively. The provision for income taxes for the year ended September 30, 2005 is lower than the amount computed by applying our statutory rate of 35% to the income before income taxes principally due to a change in the tax method of determining LIFO inventory and the recognition of permanent differences due to the reorganization. The change in tax method of determining LIFO inventory resulted in a tax benefit of $2.7 million, which increased fiscal 2005 net income by $2.7 million.

Net Income and Earnings Per Share.  As a result of the items described above, net income was $16.1 million for the year ended September 30, 2006, compared to net income of $15.1 million for the year ended September 30, 2005. On a diluted basis, earnings per share was $0.99 and $0.94, respectively, for the same periods.

LIQUIDITY AND CAPITAL RESOURCES

As of September 30, 2007 our outstanding indebtedness consisted of Neenah’s $225.0 million of outstanding 91/2% Notes, $1.4 million of capital lease obligations, Neenah’s $75.0 million of outstanding 121/2% Notes and $17.2 million of borrowings outstanding under the 2006 Credit Facility. Our primary sources of liquidity in the future will be cash flow from operations and borrowings under Neenah’s 2006 Credit Facility. We expect that ongoing requirements for debt service, capital expenditures, including Neenah’s new mold line, and other operating needs will be funded from these sources of funds.

2006 Credit Facility.  The 2006 Credit Facility provides for borrowings in an amount up to $100.0 million and includes a provision permitting us from time to time to request increases (subject to the lenders’ consent) in the aggregate amount by up to $10.0 million with the increases to be funded through additional commitments from existing lenders or new commitments from financial institutions acceptable to the current lenders. It matures on December 31, 2011. Outstanding borrowings bear interest at rates based on the lenders’ Base Rate, as defined in the 2006 Credit Facility, or, if Neenah so elects, at an adjusted rate based on LIBOR. Availability under the 2006 Credit Facility is subject to customary conditions and is limited by our borrowing base determined by the amount of our accounts receivable, inventory and casting patterns and core boxes. Amounts under the 2006 Credit Facility may be

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borrowed, repaid and reborrowed subject to the terms of the facility. At September 30, 2007, we had approximately $17.2 million outstanding under the 2006 Credit Facility and had unused availability of $78.7 million.

Most of our wholly owned subsidiaries are co-borrowers under the 2006 Credit Facility and are jointly and severally liable with Neenah for all obligations under the 2006 Credit Facility, subject to customary exceptions for transactions of this type. In addition, NFC Castings, Inc. (“NFC”), NEI’s immediate subsidiary, and Neenah’s remaining wholly owned subsidiaries jointly, fully, severally and unconditionally guarantee the borrowers’ obligations under the 2006 Credit Facility, subject to customary exceptions for transactions of this type. The borrowers’ and guarantors’ obligations under the 2006 Credit Facility are secured by first priority liens, subject to customary restrictions, on Neenah’s and the guarantors’ accounts receivable, inventory, casting patterns and core boxes, business interruption insurance policies, certain inter-company loans, cash and deposit accounts and related assets, subject to certain exceptions, and any proceeds of the foregoing, and by second priority liens (junior to the liens securing the 91/2% Notes) on substantially all of our and the guarantors’ remaining assets. The 91/2% Notes discussed below, and the guarantees in respect thereof, are equal in right of payment to the 2006 Credit Facility, and the guarantees in respect thereof.

The 2006 Credit Facility requires Neenah to prepay outstanding principal amounts upon certain asset sales, upon certain equity offerings, and under certain other circumstances. It also requires us to observe certain customary conditions, affirmative covenants and negative covenants including financial covenants and it requires us to maintain a specified minimum interest coverage ratio or specified fixed charge coverage ratio whenever our unused availability is less than $15.0 million. Non-compliance with the covenants could result in the requirement to immediately repay all amounts outstanding under the 2006 Credit Facility, which could have a material adverse effect on our results of operations, financial position and cash flow. The 2006 Credit Facility also contains events of default customary for these types of facilities, including, without limitation, payment defaults, material misrepresentations, covenant defaults, bankruptcy and certain changes of ownership or control of us, Neenah, or NFC. We are prohibited from paying dividends, with certain limited exceptions, and are restricted to a maximum yearly stock repurchase of $1.0 million.

At September 30, 2007, Neenah was in compliance with existing bank covenants.

91/2% Notes.  The $225.0 million of outstanding 91/2% Notes will mature on January 1, 2017. The 91/2% Notes are fully and unconditionally guaranteed by our existing and certain future direct and indirect wholly owned domestic restricted subsidiaries. The 91/2% Notes and the guarantees are secured by first-priority liens on substantially all of Neenah’s and the guarantors’ assets (other than accounts receivable, inventory, casting patterns and core boxes, business interruption insurance policies, certain inter-company loans, cash and deposit accounts and related assets, subject to certain exceptions, and any proceeds of the foregoing) and by second-priority liens, junior to the liens for the benefit of the lenders under the 2006 Credit Facility, on Neenah’s and the guarantors’ accounts receivable, inventory, casting patterns and core boxes, business interruption insurance policies, certain inter-company loans, cash and deposit accounts and related assets, subject to certain exceptions, and any proceeds of the foregoing. Interest on the 91/2% Notes is payable on a semi-annual basis. Subject to the restrictions in the 2006 Credit Facility, the 91/2% Notes are redeemable at our option in whole or in part at any time on or after January 1, 2012, at the redemption price specified in the indenture governing the 91/2% Notes (104.750% of the principal amount redeemed beginning January 1, 2012, 103.167% beginning January 1, 2013, 101.583% beginning January 1, 2014 and 100.000% beginning January 1, 2015 and thereafter), plus accrued and unpaid interest up to the redemption date. Subject to certain conditions, until January 1, 2010, we also have the right to redeem up to 35% of the 91/2% Notes with the proceeds of one or more equity offerings at a redemption price equal to 109.500% of the face amount thereof plus accrued and unpaid interest. Upon the occurrence of a “change of control” as defined in the indenture governing the notes, Neenah is required to make an offer to purchase the 91/2% Notes at 101.000% of the outstanding principal amount thereof, plus accrued and unpaid interest up to the purchase date. The 91/2% Notes contain customary covenants typical to this type of financing, such as limitations on (1) indebtedness, (2) restricted payments, (3) liens, (4) distributions from restricted subsidiaries, (5) sale of assets, (6) affiliate transactions, (7) mergers and consolidations and (8) lines of business. The 91/2% Notes also contain customary events of default typical to this type of financing, such as (1) failure to pay principal and/or interest when due, (2) failure to observe covenants, (3) certain events of bankruptcy, (4) the rendering of certain judgments or (5) the loss of any guarantee.

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121/2% Notes.  The $75.0 million of Neenah’s outstanding 121/2% Notes will mature on September 30, 2013. The 121/2% Notes were issued to Tontine Capital Partners, L.P. (“TCP”) in exchange for an equal principal amount of Neenah’s 13% Notes that were then held by TCP. The obligations under the 121/2% Notes are senior to Neenah’s subordinated unsecured indebtedness, if any, and are subordinate to the 2006 Credit Facility and the 91/2% Notes. Interest on the 121/2% Notes is payable on a semi-annual basis. Not less than five percent (500 basis points) of the interest on the 121/2% Notes must be paid in cash and the remainder (up to 71/2% or 750 basis points) of the interest may be deferred at our option. We must pay interest on any interest so deferred at a rate of 12.5% per annum. Neenah’s obligations under the 121/2% Notes are guaranteed on an unsecured basis by each of our wholly owned subsidiaries. Subject to the restrictions in the 2006 Credit Facility and in the indenture for the 91/2% Notes, the 121/2% Notes are redeemable at our option in whole or in part at any time, with not less than 30 days nor more than 60 days notice, at 100.000% of the principal amount thereof, plus accrued and unpaid interest up to the redemption date. Upon the occurrence of a “change of control,” Neenah is required to make an offer to purchase the 121/2% Notes at 101.000% of the outstanding principal amount thereof, plus accrued and unpaid interest up to the purchase date. The 121/2% Notes contain customary covenants typical to this type of financing, such as limitations on (1) indebtedness, (2) restricted payments, (3) liens, (4) distributions from restricted subsidiaries, (5) sale of assets, (6) affiliate transactions, (7) mergers and consolidations and (8) lines of business. The 121/2% Notes also contain customary events of default typical to this type of financing, such as, (1) failure to pay principal and/or interest when due, (2) failure to observe covenants, (3) certain events of bankruptcy, (4) the rendering of certain judgments or (5) the loss of any guarantee.

For the fiscal years ended September 30, 2007 and 2006, capital expenditures were $48.7 million and $17.8 million, respectively. Capital expenditures for the year ended September 30, 2006 represent a level of capital expenditures necessary to maintain equipment and facilities. The increased level of capital expenditures for the year ended September 30, 2007 includes $30.6 million (including capitalized interest of $1.0 million) for the new mold line at the Neenah location described above under “Recent Developments.”

The net cash provided by operating activities during the year ended September 30, 2007 was $5.2 million, a decrease of $19.6 million over net cash of $24.8 million provided by operating activities during the year ended September 30, 2006. The decrease in cash provided by operating activities was primarily due to a decrease in net income of $30.1 million, partially offset by changes in working capital accounts. The net loss for the year ended September 30, 2007 included the payment of the tender premium of $12.9 million paid to repurchase Neenah’s 11% Senior Secured Notes due 2010 and the non-cash expense of $7.5 million from the write-off of deferred financing costs and discounts on notes. The major reasons for the decrease in net income include $20.4 million in refinancing costs incurred during the fiscal year ended September 30, 2007 ($12.4 million after giving effect to income taxes), $58.9 million in reduced sales volume and escalating scrap metal prices of $60 to $100 per ton depending on the grade used that could not be entirely recovered through the implementation of a metal surcharge.

Future Capital Needs.  We are significantly leveraged. Our ability to meet debt obligations will depend upon future operating performance which will be affected by many factors, some of which are beyond our control. We are proceeding with a major capital project to replace an existing mold line that is expected to enhance efficiency, increase capacity and provide expanded molding capabilities. Based on our current level of operations, we anticipate that our operating cash flows and borrowings under the 2006 Credit Facility will be sufficient to fund anticipated operational investments, including working capital and capital expenditure needs, for at least the next twelve months. If, however, we are unable to service our debt requirements as they become due or if we are unable to maintain ongoing compliance with certain covenants, we may be forced to adopt alternative strategies that may include reducing or delaying capital expenditures, selling assets, restructuring or refinancing indebtedness or seeking additional equity capital. There can be no assurances that any of these strategies could be effected on satisfactory terms, if at all.

OFF-BALANCE SHEET ARRANGEMENTS

None.

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CONTRACTUAL OBLIGATIONS

The following table includes the Company’s significant contractual obligations at September 30, 2007 (in millions):

			Less Than						More Than
	Total		1 year		1-3 Years		3-5 Years		5 Years
Long-term debt	$	300.0	$	—	$	—	$	—	$	300.0
Interest on long-term debt		254.2		30.8		61.5		61.5		100.4
Revolving line of credit		17.2		17.2		—		—		—
Interest and fees on revolving line of credit		0.7		0.7		—		—		—
Capital leases		1.4		0.2		0.4		0.4		0.4
Operating leases		5.0		2.0		2.0		0.8		0.2
New mold line commitments		16.6		16.6		—		—		—
Total contractual obligations	$	595.1	$	67.5	$	63.9	$	62.7	$	401.0

As of September 30, 2007, other than the new mold line commitments listed above, which comprise the committed portion at September 30, 2007 of the remaining $24.4 million budgeted for the completion of Neenah’s new mold line, the Company had no material purchase obligations other than those created in the ordinary course of business related to inventory and property, plant and equipment, which generally have terms of less than 90 days. The Company also has long-term obligations related to its pension and post-retirement plans which are discussed in detail in Note 9 of the Notes to Consolidated Financial Statements. As of the most recent actuarial measurement date, the Company anticipates making $1.6 million of contributions to pension plans in fiscal 2008. Post-retirement medical claims are paid as they are submitted and are anticipated to be $0.5 million in fiscal 2008.

CRITICAL ACCOUNTING ESTIMATES

Critical accounting estimates are those that are, in management’s view, both very important to the portrayal of our financial condition and results of operations and require management’s most difficult, subjective or complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain.

Future events and their effects cannot be determined with absolute certainty. The determination of estimates, therefore, requires the exercise of judgment. Actual results may differ from those estimates, and such differences may be material to the financial statements. Our accounting policies are more fully described in Note 2 in the Notes to Consolidated Financial Statements.

We believe that the most significant accounting estimates inherent in the preparation of our financial statements include estimates associated with the evaluation of the recoverability of certain assets including goodwill, other intangible assets and property, plant and equipment as well as those estimates used in the determination of reserves related to the allowance for doubtful accounts, inventory obsolescence, workers compensation and pensions and other post-retirement benefits. Various assumptions and other factors underlie the determination of these significant estimates. In addition to assumptions regarding general economic conditions, the process of determining significant estimates is fact-specific and accounts for such factors as historical experience, product mix and, in some cases, actuarial techniques. We constantly reevaluate these significant factors and make adjustments where facts and circumstances necessitate. Historically, our actual results have not significantly deviated from those determined using the estimates described above.

We believe the following critical accounting estimates affect our more significant judgments and estimates used in the preparation of our consolidated financial statements:

•  Defined-Benefit Pension Plans.  We account for Neenah’s defined benefit pension plans in accordance with Statement of Financial Accounting Standards No. 158 “Accounting for Defined Benefit Pension and Other Postretirement Plans, an amendment of FASB Statement No. 87, 88, 106 and 132(R)” (SFAS 158), which requires that amounts recognized in financial statements be determined on an actuarial basis. The most

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significant element in determining our pension expense in accordance with SFAS 158 is the expected return on plan assets. We have assumed that the expected long-term rate of return on plan assets will be 7.50% to 8.50%, depending on the plan. Over the long term, the rate of return on our pension plan assets has approximated these rates; therefore, we believe that our assumption of future returns is reasonable. The plan assets, however, have earned a rate of return substantially less than these rates in the last three years. Should this trend continue, our future pension expense would likely increase. At the measurement date, we determine the discount rate to be used to discount plan liabilities. We develop this rate with the assistance of our actuary using both the Moody’s AA Corporate Bond Rate and the Citigroup Pension Liability Curve and Index. The annualized Moody’s AA Bond Rate was 6.19% at the measurement date of June 30, 2007 and no adjustments to this rate were required to account for the differences in the duration of the bonds in the Moody’s AA portfolio to the duration of the pension plan liabilities because the yield curve was essentially flat. In addition, the Company also developed a level equivalent yield using the expected cash flows from the pension plans based on the June 30, 2007 Citigroup Pension Discount Curve and Index. This level equivalent yield was 6.30% at June 30, 2007. The Citigroup Pension Liability Curve and Index are published on the Society of Actuaries website along with a background paper on this interest rate curve. Based on these analyses, the Company has established its discount rate assumption for determination of the projected benefit obligation of the pension plans at 6.25%, based on a June 30, 2007 measurement date. Changes in discount rates over the past few years have not materially affected our pension expense. The net effect of changes in this rate, as well as other changes in actuarial assumptions and experience, have been deferred as allowed by SFAS 158.

•  Other Postretirement Benefits.  Neenah provides retiree health benefits to qualified employees under an unfunded plan. We use various actuarial assumptions including the discount rate and the expected trend in health care costs and benefit obligations for our retiree health plan. Consistent with our pension plans, we used a discount rate of 6.25%. In 2007, our assumed healthcare cost trend rate was 9.5% decreasing gradually to 5.0% in 2016 and then remaining at that level thereafter. Changes in these rates could materially affect our future operating results and net worth. A one percentage point change in the healthcare cost trend rate would have the following effect (in thousands):

	1% Increase		1% Decrease
Effect on total of service cost and interest cost	$	101	$	(78	)
Effect on postretirement benefit obligation		934		(741	)

Recent Accounting Pronouncements

In June 2006, the Financial Accounting Standards Board (FASB) issued FASB Interpretation No. (FIN) 48, “Accounting for Uncertainty in Income Taxes,” which clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements in accordance with SFAS No. 109, “Accounting for Income Taxes.” The interpretation prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. The Company is required to adopt FIN 48 as of October 1, 2007, and the impact that the adoption of FIN 48 will have on its consolidated financial statements and notes thereto is not expected to be significant.

In September 2006, the FASB issued SFAS 158 which requires employers that sponsor defined benefit pension and postretirement benefit plans to recognize previously unrecognized actuarial losses and prior service costs in the statement of financial position and to recognize future changes in these amounts in the year in which changes occur through comprehensive income. As a result, the balance sheet will reflect the funded status of those plans as an asset or liability. Additionally, employers are required to measure the funded status of a plan as of the date of its year-end statement of financial position and provide additional disclosures. On September 30, 2007, the Company adopted the provisions of SFAS 158 by recognizing the funded status of its defined benefit pension and postretirement benefit plans in the balance sheet. See Note 8 of the Notes to Consolidated Financial Statements for further discussion and disclosures of the effect of adopting SFAS 158 on the Company’s consolidated financial statements and notes thereto. In addition, the Company will be required to measure the plan assets and benefit obligations as of the date of the year-end balance sheet by September 30, 2009. The Company is currently evaluating the impact the change in the measurement date will have on its consolidated financial statements and notes thereto.

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In September 2006, the FASB issued SFAS No. 157, “Fair Value Measurements” (SFAS 157). SFAS 157 defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles, and expands disclosures about fair value measurements. The Company is required to adopt SFAS 157 effective October 1, 2008 and is currently evaluating the impact of adopting SFAS 157 on its future results of operations and financial condition.

In February 2007, the FASB issued SFAS No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities, including an amendment of FASB Statement No. 115” (SFAS 159). SFAS 159 permits companies to choose to measure many financial instruments and certain other items at fair value that are not currently required to be measured at fair value and establishes presentation and disclosure requirements designed to facilitate comparisons between companies that choose different measurement attributes for similar types of assets and liabilities. The Company is required to adopt SFAS 159 effective October 1, 2008 and is currently evaluating the impact of adopting SFAS 159 on its future results of operations and financial condition.

Item 7A.   Quantitative and Qualitative Disclosures About Market Risk

We are exposed to market risk related to changes in interest rates. We do not use derivative financial instruments for speculative or trading purposes.

Interest Rate Sensitivity. Although Neenah’s 91/2% Notes and 121/2% Notes are subject to fixed interest rates, our earnings are affected by changes in short-term interest rates as a result of our borrowings under the 2006 Credit Facility. As of September 30, 2007 the Company has $17.2 million outstanding under the 2006 Credit Facility. If market interest rates for such borrowings increase or decrease by 1%, the Company’s interest expense would increase or decrease by approximately $0.2 million. This analysis does not consider the effects of changes in the level of overall economic activity that could occur due to interest rate changes. Further, in the event of an upward change of such magnitude, management could take actions to further mitigate its exposure to the change. However, due to the uncertainty of the specific actions that would be taken and their possible effects, the sensitivity analysis assumes no changes in the Company’s financial structure.

Item 8.   Financial Statements and Supplementary Data

The financial statements and schedules are listed in Part IV Item 15 of this Annual Report on Form 10-K and are incorporated by reference in this Item 8.

Item 9.   Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

None.

Item 9A.   Controls and Procedures

Disclosure Controls and Procedures.  NEI’s and Neenah’s management, with the participation of the Chief Executive Officer and the Chief Financial Officer, have evaluated the effectiveness of the NEI’s and Neenah’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of the end of the period covered by this report. Based upon such evaluation, the Chief Executive Officer and the Chief Financial Officer have concluded that, as of the end of such period, NEI’s and Neenah’s disclosure controls and procedures are effective (i) in recording, processing, summarizing and reporting, on a timely basis, information required to be disclosed by NEI and Neenah in the reports that NEI and Neenah file or submit under the Exchange Act and (ii) to ensure that information required to be disclosed in the reports that NEI and Neenah file or submit under the Exchange Act is accumulated and communicated to NEI’s and Neenah’s management, including the Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.

Internal Control Over Financial Reporting.  There have not been any changes in NEI’s and Neenah’s internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the last fiscal quarter that have materially affected, or are reasonably likely to materially affect, NEI’s and Neenah’s internal control over financial reporting.

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Item 9B.  Other Information

None.

PART III

Item 10.   Directors, Executive Officers and Corporate Governance

The information called for by Item 10 of Form 10-K with respect to directors, executive officers and the audit committee is incorporated herein by reference to such information included in NEI’s Proxy Statement for the Annual Meeting of Stockholders to be held January 24, 2008 (the “2008 Annual Meeting Proxy Statement”), under the captions “Proposal 1: Election of Directors — Terms Expiring in 2009”, and “Section 16(a) Beneficial Ownership Reporting Compliance,” and to the information under the caption “Executive Officers of the Registrant” in Part I hereof. Additionally, the information included in the 2008 Annual Meeting Proxy Statement under the caption “Corporate Governance” is incorporated herein by reference.

Item 11.   Executive Compensation

The information called for by Item 11 of Form 10-K is incorporated herein by reference to such information included in the 2008 Annual Meeting Proxy Statement under the captions “Compensation Discussion and Analysis”, “Compensation Committee Report”, “Executive Compensation Tables and Supporting Information”, “Potential Payments Upon Termination or Change-In-Control”, and “Director Compensation”.

Item 12.   Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

The information called for by Item 12 of Form 10-K is incorporated herein by reference to such information included in the 2008 Annual Meeting Proxy Statement under the captions “Security Ownership of Certain Beneficial Owners and Management” and “Equity Compensation Plan Information”.

Item 13.   Certain Relationships and Related Transactions, and Director Independence

The information called for by Item 13 of Form 10-K is incorporated herein by reference to such information included in the 2008 Annual Meeting Proxy Statement under the captions “Certain Relationships and Related Transactions” and “Corporate Governance — Director Independence”.

Item 14.   Principal Accountant Fees and Services

The information called for by Item 14 of Form 10-K is incorporated herein by reference to such information included in the 2008 Annual Meeting Proxy Statement under the captions “Independent Registered Public Accounting Firm’s Fees and Services”.

35

PART IV

Item 15.   EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

		Page
(a)(1)	Consolidated Financial Statements of Neenah Enterprises, Inc.
	Report of Independent Registered Public Accounting Firm		37
	Consolidated Balance Sheets		38
	Consolidated Statements of Operations		40
	Consolidated Statements of Changes in Stockholders’ Equity (Deficit)		41
	Consolidated Statements of Cash Flows		42
	Notes to Consolidated Financial Statements		43
	Consolidated Financial Statements of Neenah Foundry Company
	Report of Independent Registered Public Accounting Firm		60
	Consolidated Balance Sheets		61
	Consolidated Statements of Operations		63
	Consolidated Statements of Changes in Stockholder’s Equity (Deficit)		64
	Consolidated Statements of Cash Flows		65
	Notes to Consolidated Financial Statements		66
(2)	Financial Statement Schedules
	Report of Independent Registered Public Accounting Firm		91
	Schedule II — Valuation and Qualifying Accounts of Neenah Enterprises, Inc, and Neenah Foundry Company		92

Schedules I, III, IV, and V are omitted since they are not applicable or not required under the rules of Regulation S-X.

(3) Exhibits

See (b) below

(b) Exhibits

See the Exhibit Index following the signature page of this report, which is incorporated herein by reference. Each management contract and compensatory plan or arrangement required to be filed as an exhibit to this report is identified in the Exhibit Index by an asterisk following its exhibit number.

(c) Financial Statements Excluded From Annual Report to Shareholders

Not Applicable

36

Report of Independent Registered Public Accounting Firm

The Board of Directors

Neenah Enterprises, Inc.

We have audited the accompanying consolidated balance sheets of Neenah Enterprises, Inc. (formerly ACP Holding Company) and Subsidiaries (the Company) as of September 30, 2007 and 2006, and the related consolidated statements of operations, changes in stockholders’ equity and cash flows for each of the three years in the period ended September 30, 2007. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. We were not engaged to perform an audit of the Company’s internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of the Company at September 30, 2007 and 2006, and the consolidated results of its operations and its cash flows for each of the three years in the period ended September 30, 2007, in conformity with U.S. generally accepted accounting principles.

As discussed in Note 2 to the consolidated financial statements, on September 30, 2007, the Company changed its method of accounting for defined benefit pension and postretirement healthcare plans.

/s/  Ernst & Young LLP
Milwaukee, Wisconsin
November 28, 2007

37

Neenah Enterprises, Inc.

Consolidated Balance Sheets

	September 30
	2007		2006
	(In thousands, except share and per share data)
Assets
Current assets:
Cash	$	—	$	910
Accounts receivable, less allowance for doubtful accounts of $2,262 in 2007 and $1,885 in 2006		81,085		85,161
Inventories		64,196		61,847
Refundable income taxes		6,501		—
Deferred income taxes		3,070		2,697
Other current assets		6,479		7,425
Total current assets		161,331		158,040
Property, plant and equipment:
Land		7,218		7,209
Buildings and improvements		19,955		18,733
Machinery and equipment		104,893		88,562
Patterns		14,617		13,527
Construction in progress		32,839		3,679
		179,522		131,710
Less accumulated depreciation		47,972		34,832
		131,550		96,878
Deferred financing costs, net of accumulated amortization of $343 in 2007 and $1,509 in 2006		3,457		1,695
Identifiable intangible assets, net of accumulated amortization of $28,486 in 2007 and $21,365 in 2006		54,951		62,072
Goodwill		86,699		86,699
Other assets		5,986		5,536
		151,093		156,002
	$	443,974	$	410,920

38

Neenah Enterprises, Inc.

Consolidated Balance Sheets

	September 30
	2007		2006
	(In thousands, except share and per share data)
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable	$	27,764	$	29,766
Accrued wages and employee benefits		13,139		13,713
Accrued interest		5,449		7,157
Accrued interest — related party		2,344		—
Other accrued liabilities		4,763		5,432
Current portion of long-term debt		17,152		27,750
Current portion of capital lease obligations		213		161
Total current liabilities		70,824		83,979
Long-term debt		225,000		236,445
Long-term debt — related party		75,000		—
Capital lease obligations		1,222		1,060
Deferred income taxes		28,134		26,931
Postretirement benefit obligations		5,269		10,141
Pension benefit obligations		3,142		8,036
Other liabilities		4,818		5,100
Total liabilities		413,409		371,692
Commitments and contingencies
Stockholders’ equity:
Preferred stock, par value $0.01 per share; 1,000,000 shares authorized, no shares issued and outstanding		—		—
Common stock, par value $0.01 per share; 35,000,000 shares authorized, 13,672,764 and 9,394,920 issued and outstanding at September 30, 2007 and 2006, respectively		137		94
Capital in excess of par value		5,686		5,477
Retained earnings		20,571		34,499
Accumulated other comprehensive income (loss)		4,171		(842	)
Total stockholders’ equity		30,565		39,228
	$	443,974	$	410,920

See accompanying notes.

39

Neenah Enterprises, Inc.

Consolidated Statements of Operations

	Years Ended September 30
	2007			2006			2005
	(In thousands, except share
	and per share data)
Net sales	$	483,623		$	542,452		$	541,772
Cost of sales		408,904			442,558			440,818
Gross profit		74,719			99,894			100,954
Selling, general and administrative expenses		38,119			34,314			34,467
Litigation settlement		—			—			6,500
Amortization expense		7,121			7,120			7,124
Loss on disposal of property, plant and equipment		453			127			953
Operating income		29,026			58,333			51,910
Other income (expense):
Interest expense		(24,610	)		(33,410	)		(33,419	)
Interest expense — related party		(7,090	)		—			—
Interest income		356			83			13
Debt refinancing costs		(20,429	)		—			—
Income (loss) before income taxes		(22,747	)		25,006			18,504
Provision (credit) for income taxes		(8,819	)		8,857			3,409
Net income (loss)	$	(13,928	)	$	16,149		$	15,095
Earnings (loss) per share:
Basic	$	(1.31	)	$	1.72		$	1.71
Diluted	$	(1.31	)	$	0.99		$	0.94

See accompanying notes.

40

Neenah Enterprises, Inc.

Consolidated Statements of Changes in Stockholders’ Equity (Deficit)

								Accumulated
								Other
			Capital					Comprehensive
	Common		in Excess of		Retained			(Loss)
	Stock		Par Value		Earnings			Income			Total
	(In thousands)
Balance at September 30, 2004	$	87	$	5,451	$	3,255		$	—		$	8,793
Exercise of stock warrants for 652,199 shares of common stock		7		26		—			—			33
Components of comprehensive income:
Net income		—		—		15,095			—			15,095
Pension liability adjustment, net of tax effect of $4,350		—		—		—			(6,526	)		(6,526	)
Total comprehensive income												8,569
Balance at September 30, 2005		94		5,477		18,350			(6,526	)		17,395
Components of comprehensive income:
Net income		—		—		16,149			—			16,149
Pension liability adjustment, net of tax effect of $(3,789)		—		—		—			5,684			5,684
Total comprehensive income												21,833
Balance at September 30, 2006		94		5,477		34,499			(842	)		39,228
Exercise of stock warrants for 4,227,844 shares of common stock		43		168		—			—			211
Components of comprehensive loss:
Net loss		—		—		(13,928	)		—			(13,928	)
Pension liability adjustment, net of tax effect of $(561)		—		—		—			842			842
Total comprehensive loss												(13,086	)
Stock based compensation		—		41		—			—			41
Adjustment to initially apply SFAS 158, net of tax effect of $(2,764)		—		—		—			4,171			4,171
Balance at September 30, 2007	$	137	$	5,686	$	20,571		$	4,171		$	30,565

See accompanying notes.

41

Neenah Enterprises, Inc.

Consolidated Statements of Cash Flows

	Years Ended September 30
	2007			2006			2005
	(In thousands)
Operating activities
Net income (loss)	$	(13,928	)	$	16,149		$	15,095
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Provision for obsolete inventories		669			318			356
Provision for bad debts		1,047			433			2,153
Depreciation		13,934			13,123			11,740
Amortization of identifiable intangible assets		7,121			7,120			7,124
Amortization of deferred financing costs and discount on notes		862			2,081			2,110
Write-off of deferred financing costs and discount on notes		7,512			—			—
Loss on disposal of property, plant and equipment		453			127			953
Deferred income taxes		(2,578	)		(10	)		(5,191	)
Stock based compensation expense		41			—			—
Changes in operating assets and liabilities:
Accounts receivable		3,029			201			(6,628	)
Inventories		(3,018	)		(3,042	)		1,640
Other current assets		(5,555	)		(528	)		281
Accounts payable		(2,002	)		(539	)		1,155
Accrued liabilities		(741	)		(5,349	)		6,686
Postretirement benefit obligations		(245	)		(263	)		(171	)
Pension benefit obligations		(1,139	)		(5,284	)		(3,631	)
Other liabilities		(282	)		214			(118	)
Net cash provided by operating activities		5,180			24,751			33,554
Investing activities
Purchase of property, plant and equipment		(48,733	)		(17,803	)		(17,572	)
Proceeds from sale of property, plant and equipment		88			196			905
Other		(277	)		(525	)		347
Net cash used in investing activities		(48,922	)		(18,132	)		(16,320	)
Financing activities
Proceeds from long-term debt		225,000			—			84
Proceeds from long-term debt — related party		75,000			—			—
Payments on debt and capital lease obligations		(253,579	)		(9,193	)		(13,716	)
Debt issuance costs		(3,800	)		—			(151	)
Proceeds from the exercise of stock warrants		211			—			33
Net cash provided by (used in) financing activities		42,832			(9,193	)		(13,750	)
Increase (decrease) in cash		(910	)		(2,574	)		3,484
Cash at beginning of year		910			3,484			—
Cash at end of year	$	—		$	910		$	3,484
Supplemental disclosures of cash flows information:
Interest paid	$	29,898		$	31,306		$	31,315
Income taxes paid		494			11,864			5,622

See accompanying notes.

42

Neenah Enterprises, Inc.

Notes to Consolidated Financial Statements

September 30, 2007

(In Thousands, Except Share and Per Share Data)

1.   Organization and Description of Business

Neenah Enterprises, Inc. (formerly ACP Holding Company) (“NEI”) is a Delaware corporation which has no business activity other than its ownership of NFC Castings, Inc. Neenah Foundry Company (Neenah) is a wholly owned subsidiary of NFC Castings, Inc. NEI, alone or together with its subsidiaries as appropriate in the context, is referred to as “the Company.” Neenah, together with its subsidiaries, manufactures gray and ductile iron castings and forged components for sale to industrial and municipal customers. Industrial castings are custom-engineered and are produced for customers in several industries, including the medium and heavy-duty truck components, farm equipment, heating, ventilation and air-conditioning industries. Municipal castings include manhole covers and frames, storm sewer frames and grates, tree grates and specialty castings for a variety of applications and are sold principally to state and local government entities, utilities and contractors. The Company’s sales generally are unsecured.

Neenah has the following subsidiaries, all of which are wholly owned: Deeter Foundry, Inc. (Deeter); Mercer Forge Corporation and subsidiaries (Mercer); Dalton Corporation and subsidiaries (Dalton); Advanced Cast Products, Inc. and subsidiaries (Advanced Cast Products); Gregg Industries, Inc. (Gregg); Neenah Transport, Inc. (Transport) and Cast Alloys, Inc. (Cast Alloys), which is inactive. Deeter manufactures gray iron castings for the municipal market and special application construction castings. Mercer manufactures forged components for use in transportation, railroad, mining and heavy industrial applications and microalloy forgings for use by original equipment manufacturers and industrial end users. Dalton manufactures gray iron castings for refrigeration systems, air conditioners, heavy equipment, engines, gear boxes, stationary transmissions, heavy-duty truck transmissions and other automotive parts. Advanced Cast Products manufactures ductile and malleable iron castings for use in various industrial segments, including heavy truck, construction equipment, railroad, mining and automotive. Gregg manufactures gray and ductile iron castings for industrial and commercial use. Transport is a common and contract carrier licensed to operate in the continental United States. The majority of Transport’s revenues are derived from transport services provided to the Company.

2.   Summary of Significant Accounting Policies

Principles of Consolidation

The consolidated financial statements include the accounts of NEI and its subsidiaries. All intercompany transactions have been eliminated in consolidation.

Stock Split

On August 3, 2007, NEI amended its certificate of incorporation, which changed NEI’s authorized capital stock to 35,000,000 shares of common stock and 1,000,000 shares of preferred stock (the preferred stock was first authorized on August 3, 2007), and effected a 1-for-5 reverse split of its common stock. The number of shares and per share data in the accompanying financial statements have been adjusted for this reverse stock split.

Use of Estimates

The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.

Accounts Receivable

The Company evaluates the collectibility of its accounts receivable based on a number of factors. For known collectibility concerns, an allowance for doubtful accounts is recorded based on the customer’s ability and

43

Neenah Enterprises, Inc.

Notes to Consolidated Financial Statements — (Continued)

likelihood to pay based on management’s review of the facts. For all other accounts, the Company recognizes an allowance based on the length of time the receivable is past due based on historical experience. Adjustments to these estimates may be required if the financial condition of the Company’s customers were to change. The Company does not require collateral or other security on accounts receivable.

Inventories

Inventories at September 30, 2007 and 2006 are stated at the lower of cost or market. The cost of inventories for Neenah and Dalton is determined on the last-in, first-out (LIFO) method for substantially all inventories except supplies, for which cost is determined on the first-in, first-out (FIFO) method. The cost of inventories for Deeter, Mercer, Advanced Cast Products and Gregg is determined on the FIFO method. LIFO inventories comprised 37% and 38% of total inventories at September 30, 2007 and 2006, respectively. If the FIFO method of inventory valuation had been used by all companies, inventories would have been approximately $9,003 and $6,600 higher than reported at September 30, 2007 and 2006, respectively.

Property, Plant and Equipment

Property, plant and equipment acquired prior to September 30, 2003 are stated at fair value, as required by fresh start accounting. Additions to property, plant and equipment subsequent to October 1, 2003 are stated at cost. Depreciation for financial reporting purposes is provided over the estimated useful lives (3 to 40 years) of the respective assets using the straight-line method.

Capitalized Interest

Interest is capitalized on the acquisition and construction of long-term capital projects. Capitalized interest in fiscal 2007 was $1,027. No interest was capitalized in fiscal 2006 or 2005.

Deferred Financing Costs

Costs incurred to obtain long-term financing are amortized using the effective interest method over the term of the related debt.

Identifiable Intangible Assets

Identifiable intangible assets, primarily customer lists and tradenames, are amortized on a straight-line basis. The estimated useful lives of customer lists, tradenames and other are 10 years, 40 years and 15 years, respectively.

Goodwill

Goodwill is tested for impairment annually during the fourth fiscal quarter or more frequently if an event indicates that the goodwill might be impaired in accordance with Statement of Financial Accounting Standards (SFAS) No. 142, “Goodwill and Other Intangible Assets.” Based on such tests, there was no impairment of goodwill recorded in fiscal 2007, 2006 or 2005. All goodwill is within the Castings segment.

Impairment of Long-Lived Assets

Property, plant and equipment and identifiable intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. If the sum of the expected undiscounted cash flows is less than the carrying value of the related asset or group of assets, a loss is recognized for the difference between the fair value and carrying value of the asset or group of assets. Such analyses necessarily involve significant judgment.

44

Neenah Enterprises, Inc.

Notes to Consolidated Financial Statements — (Continued)

Revenue Recognition

Revenues are recognized when all of the following criteria are met: persuasive evidence of an arrangement exists; delivery has occurred and ownership has transferred to customer; the price to the customer is fixed and determinable; and collectibility is reasonably assured. The Company meets these criteria for revenue recognition upon shipment of product, which corresponds with transfer of title.

Shipping and Handling Costs

Shipping and handling costs billed to customers are recognized within net sales. Shipping and handling costs are included in cost of sales.

Advertising Costs

Advertising costs are expensed as incurred. Advertising costs were $793, $564 and $470 for the years ended September 30, 2007, 2006 and 2005, respectively.

Income Taxes

Deferred income taxes are provided for temporary differences between the financial reporting and income tax basis of the Company’s assets and liabilities and are measured using currently enacted tax rates and laws.

Financial Instruments

The carrying value of the Company’s financial instruments, including cash, accounts receivable, accounts payable, short-term debt (borrowings under the revolving credit facility) and capital lease obligations approximates fair value. The fair value of the Company’s 91/2% Notes, based on quoted market prices, was approximately $205,875 at September 30, 2007 compared to a carrying value of $225,000. The Company has concluded that it is not practicable to determine the fair value of the $75,000 121/2% Notes because they were issued to a related party.

Comprehensive Income/Loss

Comprehensive income/loss represents net income/loss plus any gains or losses that, under U.S. generally accepted accounting principles, are excluded from net income/loss and recognized directly as a component of stockholders’ equity.

Reclassifications

Certain reclassifications have been made to the prior year financial statements to conform to the current year presentation.

Earnings Per Share

Basic earnings per share is computed by dividing net income/loss by the weighted average number of shares of common stock outstanding during the period. Dilutive earnings per share is computed reflecting the potential dilutive effect of share based awards and stock warrants under the treasury stock method, which assumed the Company uses proceeds from the exercise of share based awards and stock warrants to repurchase the Company’s common stock at the average market price during the period. In applying the treasury stock method, the market price for the Company’s common stock was determined based on observable market prices and valuation techniques.

45

Neenah Enterprises, Inc.

Notes to Consolidated Financial Statements — (Continued)

The following table sets forth the computation of basic and diluted earnings (loss) per share for the years ended September 30 (in thousands):

	2007			2006		2005
Numerator:
Income (loss) used in computing basic and diluted earnings per share:
Net income (loss)	$	(13,928	)	$	16,149	$	15,095
Denominator:
Denominator for basic earnings per share — weighted-average common shares outstanding		10,663,274			9,394,920		8,841,274
Effect of dilutive securities — employee stock compensation plan		—			150,000		400,000
Effect of dilutive securities — stock warrants		—			6,731,078		6,827,610
Denominator for diluted earnings per share — adjusted weighted-average shares outstanding		10,663,274			16,275,998		16,068,884

At September 30, 2007 stock warrants to purchase 2,537,235 shares of common stock and 50,000 shares of restricted stock were not included in the Company’s computation of dilutive securities because the effect would have been anti-dilutive.

Stock Based Compensation

Prior to October 1, 2005, the Company accounted for share based awards under the recognition and measurement provisions of Accounting Principles Board Opinion No. 25 (APB 25), “Accounting for Stock Issued to Employees,” and related Interpretations, as permitted by SFAS No. 123, “Accounting for Stock-Based Compensation.” Effective October 1, 2005, as a non-public entity that previously used the minimum value method for proforma disclosure purposes under SFAS No. 123, the Company adopted the fair value recognition provisions of SFAS 123(R), “Share-Based Payment,” using the prospective-transition method. Accordingly, the provisions of SFAS No. 123(R) are applied prospectively to new awards and to awards modified, repurchased or cancelled after the adoption date.

New Accounting Pronouncements

In June 2006, the Financial Accounting Standards Board (FASB) issued FASB Interpretation No. (FIN) 48, “Accounting for Uncertainty in Income Taxes,” which clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements in accordance with SFAS No. 109, “Accounting for Income Taxes.” The interpretation prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. The Company is required to adopt FIN 48 as of October 1, 2007, and the impact that the adoption of FIN 48 will have on its consolidated financial statements and notes thereto is not expected to be significant.

In September 2006, the FASB issued SFAS No. 158, “Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans, an amendment of FASB Statements No. 87, 88, 106 and 132(R)” (SFAS 158). SFAS 158 requires employers that sponsor defined benefit pension and postretirement benefit plans to recognize previously unrecognized actuarial losses and prior service costs in the statement of financial position and to recognize future changes in these amounts in the year in which changes occur through comprehensive income. As a result, the balance sheet will reflect the funded status of those plans as an asset or liability. Additionally, employers are required to measure the funded status of a plan as of the date of its year-end statement of financial position and provide additional disclosures. On September 30, 2007, the Company adopted the provisions of SFAS 158 by

46

Neenah Enterprises, Inc.

Notes to Consolidated Financial Statements — (Continued)

recognizing the funded status of its defined benefit pension and postretirement benefit plans in the balance sheet. SFAS 158 did not have an effect on the Company’s consolidated financial condition at September 30, 2006 and 2005. See Note 8 for further discussion and disclosures of the effect of adopting SFAS 158 on the Company’s consolidated financial statements and notes thereto. In addition, the Company will be required to measure the plan assets and benefit obligations as of the date of the year-end balance sheet by September 30, 2009. The Company is currently evaluating the impact the change in the measurement date will have on its consolidated financial statements and notes thereto.

In September 2006, the FASB issued SFAS No. 157, “Fair Value Measurements” (SFAS 157). SFAS 157 defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles, and expands disclosures about fair value measurements. The Company is required to adopt SFAS 157 effective October 1, 2008 and is currently evaluating the impact of adopting SFAS 157 on its future results of operations and financial condition.

In February 2007, the FASB issued SFAS No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities, including an amendment of FASB Statement No. 115” (SFAS 159). SFAS 159 permits companies to choose to measure many financial instruments and certain other items at fair value that are not currently required to be measured at fair value and establishes presentation and disclosure requirements designed to facilitate comparisons between companies that choose different measurement attributes for similar types of assets and liabilities. The Company is required to adopt SFAS 159 effective October 1, 2008 and is currently evaluating the impact of adopting SFAS 159 on its future results of operations and financial condition.

3.   Inventories

Inventories consisted of the following as of September 30:

	2007		2006
Raw materials	$	6,941	$	7,857
Work in process and finished goods		41,407		38,437
Supplies		15,848		15,553
	$	64,196	$	61,847

4.   Intangible Assets

Identifiable intangible assets consisted of the following as of September 30:

	2007				2006
	Gross				Gross
	Carrying		Accumulated		Carrying		Accumulated
	Amount		Amortization		Amount		Amortization
Amortizable intangible assets:
Customer lists	$	67,000	$	26,800	$	67,000	$	20,100
Tradenames		16,282		1,645		16,282		1,234
Other		155		41		155		31
	$	83,437	$	28,486	$	83,437	$	21,365

The Company does not have any intangible assets deemed to have indefinite lives. The Company expects to recognize amortization expense of $7,120 in each of the five fiscal years subsequent to September 30, 2007.

47

Neenah Enterprises, Inc.

Notes to Consolidated Financial Statements — (Continued)

5.   Long-Term Debt

Long-term debt consisted of the following as of September 30:

	2007		2006
121/2% Senior Subordinated Notes	$	75,000	$	—
91/2% Senior Secured Notes		225,000		—
13% Senior Subordinated Notes		—		100,000
11% Senior Secured Notes, less unamortized discount of $6,337 in 2006		—		126,191
Term Loan Facilities		—		13,409
Revolving credit facility		17,152		24,595
		317,152		264,195
Less current portion		17,152		27,750
	$	300,000	$	236,445

On December 29, 2006, the Company repaid its outstanding indebtedness under Neenah’s then existing credit facility, repurchased all $133,130 of Neenah’s outstanding 11% Senior Secured Notes due 2010 through an issuer tender offer, retired $75,000 of Neenah’s outstanding 13% Senior Subordinated Notes due 2013 (the 13% Notes) by exchanging them for $75,000 of new 121/2% Senior Subordinated Notes due 2013 (the 121/2% Notes) in a private transaction, and issued a notice to redeem the remaining $25,000 of 13% Notes that remained outstanding after the initial exchange. The remaining 13% Notes were redeemed on February 2, 2007. To fund these payments and to provide cash for capital expenditures, ongoing working capital requirements and general corporate purposes, Neenah (a) issued $225,000 of new 91/2% Senior Secured Notes due 2017 (the 91/2% Notes) and the $75,000 of 121/2% Notes and (b) entered into an amended and restated credit facility (the 2006 Credit Facility) providing for borrowings in an amount up to $100,000. The 121/2% Notes were issued in a related party transaction with a substantial stockholder of the Company in exchange for 13% Notes held by such stockholder.

The 2006 Credit Facility provides for borrowings in an amount up to $100,000 and includes a provision permitting Neenah from time to time to request increases (subject to the lenders’ consent) in the aggregate amount by up to $10,000 with the increases to be funded through additional commitments from existing lenders or new commitments from financial institutions acceptable to the current lenders. It matures on December 31, 2011. The interest rate on the 2006 Credit Facility is based on LIBOR (5.25% at September 30, 2007) or prime (7.75% at September 30, 2007) plus an applicable margin, based upon Neenah meeting certain financial statistics. The weighted-average interest rate on the outstanding borrowings under the 2006 Credit Facility at September 30, 2007 was 7.10%, compared to 7.65% at September 30, 2006 on the outstanding borrowings under the revolving credit facility then in place. At September 30, 2007, Neenah had unused availability of $78,737. Substantially all of Neenah’s wholly owned subsidiaries are co-borrowers with Neenah under the 2006 Credit Facility. In addition, NFC Castings, Inc. and the remaining wholly owned subsidiaries of Neenah jointly, fully, severally and unconditionally guarantee Neenah’s obligations under the 2006 Credit Facility, subject to customary exceptions for transactions of this type.

The borrowers’ and guarantors’ obligations under the 2006 Credit Facility are secured by first priority liens, subject to customary restrictions, on Neenah’s and the guarantors’ accounts receivable, inventory, casting patterns and core boxes, business interruption insurance policies, certain inter-company loans, cash and deposit accounts and related assets, subject to certain exceptions, and any proceeds of the foregoing, and by second priority liens (junior to the liens securing the 91/2% Notes) on substantially all of our and the guarantors’ remaining assets. The 91/2% Notes, and the guarantees in respect thereof, are equal in right of payment to the 2006 Credit Facility, and the guarantees in respect thereof. Borrowings under the revolving credit facility have been classified as current liabilities in the accompanying consolidated balance sheets in accordance with the consensus of Emerging Issues

48

Neenah Enterprises, Inc.

Notes to Consolidated Financial Statements — (Continued)

Task Force No. 95-22, “Balance Sheet Classification of Borrowings Outstanding under Revolving Credit Agreements that include both a Subjective Acceleration Clause and a Lock-Box Arrangement.”

The 2006 Credit Facility requires Neenah to observe certain customary conditions, affirmative covenants and negative covenants including financial covenants and it requires Neenah to maintain a specified minimum interest coverage ratio or fixed charge coverage ratio whenever the unused availability is less than $15,000.

The 91/2% Notes mature on January 1, 2017 and bear interest at 91/2%. Interest is payable semiannually on January 1 and July 1. The 91/2% Notes are secured by first-priority liens on substantially all of Neenah’s and the guarantors’ assets (other than accounts receivable, inventory, casting patterns and core boxes, business interruption insurance policies, certain inter-company loans, cash and deposit accounts and related assets, subject to certain exceptions, and any proceeds of the foregoing) and by second-priority liens, junior to the liens for the benefit of the lenders under the 2006 Credit Facility, on Neenah’s and the guarantors’ accounts receivable, inventory, casting patterns and core boxes, business interruption insurance policies, certain inter-company loans, cash and deposit accounts and related assets, subject to certain exceptions, and any proceeds of the foregoing. Neenah’s obligations under the 91/2% Notes are guaranteed on a secured basis by each of its wholly owned subsidiaries. The 121/2% Notes are unsecured, mature on September 30, 2013 and bear interest at 121/2%. Interest of not less than 5% is payable in cash and the remainder (up to 71/2%) may be paid-in-kind semiannually on January 1 and July 1. Through July 1, 2007, Neenah has paid the interest in cash. The 91/2% and the 121/2% Notes are jointly, fully, severally and unconditionally guaranteed by all of Neenah’s subsidiaries.

The 91/2% Notes and the 121/2% Notes contain customary covenants typical to this type of financing, such as limitations on (1) indebtedness, (2) restricted payments, (3) liens, (4) distributions from restricted subsidiaries, (5) sale of assets, (6) affiliate transactions, (7) mergers and consolidations and (8) lines of business. At September 30, 2007, Neenah is in compliance with all covenants.

As a result of the refinancing transactions discussed above, Neenah incurred $20,429 of debt refinancing costs in the year ended September 30, 2007. This amount consisted of a $12,917 tender premium paid to repurchase the 11% Senior Secured Notes due 2010, $5,940 to write off the unamortized portion of discount on the 11% Senior Secured Notes and $1,572 to write off the unamortized portion of deferred financing costs on the old indebtedness.

6.   Commitments and Contingencies

The Company leases certain plants, warehouse space, machinery and equipment, office equipment and vehicles under operating leases, which generally include renewal options. Rent expense under these operating leases for the years ended September 30, 2007, 2006 and 2005 totaled $2,985, $2,923 and $2,920, respectively.

During the years ended September 30, 2007 and 2006, the Company financed purchases of property, plant and equipment totaling $413 and $1,271, respectively, by entering into capital lease obligations. Property, plant and equipment under leases accounted for as capital leases as of September 30 were as follows:

	2007		2006
Machinery and equipment	$	1,757	$	1,344
Less accumulated depreciation		551		214
	$	1,206	$	1,130

49

Neenah Enterprises, Inc.

Notes to Consolidated Financial Statements — (Continued)

Minimum rental payments due under operating and capital leases for fiscal years subsequent to September 30, 2007, are as follows:

	Operating		Capital
	Leases		Leases
2008	$	1,945	$	290
2009		1,286		290
2010		756		290
2011		456		290
2012		323		391
Thereafter		204		144
Total minimum lease payments	$	4,970		1,695
Less amount representing interest				260
Present value of minimum lease payments				1,435
Less current portion				213
Capital lease obligations			$	1,222

The Company is partially self-insured for workers’ compensation claims. An accrued liability is recorded for claims incurred but not yet paid or reported and is based on current and historical claim information. The accrued liability may ultimately be settled for an amount different than the recorded amount. Adjustments of the accrued liability are recorded in the period in which they become known.

Approximately 64% of the Company’s employees (or approximately 80% of the Company’s hourly workforce) are covered by collective bargaining agreements. The collective bargaining agreements for Mercer and the Warsaw location of Dalton, which represent approximately 25% of the Company’s employees (or approximately 39% of the Company’s hourly workforce), are scheduled to expire during fiscal 2008.

In the normal course of business, the Company is named in legal proceedings. There are currently no material legal proceedings pending with respect to the Company. On August 5, 2005 the Company settled a legal matter related to the proposed sale of one of its subsidiaries by paying a cash settlement of $6,500.

The Company is continuing to invest in a $54,000 capital project to replace a mold line at its Neenah facility. The new mold line is expected to significantly enhance operating efficiencies, increase capacity and provide expanded molding capabilities for municipal products. The Company anticipates that operating cash flows and borrowings under its 2006 Credit Facility will be sufficient to fund this and other anticipated operational investments, including working capital and capital expenditure needs, over the remaining construction timeframe. The Company expects the new mold line to become operational in April, 2008. At September 30, 2007, the Company had expended $30,594 and committed to an additional $16,578 of expenditures related to the new mold line.

7.   Stockholders’ Equity

The authorized capital of NEI consists of 1,000,000 shares of preferred stock, with a par value of $0.01 per share, and 35,000,000 shares of common stock, with a par value of $0.01 per share. All shares of common stock have equal voting rights. No shares of preferred stock have been issued. At September 30, 2007, NEI had stock warrants outstanding that are exercisable for an additional 2,537,235 shares of common stock. The warrants have an exercise price of $0.05 per share and expire on October 7, 2013.

The Company has a 2003 Management Equity Incentive Plan (the Plan) which provides for the issuance of share based awards to key employees and directors up to an aggregate amount of 1,600,000 shares of common

50

Neenah Enterprises, Inc.

Notes to Consolidated Financial Statements — (Continued)

stock. In July 2007, the Plan was amended and restated, assumed by NEI and renamed the Neenah Enterprises, Inc. Management Equity Incentive Plan. The Plan allows for the grant of incentive or non-qualified stock option awards and restricted stock awards. As of September 30, 2007, share based awards to purchase 750,000 shares of common stock are available for grant under this plan. The Company records compensation expense for this plan ratably over the vesting period.

In fiscal 2004, the Company granted 800,000 shares of restricted stock awards under the Plan which vested one fourth on the date of grant, with equal annual cliff vesting for the remaining unvested portion over a three year period, contingent on employment and subject to acceleration in the event of a significant transaction, as defined in the award agreement. These restricted shares were determined to have a nominal fair value at the date of grant. As provided for under the terms of the award, the vesting of all nonvested restricted stock awards was accelerated on May 25, 2006, such that the awards were fully vested, as a result of a change in control of the Company.

In fiscal 2007, the Company granted 50,000 shares of restricted stock under the Plan which vest in two equal installments on the first and second anniversary of the grant date and were determined to have a grant date fair value of $6.50 per share, based on available quoted market prices. Nonvested stock compensation expense recognized by the Company for the year ended September 30, 2007 was $41. As of September 30, 2007, there was $284 of unrecognized compensation cost related to non-vested stock that is expected to be recognized over a weighted average period of 1.75 years.

8.   Income Taxes

The provision (credit) for income taxes consisted of the following:

	Years Ended September 30
	2007			2006			2005
Current:
Federal	$	(6,593	)	$	7,553		$	7,032
State		352			1,314			1,568
		(6,241	)		8,867			8,600
Deferred		(2,578	)		(10	)		(5,191	)
	$	(8,819	)	$	8,857		$	3,409

The provision (credit) for income taxes differed from the amount computed by applying the federal statutory rate of 35% to income (loss) before income taxes as follows:

	Years Ended September 30
	2007			2006			2005
Provision at statutory rate	$	(7,961	)	$	8,752		$	6,476
State income taxes, net of federal taxes		(841	)		851			815
Permanent differences due to reorganization		—			—			(885	)
Change in tax method of determining LIFO inventory		—			—			(2,679	)
Change in enacted state tax laws		—			(758	)		—
Other		(17	)		12			(318	)
Provision (credit) for income taxes	$	(8,819	)	$	8,857		$	3,409

51

Neenah Enterprises, Inc.

Notes to Consolidated Financial Statements — (Continued)

Deferred income tax assets and liabilities consisted of the following as of September 30:

	2007			2006
Deferred income tax liabilities:
Inventories	$	(529	)	$	(1,195	)
Property, plant and equipment		(12,339	)		(11,667	)
Identifiable intangible assets		(21,220	)		(24,069	)
Other		(388	)		(336	)
		(34,476	)		(37,267	)
Deferred income tax assets:
Employee benefit plans		4,697			8,926
Accrued vacation		1,940			2,237
Other accrued liabilities		926			997
State net operating loss and credit carryforwards		909			155
Other		995			873
Total deferred tax assets		9,467			13,188
Valuation allowance for deferred income tax assets		(55	)		(155	)
		9,412			13,033
Net deferred income tax liability	$	(25,064	)	$	(24,234	)
Included in the consolidated balance sheets as:
Current deferred income tax asset	$	3,070		$	2,697
Noncurrent deferred income tax liability		(28,134	)		(26,931	)
	$	(25,064	)	$	(24,234	)

As of September 30, 2007, the Company had state net operating loss and credit carryforwards of $16,786 which expire through fiscal 2017. A full valuation allowance has been established for certain state net operating loss carryforwards due to the uncertainty regarding the realization of the deferred tax benefit through future earnings.

9.   Employee Benefit Plans

Defined-Benefit Pension Plans and Postretirement Benefits

The Company sponsors five defined-benefit pension plans covering the majority of its hourly employees. Retirement benefits under the pension plans are based on years of service and defined-benefit rates. The Company has elected a measurement date of June 30 for all of its pension plans. The Company funds the pension plans based on actuarially determined cost methods allowable under Internal Revenue Service regulations. During each of the years ended September 30, 2006 and 2007, the Company amended one of its defined-benefit pension plans to freeze its defined benefit rate and credited years of service. No curtailment gain or loss was required in conjunction with freezing these defined-benefit plans.

The Company also sponsors unfunded defined-benefit postretirement health care plans covering substantially all salaried and hourly employees at Neenah and their dependents. For salaried employees at Neenah, benefits are provided from the date of retirement for the duration of the employee’s life, while benefits for hourly employees at Neenah are provided from retirement to age 65. Retirees’ contributions to the plans are based on years of service and age at retirement. The Company funds benefits as incurred. The Company has elected a measurement date of June 30 for these plans.

52

Neenah Enterprises, Inc.

Notes to Consolidated Financial Statements — (Continued)

FASB Financial Staff Position No. FAS 106-2, “Accounting and Disclosure Requirements Related to the Medicare Prescription Drug, Improvement and Modernization Act of 2003” (the Act), addresses the impact of the Act enacted in December 2003. The Act provides a prescription drug subsidy benefit for Medicare eligible employees starting in 2006. During fiscal 2005, it was determined that the benefit levels of the Company’s defined-benefit postretirement health care plan covering salaried employees met the criteria set forth by the Act to qualify for the subsidy. Effective with the June 30, 2005 measurement date, the effects of the subsidy were used in measuring the plan’s benefit obligation and net periodic postretirement benefit cost. The effect of the subsidy was to reduce the net periodic postretirement benefit cost by approximately $337 for the year ended September 30, 2006.

Adoption of SFAS 158

As discussed in Note 2, the Company adopted SFAS 158, as it relates to recognizing the funded status of its defined benefit pension and postretirement benefit plans in its consolidated balance sheets and related disclosure provisions, on September 30, 2007. Funded status is defined as the difference between the projected benefit obligation and the fair value of plan assets. Upon adoption, the Company recorded an adjustment to accumulated other comprehensive income (loss) representing the recognition of previously unrecorded pension and postretirement healthcare liabilities related to net unrecognized actuarial gains and unrecognized prior service costs and credits. These amounts will be subsequently recognized as a component of net periodic pension cost pursuant to the Company’s historical accounting policy for recognizing such amounts.

The incremental effects of adopting the provisions of SFAS 158 on the Company’s consolidated balance sheets at September 30, 2007 are presented in the following table. The adoption of SFAS 158 had no effect on the Company’s consolidated statements of operations for the year ended September 30, 2007 or for any prior period presented, and it will not affect the Company’s operating results in future periods.

	At September 30, 2007
	Prior to			Effect of
	Adopting			Adopting
	SFAS 158			SFAS 158			As Reported
Other assets	$	5,439		$	547		$	5,986
Net deferred tax liability		(22,300	)		(2,764	)		(25,064	)
Other accrued liabilities		(4,563	)		(200	)		(4,763	)
Postretirement benefit obligations		(9,897	)		4,628			(5,269	)
Pension benefit obligations		(5,102	)		1,960			(3,142	)
Accumulated other comprehensive income		—			(4,171	)		(4,171	)

Amounts included in accumulated other comprehensive income, net of tax, at September 30, 2007 which have not yet been recognized in net periodic benefit cost were as follows:

				Other
	Pension			Postretirement
	Plans			Benefits
Prior service cost (credit)	$	217		$	(219	)
Net actuarial gain		(1,723	)		(2,446	)

Amounts included in accumulated other comprehensive income, net of tax, at September 30, 2007 expected to be recognized in net periodic benefit cost during the fiscal year ending September 30, 2008 were as follows:

				Other
	Pension			Postretirement
	Plans			Benefits
Prior service cost (credit)	$	30		$	(32	)
Net actuarial gain		(15	)		(246	)

53

Neenah Enterprises, Inc.

Notes to Consolidated Financial Statements — (Continued)

Obligations and Funded Status

The following table summarizes the funded status of the pension plans and postretirement benefit plans and the amounts recognized in the consolidated balance sheets at September 30, 2007 and 2006:

	Pension						Postretirement
	Benefits						Benefits
	2007			2006			2007			2006
Change in benefit obligation:
Benefit obligation, July 1	$	71,914		$	78,162		$	5,631		$	7,351
Service cost		1,798			2,328			179			153
Interest cost		4,421			4,083			324			282
Unrecognized prior service cost		30			30			—			—
Actuarial gains		(280	)		(10,294	)		(123	)		(1,748	)
Benefits paid		(3,012	)		(2,757	)		(425	)		(407	)
Benefit obligation, June 30	$	74,871		$	71,914		$	5,586		$	5,631
Change in plan assets:
Fair value of plan assets, July 1	$	64,373		$	54,648		$	—		$	—
Actual return on plan assets		8,781			3,963			—			—
Company contributions		574			8,519			425			407
Benefits paid		(3,012	)		(2,757	)		(425	)		(407	)
Fair value of plan assets, June 30	$	70,716		$	64,373		$	—		$	—
Funded status of the plans:
Benefit obligation in excess of plan assets	$	(4,155	)	$	(7,541	)	$	(5,586	)	$	(5,631	)
Unrecognized prior service cost (credit)		—			392			—			(396	)
4th quarter contributions		1,560			—			117			101
Unrecognized net (gains) losses		—			908			—			(4,215	)
	$	(2,595	)	$	(6,241	)	$	(5,469	)	$	(10,141	)
Amounts recognized in the consolidated balance sheets at September 30:
Prepaid benefit cost (long-term asset)	$	547		$	—		$	—		$	—
Accrued benefit liability (long-term liability)		(3,142	)		(8,036	)		(5,269	)		(10,141	)
Accrued benefit liability (current liability)		—			—			(200	)		—
	$	(2,595	)	$	(8,036	)	$	(5,469	)	$	(10,141	)

The accumulated benefit obligation for the Company’s defined benefit pension plans was $74,871 and $71,914 at September 30, 2007 and 2006, respectively. At September 30, 2007, pension plans with benefit obligations in excess of plan assets had an aggregate projected benefit obligation of $68,926 and aggregate fair value of plan assets of $65,784.

54

Neenah Enterprises, Inc.

Notes to Consolidated Financial Statements — (Continued)

Benefit Costs

Components of net periodic benefit cost for the years ended September 30 were as follows:

	Pension Benefits									Postretirement Benefits
	2007			2006			2005			2007			2006			2005
Service cost	$	1,798		$	2,328		$	2,008		$	179		$	153		$	161
Interest cost		4,421			4,083			3,870			324			282			363
Expected return on plan assets		(5,255	)		(4,732	)		(4,157	)		—			—			—
Amortization of prior service cost (credit)		30			30			—			(32	)		(33	)		(32	)
Recognized net actuarial (gain) loss		—			185			2			(275	)		(265	)		(244	)
Net periodic benefit cost	$	994		$	1,894		$	1,723		$	196		$	137		$	248

Assumptions

Weighted-average assumptions used to determine benefit obligations as of September 30 were as follows:

	Pension Benefits						Postretirement Benefits
	2007			2006			2007			2006
Discount rate		6.25	%		6.25	%		6.25	%		6.25	%

Weighted-average assumptions used to determine net periodic benefit cost for the years ended September 30 were as follows:

	Pension Benefits						Postretirement Benefits
	2007		2006		2005		2007			2006			2005
Discount rate		6.25%		5.25%		6.25%		6.25	%		5.25	%		6.25	%
Expected long-term rate of return on plan assets		7.50% to 8.50%		7.50% to 8.50%		7.50% to 8.50%		—			—			—

For measurement purposes, the healthcare cost trend rate was assumed to be 9.5% decreasing gradually to 5.0% in 2016 and then remaining at that level thereafter. The healthcare cost trend rate assumption has a significant effect on the amounts reported. A one percentage point change in the healthcare cost trend rate would have the following effect:

	1% Increase		1% Decrease
Effect on total of service cost and interest cost	$	101	$	(78	)
Effect on postretirement benefit obligation		934		(741	)

Pension Plan Assets

The following table summarizes the weighted-average asset allocations of the pension plans at September 30:

	2007			2006
Asset category:
Equity securities		56	%		51	%
Debt securities		34			32
Real estate		4			3
Other		6			14
		100	%		100	%

55

Neenah Enterprises, Inc.

Notes to Consolidated Financial Statements — (Continued)

The Company employs a total return investment approach whereby a mix of equities and fixed income investments are used to maximize the long-term return of plan assets for a prudent level of risk. The intent of this strategy is to minimize plan expenses by maximizing investment returns within that prudent level of risk. The investment portfolio contains a diversified blend of equity and fixed income investments. Furthermore, equity investments are diversified across U.S. and non-U.S. stocks as well as growth, value, and small and large capitalizations. The Company’s targeted asset allocation ranges as a percentage of total market value are as follows: equity securities 45% to 55% and debt securities 30% to 35%. None of the plans’ equity securities are invested in common stock of NEI. Additionally, cash balances are maintained at levels adequate to meet near term plan expenses and benefit payments. Investment risk is measured and monitored on an ongoing basis through quarterly investment portfolio reviews.

The Company’s overall expected long-term rates of return on assets range from 7.50% to 8.50%. The expected long-term rates of return are based on the portfolio of each defined benefit pension plan as a whole and not on the sum of the returns of individual asset categories. The rates of return are based on historical returns adjusted to reflect the current view of the long-term investment market.

Benefit Payments and Contributions

The following benefit payments, which reflect expected future service, as appropriate, and are net of expected Medicare subsidy receipts, are expected to be paid for fiscal years subsequent to September 30, 2007:

2008	$	3,166
2009		3,278
2010		3,456
2011		3,626
2012		3,964
2013 — 2017		25,753
	$	43,243

The Company expects to contribute $1,621 to its pension plans during fiscal 2008.

Defined-Contribution Retirement Plans

The Company sponsors various defined-contribution retirement plans (the Plans) covering substantially all salaried and certain hourly employees. The Plans allow participants to make 401(k) contributions in amounts ranging from 1% to 15% of their compensation. The Company matches between 35% and 50% of the participants’ contributions up to a maximum of 6% of the employee’s compensation, as defined. The Company may make additional voluntary contributions to the Plans as determined annually by the Board of Directors. Total Company contributions amounted to $3,268, $2,448 and $2,264 for the years ended September 30, 2007, 2006 and 2005, respectively.

Other Employee Benefits

The Company provides unfunded supplemental retirement benefits to certain active and retired employees at Dalton. At September 30, 2007, the present value of the current and long-term portion of these supplemental retirement obligations totaled $262 and $1,871, respectively. At September 30, 2006, the present value of the current and long-term portion of these supplemental retirement obligations totaled $246 and $2,117, respectively.

Certain of Dalton’s hourly employees are covered by a multi-employer, defined-benefit pension plan pursuant to a collective bargaining agreement. The Company’s expense for the years ended September 30, 2007, 2006 and 2005, was $334, $356 and $337, respectively.

56

Neenah Enterprises, Inc.

Notes to Consolidated Financial Statements — (Continued)

Substantially all of Mercer’s union employees are covered by a multiemployer, defined-benefit pension plan pursuant to a collective bargaining agreement. The Company’s expense for the years ended September 30, 2007, 2006 and 2005, was $197, $221 and $290, respectively.

10.   Segment Information

The Company has two reportable segments, Castings and Forgings. The Castings segment manufactures and sells gray and ductile iron castings for the industrial and municipal markets, while the Forgings segment manufactures forged components for the industrial market. The Other segment includes machining operations and freight hauling.

The Company evaluates performance and allocates resources based on the operating income before depreciation and amortization charges of each segment. The accounting policies of the reportable segments are the same as those described in the summary of significant accounting policies. Intersegment sales and transfers are recorded at cost plus a share of operating profit.

	Years Ended September 30
	2007			2006			2005
Revenues from external customers:
Castings	$	441,524		$	495,384		$	491,159
Forgings		37,113			41,222			44,348
Other		18,321			20,703			22,507
Elimination of intersegment revenues		(13,335	)		(14,857	)		(16,242	)
	$	483,623		$	542,452		$	541,772
Net income (loss):
Castings	$	(13,928	)	$	16,149		$	15,095
Forgings		(1,551	)		(605	)		(570	)
Other		(150	)		345			189
Elimination of intersegment loss		1,701			260			381
	$	(13,928	)	$	16,149		$	15,095
Total assets:
Castings	$	496,219		$	472,760		$	475,725
Forgings		5,927			6,399			7,040
Other		10,086			10,285			13,268
Elimination of intersegment assets		(68,258	)		(78,524	)		(83,478	)
	$	443,974		$	410,920		$	412,555

57

Neenah Enterprises, Inc.

Notes to Consolidated Financial Statements — (Continued)

	Castings			Forgings		Other			Total
Year ended September 30, 2007:
Interest expense	$	27,649		$	3,571	$	480		$	31,700
Interest income		349			7		—			356
Provision (credit) for income taxes		(9,933	)		1,166		(52	)		(8,819	)
Depreciation and amortization expense		19,046			857		1,152			21,055
Expenditures for long-lived assets		47,475			563		695			48,733
Year ended September 30, 2006:
Interest expense	$	29,309		$	3,368	$	733		$	33,410
Interest income		78			—		5			83
Provision for income taxes		7,077			1,569		211			8,857
Depreciation and amortization expense		18,105			916		1,222			20,243
Expenditures for long-lived assets		16,866			417		520			17,803
Year ended September 30, 2005:
Interest expense	$	29,543		$	3,387	$	489		$	33,419
Interest income		13			—		—			13
Provision for income taxes		1,642			479		1,288			3,409
Depreciation and amortization expense		16,979			815		1,070			18,864
Expenditures for long-lived assets		15,966			948		658			17,572

Geographic Information

			Long-Lived
	Net Sales		Assets(1)
Year ended September 30, 2007:
United States	$	462,597	$	131,550
Foreign countries		21,026		—
	$	483,623	$	131,550
Year ended September 30, 2006:
United States	$	521,193	$	96,878
Foreign countries		21,259		—
	$	542,452	$	96,878
Year ended September 30, 2005:
United States	$	509,104	$	91,250
Foreign countries		32,668		—
	$	541,772	$	91,250

(1) Represents property, plant and equipment.

58

Neenah Enterprises, Inc.

Notes to Consolidated Financial Statements — (Continued)

11.   Quarterly Results of Operations (Unaudited)

	Year Ended September 30, 2007
	1st Quarter			2nd Quarter			3rd Quarter		4th Quarter
Net sales	$	117,342		$	111,789		$	126,838	$	127,654
Gross profit		18,625			10,733			22,297		23,064
Net income (loss)		(12,332	)(a)		(4,299	)		1,710		993	(b)
Earnings (loss) per common share:
Basic	$	(1.31	)	$	(0.46	)	$	0.17	$	0.07
Diluted		(1.31	)		(0.46	)		0.13		0.06

	Year Ended September 30, 2006
	1st Quarter		2nd Quarter		3rd Quarter		4th Quarter
Net sales	$	121,714	$	130,513	$	147,724	$	142,501
Gross profit		19,090		21,219		29,951		29,634
Net income		720		1,057		6,842		7,530
Earnings per common share:
Basic	$	0.08	$	0.12	$	0.74	$	0.80
Diluted		0.05		0.07		0.42		0.47

(a)	Net income for the three months ended December 31, 2006 included $20,419 of debt refinancing costs, on a pretax basis. See Note 5 for further details on the debt refinancing.
(b)	Certain non-standard adjustments, primarily related to the capitalization of interest, were recorded in the fourth quarter of fiscal 2007. These adjustments resulted in lower net income of approximately $761 or $0.05 per diluted share and were deemed to be immaterial with respect to the impact on prior quarters.

59

Report of Independent Registered Public Accounting Firm

The Board of Directors

Neenah Foundry Company

We have audited the accompanying consolidated balance sheets of Neenah Foundry Company and Subsidiaries (the Company) as of September 30, 2007 and 2006, and the related consolidated statements of operations, changes in stockholder’s equity and cash flows for each of the three years in the period ended September 30, 2007. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. We were not engaged to perform an audit of the Company’s internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of the Company at September 30, 2007 and 2006, and the consolidated results of its operations and its cash flows for each of the three years in the period ended September 30, 2007, in conformity with U.S. generally accepted accounting principles.

As discussed in Note 2 to the consolidated financial statements, on September 30, 2007, the Company changed its method of accounting for defined benefit pension and postretirement healthcare plans.

/s/  Ernst & Young LLP

Milwaukee, Wisconsin

November 28, 2007

60

Neenah Foundry Company

Consolidated Balance Sheets

	September 30
	2007		2006
	(In thousands, except share and per share data)
Assets
Current assets:
Cash	$	—	$	910
Accounts receivable, less allowance for doubtful accounts of $2,262 in 2007 and $1,885 in 2006		81,085		85,161
Inventories		64,196		61,847
Refundable income taxes		6,501		—
Deferred income taxes		3,070		2,697
Other current assets		6,479		7,425
Total current assets		161,331		158,040
Property, plant and equipment:
Land		7,218		7,209
Buildings and improvements		19,955		18,733
Machinery and equipment		104,893		88,562
Patterns		14,617		13,527
Construction in progress		32,839		3,679
		179,522		131,710
Less accumulated depreciation		47,972		34,832
		131,550		96,878
Deferred financing costs, net of accumulated amortization of $343 in 2007 and $1,509 in 2006		3,457		1,695
Identifiable intangible assets, net of accumulated amortization of $28,486 in 2007 and $21,365 in 2006		54,951		62,072
Goodwill		86,699		86,699
Other assets		5,986		5,536
		151,093		156,002
	$	443,974	$	410,920

61

Neenah Foundry Company

Consolidated Balance Sheets

	September 30
	2007		2006
	(In thousands, except share and per share data)
Liabilities and stockholder’s equity
Current liabilities:
Accounts payable	$	27,764	$	29,766
Accrued wages and employee benefits		13,139		13,713
Accrued interest		5,449		7,157
Accrued interest — related party		2,344		—
Other accrued liabilities		5,016		5,474
Current portion of long-term debt		17,152		27,750
Current portion of capital lease obligations		213		161
Total current liabilities		71,077		84,021
Long-term debt		225,000		236,445
Long-term debt — related party		75,000		—
Capital lease obligations		1,222		1,060
Deferred income taxes		28,134		26,931
Postretirement benefit obligations		5,269		10,141
Pension benefit obligations		3,142		8,036
Other liabilities		4,818		5,100
Total liabilities		413,662		371,734
Commitments and contingencies
Stockholder’s equity:
Common stock, par value $100 per share; 1,000 shares authorized, issued and outstanding		100		100
Capital in excess of par value		5,470		5,429
Retained earnings		20,571		34,499
Accumulated other comprehensive income (loss)		4,171		(842	)
Total stockholder’s equity		30,312		39,186
	$	443,974	$	410,920

See accompanying notes.

62

Neenah Foundry Company

Consolidated Statements of Operations

				Years Ended
				September 30
	2007			2006			2005
	(In thousands)
Net sales	$	483,623		$	542,452		$	541,772
Cost of sales		408,904			442,558			440,818
Gross profit		74,719			99,894			100,954
Selling, general and administrative expenses		38,119			34,314			34,467
Litigation settlement		—			—			6,500
Amortization expense		7,121			7,120			7,124
Loss on disposal of property, plant and equipment		453			127			953
Operating income		29,026			58,333			51,910
Other income (expense):
Interest expense		(24,610	)		(33,410	)		(33,419	)
Interest expense — related party		(7,090	)		—			—
Interest income		356			83			13
Debt refinancing costs		(20,429	)		—			—
Income (loss) before income taxes		(22,747	)		25,006			18,504
Provision (credit) for income taxes		(8,819	)		8,857			3,409
Net income (loss)	$	(13,928	)	$	16,149		$	15,095

See accompanying notes.

63

Neenah Foundry Company

Consolidated Statements of Changes in Stockholder’s Equity (Deficit)

								Accumulated
								Other
			Capital					Comprehensive
	Common		in Excess of		Retained			(Loss)
	Stock		Par Value		Earnings			Income			Total
	(In thousands)
Balance at September 30, 2004	$	100	$	5,429	$	3,255		$	—		$	8,784
Components of comprehensive income:
Net income		—		—		15,095			—			15,095
Pension liability adjustment, net of tax effect of $4,350		—		—		—			(6,526	)		(6,526	)
Total comprehensive income												8,569
Balance at September 30, 2005		100		5,429		18,350			(6,526	)		17,353
Components of comprehensive income:
Net income		—		—		16,149			—			16,149
Pension liability adjustment, net of tax effect of $(3,789)		—		—		—			5,684			5,684
Total comprehensive income												21,833
Balance at September 30, 2006		100		5,429		34,499			(842	)		39,186
Components of comprehensive loss:
Net loss		—		—		(13,928	)		—			(13,928	)
Pension liability adjustment, net of tax effect of $(561)		—		—		—			842			842
Total comprehensive loss												(13,086	)
Stock based compensation		—		41		—			—			41
Adjustment to initially apply SFAS 158, net of tax effect of $(2,764)		—		—		—			4,171			4,171
Balance at September 30, 2007	$	100	$	5,470	$	20,571		$	4,171		$	30,312

See accompanying notes.

64

Neenah Foundry Company

Consolidated Statements of Cash Flows

				Years Ended
				September 30
	2007			2006			2005
	(In thousands)
Operating activities
Net income (loss)	$	(13,928	)	$	16,149		$	15,095
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Provision for obsolete inventories		669			318			356
Provision for bad debts		1,047			433			2,153
Depreciation		13,934			13,123			11,740
Amortization of identifiable intangible assets		7,121			7,120			7,124
Amortization of deferred financing costs and discount on notes		862			2,081			2,110
Write-off of deferred financing costs and discount on notes		7,512			—			—
Loss on disposal of property, plant and equipment		453			127			953
Deferred income taxes		(2,578	)		(10	)		(5,191	)
Stock based compensation expense		41			—			—
Changes in operating assets and liabilities:
Accounts receivable		3,029			201			(6,628	)
Inventories		(3,018	)		(3,042	)		1,640
Other current assets		(5,555	)		(528	)		281
Accounts payable		(2,002	)		(539	)		1,155
Accrued liabilities		(530	)		(5,349	)		6,719
Postretirement benefit obligations		(245	)		(263	)		(171	)
Pension benefit obligations		(1,139	)		(5,284	)		(3,631	)
Other liabilities		(282	)		214			(118	)
Net cash provided by operating activities		5,391			24,751			33,587
Investing activities
Purchase of property, plant and equipment		(48,733	)		(17,803	)		(17,572	)
Proceeds from sale of property, plant and equipment		88			196			905
Other		(277	)		(525	)		347
Net cash used in investing activities		(48,922	)		(18,132	)		(16,320	)
Financing activities
Proceeds from long-term debt		225,000			—			84
Proceeds from long-term debt — related party		75,000			—			—
Payments on debt and capital lease obligations		(253,579	)		(9,193	)		(13,716	)
Debt issuance costs		(3,800	)		—			(151	)
Net cash provided by (used in) financing activities		42,621			(9,193	)		(13,783	)
Increase (decrease) in cash		(910	)		(2,574	)		3,484
Cash at beginning of year		910			3,484			—
Cash at end of year	$	—		$	910		$	3,484
Supplemental disclosures of cash flows information:
Interest paid	$	29,898		$	31,306		$	31,315
Income taxes paid		494			11,864			5,622

See accompanying notes.

65

Neenah Foundry Company

Notes to Consolidated Financial Statements

September 30, 2007

(In Thousands, Except Share and Per Share Data)

1.   Organization and Description of Business

Neenah Foundry Company (Neenah), together with its subsidiaries (collectively, the Company), manufactures gray and ductile iron castings and forged components for sale to industrial and municipal customers. Industrial castings are custom-engineered and are produced for customers in several industries, including the medium and heavy-duty truck components, farm equipment, heating, ventilation and air-conditioning industries. Municipal castings include manhole covers and frames, storm sewer frames and grates, tree grates and specialty castings for a variety of applications and are sold principally to state and local government entities, utilities and contractors. The Company’s sales generally are unsecured.

Neenah is a wholly owned subsidiary of NFC Castings, Inc., which is a wholly owned subsidiary of Neenah Enterprises, Inc. (NEI), formerly ACP Holding Company. Neenah has the following subsidiaries, all of which are wholly owned: Deeter Foundry, Inc. (Deeter); Mercer Forge Corporation and subsidiaries (Mercer); Dalton Corporation and subsidiaries (Dalton); Advanced Cast Products, Inc. and subsidiaries (Advanced Cast Products); Gregg Industries, Inc. (Gregg); Neenah Transport, Inc. (Transport) and Cast Alloys, Inc. (Cast Alloys), which is inactive. Deeter manufactures gray iron castings for the municipal market and special application construction castings. Mercer manufactures forged components for use in transportation, railroad, mining and heavy industrial applications and microalloy forgings for use by original equipment manufacturers and industrial end users. Dalton manufactures gray iron castings for refrigeration systems, air conditioners, heavy equipment, engines, gear boxes, stationary transmissions, heavy-duty truck transmissions and other automotive parts. Advanced Cast Products manufactures ductile and malleable iron castings for use in various industrial segments, including heavy truck, construction equipment, railroad, mining and automotive. Gregg manufactures gray and ductile iron castings for industrial and commercial use. Transport is a common and contract carrier licensed to operate in the continental United States. The majority of Transport’s revenues are derived from transport services provided to the Company.

2.   Summary of Significant Accounting Policies

Principles of Consolidation

The consolidated financial statements include the accounts of Neenah and its subsidiaries. All intercompany transactions have been eliminated in consolidation.

Use of Estimates

The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.

Accounts Receivable

The Company evaluates the collectibility of its accounts receivable based on a number of factors. For known collectibility concerns, an allowance for doubtful accounts is recorded based on the customer’s ability and likelihood to pay based on management’s review of the facts. For all other accounts, the Company recognizes an allowance based on the length of time the receivable is past due based on historical experience. Adjustments to these estimates may be required if the financial condition of the Company’s customers were to change. The Company does not require collateral or other security on accounts receivable.

66

Neenah Foundry Company

Notes to Consolidated Financial Statements — (Continued)

Inventories

Inventories at September 30, 2007 and 2006 are stated at the lower of cost or market. The cost of inventories for Neenah and Dalton is determined on the last-in, first-out (LIFO) method for substantially all inventories except supplies, for which cost is determined on the first-in, first-out (FIFO) method. The cost of inventories for Deeter, Mercer, Advanced Cast Products and Gregg is determined on the FIFO method. LIFO inventories comprised 37% and 38% of total inventories at September 30, 2007 and 2006, respectively. If the FIFO method of inventory valuation had been used by all companies, inventories would have been approximately $9,003 and $6,600 higher than reported at September 30, 2007 and 2006, respectively.

Property, Plant and Equipment

Property, plant and equipment acquired prior to September 30, 2003 are stated at fair value, as required by fresh start accounting. Additions to property, plant and equipment subsequent to October 1, 2003 are stated at cost. Depreciation for financial reporting purposes is provided over the estimated useful lives (3 to 40 years) of the respective assets using the straight-line method.

Capitalized Interest

Interest is capitalized on the acquisition and construction of long-term capital projects. Capitalized interest in fiscal 2007 was $1,027. No interest was capitalized in fiscal 2006 or 2005.

Deferred Financing Costs

Costs incurred to obtain long-term financing are amortized using the effective interest method over the term of the related debt.

Identifiable Intangible Assets

Identifiable intangible assets, primarily customer lists and tradenames, are amortized on a straight-line basis. The estimated useful lives of customer lists, tradenames and other are 10 years, 40 years and 15 years, respectively.

Goodwill

Goodwill is tested for impairment annually during the fourth fiscal quarter or more frequently if an event indicates that the goodwill might be impaired in accordance with Statement of Financial Accounting Standards (SFAS) No. 142, “Goodwill and Other Intangible Assets.” Based on such tests, there was no impairment of goodwill recorded in fiscal 2007, 2006 or 2005. All goodwill is within the Castings segment.

Impairment of Long-Lived Assets

Property, plant and equipment and identifiable intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. If the sum of the expected undiscounted cash flows is less than the carrying value of the related asset or group of assets, a loss is recognized for the difference between the fair value and carrying value of the asset or group of assets. Such analyses necessarily involve significant judgment.

Revenue Recognition

Revenues are recognized when all of the following criteria are met: persuasive evidence of an arrangement exists; delivery has occurred and ownership has transferred to customer; the price to the customer is fixed and determinable; and collectibility is reasonably assured. The Company meets these criteria for revenue recognition upon shipment of product, which corresponds with transfer of title.

67

Neenah Foundry Company

Notes to Consolidated Financial Statements — (Continued)

Shipping and Handling Costs

Shipping and handling costs billed to customers are recognized within net sales. Shipping and handling costs are included in cost of sales.

Advertising Costs

Advertising costs are expensed as incurred. Advertising costs were $793, $564 and $470 for the years ended September 30, 2007, 2006 and 2005, respectively.

Income Taxes

Deferred income taxes are provided for temporary differences between the financial reporting and income tax basis of the Company’s assets and liabilities and are measured using currently enacted tax rates and laws.

Financial Instruments

The carrying value of the Company’s financial instruments, including cash, accounts receivable, accounts payable, short-term debt (borrowings under the revolving credit facility) and capital lease obligations approximates fair value. The fair value of the Company’s 91/2% Notes, based on quoted market prices, was approximately $205,875 at September 30, 2007 compared to a carrying value of $225,000. The Company has concluded that it is not practicable to determine the fair value of the $75,000 121/2% Notes because they were issued to a related party.

Comprehensive Income/Loss

Comprehensive income/loss represents net income/loss plus any gains or losses that, under U.S. generally accepted accounting principles, are excluded from net income/loss and recognized directly as a component of stockholder’s equity.

Reclassifications

Certain reclassifications have been made to the prior year financial statements to conform to the current year presentation.

Stock Based Compensation

Prior to October 1, 2005, the Company accounted for share based awards under the recognition and measurement provisions of Accounting Principles Board Opinion No. 25 (APB 25), “Accounting for Stock Issued to Employees,” and related Interpretations, as permitted by SFAS No. 123, “Accounting for Stock-Based Compensation.” Effective October 1, 2005, as a non-public entity that previously used the minimum value method for proforma disclosure purposes under SFAS No. 123, the Company adopted the fair value recognition provisions of SFAS 123(R), “Share-Based Payment,” using the prospective-transition method. Accordingly, the provisions of SFAS No. 123(R) are applied prospectively to new awards and to awards modified, repurchased or cancelled after the adoption date.

New Accounting Pronouncements

In June 2006, the Financial Accounting Standards Board (FASB) issued FASB Interpretation No. (FIN) 48, “Accounting for Uncertainty in Income Taxes,” which clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements in accordance with SFAS No. 109, “Accounting for Income Taxes.” The interpretation prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. The Company is

68

Neenah Foundry Company

Notes to Consolidated Financial Statements — (Continued)

required to adopt FIN 48 as of October 1, 2007, and the impact that the adoption of FIN 48 will have on its consolidated financial statements and notes thereto is not expected to be significant.

In September 2006, the FASB issued SFAS No. 158, “Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans, an amendment of FASB Statements No. 87, 88, 106 and 132(R)” (SFAS 158). SFAS 158 requires employers that sponsor defined benefit pension and postretirement benefit plans to recognize previously unrecognized actuarial losses and prior service costs in the statement of financial position and to recognize future changes in these amounts in the year in which changes occur through comprehensive income. As a result, the balance sheet will reflect the funded status of those plans as an asset or liability. Additionally, employers are required to measure the funded status of a plan as of the date of its year-end statement of financial position and provide additional disclosures. On September 30, 2007, the Company adopted the provisions of SFAS 158 by recognizing the funded status of its defined benefit pension and postretirement benefit plans in the balance sheet. SFAS 158 did not have an effect on the Company’s consolidated financial condition at September 30, 2006 and 2005. See Note 8 for further discussion and disclosures of the effect of adopting SFAS 158 on the Company’s consolidated financial statements and notes thereto. In addition, the Company will be required to measure the plan assets and benefit obligations as of the date of the year-end balance sheet by September 30, 2009. The Company is currently evaluating the impact the change in the measurement date will have on its consolidated financial statements and notes thereto.

In September 2006, the FASB issued SFAS No. 157, “Fair Value Measurements” (SFAS 157). SFAS 157 defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles, and expands disclosures about fair value measurements. The Company is required to adopt SFAS 157 effective October 1, 2008 and is currently evaluating the impact of adopting SFAS 157 on its future results of operations and financial condition.

In February 2007, the FASB issued SFAS No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities, including an amendment of FASB Statement No. 115” (SFAS 159). SFAS 159 permits companies to choose to measure many financial instruments and certain other items at fair value that are not currently required to be measured at fair value and establishes presentation and disclosure requirements designed to facilitate comparisons between companies that choose different measurement attributes for similar types of assets and liabilities. The Company is required to adopt SFAS 159 effective October 1, 2008 and is currently evaluating the impact of adopting SFAS 159 on its future results of operations and financial condition.

3.   Inventories

Inventories consisted of the following as of September 30:

	2007		2006
Raw materials	$	6,941	$	7,857
Work in process and finished goods		41,407		38,437
Supplies		15,848		15,553
	$	64,196	$	61,847

69

Neenah Foundry Company

Notes to Consolidated Financial Statements — (Continued)

4.   Intangible Assets

Identifiable intangible assets consisted of the following as of September 30:

	2007				2006
	Gross				Gross
	Carrying		Accumulated		Carrying		Accumulated
	Amount		Amortization		Amount		Amortization
Amortizable intangible assets:
Customer lists	$	67,000	$	26,800	$	67,000	$	20,100
Tradenames		16,282		1,645		16,282		1,234
Other		155		41		155		31
	$	83,437	$	28,486	$	83,437	$	21,365

The Company does not have any intangible assets deemed to have indefinite lives. The Company expects to recognize amortization expense of $7,120 in each of the five fiscal years subsequent to September 30, 2007.

5.   Long-Term Debt

Long-term debt consisted of the following as of September 30:

	2007		2006
121/2% Senior Subordinated Notes	$	75,000	$	—
91/2% Senior Secured Notes		225,000		—
13% Senior Subordinated Notes		—		100,000
11% Senior Secured Notes, less unamortized discount of $6,337 in 2006		—		126,191
Term Loan Facilities		—		13,409
Revolving credit facility		17,152		24,595
		317,152		264,195
Less current portion		17,152		27,750
	$	300,000	$	236,445

On December 29, 2006, the Company repaid its outstanding indebtedness under its then existing credit facility, repurchased all $133,130 of its outstanding 11% Senior Secured Notes due 2010 through an issuer tender offer, retired $75,000 of its outstanding 13% Senior Subordinated Notes due 2013 (the 13% Notes) by exchanging them for $75,000 of new 121/2% Senior Subordinated Notes due 2013 (the 121/2% Notes) in a private transaction, and issued a notice to redeem the remaining $25,000 of 13% Notes that remained outstanding after the initial exchange. The remaining 13% Notes were redeemed on February 2, 2007. To fund these payments and to provide cash for capital expenditures, ongoing working capital requirements and general corporate purposes, the Company (a) issued $225,000 of new 91/2% Senior Secured Notes due 2017 (the 91/2% Notes) and the $75,000 of 121/2% Notes and (b) entered into an amended and restated credit facility (the 2006 Credit Facility) providing for borrowings in an amount up to $100,000. The 121/2% Notes were issued in a related party transaction with a substantial stockholder of the Company’s ultimate parent, NEI in exchange for 13% Notes held by such stockholder.

The 2006 Credit Facility provides for borrowings in an amount up to $100,000 and includes a provision permitting the Company from time to time to request increases (subject to the lenders’ consent) in the aggregate amount by up to $10,000 with the increases to be funded through additional commitments from existing lenders or new commitments from financial institutions acceptable to the current lenders. It matures on December 31, 2011. The interest rate on the 2006 Credit Facility is based on LIBOR (5.25% at September 30, 2007) or prime (7.75% at September 30, 2007) plus an applicable margin, based upon the Company meeting certain financial statistics. The

70

Neenah Foundry Company

Notes to Consolidated Financial Statements — (Continued)

weighted-average interest rate on the outstanding borrowings under the 2006 Credit Facility at September 30, 2007 was 7.10%, compared to 7.65% at September 30, 2006 on the outstanding borrowings under the revolving credit facility then in place. At September 30, 2007, the Company had unused availability of $78,737. Substantially all of Neenah’s wholly owned subsidiaries are co-borrowers with Neenah under the 2006 Credit Facility. In addition, NFC Castings, Inc. and the remaining wholly owned subsidiaries of Neenah jointly, fully, severally and unconditionally guarantee Neenah’s obligations under the 2006 Credit Facility, subject to customary exceptions for transactions of this type.

The borrowers’ and guarantors’ obligations under the 2006 Credit Facility are secured by first priority liens, subject to customary restrictions, on Neenah’s and the guarantors’ accounts receivable, inventory, casting patterns and core boxes, business interruption insurance policies, certain inter-company loans, cash and deposit accounts and related assets, subject to certain exceptions, and any proceeds of the foregoing, and by second priority liens (junior to the liens securing the 91/2% Notes) on substantially all of our and the guarantors’ remaining assets. The 91/2% Notes, and the guarantees in respect thereof, are equal in right of payment to the 2006 Credit Facility, and the guarantees in respect thereof. Borrowings under the revolving credit facility have been classified as current liabilities in the accompanying consolidated balance sheets in accordance with the consensus of Emerging Issues Task Force No. 95-22, “Balance Sheet Classification of Borrowings Outstanding under Revolving Credit Agreements that include both a Subjective Acceleration Clause and a Lock-Box Arrangement.”

The 2006 Credit Facility requires the Company to observe certain customary conditions, affirmative covenants and negative covenants including financial covenants and it requires the Company to maintain a specified minimum interest coverage ratio or fixed charge coverage ratio whenever the unused availability is less than $15,000.

The 91/2% Notes mature on January 1, 2017 and bear interest at 91/2%. Interest is payable semiannually on January 1 and July 1. The 91/2% Notes are secured by first-priority liens on substantially all of Neenah’s and the guarantors’ assets (other than accounts receivable, inventory, casting patterns and core boxes, business interruption insurance policies, certain inter-company loans, cash and deposit accounts and related assets, subject to certain exceptions, and any proceeds of the foregoing) and by second-priority liens, junior to the liens for the benefit of the lenders under the 2006 Credit Facility, on Neenah’s and the guarantors’ accounts receivable, inventory, casting patterns and core boxes, business interruption insurance policies, certain inter-company loans, cash and deposit accounts and related assets, subject to certain exceptions, and any proceeds of the foregoing. Neenah’s obligations under the 91/2% Notes are guaranteed on a secured basis by each of its wholly owned subsidiaries. The 121/2% Notes are unsecured, mature on September 30, 2013 and bear interest at 121/2%. Interest of not less than 5% is payable in cash and the remainder (up to 71/2%) may be paid-in-kind semiannually on January 1 and July 1. Through July 1, 2007, the Company has paid the interest in cash. The 91/2% and the 121/2% Notes are jointly, fully, severally and unconditionally guaranteed by all of Neenah’s subsidiaries.

The 91/2% Notes and the 121/2% Notes contain customary covenants typical to this type of financing, such as limitations on (1) indebtedness, (2) restricted payments, (3) liens, (4) distributions from restricted subsidiaries, (5) sale of assets, (6) affiliate transactions, (7) mergers and consolidations and (8) lines of business. At September 30, 2007, the Company is in compliance with all covenants.

As a result of the refinancing transactions discussed above, the Company incurred $20,429 of debt refinancing costs in the year ended September 30, 2007. This amount consisted of a $12,917 tender premium paid to repurchase the 11% Senior Secured Notes due 2010, $5,940 to write off the unamortized portion of discount on the 11% Senior Secured Notes and $1,572 to write off the unamortized portion of deferred financing costs on the old indebtedness.

6.   Commitments and Contingencies

The Company leases certain plants, warehouse space, machinery and equipment, office equipment and vehicles under operating leases, which generally include renewal options. Rent expense under these operating leases for the years ended September 30, 2007, 2006 and 2005 totaled $2,985, $2,923 and $2,920, respectively.

71

Neenah Foundry Company

Notes to Consolidated Financial Statements — (Continued)

During the years ended September 30, 2007 and 2006, the Company financed purchases of property, plant and equipment totaling $413 and $1,271, respectively, by entering into capital lease obligations. Property, plant and equipment under leases accounted for as capital leases as of September 30 were as follows:

	2007		2006
Machinery and equipment	$	1,757	$	1,344
Less accumulated depreciation		551		214
	$	1,206	$	1,130

Minimum rental payments due under operating and capital leases for fiscal years subsequent to September 30, 2007, are as follows:

	Operating		Capital
	Leases		Leases
2008	$	1,945	$	290
2009		1,286		290
2010		756		290
2011		456		290
2012		323		391
Thereafter		204		144
Total minimum lease payments	$	4,970		1,695
Less amount representing interest				260
Present value of minimum lease payments				1,435
Less current portion				213
Capital lease obligations			$	1,222

The Company is partially self-insured for workers’ compensation claims. An accrued liability is recorded for claims incurred but not yet paid or reported and is based on current and historical claim information. The accrued liability may ultimately be settled for an amount different than the recorded amount. Adjustments of the accrued liability are recorded in the period in which they become known.

Approximately 64% of the Company’s employees (or approximately 80% of the Company’s hourly workforce) are covered by collective bargaining agreements. The collective bargaining agreements for Mercer and the Warsaw location of Dalton, which represent approximately 25% of the Company’s employees (or approximately 39% of the Company’s hourly workforce), are scheduled to expire during fiscal 2008.

In the normal course of business, the Company is named in legal proceedings. There are currently no material legal proceedings pending with respect to the Company. On August 5, 2005 the Company settled a legal matter related to the proposed sale of one of its subsidiaries by paying a cash settlement of $6,500.

The Company is continuing to invest in a $54,000 capital project to replace a mold line at its Neenah facility. The new mold line is expected to significantly enhance operating efficiencies, increase capacity and provide expanded molding capabilities for municipal products. The Company anticipates that operating cash flows and borrowings under its 2006 Credit Facility will be sufficient to fund this and other anticipated operational investments, including working capital and capital expenditure needs, over the remaining construction timeframe. The Company expects the new mold line to become operational in April, 2008. At September 30, 2007, the Company had expended $30,594 and committed to an additional $16,578 of expenditures related to the new mold line.

72

Neenah Foundry Company

Notes to Consolidated Financial Statements — (Continued)

7.   Stockholder’s Equity

The authorized capital of the Company consists of 1,000 shares of common stock, with a par value of $100 per share. All shares have equal voting rights.

The Company had a 2003 Management Equity Incentive Plan (the Plan) which provides for the issuance of share based awards to key employees and directors up to an aggregate amount of 1,600,000 shares of common stock of NEI. In July 2007, the Plan was amended and restated, assumed by NEI and renamed the Neenah Enterprises, Inc. Management Equity Incentive Plan. The Plan allows for the grant of incentive or non-qualified stock option awards and restricted stock awards. As of September 30, 2007, share based awards to purchase 750,000 shares of NEI common stock are available for grant under this plan. The Company records compensation expense for this plan ratably over the vesting period.

In fiscal 2004, the Company granted 800,000 shares of NEI restricted stock awards under the Plan which vested one fourth on the date of grant, with equal annual cliff vesting for the remaining unvested portion over a three year period, contingent on employment and subject to acceleration in the event of a significant transaction, as defined in the award agreement. These restricted shares were determined to have a nominal fair value at the date of grant. As provided for under the terms of the award, the vesting of all nonvested restricted stock awards was accelerated on May 25, 2006, such that the awards were fully vested, as a result of a change in control of the Company.

In fiscal 2007, the Company granted 50,000 shares of NEI restricted stock under the Plan which vest in two equal installments on the first and second anniversary of the grant date and were determined to have a grant date fair value of $6.50 per share, based on available quoted market prices. Nonvested stock compensation expense recognized by the Company for the year ended September 30, 2007 was $41. As of September 30, 2007, there was $284 of unrecognized compensation cost related to non-vested stock that is expected to be recognized over a weighted average period of 1.75 years.

8.   Income Taxes

The provision (credit) for income taxes consisted of the following:

	Years Ended September 30
	2007			2006			2005
Current:
Federal	$	(6,593	)	$	7,553		$	7,032
State		352			1,314			1,568
		(6,241	)		8,867			8,600
Deferred		(2,578	)		(10	)		(5,191	)
	$	(8,819	)	$	8,857		$	3,409

73

Neenah Foundry Company

Notes to Consolidated Financial Statements — (Continued)

The provision (credit) for income taxes differed from the amount computed by applying the federal statutory rate of 35% to income (loss) before income taxes as follows:

	Years Ended September 30
	2007			2006			2005
Provision at statutory rate	$	(7,961	)	$	8,752		$	6,476
State income taxes, net of federal taxes		(841	)		851			815
Permanent differences due to reorganization		—			—			(885	)
Change in tax method of determining LIFO inventory		—			—			(2,679	)
Change in enacted state tax laws		—			(758	)		—
Other		(17	)		12			(318	)
Provision (credit) for income taxes	$	(8,819	)	$	8,857		$	3,409

Deferred income tax assets and liabilities consisted of the following as of September 30:

	2007			2006
Deferred income tax liabilities:
Inventories	$	(529	)	$	(1,195	)
Property, plant and equipment		(12,339	)		(11,667	)
Identifiable intangible assets		(21,220	)		(24,069	)
Other		(388	)		(336	)
		(34,476	)		(37,267	)
Deferred income tax assets:
Employee benefit plans		4,697			8,926
Accrued vacation		1,940			2,237
Other accrued liabilities		926			997
State net operating loss and credit carryforwards		909			155
Other		995			873
Total deferred tax assets		9,467			13,188
Valuation allowance for deferred income tax assets		(55	)		(155	)
		9,412			13,033
Net deferred income tax liability	$	(25,064	)	$	(24,234	)
Included in the consolidated balance sheets as:
Current deferred income tax asset	$	3,070		$	2,697
Noncurrent deferred income tax liability		(28,134	)		(26,931	)
	$	(25,064	)	$	(24,234	)

As of September 30, 2007, the Company had state net operating loss and credit carryforwards of $16,786 which expire through fiscal 2017. A full valuation allowance has been established for certain state net operating loss carryforwards due to the uncertainty regarding the realization of the deferred tax benefit through future earnings.

74

Neenah Foundry Company

Notes to Consolidated Financial Statements — (Continued)

9.   Employee Benefit Plans

Defined-Benefit Pension Plans and Postretirement Benefits

The Company sponsors five defined-benefit pension plans covering the majority of its hourly employees. Retirement benefits under the pension plans are based on years of service and defined-benefit rates. The Company has elected a measurement date of June 30 for all of its pension plans. The Company funds the pension plans based on actuarially determined cost methods allowable under Internal Revenue Service regulations. During each of the years ended September 30, 2006 and 2007, the Company amended one of its defined-benefit pension plans to freeze its defined benefit rate and credited years of service. No curtailment gain or loss was required in conjunction with freezing these defined-benefit plans.

The Company also sponsors unfunded defined-benefit postretirement health care plans covering substantially all salaried and hourly employees at Neenah and their dependents. For salaried employees at Neenah, benefits are provided from the date of retirement for the duration of the employee’s life, while benefits for hourly employees at Neenah are provided from retirement to age 65. Retirees’ contributions to the plans are based on years of service and age at retirement. The Company funds benefits as incurred. The Company has elected a measurement date of June 30 for these plans.

FASB Financial Staff Position No. FAS 106-2, “Accounting and Disclosure Requirements Related to the Medicare Prescription Drug, Improvement and Modernization Act of 2003” (the Act), addresses the impact of the Act enacted in December 2003. The Act provides a prescription drug subsidy benefit for Medicare eligible employees starting in 2006. During fiscal 2005, it was determined that the benefit levels of the Company’s defined-benefit postretirement health care plan covering salaried employees met the criteria set forth by the Act to qualify for the subsidy. Effective with the June 30, 2005 measurement date, the effects of the subsidy were used in measuring the plan’s benefit obligation and net periodic postretirement benefit cost. The effect of the subsidy was to reduce the net periodic postretirement benefit cost by approximately $337 for the year ended September 30, 2006.

Adoption of SFAS 158

As discussed in Note 2, the Company adopted SFAS 158, as it relates to recognizing the funded status of its defined benefit pension and postretirement benefit plans in its consolidated balance sheets and related disclosure provisions, on September 30, 2007. Funded status is defined as the difference between the projected benefit obligation and the fair value of plan assets. Upon adoption, the Company recorded an adjustment to accumulated other comprehensive income (loss) representing the recognition of previously unrecorded pension and postretirement healthcare liabilities related to net unrecognized actuarial gains and unrecognized prior service costs and credits. These amounts will be subsequently recognized as a component of net periodic pension cost pursuant to the Company’s historical accounting policy for recognizing such amounts.

The incremental effects of adopting the provisions of SFAS 158 on the Company’s consolidated balance sheets at September 30, 2007 are presented in the following table. The adoption of SFAS 158 had no effect on the

75

Neenah Foundry Company

Notes to Consolidated Financial Statements — (Continued)

Company’s consolidated statements of operations for the year ended September 30, 2007 or for any prior period presented, and it will not affect the Company’s operating results in future periods.

	At September 30, 2007
	Prior to			Effect of
	Adopting			Adopting
	SFAS 158			SFAS 158			As Reported
Other assets	$	5,439		$	547		$	5,986
Net deferred tax liability		(22,300	)		(2,764	)		(25,064	)
Other accrued liabilities		(4,563	)		(200	)		(4,763	)
Postretirement benefit obligations		(9,897	)		4,628			(5,269	)
Pension benefit obligations		(5,102	)		1,960			(3,142	)
Accumulated other comprehensive income		—			(4,171	)		(4,171	)

Amounts included in accumulated other comprehensive income, net of tax, at September 30, 2007 which have not yet been recognized in net periodic benefit cost were as follows:

				Other
	Pension			Postretirement
	Plans			Benefits
Prior service cost (credit)	$	217		$	(219	)
Net actuarial gain		(1,723	)		(2,446	)

Amounts included in accumulated other comprehensive income, net of tax, at September 30, 2007 expected to be recognized in net periodic benefit cost during the fiscal year ending September 30, 2008 were as follows:

				Other
	Pension			Postretirement
	Plans			Benefits
Prior service cost (credit)	$	30		$	(32	)
Net actuarial gain		(15	)		(246	)

76

Neenah Foundry Company

Notes to Consolidated Financial Statements — (Continued)

Obligations and Funded Status

The following table summarizes the funded status of the pension plans and postretirement benefit plans and the amounts recognized in the consolidated balance sheets at September 30, 2007 and 2006:

	Pension						Postretirement
	Benefits						Benefits
	2007			2006			2007			2006
Change in benefit obligation:
Benefit obligation, July 1	$	71,914		$	78,162		$	5,631		$	7,351
Service cost		1,798			2,328			179			153
Interest cost		4,421			4,083			324			282
Unrecognized prior service cost		30			30			—			—
Actuarial gains		(280	)		(10,294	)		(123	)		(1,748	)
Benefits paid		(3,012	)		(2,757	)		(425	)		(407	)
Benefit obligation, June 30	$	74,871		$	71,914		$	5,586		$	5,631
Change in plan assets:
Fair value of plan assets, July 1	$	64,373		$	54,648		$	—		$	—
Actual return on plan assets		8,781			3,963			—			—
Company contributions		574			8,519			425			407
Benefits paid		(3,012	)		(2,757	)		(425	)		(407	)
Fair value of plan assets, June 30	$	70,716		$	64,373		$	—		$	—
Funded status of the plans:
Benefit obligation in excess of plan assets	$	(4,155	)	$	(7,541	)	$	(5,586	)	$	(5,631	)
Unrecognized prior service cost (credit)		—			392			—			(396	)
4th quarter contributions		1,560			—			117			101
Unrecognized net (gains) losses		—			908			—			(4,215	)
	$	(2,595	)	$	(6,241	)	$	(5,469	)	$	(10,141	)
Amounts recognized in the consolidated balance sheets at September 30:
Prepaid benefit cost (long-term asset)	$	547		$	—		$	—		$	—
Accrued benefit liability (long-term liability)		(3,142	)		(8,036	)		(5,269	)		(10,141	)
Accrued benefit liability (current liability)		—			—			(200	)		—
	$	(2,595	)	$	(8,036	)	$	(5,469	)	$	(10,141	)

The accumulated benefit obligation for the Company’s defined benefit pension plans was $74,871 and $71,914 at September 30, 2007 and 2006, respectively. At September 30, 2007, pension plans with benefit obligations in excess of plan assets had an aggregate projected benefit obligation of $68,926 and aggregate fair value of plan assets of $65,784.

77

Neenah Foundry Company

Notes to Consolidated Financial Statements — (Continued)

Benefit Costs

Components of net periodic benefit cost for the years ended September 30 were as follows:

	Pension Benefits									Postretirement Benefits
	2007			2006			2005			2007			2006			2005
Service cost	$	1,798		$	2,328		$	2,008		$	179		$	153		$	161
Interest cost		4,421			4,083			3,870			324			282			363
Expected return on plan assets		(5,255	)		(4,732	)		(4,157	)		—			—			—
Amortization of prior service cost (credit)		30			30			—			(32	)		(33	)		(32	)
Recognized net actuarial (gain) loss		—			185			2			(275	)		(265	)		(244	)
Net periodic benefit cost	$	994		$	1,894		$	1,723		$	196		$	137		$	248

Assumptions

Weighted-average assumptions used to determine benefit obligations as of September 30 were as follows:

	Pension Benefits						Postretirement Benefits
	2007			2006			2007			2006
Discount rate		6.25	%		6.25	%		6.25	%		6.25	%

Weighted-average assumptions used to determine net periodic benefit cost for the years ended September 30 were as follows:

	Pension Benefits									Postretirement Benefits
	2007			2006			2005			2007			2006			2005
Discount rate		6.25	%		5.25	%		6.25	%		6.25	%		5.25	%		6.25	%
Expected long-term rate of return on plan assets		7.50	% to		7.50	% to		7.50	% to
		8.50	%		8.50	%		8.50	%		—			—			—

For measurement purposes, the healthcare cost trend rate was assumed to be 9.5% decreasing gradually to 5.0% in 2016 and then remaining at that level thereafter. The healthcare cost trend rate assumption has a significant effect on the amounts reported. A one percentage point change in the healthcare cost trend rate would have the following effect:

	1% Increase		1% Decrease
Effect on total of service cost and interest cost	$	101	$	(78	)
Effect on postretirement benefit obligation		934		(741	)

78

Neenah Foundry Company

Notes to Consolidated Financial Statements — (Continued)

Pension Plan Assets

The following table summarizes the weighted-average asset allocations of the pension plans at September 30:

	2007			2006
Asset category:
Equity securities		56	%		51	%
Debt securities		34			32
Real estate		4			3
Other		6			14
		100	%		100	%

The Company employs a total return investment approach whereby a mix of equities and fixed income investments are used to maximize the long-term return of plan assets for a prudent level of risk. The intent of this strategy is to minimize plan expenses by maximizing investment returns within that prudent level of risk. The investment portfolio contains a diversified blend of equity and fixed income investments. Furthermore, equity investments are diversified across U.S. and non-U.S. stocks as well as growth, value, and small and large capitalizations. The Company’s targeted asset allocation ranges as a percentage of total market value are as follows: equity securities 45% to 55% and debt securities 30% to 35%. None of the plans’ equity securities are invested in common stock of the plan sponsor’s parent company, NEI. Additionally, cash balances are maintained at levels adequate to meet near term plan expenses and benefit payments. Investment risk is measured and monitored on an ongoing basis through quarterly investment portfolio reviews.

The Company’s overall expected long-term rates of return on assets range from 7.50% to 8.50%. The expected long-term rates of return are based on the portfolio of each defined benefit pension plan as a whole and not on the sum of the returns of individual asset categories. The rates of return are based on historical returns adjusted to reflect the current view of the long-term investment market.

Benefit Payments and Contributions

The following benefit payments, which reflect expected future service, as appropriate, and are net of expected Medicare subsidy receipts, are expected to be paid for fiscal years subsequent to September 30, 2007:

2008	$	3,166
2009		3,278
2010		3,456
2011		3,626
2012		3,964
2013 — 2017		25,753
	$	43,243

The Company expects to contribute $1,621 to its pension plans during fiscal 2008.

Defined-Contribution Retirement Plans

The Company sponsors various defined-contribution retirement plans (the Plans) covering substantially all salaried and certain hourly employees. The Plans allow participants to make 401(k) contributions in amounts ranging from 1% to 15% of their compensation. The Company matches between 35% and 50% of the participants’ contributions up to a maximum of 6% of the employee’s compensation, as defined. The Company may make additional voluntary contributions to the Plans as determined annually by the Board of Directors. Total Company

79

Neenah Foundry Company

Notes to Consolidated Financial Statements — (Continued)

contributions amounted to $3,268, $2,448 and $2,264 for the years ended September 30, 2007, 2006 and 2005, respectively.

Other Employee Benefits

The Company provides unfunded supplemental retirement benefits to certain active and retired employees at Dalton. At September 30, 2007, the present value of the current and long-term portion of these supplemental retirement obligations totaled $262 and $1,871, respectively. At September 30, 2006, the present value of the current and long-term portion of these supplemental retirement obligations totaled $246 and $2,117, respectively.

Certain of Dalton’s hourly employees are covered by a multi-employer, defined-benefit pension plan pursuant to a collective bargaining agreement. The Company’s expense for the years ended September 30, 2007, 2006 and 2005, was $334, $356 and $337, respectively.

Substantially all of Mercer’s union employees are covered by a multiemployer, defined-benefit pension plan pursuant to a collective bargaining agreement. The Company’s expense for the years ended September 30, 2007, 2006 and 2005, was $197, $221 and $290, respectively.

10.   Segment Information

The Company has two reportable segments, Castings and Forgings. The Castings segment manufactures and sells gray and ductile iron castings for the industrial and municipal markets, while the Forgings segment manufactures forged components for the industrial market. The Other segment includes machining operations and freight hauling.

The Company evaluates performance and allocates resources based on the operating income before depreciation and amortization charges of each segment. The accounting policies of the reportable segments are the same as those described in the summary of significant accounting policies. Intersegment sales and transfers are recorded at cost plus a share of operating profit.

80

Neenah Foundry Company

Notes to Consolidated Financial Statements — (Continued)

	Years Ended September 30
	2007			2006			2005
Revenues from external customers:
Castings	$	441,524		$	495,384		$	491,159
Forgings		37,113			41,222			44,348
Other		18,321			20,703			22,507
Elimination of intersegment revenues		(13,335	)		(14,857	)		(16,242	)
	$	483,623		$	542,452		$	541,772
Net income (loss):
Castings	$	(13,928	)	$	16,149		$	15,095
Forgings		(1,551	)		(605	)		(570	)
Other		(150	)		345			189
Elimination of intersegment loss		1,701			260			381
	$	(13,928	)	$	16,149		$	15,095
Total assets:
Castings	$	496,219		$	472,760		$	475,725
Forgings		5,927			6,399			7,040
Other		10,086			10,285			13,268
Elimination of intersegment assets		(68,258	)		(78,524	)		(83,478	)
	$	443,974		$	410,920		$	412,555

	Castings			Forgings		Other			Total
Year ended September 30, 2007:
Interest expense	$	27,649		$	3,571	$	480		$	31,700
Interest income		349			7		—			356
Provision (credit) for income taxes		(9,933	)		1,166		(52	)		(8,819	)
Depreciation and amortization expense		19,046			857		1,152			21,055
Expenditures for long-lived assets		47,475			563		695			48,733
Year ended September 30, 2006:
Interest expense	$	29,309		$	3,368	$	733		$	33,410
Interest income		78			—		5			83
Provision for income taxes		7,077			1,569		211			8,857
Depreciation and amortization expense		18,105			916		1,222			20,243
Expenditures for long-lived assets		16,866			417		520			17,803
Year ended September 30, 2005:
Interest expense	$	29,543		$	3,387	$	489		$	33,419
Interest income		13			—		—			13
Provision for income taxes		1,642			479		1,288			3,409
Depreciation and amortization expense		16,979			815		1,070			18,864
Expenditures for long-lived assets		15,966			948		658			17,572

81

Neenah Foundry Company

Notes to Consolidated Financial Statements — (Continued)

Geographic Information

			Long-Lived
	Net Sales		Assets(1)
Year ended September 30, 2007:
United States	$	462,597	$	131,550
Foreign countries		21,026		—
	$	483,623	$	131,550
Year ended September 30, 2006:
United States	$	521,193	$	96,878
Foreign countries		21,259		—
	$	542,452	$	96,878
Year ended September 30, 2005:
United States	$	509,104	$	91,250
Foreign countries		32,668		—
	$	541,772	$	91,250

(1) Represents property, plant and equipment.

82

Neenah Foundry Company

Notes to Consolidated Financial Statements — (Continued)

11.   Subsidiary Guarantors

The following tables present condensed consolidating financial information as of and for the years ended September 30, 2007, 2006 and 2005 for: (a) Neenah, and (b) on a combined basis, the guarantors of the 91/2% Notes and the 121/2% Notes, which include all of the wholly owned subsidiaries of Neenah (Subsidiary Guarantors). Separate financial statements of the Subsidiary Guarantors are not presented because the guarantors are jointly, severally, fully and unconditionally liable under the guarantees, and the Company believes separate financial statements and other disclosures regarding the Subsidiary Guarantors are not material to investors.

Condensed Consolidating Balance Sheet

September 30, 2007

				Subsidiary
	Neenah			Guarantors			Eliminations			Consolidated
ASSETS
Current assets:
Cash (overdraft)	$	969		$	(969	)	$	—		$	—
Accounts receivable, net		37,052			44,033			—			81,085
Inventories		25,143			39,053			—			64,196
Refundable income taxes		6,501			—			—			6,501
Deferred income taxes		(409	)		3,479			—			3,070
Other current assets		4,072			2,407			—			6,479
Total current assets		73,328			88,003			—			161,331
Investments in and advances to subsidiaries		123,314			—			(123,314	)		—
Property, plant and equipment, net		73,683			57,867			—			131,550
Deferred financing costs, identifiable intangible assets and goodwill, net		130,290			14,817			—			145,107
Other assets		1,711			4,275			—			5,986
	$	402,326		$	164,962		$	(123,314	)	$	443,974
LIABILITIES AND STOCKHOLDER’S EQUITY
Current liabilities:
Accounts payable	$	10,236		$	17,528		$	—		$	27,764
Net intercompany payable		—			111,947			(111,947	)		—
Accrued wages and employee benefits		4,985			8,154			—			13,139
Accrued interest		7,793			—			—			7,793
Other accrued liabilities		3,262			1,754			—			5,016
Current portion of long-term debt		17,152			—			—			17,152
Current portion of capital lease obligations		—			213			—			213
Total current liabilities		43,428			139,596			(111,947	)		71,077
Long-term debt		300,000			—			—			300,000
Capital lease obligations		—			1,222			—			1,222
Deferred income taxes		19,945			8,189			—			28,134
Postretirement benefit obligations		5,269			—			—			5,269
Pension benefit obligations		1,409			1,733			—			3,142
Other liabilities		1,963			2,855			—			4,818
Stockholder’s equity		30,312			11,367			(11,367	)		30,312
	$	402,326		$	164,962		$	(123,314	)	$	443,974

83

Neenah Foundry Company

Notes to Consolidated Financial Statements — (Continued)

Condensed Consolidating Balance Sheet

September 30, 2006

			Subsidiary
	Neenah		Guarantors			Eliminations			Consolidated
ASSETS
Current assets:
Cash (overdraft)	$	2,433	$	(1,523	)	$	—		$	910
Accounts receivable, net		43,452		41,709			—			85,161
Inventories		22,990		38,857			—			61,847
Deferred income taxes		4,169		(1,472	)		—			2,697
Other current assets		4,930		2,495			—			7,425
Total current assets		77,974		80,066			—			158,040
Investments in and advances to subsidiaries		115,243		—			(115,243	)		—
Property, plant and equipment, net		41,183		55,695			—			96,878
Deferred financing costs, identifiable intangible assets and goodwill, net		134,233		16,233			—			150,466
Other assets		1,952		3,584			—			5,536
	$	370,585	$	155,578		$	(115,243	)	$	410,920
LIABILITIES AND STOCKHOLDER’S EQUITY
Current liabilities:
Accounts payable	$	10,147	$	19,619		$	—		$	29,766
Net intercompany payable		—		89,207			(89,207	)		—
Accrued wages and employee benefits		6,478		7,235			—			13,713
Accrued interest		7,157		—			—			7,157
Other accrued liabilities		3,572		1,902			—			5,474
Current portion of long-term debt		27,750		—			—			27,750
Current portion of capital lease obligations		—		161			—			161
Total current liabilities		55,104		118,124			(89,207	)		84,021
Long-term debt		236,445		—			—			236,445
Capital lease obligations		—		1,060			—			1,060
Deferred income taxes		23,740		3,191			—			26,931
Postretirement benefit obligations		10,141		—			—			10,141
Pension benefit obligations		3,982		4,054			—			8,036
Other liabilities		1,987		3,113			—			5,100
Stockholder’s equity		39,186		26,036			(26,036	)		39,186
	$	370,585	$	155,578		$	(115,243	)	$	410,920

84

Neenah Foundry Company

Notes to Consolidated Financial Statements — (Continued)

Condensed Consolidating Statement of Operations

Year ended September 30, 2007

				Subsidiary
	Neenah			Guarantors			Eliminations			Consolidated
Net sales	$	219,645		$	270,371		$	(6,393	)	$	483,623
Cost of sales		166,750			248,547			(6,393	)		408,904
Gross profit		52,895			21,824			—			74,719
Selling, general and administrative expenses		20,311			17,808			—			38,119
Amortization expense		5,706			1,415			—			7,121
Loss on disposal of equipment		161			292			—			453
Operating income		26,717			2,309			—			29,026
Other income (expense):
Interest expense		(15,225	)		(16,475	)		—			(31,700	)
Interest income		304			52			—			356
Debt refinancing costs		(20,429	)		—			—			(20,429	)
		(35,350	)		(16,423	)		—			(51,773	)
Loss from operations before income taxes and equity in losses of subsidiaries		(8,633	)		(14,114	)		—			(22,747	)
Provision (credit) for income taxes		(10,272	)		1,453			—			(8,819	)
		1,639			(15,567	)		—			(13,928	)
Equity in losses of subsidiaries		(15,567	)		—			15,567			—
Net loss	$	(13,928	)	$	(15,567	)	$	15,567		$	(13,928	)

85

Neenah Foundry Company

Notes to Consolidated Financial Statements — (Continued)

Condensed Consolidating Statement of Operations

Year ended September 30, 2006

				Subsidiary
	Neenah			Guarantors			Eliminations			Consolidated
Net sales	$	251,813		$	297,641		$	(7,002	)	$	542,452
Cost of sales		181,318			268,242			(7,002	)		442,558
Gross profit		70,495			29,399			—			99,894
Selling, general and administrative expenses		18,416			15,898			—			34,314
Amortization expense		5,705			1,415			—			7,120
Loss (gain) on disposal of equipment		247			(120	)		—			127
Operating income		46,127			12,206			—			58,333
Other income (expense):
Interest expense		(17,842	)		(15,568	)		—			(33,410	)
Interest income		—			83			—			83
		(17,842	)		(15,485	)		—			(33,327	)
Income (loss) from operations before income taxes and equity in losses of subsidiaries		28,285			(3,279	)		—			25,006
Provision for income taxes		4,103			4,754			—			8,857
		24,182			(8,033	)		—			16,149
Equity in losses of subsidiaries		(8,033	)		—			8,033			—
Net income (loss)	$	16,149		$	(8,033	)	$	8,033		$	16,149

86

Neenah Foundry Company

Notes to Consolidated Financial Statements — (Continued)

Condensed Consolidating Statement of Operations

Year ended September 30, 2005

				Subsidiary
	Neenah			Guarantors			Eliminations			Consolidated
Net sales	$	241,467		$	306,635		$	(6,330	)	$	541,772
Cost of sales		177,897			269,251			(6,330	)		440,818
Gross profit		63,570			37,384			—			100,954
Selling, general and administrative expenses		24,169			16,798			—			40,967
Amortization expense		5,705			1,419			—			7,124
Loss on disposal of equipment		367			586			—			953
Operating income		33,329			18,581			—			51,910
Other income (expense):
Interest expense		(17,767	)		(15,652	)		—			(33,419	)
Interest income		—			13			—			13
		(17,767	)		(15,639	)		—			(33,406	)
Income from operations before income taxes and equity in losses of subsidiaries		15,562			2,942			—			18,504
Provision (credit) for income taxes		(3,784	)		7,193			—			3,409
		19,346			(4,251	)		—			15,095
Equity in losses of subsidiaries		(4,251	)		—			4,251			—
Net income (loss)	$	15,095		$	(4,251	)	$	4,251		$	15,095

87

Neenah Foundry Company

Notes to Consolidated Financial Statements — (Continued)

Condensed Consolidating Statement of Cash Flows

Year ended September 30, 2007

				Subsidiary
	Neenah			Guarantors			Eliminations			Consolidated
Operating activities
Net loss	$	(13,928	)	$	(15,567	)	$	15,567		$	(13,928	)
Noncash adjustments		18,773			10,288			—			29,061
Changes in operating assets and liabilities		(5,784	)		(3,958	)		—			(9,742	)
Net cash provided by (used in) operating activities		(939	)		(9,237	)		15,567			5,391
Investing activities
Investments in and advances to subsidiaries		(7,368	)		22,935			(15,567	)		—
Purchase of property, plant and equipment		(36,234	)		(12,499	)		—			(48,733	)
Other		256			(445	)		—			(189	)
Net cash provided by (used in) investing activities		(43,346	)		9,991			(15,567	)		(48,922	)
Financing activity
Proceeds from long-term debt		300,000			—			—			300,000
Payments on long-term debt and capital lease obligations		(240,462	)		(200	)		—			(240,662	)
Other		(16,717	)		—			—			(16,717	)
Net cash provided by (used in) financing activities		42,821			(200	)		—			42,621
Increase (decrease) in cash		(1,464	)		554			—			(910	)
Cash (overdraft) at beginning of year		2,433			(1,523	)		—			910
Cash (overdraft) at end of year	$	969		$	(969	)	$	—		$	—

88

Neenah Foundry Company

Notes to Consolidated Financial Statements — (Continued)

Condensed Consolidating Statement of Cash Flows

Year ended September 30, 2006

				Subsidiary
	Neenah			Guarantors			Eliminations			Consolidated
Operating activities
Net income (loss)	$	16,149		$	(8,033	)	$	8,033		$	16,149
Noncash adjustments		12,228			10,964			—			23,192
Changes in operating assets and liabilities		(14,471	)		(119	)		—			(14,590	)
Net cash provided by operating activities		13,906			2,812			8,033			24,751
Investing activities
Investments in and advances to subsidiaries		733			7,300			(8,033	)		—
Purchase of property, plant and equipment		(8,003	)		(9,800	)		—			(17,803	)
Other		(94	)		(235	)		—			(329	)
Net cash used in investing activities		(7,364	)		(2,735	)		(8,033	)		(18,132	)
Financing activity
Payments on long-term debt and capital lease obligations		(9,061	)		(132	)		—			(9,193	)
Decrease in cash		(2,519	)		(55	)		—			(2,574	)
Cash (overdraft) at beginning of year		4,952			(1,468	)		—			3,484
Cash (overdraft) at end of year	$	2,433		$	(1,523	)	$	—		$	910

89

Neenah Foundry Company

Notes to Consolidated Financial Statements — (Continued)

Condensed Consolidating Statement of Cash Flows

Year ended September 30, 2005

				Subsidiary
	Neenah			Guarantors			Eliminations			Consolidated
Operating activities
Net income (loss)	$	15,095		$	(4,251	)	$	4,251		$	15,095
Noncash adjustments		6,637			12,608			—			19,245
Changes in operating assets and liabilities		5,428			(6,181	)		—			(753	)
Net cash provided by operating activities		27,160			2,176			4,251			33,587
Investing activities
Investments in and advances to subsidiaries		(4,129	)		8,380			(4,251	)		—
Purchase of property, plant and equipment		(7,678	)		(9,894	)		—			(17,572	)
Other		197			1,055			—			1,252
Net cash used in investing activities		(11,610	)		(459	)		(4,251	)		(16,320	)
Financing activities
Proceeds from long-term debt		—			84			—			84
Payments on long-term debt		(12,130	)		(1,586	)		—			(13,716	)
Debt issuance costs		(151	)		—			—			(151	)
Net cash used in financing activities		(12,281	)		(1,502	)		—			(13,783	)
Increase in cash		3,269			215			—			3,484
Cash (overdraft) at beginning of year		1,683			(1,683	)		—			—
Cash (overdraft) at end of year	$	4,952		$	(1,468	)	$	—		$	3,484

12.   Quarterly Results of Operations (Unaudited)

	Year Ended September 30, 2007
	1st Quarter			2nd Quarter			3rd Quarter		4th Quarter
Net sales	$	117,342		$	111,789		$	126,838	$	127,654
Gross profit		18,625			10,733			22,297		23,064
Net income (loss)		(12,332	)(a)		(4,299	)		1,710		993	(b)

	Year Ended September 30, 2006
	1st Quarter		2nd Quarter		3rd Quarter		4th Quarter
Net sales	$	121,714	$	130,513	$	147,724	$	142,501
Gross profit		19,090		21,219		29,951		29,634
Net income		720		1,057		6,842		7,530

(a)	Net income for the three months ended December 31, 2006 included $20,419 of debt refinancing costs, on a pretax basis. See Note 5 for further details on the debt refinancing.
(b)	Certain non-standard adjustments, primarily related to the capitalization of interest, were recorded in the fourth quarter of fiscal 2007. These adjustments resulted in lower net income of approximately $761 and were deemed to be immaterial with respect to the impact on prior quarters.

90

Report of Independent Registered Public Accounting Firm

The Board of Directors

Neenah Enterprises, Inc.

Neenah Foundry Company

We have audited the consolidated financial statements of Neenah Enterprises, Inc. and Neenah Foundry Company as of September 30, 2007 and 2006 and for each of the three years in the period ended September 30, 2007, and have issued our reports thereon dated November 28, 2007 (included elsewhere in this Annual Report on Form 10-K). Our audits also included the financial statement schedule listed in the index at Item 15(a). This schedule is the responsibility of the Company’s management. Our responsibility is to express an opinion based on our audits.

In our opinion, the financial statement schedule referred to above, when considered in relation to the basic financial statements taken as a whole, presents fairly in all material respects the information set forth therein.

/s/ Ernst & Young LLP

Milwaukee, Wisconsin

November 28, 2007

91

Schedule II

Neenah Enterprises, Inc.
Neenah Foundry Company
Valuation and Qualifying Accounts
Years ended September 30, 2005, 2006, and 2007

	Balance at		Additions
	Beginning		Charged to					Balance at
Description	of Period		Expense		Deductions			End of Period
	(Dollars in thousands)
Allowance for doubtful accounts receivable:
2005	$	1,142	$	2,153	$	1,202	(A)	$	2,093
2006	$	2,093	$	433	$	641	(A)	$	1,885
2007	$	1,885	$	1,047	$	670	(A)	$	2,262
Reserve for obsolete inventory:
2005	$	735	$	356	$	90	(B)	$	1,001
2006	$	1,001	$	318	$	315	(B)	$	1,004
2007	$	1,004	$	669	$	73	(B)	$	1,600

(A)	Uncollectible accounts written off, net of recoveries
(B)	Reduction for disposition of inventory

92

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrants have duly caused this report to be signed on their behalf by the undersigned, thereunto duly authorized.

Date: December 28, 2007

NEENAH ENTERPRISES, INC.

NEENAH FOUNDRY COMPANY

(Registrants)

/s/  Gary W. LaChey

Gary W. LaChey

Corporate Vice President — Finance and

Chief Financial Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below on December 28, 2007, by the following persons on behalf of the registrants and in the capacities indicated.

/s/  Robert E. Ostendorf, Jr. Robert E. Ostendorf, Jr.	President and Chief Executive Officer, Director (Principal Executive Officer)
/s/  Gary W. LaChey Gary W. LaChey	Corporate Vice President — Finance and Chief Financial Officer (Principal Financial and Principal Accounting Officer)
/s/  William M. Barrett William M. Barrett	Director
/s/  Albert E. Ferrara, Jr. Albert E. Ferrara, Jr.	Director
/s/  David B. Gendell David B. Gendell	Director
/s/  Stephen E. K. Graham Stephen E. K. Graham	Director
/s/  Joseph V. Lash Joseph V. Lash	Director
/s/  Jeffrey G. Marshall Jeffrey G. Marshall	Director

93

SUPPLEMENTAL INFORMATION TO BE FURNISHED WITH REPORTS FILED PURSUANT TO SECTION 15(d) OF THE ACT BY REGISTRANTS WHICH HAVE NOT REGISTERED SECURITIES PURSUANT TO SECTION 12 OF THE ACT

Neenah Foundry Company does not intend to furnish an annual report or a proxy statement to its security holders.

94

NEENAH ENTERPRISES, INC.
(formerly known as ACP Holding Company)
and
NEENAH FOUNDRY COMPANY

EXHIBIT INDEX

TO

2007 ANNUAL REPORT ON FORM 10-K

Exhibit				Incorporated Herein	Filed
Number			Description	By Reference To	Herewith
	2	.1	Disclosure Statement for Pre-Petition of Votes with respect to the Prepackaged Joint Plan of Reorganization of ACP Holding Company (now known as Neenah Enterprises, Inc.), NFC Castings, Inc., and Neenah Foundry Company	Exhibit T3E-1 to application for qualification of indenture on Form T-3 filed 7/1/03 (File No. 022-28687)
	2	.2	Prepackaged Joint Plan of Reorganization of ACP Holding Company, NFC Castings, Inc., Neenah Foundry Company and Certain of its Subsidiaries under Chapter 11 of the United States Bankruptcy Code	Exhibit T3E-2 to application for qualification of indenture on Form T-3 filed 7/1/03 (File No. 022-28687)
	3	.1	Fourth Amended and Restated Certificate of Incorporation of Neenah Enterprises, Inc.	Exhibit 3.3 to Amendment No. 2 to Neenah Enterprises, Inc.’s Form 10 Registration Statement (SEC File No. 000-52681)
	3	.2	Amended and Restated Certificate [Articles] of Incorporation of Neenah Foundry Company	Exhibit 3.1 to Neenah Foundry Company’s Form 10-K for the fiscal year ended September 30, 2005 (the “2005 Form 10-K”)
	3	.3	Amended and Restated Certificate of Incorporation of NFC Castings, Inc.	Exhibit 3.3 to the 2005 Form 10-K
	3	.4	Amended and Restated Bylaws of Neenah Enterprises, Inc.	Exhibit 3.4 to Amendment No. 2 to Neenah Enterprises, Inc.’s Form 10 Registration Statement (SEC File No. 000-52681)
	3	.5	Amended Bylaws of Neenah Foundry Company		X
	3	.6	Amended Bylaws of NFC Castings, Inc.	Exhibit 3.19 to the 2005 Form 10-K
	4	.1	Warrant Agreement, dated October 8, by and between ACP Holding Company and the Bank of New York as warrant agent	Exhibit 10.3 hereto
	4	.2	[Reserved]
	4	.3	Indenture by and among Neenah Foundry Company, the guarantors named therein, and The Bank of New York Trust Company, N.A., as Trustee, dated as of December 29, 2006, for the 91/2% Senior Secured Notes due 2017	Exhibit 10.4 hereto
	4	.4	Form of Note for the 91/2% Senior Secured Notes due 2017	Exhibit 10.5 hereto
	4	.5	121/2% Senior Subordinated Note due 2013	Exhibit 10.7 hereto

95

Exhibit				Incorporated Herein	Filed
Number			Description	By Reference To	Herewith
	10	.1	Amended and Restated Loan and Security Agreement, dated as of December 29, 2006, by and among Neenah Foundry Company, its subsidiaries party thereto, the various lenders party thereto and Bank of America, N.A., as agent	Exhibit 10.13 to Neenah Foundry Company’s Quarterly Report on Form 10-Q for the Quarter Ended March 31, 2007
	10	.1(a)	Amendment No. 1, dated as of February 9, 2007, to Amended and Restated Loan and Security Agreement, dated as of December 29, 2006, by and among Neenah Foundry Company, its subsidiaries party thereto, the various lenders party thereto and Bank of America, N.A., as agent	Exhibit 10.6 to Neenah Foundry Company’s Quarterly Report on Form 10-Q for the Quarter Ended June 30, 2007
	10	.2	Subscription Agreement, dated as of October 7, 2003, by and among ACP Holding Company, Neenah Foundry Company, the subsidiary Guarantors named therein and the Investors as defined therein	Exhibit 10.2 to Neenah Foundry Company’s Form S-4 Registration Statement (File No. 333-111008) filed on December 8, 2003 (the “2003 Neenah Foundry Company Form S-4”)
	10	.3	Warrant Agreement, dated October 8, 2003, by and between ACP Holding Company and the Bank of New York as warrant agent	Exhibit 10.4 to the 2005 Form 10-K
	10	.4	Indenture by and among Neenah Foundry Company, the guarantors named therein, and The Bank of New York Trust Company, N.A., as Trustee, dated as of December 29, 2006, for the 91/2% Senior Secured Notes due 2017	Exhibit 4.1 to Neenah Foundry Company’s Current Report on Form 8-K dated December 29, 2006
	10	.5	Form of Note for the 91/2% Senior Secured Notes due 2017	Exhibit A to the Indenture filed as Exhibit 10.4 hereto
	10	.6	Registration Rights Agreement with respect to 91/2% Senior Secured Notes due 2017, by and among Neenah Foundry Company, the guarantors named therein, and Credit Suisse Securities (USA) LLC, dated December 29, 2006	Exhibit 4.3 to Neenah Foundry Company’s Current Report on Form 8-K dated December 29, 2006
	10	.7	121/2% Senior Subordinated Note due 2013 issued by Neenah Foundry Company to Tontine Capital Partners, L.P., including the form of indenture relating to the 121/2% Senior Subordinated Note due 2013	Exhibit 4.2 to Neenah Foundry Company’s Current Report on Form 8-K dated December 29, 2006
	10	.8	Registration Rights Agreement with respect to 121/2% Senior Subordinated Notes due 2013, by and among Neenah Foundry Company, the guarantors named therein, and Tontine Capital Partners, L.P., dated December 29, 2006	Exhibit 4.4 to Neenah Foundry Company’s Current Report on Form 8-K dated December 29, 2006

96

Exhibit				Incorporated Herein	Filed
Number			Description	By Reference To	Herewith
	10	.9	Exchange Agreement by and among Neenah Foundry Company, the guarantors named therein, and Tontine Capital Partners, L.P., dated December 29, 2006, relating to the exchange by Tontine of $75 million of Neenah foundry Company’s 13% Senior Subordinated Notes due 2013 for the 121/2% Senior Subordinated Notes due 2013	Exhibit 10.1 to Neenah Foundry Company’s Current Report on Form 8-K dated December 29, 2006
	10	.10*	Form of Amendment to the Employment Agreements and Restricted Grants listed in Exhibits 10.10(a), 10.11(b), 10.12, 10.13 through 10.16, 10.17 and 10.18	Exhibit 10.10 to the 2005 Form 10-K
	10	.10 (a)*	Employment Agreement and Restricted Stock Grant by and among Neenah Foundry Company, ACP Holding Company and John Andrews	Exhibit 10.9 to Amendment No. 1 to Neenah Foundry Company’s Form S-4 Registration Statement (File No. 333-111008) filed on January 28, 2004 (the “1/28/04 S-4 Amendment”)
	10	.11 (a)*	Employment Agreement and Restricted Stock Grant by and among Neenah Foundry Company, ACP Holding Company and William M. Barrett	Exhibit 10.10 to the 1/28/04 S-4 Amendment
	10	.11 (b)*	Employment Agreement by and among Neenah Foundry Company, ACP Holding Company and William M. Barrett	Exhibit 10.1 to Neenah Foundry Company’s Current Report on Form 8-K dated June 29, 2007
	10	.12*	Employment Agreement and Restricted Stock Grant by and among Dalton Corporation, ACP Holding Company and Joseph L. DeRita	Exhibit 10.11 to the 1/28/04 S-4 Amendment
	10	.12(a)*	Agreement for Payment of Supplemental Benefits to Joseph L. DeRita		X
	10	.13*	Employment Agreement and Restricted Stock Grant by and among Neenah Foundry Company, ACP Holding Company and Frank C. Headington	Exhibit 10.12 to the 1/28/04 S-4 Amendment
	10	.14*	Employment Agreement and Restricted Stock Grant by and among Neenah Foundry Company, ACP Holding Company and Timothy Koller	Exhibit 10.13 to the 1/28/04 S-4 Amendment
	10	.15*	Employment Agreement and Restricted Stock Grant by and among Neenah Foundry Company, ACP Holding Company and Gary W. LaChey	Exhibit 10.14 to the 1/28/04 S-4 Amendment
	10	.16*	Employment Agreement and Restricted Stock Grant by and among Neenah Foundry Company, ACP Holding Company and William Martin	Exhibit 10.15 to the 1/28/04 S-4 Amendment
	10	.16 (a)*	Employment Agreement and Restricted Stock Grant by and among Neenah Foundry Company, ACP Holding Company and Robert E. Ostendorf, Jr.	Exhibit 10.1 to Neenah Foundry Company’s Current Report on Form 8-K dated June 5, 2007

97

Exhibit				Incorporated Herein	Filed
Number			Description	By Reference To	Herewith
	10	.17*	Employment Agreement and Restricted Stock Grant by and among Dalton Corporation, ACP Holding Company and Steve Shaffer	Exhibit 10.16 to the 1/28/04 S-4 Amendment
	10	.18*	Employment Agreement and Restricted Stock Grant by and among Neenah Foundry Company, ACP Holding Company and Joseph Varkoly	Exhibit 10.17 to the 1/28/04 S-4 Amendment
	10	.19*	Neenah Foundry Company 2003 Management Annual Incentive Plan	Exhibit 10.18 to the 2003 Neenah Foundry Company Form S-4
	10	.19(a)*	Summary of Amendment to Neenah Foundry Company 2003 Management Annual Incentive Plan	Exhibit 10.19(a) to the 2005 Form 10-K
	10	.19(b)*	Neenah Enterprises, Inc. Incentive Compensation Plan	Exhibit 10.1 to Neenah Foundry Company’s Current Report on Form 8-K dated July 26, 2007
	10	.20*	Neenah Foundry Company Amended and Restated 2003 Severance and Change of Control Plan		X
	10	.21	Intercreditor Agreement, dated as of December 29, 2006, by and among Neenah Foundry Company, the guarantors named therein, Bank of America, N.A., as agent, and The Bank of New York Trust Company, N.A., as Trustee and collateral agent	Exhibit 10.2 to Neenah Foundry Company’s Current Report on Form 8-K dated December 29, 2006
	10	.22	Security Agreement, dated as of December 29, 2006, by and among Neenah Foundry Company, its subsidiaries party thereto, and the various lenders party thereto in favor of The Bank of New York Trust Company, N.A. for the benefit of the Secured Parties referred to therein	Exhibit 10.3 to Neenah Foundry Company’s Current Report on Form 8-K dated December 29, 2006
	10	.23	Pledge Agreement, dated as of December 29, 2006, by and among Neenah Foundry Company and its subsidiaries party thereto in favor of The Bank of New York Trust Company, N.A. for the benefit of the Secured Parties referred to therein	Exhibit 10.4 to Neenah Foundry Company’s Current Report on Form 8-K dated December 29, 2006
	10	.24	Copyright, Patent, Trademark and License Mortgage, dated as of December 29, 2006, by Neenah Foundry Company in favor of The Bank of New York Trust Company, N.A. for the benefit of the Secured Parties referred to therein	Exhibit 10.5 to Neenah Foundry Company’s Current Report on Form 8-K dated December 29, 2006

98

Exhibit				Incorporated Herein	Filed
Number			Description	By Reference To	Herewith
	10	.25	Copyright, Patent, Trademark and License Mortgage, dated as of December 29, 2006, by Advanced Cast Products, Inc. in favor of The Bank of New York Trust Company, N.A. for the benefit of the Secured Parties referred to therein	Exhibit 10.6 to Neenah Foundry Company’s Current Report on Form 8-K dated December 29, 2006
	10	.26	Copyright, Patent, Trademark and License Mortgage, dated as of December 29, 2006, by Peerless Corporation in favor of The Bank of New York Trust Company, N.A. for the benefit of the Secured Parties referred to therein	Exhibit 10.7 to Neenah Foundry Company’s Current Report on Form 8-K dated December 29, 2006
	10	.27*	Neenah Enterprises, Inc. Management Equity Incentive Plan (an amendment and restatement of the Neenah Foundry Company 2003 Management Equity Incentive Plan)	Exhibit 10.2 to Neenah Foundry Company’s Current Report on Form 8-K dated July 26, 2007
	10	.28	Registration Rights Agreement, dated October 8, 2003, by and between ACP Holding Company and the Initial Holders and Assignment of Rights thereunder.	Exhibit No. 3 to the Schedule 13D filed by Jeffrey L. Gendell, with respect to shares of Neenah Enterprises, Inc. directly owned by Tontine Capital partners, L.P. and by Tontine Capital Overseas Master Fund, L.P., on August 23, 2007
	12	.1	Ratio of Earnings to Fixed Charges		X
	21		Subsidiaries of Neenah Enterprises, Inc.		X
	31	.1	Certification of Chief Executive Officer of Neenah Enterprises, Inc. pursuant to Rule 13a-14(a) or Rule 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002		X
	31	.2	Certification of Chief Financial Officer of Neenah Enterprises, Inc. pursuant to Rule 13a-14(a) or Rule 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002		X
	31	.3	Certification of Chief Executive Officer of Neenah Foundry Company pursuant to Rule 13a-14(a) or Rule 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002		X
	31	.4	Certification of Chief Financial Officer of Neenah Foundry Company pursuant to Rule 13a-14(a) or Rule 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002		X

99

Exhibit				Incorporated Herein	Filed
Number			Description	By Reference To	Herewith
	32	.1	Certification of Chief Executive Officer and Chief Financial Officer of Neenah Enterprises, Inc. pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002		X
	32	.2	Certification of Chief Executive Officer and Chief Financial Officer of Neenah Foundry Company pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002		X
	99	.1	Securities Purchase Agreement, dated as of May 19, 2006	Exhibit 99.1 to Neenah Foundry Company’s Current Report on Form 8-K dated May 19, 2006
	99	.2	Stock Purchase Agreement, dated as of May 19, 2006	Exhibit 99.2 to Neenah Foundry Company’s Current Report on Form 8-K dated May 19, 2006
	99	.3	Transfer Notice, dated as of May 19, 2006	Exhibit 99.3 to Neenah Foundry Company’s Current Report on Form 8-K dated May 19, 2006
	99	.4	Response Letter, dated May 22, 2006	Exhibit 99.4 to Neenah Foundry Company’s Current Report on Form 8-K dated May 19, 2006

* Denotes management contract or executive compensation plan or arrangement.

100

EX-3.5

Exhibit 3.5

AMENDED
BYLAWS

of

Neenah Foundry Company

TABLE OF CONTENTS

ARTICLE I. OFFICES; RECORDS	1
1.01. Principal and Business Offices	1
1.02. Registered Office and Registered Agent	1
1.03. Corporate Records	1
ARTICLE II. SHAREHOLDERS	2
2.01. Annual Meeting	2
2.02. Special Meetings	2
2.03. Place of Meeting	2
2.04. Notices to Shareholders	2
2.05. Fixing of Record Date	4
2.06. Shareholder List	4
2.07. Quorum and Voting Requirements	5
2.08. Conduct of Meetings	5
2.09. Proxies	5
2.10. Voting of Shares	6
ARTICLE III. BOARD OF DIRECTORS	6
3.01. General Powers and Number	6
3.02. Election, Removal, Tenure and Qualifications	6
3.03. Regular Meetings	7
3.04. Special Meetings	7
3.05. Meetings By Telephone or Other Communication Technology	7
3.06. Notice of Meetings	8
3.07. Quorum	8
3.08. Manner of Acting	8
3.09. Conduct of Meetings	8
3.10. Vacancies	9
3.11. Compensation	9
3.12. Presumption of Assent	9
3.13. Committees	9
ARTICLE IV. OFFICERS	10
4.01. Officers	10
4.02. Removal, Resignation and Vacancies	10
4.03. Chairman of the Board/Executive Chairman	10
4.04. Chief Executive Officer	11
4.05. Chief Financial Officer	11
4.06. President	11
4.07. Vice Presidents	12
4.08. Treasurer	12
4.09. Secretary	12
4.10. Additional Matters	13
4.11. Compensation	13
4.12. Action with Respect to Securities of Other Corporations	13
ARTICLE V. CERTIFICATES FOR SHARES AND THEIR TRANSFER	13
5.01. Certificates for Shares	13
5.02. Signature by Former Officers	14
5.03. Transfer of Shares	14

i

TABLE OF CONTENTS (continued)

5.04. Restrictions on Transfer	14
5.05. Lost, Destroyed or Stolen Certificates	14
5.06. Consideration for Shares	14
5.07. Stock Regulations	15
ARTICLE VI. WAIVER OF NOTICE	15
6.01. Shareholder Written Waiver	15
6.02. Shareholder Waiver by Attendance	15
6.03. Director Written Waiver	15
6.04. Director Waiver by Attendance	15
ARTICLE VII. ACTION WITHOUT MEETINGS	16
7.01. Shareholder Action Without Meeting	16
7.02. Director Action Without Meeting	16
ARTICLE VIII. INDEMNIFICATION	16
8.01. Indemnification for Successful Defense	16
8.02. Other Indemnification	16
8.03. Written Request	17
8.04. Nonduplication	17
8.05. Determination of Right to Indemnification	17
8.06. Advance of Expenses	19
8.07. Nonexclusivity	19
8.08. Court-Ordered Indemnification	20
8.09. Indemnification and Allowance of Expenses of Employees and Agents	21
8.10. Insurance	21
8.11. Securities Law Claims	21
8.12. Liberal Construction	21
8.13. Definitions Applicable to this Article	21
ARTICLE IX. CONTRACTS, LOANS, CHECKS AND DEPOSITS	23
9.01. Contracts; Director Conflict of Interest	23
9.02. Loans	24
9.03. Checks, Drafts, etc	24
9.04. Deposits	24
ARTICLE X. MISCELLANEOUS	24
10.01. Corporate Seal	24
10.02. Fiscal Year	24
ARTICLE XI. AMENDMENTS	24
11.01. By Shareholders	24
11.02. By Directors	25
11.03. Implied Amendments	25

ii

ARTICLE I. OFFICES; RECORDS

          1.01. Principal and Business Offices. The corporation may have such principal and other business offices, either within or without the State of Wisconsin, as the Board of Directors may designate or as the business of the corporation may require from time to time.

          1.02. Registered Office and Registered Agent. The registered office of the corporation required by the Wisconsin Business Corporation Law to be maintained in the State of Wisconsin may be, but need not be, identical with the principal office in the State of Wisconsin. The address of the registered office may be changed from time to time by any officer or by the registered agent. The office of the registered agent of the corporation shall be identical to such registered office.

          1.03. Corporate Records. The following documents and records shall be kept at the corporation’s principal office or at such other reasonable location as may be specified by the corporation:

               (a) Minutes of shareholders’ and Board of Directors’ meetings and any written notices thereof.

               (b) Records of actions taken by the shareholders or directors without a meeting.

               (c) Records of actions taken by committees of the Board of Directors.

               (d) Accounting records.

               (e) Records of its shareholders.

               (f) Current Bylaws.

               (g) Written waivers of notice by shareholders or directors (if any).

               (h) Written consents by shareholders or directors for actions without a meeting (if any).

               (i) Voting trust agreements (if any).

               (j) Stock transfer agreements to which the corporation is a party or of which it has notice (if any).

ARTICLE II. SHAREHOLDERS

          2.01. Annual Meeting. The annual meeting of the shareholders shall be held not earlier than the second Tuesday in April nor later than the third Tuesday in June, as determined each year by the Chairman of the Board or the President, and the time and place of meeting shall be such as shall be fixed by the Secretary and specified in the notice or waiver of notice of the meeting. The annual meeting shall be held for the purpose of electing directors and for the transaction of such other business as may come before the meeting. If the election of directors is not held on the day fixed as herein provided, for any annual meeting of the shareholders, or at any adjournment thereof, the Board of Directors shall cause the election to be held at a meeting of the shareholders as soon thereafter as may be convenient.

          2.02. Special Meetings. Special meetings of the shareholders, for any purpose or purposes, unless otherwise prescribed by statute, may be called by the Chairperson of the Board, if there is one, the President or the Board of Directors. If and as required by the Wisconsin Business Corporation Law, a special meeting shall be called upon written demand describing one or more purposes for which it is to be held by holders of shares with at least 10% of the votes entitled to be cast on any issue proposed to be considered at the meeting. The purpose or purposes of any special meeting shall be described in the notice required by Section 2.04 of these Bylaws.

          2.03. Place of Meeting. The Board of Directors may designate any place, either within or without the State of Wisconsin, as the place of meeting for any annual meeting or any special meeting. If no designation is made, the place of meeting shall be the principal office of the corporation but any meeting may be adjourned to reconvene at any place designated by vote of a majority of the shares represented thereat and entitled to vote thereon.

          2.04. Notices to Shareholders. (a) Required Notice. Written notice stating the place, day and hour of the meeting and, in case of a special meeting, the purpose or purposes for which the meeting is called, shall be delivered not less than ten days nor more than sixty (60) days before the date of the meeting (unless a different time is provided by law or the Articles of Incorporation), by or at the direction of the Chairman of the Board, the President or the Secretary, to each shareholder entitled to vote at such meeting or, for the fundamental transactions described in subsections (e)(1) to (4) below (for which the Wisconsin Business Corporation Law requires that notice be given to shareholders not entitled to vote), to all shareholders. If mailed, such notice is effective when deposited

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in the United States mail, and shall be addressed to the shareholder’s address shown in the current record of shareholders of the corporation, with postage thereon prepaid. At least twenty (20) days’ notice shall be provided if the purpose, or one of the purposes, of the meeting is to consider a plan of merger or share exchange for which shareholder approval is required by law, or the sale, lease, exchange or other disposition of all or substantially all of the corporation’s property, with or without good will, otherwise than in the usual and regular course of business.

               (b) Adjourned Meeting. Except as provided in the next sentence, if any shareholder meeting is adjourned to a different date, time, or place, notice need not be given of the new date, time, and place, if the new date, time, and place is announced at the meeting before adjournment. If a new record date for the adjourned meeting is or must be fixed, then notice must be given pursuant to the requirements of paragraph (a) of this Section 2.04, to those persons who are shareholders as of the new record date.

               (c) Waiver of Notice. A shareholder may waive notice in accordance with Article VI of these Bylaws.

               (d) Contents of Notice. The notice of each special shareholder meeting shall include a description of the purpose or purposes for which the meeting is called, and only business within the purpose described in the meeting notice may be conducted at a special shareholder meeting. Except as otherwise provided in subsection (e) of this Section 2.04, in the Articles of Incorporation, or in the Wisconsin Business Corporation Law, the notice of an annual shareholder meeting need not include a description of the purpose or purposes for which the meeting is called.

               (e) Fundamental Transactions. If a purpose of any shareholder meeting is to consider either: (1) a proposed amendment to the Articles of Incorporation (including any restated articles); (2) a plan of merger or share exchange for which shareholder approval is required by law; (3) the sale, lease, exchange or other disposition of all or substantially all of the corporation’s property, with or without good will, otherwise than in the usual and regular course of business; (4) the dissolution of the corporation; or (5) the removal of a director, the notice must so state and in cases (1), (2) and (3) above must be accompanied by, respectively, a copy or summary of the: (1) proposed articles of amendment or a copy of the restated articles that identifies any amendment or other change; (2) proposed plan of merger or share exchange; or (3) proposed transaction for disposition of all or substantially all of the corporation’s property. If the proposed corporate action creates dissenters’ rights, the notice must state that shareholders and beneficial shareholders are or may be entitled to assert dissenters’ rights, and must be accompanied by a copy of Sections

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180.1301 to 180.1331 of the Wisconsin Business Corporation Law, or the corresponding provisions of any successor statute.

          2.05. Fixing of Record Date. The Board of Directors may fix in advance a date as the record date for one or more voting groups for any determination of shareholders entitled to notice of a shareholders’ meeting, to demand a special meeting, to vote, or to take any other action, such date in any case to be not more than seventy (70) days prior to the meeting or action requiring such determination of shareholders, and may fix the record date for determining shareholders entitled to a share dividend or distribution. If no record date is fixed for the determination of shareholders entitled to demand a shareholder meeting, to notice of or to vote at a meeting of shareholders, or to consent to action without a meeting, (a) the close of business on the day before the corporation receives the first written demand for a shareholder meeting, (b) the close of business on the day before the first notice of the meeting is mailed or otherwise delivered to shareholders, or (c) the close of business on the day before the first written consent to shareholder action without a meeting is received by the corporation, as the case may be, shall be the record date for the determination of shareholders. If no record date is fixed for the determination of shareholders entitled to receive a share dividend or distribution (other than a distribution involving a purchase, redemption or other acquisition of the corporation’s shares the close of business on the day on which the resolution of the Board of Directors is adopted declaring the dividend or distribution shall be the record date. When a determination of shareholders entitled to vote at any meeting of shareholders has been made as provided in this section, such determination shall be applied to any adjournment thereof unless the Board of Directors fixes a new record date and except as otherwise required by law. A new record date must be set if a meeting is adjourned to a date more than 120 days after the date fixed for the original meeting.

          2.06. Shareholder List. The officer or agent having charge of the stock transfer books for shares of the corporation shall, before each meeting of shareholders, make a complete record of the shareholders entitled to notice of such meeting, arranged by class or series of shares and showing the address of and the number of shares held by each shareholder. The shareholder list shall be available at the meeting and may be inspected by any shareholder or his or her agent or attorney at any time during the meeting or any adjournment. Any shareholder or his or her agent or attorney may inspect the shareholder list beginning two (2) business days after the notice of the meeting is given and continuing to the date of the meeting, at the corporation’s principal office or at a place identified in the meeting notice in the city where the meeting will be held and, subject to Section 180.1602(2)(b) 3 to 5 of the Wisconsin Business Corporation Law, may copy the list, during regular business hours and at his or her expense, during the period that it is available for inspection hereunder. The original stock

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transfer books and nominee certificates on file with the corporation (if any) shall be prima facie evidence as to who are the shareholders entitled to inspect the shareholder list or to vote at any meeting of shareholders. Failure to comply with the requirements of this section shall not affect the validity of any action taken at such meeting.

          2.07. Quorum and Voting Requirements. Except as otherwise provided in the Articles of Incorporation or in the Wisconsin Business Corporation Law, a majority of the votes entitled to be cast by shares entitled to vote as a separate voting group on a matter, represented in person or by proxy, shall constitute a quorum of that voting group for action on that matter at a meeting of shareholders. If a quorum exists, action on a matter, other than the election of directors, by a voting group is approved if the votes cast within the voting group favoring the action exceed the votes cast opposing the action unless a greater number of affirmative votes is required by the Wisconsin Business Corporation Law or the Articles of Incorporation. If the Articles of Incorporation or the Wisconsin Business Corporation Law provide for voting by two (2) on more voting groups on a matter, action on that matter is taken only when voted upon by each of those voting groups counted separately. Action may be taken by one (1) voting group on a matter even though no action is taken by another voting group entitled to vote on the matter. Once a share is represented for any purpose at a meeting, other than for the purpose of objecting to holding the meeting or transacting business at the meeting, it is considered present for purposes of determining whether a quorum exists for the remainder of the meeting and for any adjournment of that meeting unless a new record date is or must be set for that meeting.

          2.08. Conduct of Meetings. The Chairman of the Board, or in his or her absence, the President, and in the President’s absence, a Vice President in the order provided under Section 4.07 of these Bylaws, and in their absence, any person chosen by the shareholders present shall call the meeting of the shareholders to order and shall act as chairperson of the meeting, and the Secretary shall act as secretary of all meetings of the shareholders, but, in the absence of the Secretary, the presiding officer may appoint any other person to act as secretary of the meeting.

          2.09. Proxies. At all meetings of shareholders, a shareholder entitled to vote may vote in person or by proxy appointed in writing by the shareholder or by his or her duly authorized attorney-in-fact. All proxy appointment forms shall be filed with the Secretary or other officer or agent of the corporation authorized to tabulate votes before or at the time of the meeting. Unless the appointment form conspicuously states that it is irrevocable and the appointment is coupled with an interest, a proxy appointment may be revoked at any time. The presence of a shareholder who has filed a proxy appointment shall

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not of itself constitute a revocation. No proxy appointment shall be valid after eleven months from the date of its execution, unless otherwise expressly provided in the appointment form. The Board of Directors shall have the power and authority to make rules that are not inconsistent with the Wisconsin Business Corporation Law as to the validity and sufficiency of proxy appointments.

          2.10. Voting of Shares. Each outstanding share of Class A common stock shall be entitled to one (1) vote on each matter submitted to a vote at a meeting of shareholders. The holders of preferred stock and of Class B common stock shall have no voting rights whatsoever, except as required by law. Shares owned directly or indirectly by another corporation are not entitled to vote if this corporation owns, directly or indirectly, sufficient shares to elect a majority of the directors of such other corporation. However, the prior sentence shall not limit the power of the corporation to vote any shares, including its own shares, held by it in a fiduciary capacity. Redeemable shares are not entitled to vote after notice of redemption is mailed to the holders and a sum sufficient to redeem the shares has been deposited with a bank, trust company, or other financial institution under an irrevocable obligation to pay the holders the redemption price on surrender of the shares.

ARTICLE III. BOARD OF DIRECTORS

          3.01. General Powers and Number. All corporate powers shall be exercised by or under the authority of, and the business and affairs of the corporation shall be managed under the direction of, its Board of Directors. The number of directors of the corporation shall be no less than two (2) and no more than seven (7). The number of directors may be increased or decreased from time to time by amendment to this Section adopted by the shareholders or the Board of Directors, but no decrease shall have the effect of shortening the term of an incumbent director.

          3.02. Election, Removal, Tenure and Qualifications. Unless action is taken without a meeting under Section 7.01 of these Bylaws, directors shall be elected by a plurality of the votes cast by the shares entitled to vote in the election at a shareholders meeting at which a quorum is present; i.e., the individuals with the largest number of votes in favor of their election are elected as directors up to the maximum number of directors to be chosen in the election. Votes against a candidate are not given legal effect and are not counted as votes cast in an election of directors. In the event two (2) or more persons tie for the last vacancy to be filled, a run-off vote shall be taken from among the candidates receiving the tie vote. Each director shall hold office until the next annual meeting of shareholders and until the director’s successor shall have been elected and qualified or there is a decrease in the number of

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directors, or until his or her prior death, resignation or removal. If cumulative voting for directors is not authorized by the Articles of Incorporation, any director or directors may be removed from office by the shareholders if the number of votes cast to remove the director exceeds the number cast not to remove him or her, taken at a meeting of shareholders called for that purpose (unless action is taken without a meeting under Section 7.01 of these Bylaws), provided that the meeting notice states that the purpose, or one of the purposes, of the meeting is removal of the director. The removal may be made with or without cause unless the Articles of Incorporation or these Bylaws provide that directors may be removed only for cause. A director may resign at any time by delivering a written resignation to the Board of Directors, to the Chairman of the Board, or to the corporation through the Secretary or otherwise. Directors need not be residents of the State of Wisconsin or shareholders of the corporation.

          3.03. Regular Meetings. A regular meeting of the Board of Directors shall be held, without other notice than this Bylaw, immediately after the annual meeting of shareholders, and each adjourned session thereof. The place of such regular meeting shall be the same as the place of the meeting of shareholders which precedes it, or such other suitable place as may be announced at such meeting of shareholders. The Board of Directors and any committee may provide, by resolution, the time and place, either within or without the State of Wisconsin, for the holding of additional regular meetings without other notice than such resolution.

          3.04. Special Meetings. Special meetings of the Board of Directors may be called by or at the request of the Chairman of the Board, the President or any two (2) directors. Special meetings of any committee may be called by or at the request of the foregoing persons or the chairperson of the committee. The persons calling any special meeting of the Board of Directors or committee may fix any place, either within or without the State of Wisconsin, as the place for holding any special meeting called by them, and if no other place is fixed the place of meeting shall be the principal office of the corporation in the State of Wisconsin.

          3.05. Meetings By Telephone or Other Communication Technology. (a) Any or all directors may participate in a regular or special meeting or in a committee meeting of the Board of Directors by, or conduct the meeting through the use of, telephone or any other means of communication by which either: (i) all participating directors may simultaneously hear each other during the meeting or (ii) all communication during the meeting is immediately transmitted to each participating director, and each participating director is able to immediately send messages to all other participating directors.

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          (b) If a meeting will be conducted through the use of any means described in paragraph (a), all participating directors shall be informed that a meeting is taking place at which official business may be transacted. A director participating in a meeting by any means described in paragraph (a) is deemed to be present in person at the meeting.

          3.06. Notice of Meetings. Except as otherwise provided in the Articles of Incorporation or the Wisconsin Business Corporation Law, notice of the date, time and place of any special meeting of the Board of Directors and of any special meeting of a committee of the Board shall be given orally or in writing to each director or committee member at least 48 hours prior to the meeting, except that notice by mail shall be given at least 72 hours prior to the meeting. The notice need not describe the purpose of the meeting. Notice may be communicated in person, by telephone, telegraph or facsimile or by mail or private carrier. Oral notice is effective when communicated. Written notice is effective as follows: If delivered in person, when received; if given by mail, when deposited, postage prepaid, in the United States mail addressed to the director at his or her business or home address (or such other address as the director may have designated in writing filed with the Secretary); if given by facsimile, at the time transmitted to a facsimile number at any address designated above; and if given by telegraph, when delivered to the telegraph company.

          3.07. Quorum. Except as otherwise provided by the Wisconsin Business Corporation Law, a majority of the number of directors as provided in Section 3.01 shall constitute a quorum of the Board of Directors. Except as otherwise provided by the Wisconsin Business Corporation Law, a majority of the number of directors appointed to serve on a committee shall constitute a quorum of the committee.

          3.08. Manner of Acting. Except as otherwise provided by the Wisconsin Business Corporation Law, the affirmative vote of a majority of the directors present at a meeting at which a quorum is present shall be the act of the Board of Directors or any committee thereof.

          3.09. Conduct of Meetings. The Chairman of the Board, or in his or her absence, the President, and in the President’s absence, a Vice President in the order provided under Section 4.07 of these Bylaws, and in their absence, any director chosen by the directors present, shall call meetings of the Board of Directors to order and shall chair the meeting. The Secretary of the corporation shall act as secretary of all meetings of the Board of Directors, but in the absence of the Secretary, the presiding officer may appoint any assistant secretary or any director or other person present to act as secretary of the meeting.

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          3.10. Vacancies. Any vacancy occurring in the Board of Directors, including a vacancy created by an increase in the number of directors, may be filled by the shareholders or the Board of Directors. If the directors remaining in office constitute fewer than a quorum of the Board, the directors may fill a vacancy by the affirmative vote of a majority of all directors remaining in office. A vacancy that will occur at a specific later date (because of a resignation effective at a later date or otherwise) may be filled before the vacancy occurs, but the new director may not take office until the vacancy occurs.

          3.11. Compensation. The Board of Directors, irrespective of any personal interest of any of its members, may fix the compensation of directors.

          3.12. Presumption of Assent. A director who is present and is announced as present at a meeting of the Board of Directors or a committee thereof at which action on any corporate matter is taken shall be presumed to have assented to the action taken unless (i) the director objects at the beginning of the meeting or promptly upon his or her arrival to holding the meeting or transacting business at the meeting, or (ii) the director’s dissent or abstention from the action taken is entered in the minutes of the meeting, or (iii) the director delivers his or her written dissent or abstention to the presiding officer of the meeting before the adjournment thereof or to the corporation immediately after the adjournment of the meeting. Such right to dissent or abstain shall not apply to a director who voted in favor of such action.

          3.13. Committees. The Board of Directors, by resolution adopted by the affirmative vote of a majority of all the directors then in office, may create one (1) or more committees, each committee to consist of two (2) or more directors as members, which to the extent provided in the resolution as initially adopted, and as thereafter supplemented or amended by further resolution adopted by a like vote, may exercise the authority of the Board of Directors, except that no committee may: (a) authorize distributions; (b) approve or propose to shareholders action that the Wisconsin Business Corporation Law requires be approved by shareholders; (c) fill vacancies on the Board of Directors or any of its committees, except that the Board of Directors may provide by resolution that any vacancies on a committee shall be filled by the affirmative vote of a majority of the remaining committee members; (d) amend the Articles of Incorporation; (e) adopt, amend or repeal Bylaws; (f) approve a plan of merger not requiring shareholder approval; (g) authorize or approve reacquisition of shares, except according to a formula or method prescribed by the Board of Directors or (h) authorize or approve the issuance or sale or contract for sale of shares, or determine the designation and relative rights, preferences and limitations of a class or series of shares, except within limits prescribed by the Board of Directors. All

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members of the Board of Directors who are not members of a given committee shall be alternate members of such committee and may take the place of any absent member or members at any meeting of such committee, upon request by the Chairman of the Board, the President or upon request by the chairperson of such meeting. Each such committee shall fix its own rules (consistent with the Wisconsin Business Corporation Law, the Articles of Incorporation and these Bylaws) governing the conduct of its activities and shall make such reports to the Board of Directors of its activities as the Board of Directors may request. Unless otherwise provided by the Board of Directors in creating a committee, a committee may employ counsel, accountants and other consultants to assist it in the exercise of authority. The creation of a committee, delegation of authority to a committee or action by a committee does not relieve the Board of Directors or any of its members of any responsibility imposed on the Board of Directors or its members by law.

ARTICLE IV. OFFICERS

          4.01. Officers. The officers of the corporation shall consist of a Chairman of the Board, if any is elected, who may also be designated as an Executive Chairman, a Chief Executive Officer, a Chief Financial Officer, a President, one or more Vice Presidents (any one or more of which may be designated as an Executive Vice President, Senior Vice President, Corporate Vice President or other designation), a Secretary, and a Treasurer and such other officers as the Board of Directors may from time to time determine, each of whom shall be elected by the Board of Directors, each to have such authority, functions or duties as set forth in these Bylaws or as determined by the Board of Directors. Each officer shall be chosen by the Board of Directors and shall hold office for such term as may be prescribed by the Board of Directors and until such person’s successor shall have been duly chosen and qualified, or until such person’s earlier death, disqualification, resignation or removal. Any two or more of such offices may be held by the same person; provided, however, that no officer shall execute, acknowledge or verify any instrument in more than one capacity if such instrument is required by law, the Articles of Incorporation or these Bylaws to be executed, acknowledged or verified by two or more officers.

          4.02. Removal, Resignation and Vacancies. Any officer of the corporation may be removed, with or without cause, by the Board of Directors, without prejudice to the rights, if any, of such officer under any contract to which the corporation is a party. Any officer may resign at any time upon written notice to the corporation, without prejudice to the rights, if any, of the corporation under any contract to which such officer is a party. If any vacancy occurs in any office of the corporation, the Board of Directors may elect a successor to fill such vacancy for the remainder of the unexpired term and until a successor shall have been duly chosen and qualified.

          4.03. Chairman of the Board/Executive Chairman. The Chairman of the Board or Executive Chairman, if there is one, shall be a member of the Board of Directors, shall be deemed to be an officer of the corporation, subject to the control of the Board of Directors, shall report directly to the Board of Directors, and shall perform such duties as the Board of Directors may from time to time determine. References to the Chairman of the Board shall include the Executive Chairman if the Chairman of the Board is so designated. The Chairman of the Board may or may not be an employee of the corporation. If present, the Chairman of the Board, if one shall have been elected, shall preside at each meeting of the Board of Directors or shareholders.

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          4.04. Chief Executive Officer. The Chief Executive Officer shall have general supervision and direction of the business and affairs of the corporation, shall be responsible for corporate policy and strategy, and shall report directly to the Board of Directors. Unless otherwise provided in these Bylaws, all other officers of the corporation shall report directly to the Chief Executive Officer or as otherwise determined by the Chief Executive Officer.

          4.05. Chief Financial Officer. The Chief Financial Officer shall exercise all the powers and perform the duties of the office of the chief financial officer and in general have overall supervision of the financial operations of the corporation. The Chief Financial Officer shall, when requested, counsel with and advise the other officers of the corporation and shall perform such other duties as such officer may agree with the Chief Executive Officer or as the Board of Directors may from time to time determine.

          4.06. President. The President shall have general responsibility for the management and control of the operations of the corporation. The President shall have the power to affix the signature of the corporation to all contracts that have been authorized by the Board of Directors or the Chief Executive Officer. The President shall, when requested, counsel with and advise the other officers of the corporation and shall perform such other duties as such officer may agree with the Chief Executive Officer or as the Board of Directors may from time to time determine.

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          4.07. Vice Presidents. Each Vice President shall have such powers and duties as shall be prescribed by his or her superior officer or the Chief Executive Officer. A Vice President shall, when requested, counsel with and advise the other officers of the corporation and shall perform such other duties as such officer may agree with the Chief Executive Officer or as the Board of Directors may from time to time determine. In the absence of both the Chief Executive Officer and the President, or in the event of the death, inability or refusal to act of both the Chief Executive Officer and the President, or in the event for any reason it shall be impracticable for either of them to act personally, the Vice President (or in the event there be more than one Vice President, the Vice Presidents in the order designated by the Board of Directors, or in the absence of any designation, then in the order of their election) shall perform the duties of the President, and when so acting, shall have all the powers of and be subject to all the restrictions upon the President. Any Vice President may sign, with the Secretary or Assistant Secretary, certificates for shares of the corporation; and shall perform such other duties and have such authority as from time to time may be delegated or assigned to him or her by the Chief Executive Officer, the President or the Board of Directors. The execution of any instrument of the corporation by any Vice President shall be conclusive evidence, as to third parties, of the Vice President’s authority to act in the stead of the Chief Executive Officer or President. Vice Presidents may, by their election, have charge and supervision of designated divisions, departments or units of the corporation’s business.

          4.08. Treasurer. The Treasurer shall supervise and be responsible for all the funds and securities of the corporation, the deposit of all moneys and other valuables to the credit of the corporation in depositories of the corporation, borrowings and compliance with the provisions of all indentures, agreements and instruments governing such borrowings to which the corporation is a party, the disbursement of funds of the corporation and the investment of its funds, and in general shall perform all of the duties incident to the office of the Treasurer. The Treasurer shall, when requested, counsel with and advise the other officers of the corporation and shall perform such other duties as such officer may agree with the Chief Executive Officer or as the Board of Directors may from time to time determine.

          4.09. Secretary. The powers and duties of the Secretary are: (i) to act as Secretary at all meetings of the Board of Directors, of the committees of the Board of Directors and of the shareholders and to record the proceedings of such meetings in a book or books to be kept for that purpose; (ii) to see that all notices required to be given by the corporation are duly given and serve d; (iii) to act as custodian of the seal of the corporation and affix the seal or cause it to be affixed to all certificates of stock of the corporation and to all documents, the execution of which on behalf of the corporation under its seal is duly authorized in accordance with the provisions of these Bylaws; (iv) to have charge of the books, records and papers of the corporation and see that the reports, statements and other documents required by law to be kept and filed are properly kept and filed; and (v) to perform all of the duties incident to the office of Secretary. The Secretary shall, when requested, counsel with and advise the other officers of the corporation and shall perform such other duties as such officer may agree with the Chief Executive Officer or as the Board of Directors may from time to time determine.

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          4.10. Additional Matters. The Chief Executive Officer and the Chief Financial Officer of the corporation shall have the authority to designate employees of the corporation to have the title of Vice President, Assistant Vice President, Assistant Treasurer or Assistant Secretary. Any employee so designated shall have the powers and duties determined by the officer making such designation.

          4.11. Compensation. The salaries of the officers of the corporation and the manner and time of the payment of such salaries shall be fixed and determined by the Board of Directors and may be altered by the Board of Directors from time to time as it deems appropriate, subject to the rights, if any, of such officers under any contract of employment.

          4.12. Action with Respect to Securities of Other Corporations. The Chief Executive Officer or any other officer of the corporation authorized by the Board of Directors or the Chief Executive Officer is authorized to vote, represent, and exercise on behalf of the corporation all rights incident to any and all shares of any other corporation or corporations standing in the name of the corporation. The authority herein granted may be exercised either by such person directly or by any other person authorized to do so by proxy or power of attorney duly executed by the person having such authority.

ARTICLE V. CERTIFICATES FOR SHARES AND THEIR TRANSFER

          5.01. Certificates for Shares. All shares of this corporation shall be represented by certificates. Certificates representing shares of the corporation shall be in such form, consistent with law, as shall be determined by the Board of Directors. At a minimum, a share certificate shall state on its face the name of the corporation and that it is organized under the laws of the State of Wisconsin, the name of the person to whom issued, and the number and class of shares and the designation of the series, if any, that the certificate represents. The front or back of the certificate also must contain either (a) a summary of the designations, relative rights, preferences and limitations applicable to each class, and the variations in the rights, preferences and limitations determined for each series and the authority of the Board of Directors to determine variations for future series, or (b) a conspicuous statement that the corporation will furnish the shareholder the information described in clause (a) on request, in writing and without charge. Such certificates shall be signed, either manually or in facsimile, by the President or a Vice President and by the Secretary or an Assistant Secretary. All certificates for shares shall be consecutively numbered or otherwise identified. The name and address of the person to whom the shares represented thereby are issued, with the number of shares and date of issue, shall be entered on the stock transfer books of the corporation. All certificates surrendered to the corporation for transfer shall be cancelled and no new certificate shall be issued until the former certificate for a like number of shares shall have

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been surrendered and cancelled, except as provided in Section 5.05.

          5.02. Signature by Former Officers. If an officer or assistant officer, who has signed or whose facsimile signature has been placed upon any certificate for shares, has ceased to be such officer or assistant officer before such certificate is issued, the certificate may be issued by the corporation with the same effect as if that person were still an officer or assistant officer at the date of its issue.

          5.03. Transfer of Shares. Prior to due presentment of a certificate for shares for registration of transfer, and unless the corporation has established a procedure by which a beneficial owner of shares held by a nominee is to be recognized by the corporation as the shareholder, the corporation may treat the registered owner of such shares as the person exclusively entitled to vote, to receive notifications and otherwise to have and exercise all the rights and power of an owner. The corporation may require reasonable assurance that all transfer endorsements are genuine and effective and in compliance with all regulations prescribed by or under the authority of the Board of Directors.

          5.04. Restrictions on Transfer. The face or reverse side of each certificate representing shares shall bear a conspicuous notation of the restrictions upon the transfer of such shares imposed by the Articles of Incorporation of the corporation and any other restrictions imposed by any agreement of which the corporation has written notice.

          5.05. Lost, Destroyed or Stolen Certificates. Where the owner claims that his or her certificate for shares has been lost, destroyed or wrongfully taken, a new certificate shall be issued in place thereof if the owner (a) so requests before the corporation has notice that such shares have been acquired by a bona fide purchaser, and (b) if required by the corporation, files with the corporation a sufficient indemnity bond or affidavit and indemnity agreement, and (c) satisfies such other reasonable requirements as may be prescribed by or under the authority of the Board of Directors.

          5.06. Consideration for Shares. The shares of the corporation may be issued for such consideration as shall be fixed from time to time and determined to be adequate by the Board of Directors, but not less than the par value thereof. The consideration may consist of any tangible or intangible property or benefit to the corporation, including cash, promissory notes, services performed, contracts for services to be performed, or other securities of the corporation. When the corporation receives the consideration for which the Board of Directors authorized the issuance of shares, such shares shall be deemed to be fully paid and nonassessable by the corporation.

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          5.07. Stock Regulations. The Board of Directors shall have the power and authority to make all such rules and regulations not inconsistent with the statutes of the State of Wisconsin as it may deem expedient concerning the issue, transfer and registration of certificates representing shares of the corporation, including the appointment or designation of one or more stock transfer agents and one or more registrars.

ARTICLE VI. WAIVER OF NOTICE

     6.01. Shareholder Written Waiver. A shareholder may waive any notice required by the Wisconsin Business Corporation Law, the Articles of Incorporation or these Bylaws before or after the date and time stated in the notice. The waiver shall be in writing and signed by the shareholder entitled to the notice, shall contain the same information that would have been required in the notice under the Wisconsin Business Corporation Law except that the time and place of meeting need not be stated, and shall be delivered to the corporation for inclusion in the corporate records.

     6.02. Shareholder Waiver by Attendance. A shareholder’s attendance at a meeting, in person or by proxy, waives objection to both of the following:

     (a) Lack of notice or defective notice of the meeting, unless the shareholder at the beginning of the meeting or promptly upon arrival objects to holding the meeting or transacting business at the meeting.

     (b) Consideration of a particular matter at the meeting that is not within the purpose described in the meeting notice, unless the shareholder objects to considering the matter when it is presented.

          6.03. Director Written Waiver. A director may waive any notice required by the Wisconsin Business Corporation Law the Articles of Incorporation or the Bylaws before or after the date and time stated in the notice. The waiver shall be in writing, signed by the director entitled to the notice and retained by the corporation.

          6.04. Director Waiver by Attendance. A director’s attendance at or participation in a meeting of the Board of Directors or any committee thereof waives any required notice to him or her of the meeting unless the director at the beginning of the meeting or promptly upon his or her arrival objects to holding the meeting or transacting business at the meeting and does not thereafter vote for or assent to action taken at the meeting.

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ARTICLE VII. ACTION WITHOUT MEETINGS

          7.01. Shareholder Action Without Meeting. Action required or permitted by the Wisconsin Business Corporation Law to be taken at a shareholders’ meeting may be taken without a meeting by all shareholders entitled to vote on the action. The action must be evidenced by one or more written consents describing the action taken, signed by the shareholders consenting thereto and delivered to the corporation for inclusion in its corporate records. A consent hereunder has the effect of a meeting vote and may be described as such in any document. The Wisconsin Business Corporation Law requires that notice of the action be given to certain shareholders and specifies the effective date thereof and the record date in respect thereto.

          7.02. Director Action Without Meeting. Unless the Articles of Incorporation provide otherwise, action required or permitted by the Wisconsin Business Corporation Law to be taken at a Board of Directors meeting or committee meeting may be taken without a meeting if the action is taken by all members of the Board or committee. The action shall be evidenced by one or more written consents describing the action taken signed by each director and retained by the corporation. Action taken hereunder is effective when the last director signs the consent, unless the consent specifies a different effective date. A consent signed hereunder has the effect of a unanimous vote taken at a meeting at which all directors or committee members were present, and may be described as such in any document.

ARTICLE VIII. INDEMNIFICATION

          8.01. Indemnification for Successful Defense. Within twenty (20) days after receipt of a written request pursuant to Section 8.03, the corporation shall indemnify a director or officer, to the extent he or she has been successful on the merits or otherwise in the defense of a proceeding, for all reasonable expenses incurred in the proceeding if the director or officer was a party because he or she is a director or officer of the corporation.

          8.02. Other Indemnification.

     (a) In cases not included under Section 8.01, the corporation shall indemnify a director or officer against all liabilities and expenses incurred by the director or officer in a proceeding to which the director or officer was a party because he or she is a director or officer of the corporation, unless liability was incurred because the director or officer breached or failed to perform a duty he or she owes to

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the corporation and the breach or failure to perform constitutes any of the following:

     (1) A willful failure to deal fairly with the corporation or its shareholders in connection with a matter in which the director or officer has a material conflict of interest.

     (2) A violation of criminal law, unless the director or officer had reasonable cause to believe that his or her conduct was lawful or no reasonable cause to believe that his or her conduct was unlawful.

     (3) A transaction from which the director or officer derived an improper personal profit.

     (4) Willful misconduct.

     (b) Determination of whether indemnification is required under this Section shall be made pursuant to Section 8.05.

     (c) The termination of a proceeding by judgment, order, settlement or conviction, or upon a plea of no contest or an equivalent plea, does not, by itself, create a presumption that indemnification of the director or officer is not required under this Section.

          8.03. Written Request. A director or officer who seeks indemnification under Sections 8.01 or 8.02 shall make a written request to the corporation.

          8.04. Nonduplication. The corporation shall not indemnify a director or officer under Sections 8.01 or 8.02 if the director or officer has previously received indemnification or allowance of expenses from any person, including the corporation, in connection with the same proceeding. However, the director or officer has no duty to look to any other person for indemnification.

          8.05. Determination of Right to Indemnification.

     (a) Unless otherwise provided by the Articles of Incorporation or by written agreement between the director or officer and the corporation, the director or officer seeking indemnification under Section 8.02 shall select one of the following means for determining his or her right to indemnification:

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     (1) By a majority vote of a quorum of the Board of Directors consisting of directors not at the time parties to the same or related proceedings. If a quorum of disinterested directors cannot be obtained, by majority vote of a committee duly appointed by the Board of Directors and consisting solely of two (2) or more directors who are not at the time parties to the same or related proceedings. Directors who are parties to the same or related proceedings may participate in the designation of members of the committee.

     (2) By independent legal counsel selected by a quorum of the Board of Directors or its committee in the manner prescribed in sub. (1) or, if unable to obtain such a quorum or committee, by a majority vote of the full Board of Directors, including directors who are parties to the same or related proceedings.

     (3) By a panel of three (3) arbitrators consisting of one arbitrator selected by those directors entitled under sub. (2) to select independent legal counsel, one arbitrator selected by the director or officer seeking indemnification and one arbitrator selected by the two arbitrators previously selected.

     (4) By an affirmative vote of shares represented at a meeting of Shareholders at which a quorum of the voting group entitled to vote thereon is present. Shares owned by, or voted under the control of, persons who are at the time parties to the same or related proceedings, whether as plaintiffs or defendants or in any other capacity, may not be voted in making the determination.

     (5) By a court under Section 8.08.

     (6) By any other method provided for in any additional right to indemnification permitted under Section 8.07.

     (b) In any determination under (a), the burden of proof is on the corporation to prove by clear and convincing evidence that indemnification under Section 8.02 should not be allowed.

     (c) A written determination as to a director’s or officer’s indemnification under Section 8.02 shall be submitted to both the corporation and the director or officer within 60 days of the selection made under (a).

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     (d) If it is determined that indemnification is required under Section 8.02, the corporation shall pay all liabilities and expenses not prohibited by Section 8.04 within ten (10) days after receipt of the written determination under (c). The corporation shall also pay all expenses incurred by the director or officer in the determination process under (a).

          8.06. Advance of Expenses. Within ten (10) days after receipt of a written request by a director or officer who is a party to a proceeding, the corporation shall pay or reimburse his or her reasonable expenses as incurred if the director or officer provides the corporation with all of the following:

     (1) A written affirmation of his or her good faith belief that he or she has not breached or failed to perform his or her duties to the corporation.

     (2) A written undertaking, executed personally or on his or her behalf, to repay the allowance to the extent that it is ultimately determined under Section 8.05 that indemnification under Section 8.02 is not required and that indemnification is not ordered by a court under Section 8.08(b)(2). The undertaking under this subsection shall be an unlimited general obligation of the director or officer and may be accepted without reference to his or her ability to repay the allowance. The undertaking may be secured or unsecured.

          8.07. Nonexclusivity.

     (a) Except as provided in (b), Sections 8.01, 8.02 and 8.06 do not preclude any additional right to indemnification or allowance of expenses that a director or officer may have under any of the following:

     (1) The Articles of Incorporation.

     (2) A written agreement between the director or officer and the corporation.

     (3) A resolution of the Board of Directors.

     (4) A resolution, after notice, adopted by a majority vote of all of the corporation’s voting shares then issued and outstanding.

     (b) Regardless of the existence of an additional right under (a), the corporation shall not indemnify a director or officer, or permit a director or officer to

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retain any allowance of expenses unless it is determined by or on behalf of the corporation that the director or officer did not breach or fail to perform a duty he or she owes to the corporation which constitutes conduct under Section 8.02(a)(l), (2), (3) or (4). A director or officer who is a party to the same or related proceeding for which indemnification or an allowance of expenses is sought may not participate in a determination under this subsection.

     (c) Sections 8.01 to 8.13 do not affect the corporation’s power to pay or reimburse expenses incurred by a director or officer in any of the following circumstances.

     (1) As a witness in a proceeding to which he or she is not a party.

     (2) As a plaintiff or petitioner in a proceeding because he or she is or was an employee, agent, director or officer of the corporation.

          8.08. Court-Ordered Indemnification.

     (a) Except as provided otherwise by written agreement between the director or officer and the corporation, a director or officer who is a party to a proceeding may apply for indemnification to the court conducting the proceeding or to another court of competent jurisdiction. Application shall be made for an initial determination by the court under Section 8.05(a)(5) or for review by the court of an adverse determination under Section 8.05(a) (1), (2), (3), (4) or (6). After receipt of an application, the court shall give any notice it considers necessary.

     (b) The court shall order indemnification if it determines any of the following:

     (1) That the director or officer is entitled to indemnification under Sections 8.01 or 8.02.

     (2) That the director or officer is fairly and reasonably entitled to indemnification in view of all the relevant circumstances, regardless of whether indemnification is required under Section 8.02.

     (c) If the court determines under (b) that the director or officer is entitled to indemnification, the corporation shall pay the director’s or officer’s expenses incurred to obtain the court-ordered indemnification.

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          8.09. Indemnification and Allowance of Expenses of Employees and Agents. The corporation shall indemnify an employee of the corporation who is not a director or officer of the corporation, to the extent that he or she has been successful on the merits or otherwise in defense of a proceeding, for all reasonable expenses incurred in the proceeding if the employee was a party because he or she was an employee of the corporation. In addition, the corporation may indemnify and allow reasonable expenses of an employee or agent who is not a director or officer of the corporation to the extent provided by the Articles of Incorporation or these Bylaws, by general or specific action of the Board of Directors or by contract.

          8.10. Insurance. The corporation may purchase and maintain insurance on behalf of an individual who is an employee, agent, director or officer of the corporation against liability asserted against or incurred by the individual in his or her capacity as an employee, agent, director or officer, regardless of whether the corporation is required or authorized to indemnify or allow expenses to the individual against the same liability under Sections 8.01, 8.02, 8.06, 8.07 and 8.09.

          8.11. Securities Law Claims.

     (a) Pursuant to the public policy of the State of Wisconsin, the corporation shall provide indemnification and allowance of expenses and may insure for any liability incurred in connection with a proceeding involving securities regulation described under (b) to the extent required or permitted under Sections 8.01 to 8.10.

     (b) Sections 8.01 to 8.10 apply, to the extent applicable to any other proceeding, to any proceeding involving a federal or state statute, rule or regulation regulating the offer, sale or purchase of securities, securities brokers or dealers, or investment companies or investment advisers.

          8.12. Liberal Construction. In order for the corporation to obtain and retain qualified directors, officers and employees, the foregoing provisions shall be liberally administered in order to afford maximum indemnification of directors, officers and, where Section 8.09 of these Bylaws applies, employees. The indemnification above provided for shall be granted in all applicable cases unless to do so would clearly contravene law, controlling precedent or public policy.

          8.13. Definitions Applicable to this Article. For purposes of this Article:

     (a) “Affiliate” shall include, without limitation, any corporation, partnership, joint venture, employee benefit plan, trust or other

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enterprise that directly or indirectly through one or more intermediaries, controls or is controlled by, or is under common control with, the corporation.

     (b) “Corporation” means this corporation and any domestic or foreign predecessor of this corporation where the predecessor corporation’s existence ceased upon the consummation of a merger or other transaction.

     (c) “Director or officer” means any of the following:

     (1) An individual who is or was a director or officer of this corporation.

     (2) An individual who, while a director or officer of this corporation, is or was serving at the corporation’s request as a director, officer, partner, trustee, member of any governing or decision-making committee, employee or agent of another corporation or foreign corporation, partnership, joint venture, trust or other enterprise.

     (3) An individual who, while a director or officer of this corporation, is or was serving an employee benefit plan because his or her duties to the corporation also impose duties on, or otherwise involve services by, the person to the plan or to participants in or beneficiaries of the plan.

     (4) Unless the context requires otherwise, the estate or personal representative of a director or officer.

For purposes of this Article, it shall be conclusively presumed that any director or officer serving as a director, officer, partner, trustee, member of any governing or decision-making committee, employee or agent of an affiliate shall be so serving at the request of the corporation.

     (d) “Expenses” include fees, costs, charges, disbursements, attorney fees and other expenses incurred in connection with a proceeding.

     (e) “Liability” includes the obligation to pay a judgment, settlement, penalty, assessment, forfeiture or fine, including an excise tax assessed with respect to an employee benefit plan, and reasonable expenses.

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     (f) “Party” includes an individual who was or is, or who is threatened to be made, a named defendant or respondent in a proceeding.

     (g) “Proceeding” means any threatened, pending or completed civil, criminal, administrative or investigative action, suit, arbitration or other proceeding, whether formal or informal, which involves foreign, federal, state or local law and which is brought by or in the right of the corporation or by any other person.

ARTICLE IX. CONTRACTS, LOANS, CHECKS AND DEPOSITS

          9.01. Contracts; Director Conflict of Interest. The Board of Directors may authorize any officer or officers, agent or agents, to enter into any contract or execute or deliver any instrument in the name of and on behalf of the corporation, and such authorization may be general or confined to specific instances.

          Any contract or other transaction between the corporation and one or more of its directors, or between the corporation and any entity of which one or more of its directors are members or employees or in which one or more of its directors are interested, or between the corporation and any corporation or association of which one or more of its directors are shareholders, members, directors, officers or employees or in which one or more of its directors are interested, shall not be voidable by the corporation solely because of the director’s interest, whether direct or indirect, in the transaction if:

     (a) The material facts of the transaction and the director’s interest were disclosed or known to the Board of Directors or a committee of the Board of Directors, and a majority of disinterested members of the Board of Directors or committee authorized, approved, or specifically ratified the transaction; or

     (b) The material, facts of the transaction and the director’s interest were disclosed or known to the shareholders entitled to vote, and a majority of the shares held by disinterested shareholders authorized, approved, or specifically ratified the transaction; or

     (c) The transaction was fair to the corporation.

For purposes of this Section 9.01, a majority of directors having no direct or indirect interest in the transaction shall constitute a quorum of the Board or a committee of the Board acting on the matter, and a majority of the shares entitled to Vote on the matter, whether or not present, and other than those

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owned by or under the control of a director having a direct or indirect interest in the transaction, shall constitute a quorum of the shareholders for the purpose of acting on the matter.

          9.02. Loans. No indebtedness for borrowed money shall be contracted on behalf of the corporation and no evidences of such indebtedness shall be issued in its name unless authorized by or under the authority of a resolution of the Board of Directors. Such authorization may be general or confined to specific instances.

          9.03. Checks, Drafts, etc. All checks, drafts or other orders for the payment of money, notes or other evidences of indebtedness issued in the name of the corporation, shall be signed by such officer(s), employee(s) or agents of the corporation and in such manner as shall from time to time be determined by or under the authority of a resolution of the Board of Directors.

          9.04. Deposits. All funds of the corporation not otherwise employed shall be deposited from time to time to the credit of the corporation in such banks, trust companies or other depositaries as may be selected by or under the authority of a resolution of the Board of Directors.

ARTICLE X. MISCELLANEOUS

          10.01. Corporate Seal. The Board of Directors may provide a corporate seal which may be circular in form and have inscribed thereon the name of the corporation and the state of incorporation and the words “Corporate Seal.”

          10.02. Fiscal Year. The fiscal year of the corporation shall begin on the first day of April and end on the last day of March in each year.

ARTICLE XI. AMENDMENTS

          11.01. By Shareholders. These Bylaws may be amended or repealed and new Bylaws may be adopted by the shareholders by the vote provided in Section 2.07 of these Bylaws or as specifically provided below. The shareholders may adopt or amend a Bylaw that fixes a greater or lower quorum requirement or a greater voting requirement for shareholders or voting groups of shareholders than otherwise is provided in the Wisconsin Business Corporation Law. The adoption or amendment of a Bylaw that adds, changes or deletes a greater or lower quorum requirement or a greater voting requirement for shareholders must meet the same quorum requirement and be adopted by the same vote and voting

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groups required to take action under the quorum and voting requirement then in effect.

          11.02. By Directors. Except as the Articles of Incorporation may otherwise provide, these Bylaws may also be amended or repealed and new Bylaws may be adopted by the Board of Directors by the vote provided in Section 3.08, but (a) no Bylaw adopted by the shareholders shall be amended, repealed or readopted by the Board of Directors if the Bylaw so adopted so provides and (b) a Bylaw adopted or amended by the shareholders that fixes a greater or lower quorum requirement or a greater voting requirement for the Board of Directors than otherwise is provided in the Wisconsin Business Corporation Law may not be amended or repealed by the Board of Directors unless the Bylaw expressly provides that it may be amended or repealed by a specified vote of the Board of Directors. Action by the Board of Directors to adopt or amend a Bylaw that changes the quorum or voting requirement for the Board of Directors must meet the same quorum requirement and be adopted by the same vote required to take action under the quorum and voting requirement then in effect, unless a different voting requirement is specified as provided by the preceding sentence. A Bylaw that fixes a greater or lower quorum requirement or a greater voting requirement for shareholders or voting groups of shareholders than otherwise is provided in the Wisconsin Business Corporation Law may not be adopted, amended or repealed by the Board of Directors.

          11.03. Implied Amendments. Any action taken or authorized by the shareholders or by the Board of Directors, which would be inconsistent with the Bylaws then in effect but is taken or authorized by a vote that would be sufficient to amend the Bylaws so that the Bylaws would be consistent with such action, shall be given the same effect as though the Bylaws had been temporarily amended or suspended so far, but only so far, as is necessary to permit the specific action so taken or authorized.

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EX-10.12(A)

EXHIBIT - 10.12(A)

AGREEMENT FOR PAYMENT OF SUPPLEMENTAL BENEFITS

     THIS AGREEMENT (the Agreement) is executed the 26th day of April,1995 effective the 1st day of January, 1995 between The Dalton Foundries, Inc., an Indiana corporation with its principal office in Warsaw, Indiana (the Company) and J. L. DeRita (the Employee).

RECITALS

     The Employee holds a key executive and management position with the Company and currently is employed pursuant to a letter agreement dated July 25, 1994, as amended by a letter agreement dated April 4, 1995 (the “Employment Letter”). As additional incentive to the Employee and to assure his interest in the Company’s continued growth and success, the Company is willing to provide to the Employee certain deferred, supplemental benefits as described herein.

     THEREFORE, in consideration of their mutual undertakings, the parties agree as follows:

     1. Continued Employment. The Company continues the Employee’s services as an employee and the Employee accepts continued employment under the terms and conditions of the Employment Letter and this Agreement

     2. Other Benefits. Nothing contained in this Agreement shall be construed to exclude the Employee from any supplemental compensation, bonus, insurance, medical, severance, retirement or other employee benefit to which he otherwise may be or become entitled as an employee of the Company. The benefit(s) payable under this Agreement shall

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not be construed as compensation to the Employee for the purpose of computing benefits under any employee retirement plan or similar arrangement maintained by the Company for the benefit of its employees.

     3. Supplemental Retirement Benefit.

     (a) For purposes of this Agreement: “Service” means employment with the Company, and “Benefit Commencement Date” means the first day of the month following the earlier of (i) the date the Employee attains age sixty-five (65) or (ii) the date of the Employee’s death.

     (b) If the Employee’s Service continues to the date he attains age sixty-five (65), a supplemental retirement benefit shall be paid by the Company to the Employee in the amount of Four Thousand One Hundred Sixty-Seven Dollars ($4,167) per month for a period not to exceed one hundred twenty (120) months, commencing on the Employee’s Benefit Commencement Date.

     4. Death or Disability Benefit. If the Employee’s Service is terminated by death or disability at any time, in lieu of the supplemental retirement benefit a death benefit equal in amount to the supplemental retirement benefit shall be paid by the Company to the Employee’s spouse, Sandra L. DeRita (if she survives) during her lifetime. Such benefit shall be paid monthly for a period not to exceed one hundred twenty (120) months, commencing on the Employee’s Benefit Commencement Date.

     5. Involuntary Termination.

     (a) If the Employee’s Service is terminated involuntarily by the Company for any reason other than Cause, the Employee shall be given credit for Service for,

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and for the purpose of crediting Service shall be deemed to be an employee of the Company during, the period from the date of his termination of employment to the first day of the month following the earlier of (i) the date he attains age sixty-five (65) or (ii) the date of his death, notwithstanding the fact that he is not an employee of the Company during such period.

     (b) For purposes of this Paragraph 5, “Cause” means:

     (i) The willful and continued failure of Employee to perform his duties as an employee of the Company;

     (ii) An action by Employee which involves willful misfeasance or gross negligence in connection with the performance of his duties as an employee of the Company;

     (iii) Conviction of Employee of the commission of any criminal offense which involves dishonesty or breach of trust; or

     (iv) Any intentional breach by Employee of a material term, condition or covenant of this Agreement or any other agreement between Employee and the Company.

     6. Change in Control.

     (a) For all purposes of Paragraphs 3 and 4 of this Agreement and the deferred compensation arrangement described in the Employment Letter, if the Employee’s Service is terminated for any reason following a Change in Control of the Company the Employee shall be given credit for Service for, and for the purpose of crediting Service shall be deemed to be an employee of the Company during, the

3

period from the date of his termination of employment to the first day of the month following the earlier of (i) the date he attains age sixty-five (65) or (ii) the date of his death, notwithstanding the fact that he is not an employee of the Company during such period.

     (b) For purposes of this Paragraph 6, “Change in Control” means the acquisition by any person, entity or group of persons within the meaning of Section 13(d) or 14(d) of the Securities Exchange Act of 1934 (“Act”), or comparable successor provisions, of beneficial ownership (within the meaning of Rule 13d promulgated under the Act) of 25% or more of either the outstanding shares of common stock or the combined voting power of the Company’s then outstanding voting securities entitled to vote generally, or the approval by the Company’s stockholders of any merger, consolidation or other reorganization with respect to which persons who were stockholders of the Company immediately prior to such reorganization do not, immediately thereafter, own more than 50% of the combined voting power entitled to vote generally in the election of directors of the reorganized Company’s then outstanding securities, or the sale of all or substantially all of the Company’s assets, or a liquidation or dissolution of the Company.

     7. Noncompetition and Nondisclosure. The Employee recognizes and acknowledges that incident to his employment by the Company he has access to certain confidential information with has significant competitive value and is known only to the Company and its authorized personnel. This information includes (but is not limited to) vendor and customer lists, prices and pricing structures, marketing plans, engineering and

4

manufacturing designs and techniques, and other information concerning the manner in which the Company’s business is conducted. The Employee further acknowledges that such information is the unique and valuable property of the Company. Therefore, the Employee agrees that he will not at any time, either before or after the termination of his employment for any reason, use for the benefit of any person other than the Company, or disclose to any other person, any such confidential information. In addition, during the remaining period of his employment and for a period of one (1) year thereafter, the Employee will not directly or indirectly, either alone or with any other person:

     (a) Solicit or enter into any contractual relationship with any customer of the Company or any of the Company’s employees or agents, without the prior written consent of the Company; nor

     (b) As an owner, employee, partner, shareholder, independent contractor or otherwise, establish or engage in any business, enterprise or other activity involving the manufacture, production, machining or sale of gray iron castings in competition with the business of the Company;

     (c) For purposes of the foregoing provisions of this Paragraph 8, the term “Company” shall include the Company and any direct or indirect subsidiary of the Company.

In the event of a material breach of any of the covenants contained in this Paragraph 8, if the Employee does not substantially cure such breach within ten (10) business days of receiving written notice of the breach from the Company, thereafter no benefits shall be payable to or on behalf of the Employee or his beneficiaries under this Agreement; and in

5

such case the Company shall be entitled (in addition to any other remedy available at law or in equity) to the enforcement of such covenants by injunctive relief and to the recovery of damages, including a reasonable sum for its attorneys’ fees and expenses.

     8. Facility of Payment. Notwithstanding any other provision of this Agreement, if the Employee or any beneficiary entitled to payments under this Agreement in the Company’s opinion becomes incapacitated and unable to manage his financial affairs, the Company may make such payments to his legal representative or to a relative or friend for his benefit or may otherwise make payments for the benefit of such person in any manner that it considers advisable; and any such payment shall be a full and complete discharge of the Company’s liability for such payment.

     9. No Assignment; Binding Effect. This is a personal services contract which is not assignable by the Employee. Neither shall the Employee nor any beneficiary assign, grant a security interest in or otherwise transfer his right or interest in any benefit under this Agreement, nor shall any such right or interest be subject to attachment, garnishment, levy, execution or other legal or equitable process. However, the Company may assign its rights under this Agreement by operation of law or to a parent or subsidiary corporation or a successor by merger or consolidation; and subject to the foregoing provisions of this paragraph, this Agreement shall be binding upon and inure to the benefit of the parties and their respective successors, assigns, personal representatives, heirs, legatees and beneficiaries.

     10. Additional Conditions.

     (a) The Company in its discretion may elect to fund the benefits under this Agreement through insurance owned and maintained by the Company on the

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Employee’s life. In such event the Employee shall cooperate with the Company by providing such necessary information and undergoing such examinations as the insurance carrier(s) may reasonably require.

     (b) The benefits provided to the Employee hereunder shall at all times be a general, unsecured and unfunded obligation of the Company. This Agreement shall not give any person any right or security interest in any asset of the Company, nor shall it imply any trust or segregation of assets by the Company.

     11. Provisions Which Survive. The provisions of Paragraphs 3 through 10 (as well as any other provision necessary for these paragraphs to be effective) shall survive the termination of the Employee’s employment and the termination of this Agreement for any reason.

     12. Entire Agreement. This Agreement shall terminate and supersede all prior agreements except the Employment Letter, whether written or oral, with respect to the subject matter of this Agreement, and excepting the Employment Letter this Agreement represents the entire agreement between the parties with respect to such matters. This Agreement may be amended or revoked only by an Agreement in writing between the Company and the Employee.

     13. Severability. If any provision of this Agreement or its application to any person or circumstance shall be invalid or unenforceable to any extent or in any jurisdiction, the remainder of this Agreement and the application of its provisions to other persons or circumstances and in other jurisdictions shall not be affected and shall be in force to the extent permitted by law.

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     14. Waiver of Breach. The waiver by either party of a breach of any provision of this Agreement shall not operate or be construed as a waiver of any subsequent breach by either the Company or the Employee.

     15. Governing Law. This Agreement shall be construed in accordance with the laws of the State of Indiana as if the Agreement were wholly to be performed in the State of Indiana.

     EXECUTED on the date first stated above.

COMPANY THE DALTON FOUNDRIES, INC.
By:	/s/ K. L. Davidson
	K. L. Davidson, Chairman and Chief
	Executive Officer

EMPLOYEE
 

/s/ J. L. DeRita  

J. L. DeRita 

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DALTON 

Dalton Corporation

July 31 , 2001

Mr. J. L. DeRita, President
Dalton Corporation
P.O. Box 230
Warsaw, IN 46581-0230

Dear Joe:

     In consideration of your continued employment by Dalton Corporation (“Company”), this letter is signed and delivered to you for the purpose of correcting an ambiguity in Paragraph 3(b) of the Agreement for Payment of Supplemental Benefits executed between you and the Company under date of April 26, 1995.

     It is agreed that Paragraph 3(b) is hereby amended to include the following additional sentence:

     “Such payments shall be continued during the Employee’s lifetime, but in the event of the Employee’s death before the one hundred twenty (120) monthly payments are completed, such payments shall be continued by the Company to the Employee’s spouse, Sandra L. DeRita (if she survives), during her lifetime until the earlier of her death or the expiration of such 120 months.”

     Please indicate your acceptance of this Amendment by signing and returning to me the enclosed copy of this letter.

Sincerely yours,
 

/s/ William M. Barrett 

William M. Barrett 

     Accepted this 31st day of July, 2001.

/s/ J. L. DeRita  

J. L. DeRita 

General Office
P.O.Box 230
Warsaw, IN 46581-0230
(219) 267-8111

EX-10.20

Exhibit 10.20

NEENAH FOUNDRY COMPANY AMENDED AND RESTATED
2003 SEVERANCE AND CHANGE OF CONTROL PLAN

1.  Purpose.

     This plan shall be known as the Neenah Foundry Company Amended and Restated 2003 Severance and Change of Control Plan (the “Plan”). The purpose of the Plan shall be to set forth payments and other benefits, if any, to which an executive of Neenah Foundry Company (the “Company”) or any of its Subsidiaries will be entitled upon termination of such person’s employment. This Plan document supersedes, in all respects, the prior version of the Plan, (as previously amended) as of the Effective Date.

2.  Definitions. For purposes of this Plan, except when the context clearly indicates otherwise, the following terms shall have the meanings set forth below.

     “Affiliate” means, in respect of any Person, any other Person who, directly, or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with such Person. For purposes of this definition, “control” (including the terms “controlled by” and “under common control with”) when used in respect of any Person means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract, or otherwise.

     “Base Salary” means, with respect to any Plan Participant, “Base Salary” as defined in such Plan Participant’s Employment Agreement.

     “Board of Directors” and “Board” mean the board of directors of the Company.

     “Cause” means, with respect to a Plan Participant, the occurrence of one or more of the following events: (i) such Plan Participant’s willful and material breach of, or gross negligence or malfeasance in the performance of, the Plan Participant’s duties under such Plan Participant’s Employment Agreement; (ii) any material insubordination by the Plan Participant with respect to carrying out the reasonable instructions of the Board; (iii) the conviction for, or the entering of a guilty plea or plea of nolo contendere with respect to, a felony, the equivalent thereof or other crime with respect to which imprisonment of more than one year is a possible punishment or that is expected to result in Significant Injury; (iv) a Plan Participant’s breach of a fiduciary obligation to the Company Group or breach of any confidentiality or non-competition obligation set forth herein; (v) any act of moral turpitude or willful misconduct by the Plan Participant that (1) is intended to result in personal enrichment of the Plan Participant or any related person at the expense of the Company Group or (2) is reasonably expected to result in Significant Injury; provided, however, that the Plan Participant shall have 21 days (or such longer period as is reasonable under the circumstances) after written notice by the Company of any such event constituting “Cause” hereunder in which to cure any failure or default under subsections (i) and (ii) that is curable.

     “Change of Control” means the consummation of any transaction or series of related transactions, the result of which is that: (i) any Person or group (within the meaning of Rule 13d-5 of the Exchange Act), other than Tontine together with its Affiliates, shall own directly or indirectly, beneficially or of record, greater than 50% of the equity securities of NEI or the Company on a fully diluted basis; (ii) substantially all of the assets of NEI and its Subsidiaries taken as a whole are sold or NEI is merged or recapitalized and the stockholders of NEI do not own a majority of the voting stock of the surviving corporation, or (iii) after the first fully distributed public offering of voting stock of any member of the Company Group (1) any Person or group (within the meaning of Rule 13d-5 of the Exchange Act), shall own directly or indirectly, beneficially or of record, a percentage of the issued and outstanding voting stock of NEI or the Company on a fully diluted basis, having ordinary voting power in excess of 35% and in excess of the percentage then owned, directly or indirectly, beneficially and of record, on a fully diluted basis, by Tontine together with its Affiliates, or (2) a majority of the seats on the boards of directors of NEI or the Company (except in the case of any vacancy for 30 days or less resulting from the death or resignation of any director) is replaced during a twelve-month period by persons who were neither (i) nominated by Tontine nor (ii) appointed by directors so nominated, in each case, whether as the result of the purchase, issuance or sale of securities of any member of the Company Group or any merger, consolidation, liquidation, dissolution, recapitalization or similar transaction involving any member of the Company Group. Notwithstanding the foregoing, no Change of Control shall have occurred unless the transaction or series of transactions results in a Change in Control within the meaning of Code Section 409A and the regulations thereunder. This Change of Control definition shall be interpreted in a manner which is consistent with Code Section 409A and the regulations thereunder.

     “Change of Control Multiple” means, with respect to any Plan Participant, “Change of Control Multiple” as defined in such Plan Participant’s Employment Agreement.

     “Change of Control Payment” has the meaning given to such term in Section 4(b) hereof.

     “COBRA” means Part 6 of Subtitle B of Title I of the Employee Retirement Income Security Act of 1974, as amended and Section 4980B of the Code.

     “Code” means the Internal Revenue Code of 1986, as amended.

     “Committee” means the Compensation Committee of the Board or such other committee that consists solely of two or more individuals, each of whom is a Non-Employee Director and an “outside director” within the meaning of Treasury Regulation Section 1.162-27(e)(3).

     “Company” has the meaning set forth in Section 1 hereof.

     “Company Group” means NEI, the Company and their respective Subsidiaries.

     “Effective Date” means October 25, 2007.

     “Employment Agreement” means the written agreement between any Plan Participant and the Company or any of its Subsidiaries pursuant to which such Plan Participant is entitled to the benefits under the Plan.

     “Employment Period” means, with respect to a Plan Participant’s employment, the period from the effective date of the Employment Agreement until the date the Plan Participant is no longer employed with the Company.

     “Exchange Act” means the Securities Exchange Act of 1934, as amended.

     “Excise Taxes” has the meaning given to such term in Section 4(b) hereof.

     “Good Reason” means with respect to any Plan Participant, the termination of such Plan Participant’s employment within a year following a material diminution in Participant’s Base Salary, a material diminution in the Participant's authority, duties and responsibilities or a material change in the geographic location at which the Plan Participant must perform services and, solely with respect to Robert E. Ostendorf, either: (i) the failure of the Company Group to nominate Mr. Ostendorf to the Board of Directors of NEI and each of its subsidiaries; or (ii) the Board repeatedly overrides, supersedes or disregards reasonable decisions by Mr. Ostendorf or reasonable recommendations made by Mr. Ostendorf to the Board such that the Board materially interfered with Mr. Ostendorf’s ability effectively function as President and Chief Executive Officer. A Participant may not terminate for Good Reason unless he provides the Company Group with notice of the condition constituting the Good Reason within 90 days of the existence of the condition and the Company Group fails to remedy the condition within 30 days of such notice.

     “Gross-Up Amount” has the meaning given to such term in Section 4(b) hereof.

     “NEI” means Neenah Enterprises, Inc. a Delaware corporation (formerly known as ACP Holding Company).

     “Non-Employee Director” has the meaning given to such term in Rule 16b-3 under the Exchange Act and any successor thereto.

     “Payout Period” means, with respect to any Plan Participant, “Payout Period” as defined in such Plan Participant’s Employment Agreement.

     “Person” shall mean an individual, a partnership, a corporation, a limited liability company, an association, a joint stock company, a trust, a joint venture, an unincorporated organization or a governmental entity or any department, agency or political subdivision thereof.

     “Plan” has the meaning set forth in Section 1 hereof.

     “Plan Participant” means each of Robert E. Ostendorf, Jr., Gary LaChey, Frank Headington, Timothy Koller, William Martin, Joseph Varkoly, Steve Shaffer, John Andrews, Robert Gitter, Dennis O’Brien, Joseph Harvey, Ronald Schmucker and any other employee of the Company Group selected by the Board or the Committee.”

     “Severance Multiple” means, with respect to any Plan Participant, “Severance Multiple” as defined in such Plan Participant’s Employment Agreement.

     “Severance Payments” has the meaning given to such term in Section 4(a) hereof.

     “Significant Injury” means significant economic or reputational injury or both (such determination to be made by the Board in its reasonable judgment) to the Company Group.

     “Subsidiary” of any Person means a corporation or other entity of which outstanding shares or ownership interests representing 50% or more of the combined voting power of such corporation or other entity entitled to elect the management thereof, or such lesser percentage as may be approved by the Committee, are owned directly or indirectly by such Person.

     “Tontine” means Tontine Capital Partners, L.P., a Delaware limited partnership.

3.  Administration.

     The Plan shall be administered by the Committee; provided, that the Board may, in its discretion, at any time and from time to time, resolve to administer the Plan, in which case the term “Committee” shall be deemed to mean the Board for all purposes herein. Subject to the provisions of the Plan, the Committee shall be authorized to: (i) select persons to participate in the Plan in addition to those entitled to participate in the Plan pursuant to Employment Agreements entered into at or prior to the Effective Date; (ii) determine the form, substance, terms and conditions of each additional grant made under the Plan; (iii) certify that the conditions and restrictions applicable to any grant have been met; (iv) modify the terms of grants made under the Plan; (v) make any adjustments necessary or desirable in connection with grants made under the Plan to eligible participants located outside the United States; (vi) adopt, amend, or rescind rules and regulations for the administration of the Plan, including, but not limited to, correcting any defect or supplying any omission, or reconciling any inconsistency in the Plan or in any Employment Agreement, in the manner and to the extent it shall deem necessary or advisable, including so that the Plan and the operation of the Plan complies with the Code to the extent applicable and other applicable law; and (vii) exercise such powers and perform such acts as are deemed necessary or advisable to promote the best interests of the Company with respect to the Plan; provided, that in no event shall any amendment, modification, adjustment, correction or supplement to the Plan pursuant to the foregoing clauses (i) through (vii) adversely affect any Plan Participant without such Plan Participant’s consent. The validity, construction, and effect of the Plan and any rules and regulations relating to the Plan shall be determined in accordance with applicable federal and state laws and rules and regulations promulgated pursuant thereto. No member of the Committee and no officer of the Company shall be liable for any action taken or omitted to be taken by such member, by any other member of the Committee or by any officer of the Company in connection with the performance of duties under the Plan, except for such person’s own willful misconduct or as expressly provided by statute.

     The expenses of administering the Plan shall be borne by the Company.

4.  Severance Arrangements; Change of Control Payments.

     (a)     Severance Arrangement. Except as provided in Section 4(b) and 4(c) below, if any Plan Participant’s employment with a member of the Company Group is terminated by such Person other than for Cause, or if any Plan Participant resigns from employment with such Person for Good Reason, such Plan Participant shall receive, during the Payout Period, (x) severance payments (“Severance Payments”) equal in the aggregate to the product of (1) the Severance Multiple and (2) Base Salary of such Plan Participant and (y) the health benefits, at the Company’s cost (subject to satisfying insurability requirements), to which such Plan Participant would otherwise have been entitled pursuant to the Employment Agreement (subject to such Plan Participant’s COBRA election) and outplacement services, in each case, for the Payout Period. Severance Payments shall be made bi-weekly, in accordance with normal payroll practices for the Payout Period except that if any class of NEI common stock is publicly tradable on an established securities market, no amounts shall be paid pursuant to this Section 4(a) during the first 6 months following a Participant’s termination unless the payments satisfy the requirements for separation pay due to involuntary separation from service as provided in Treas. Reg. 1.409A-1(b)(9)(iii). The Company’s health benefits and outplacement services described above will be made available until the earlier of the end of the Payout Period or the receipt of comparable benefits on re-employment. Severance Payments shall not be reduced as a result of re-employment or otherwise.

     (b)     Termination upon Change of Control. If any Plan Participant’s employment with a member of the Company Group is terminated by such Person other than for Cause or if any Plan Participant resigns from employment with such Person for Good Reason, in each case, within one year after a Change of Control, such Plan Participant shall receive a lump sum cash payment in an amount equal to the product of (x) the Change of Control Multiple and (y) Base Salary (the “Change of Control Payment”). The Change of Control Payment (i) will be payable by the Company to such Plan Participant in a lump sum within 30 days of such Plan Participant’s termination pursuant to the preceding sentence, (ii) is not subject to mitigation or reduction upon re-employment or otherwise and (iii) will be increased to provide for payment of an additional amount (the “Gross-Up Amount”) such that the net amount retained by the Plan Participant, after payment of (1) any excise taxes due on the Change of Control Payment under Section 4999 of the Code or any corresponding or applicable state law provision (“Excise Taxes”) and (2) any federal, state or local income tax and any Excise Taxes due in respect of the Gross-Up Amount, shall equal the Change of Control Payment. Clauses (i) and (ii) of the immediately preceding sentence shall apply to the Gross-Up Amount. Such Plan Participant shall also be entitled to the continuation of health benefits (subject to satisfying insurability requirements) and outplacement services during the Payout Period on the same basis as provided pursuant to Section 4(a), subject to mitigation upon re-employment and receipt of comparable benefits set forth in Section 4(a). Payments made upon termination following a Change of Control are in lieu of any severance payments described in Section 4(a) above that would otherwise be payable following such termination. Notwithstanding the foregoing, if any class of NEI common stock is publicly tradable on an established securities market, no amounts shall be paid pursuant to this Section 4(b) during the first 6 months following a Participants termination unless the payments satisfy the requirements for separation pay due to involuntary separation from service as provided in Treas. Reg. 1.409A-1(b)(9)(iii).

     (c)     Notwithstanding any other provision of Section 4 to the contrary, to the extent that: (i) NEI common stock is publicly tradable on an established securities market and (ii) any benefits provided pursuant to Section 4 during the first six months after the Participant’s termination are not paid pursuant to a qualified plan, a bona fide sick leave or vacation plan, a disability plan, a death benefit plan or a plan providing medical expense reimbursements which are non-taxable or a separation pay plan (within the meaning of the regulations under Code Section 409A), the Participant shall pay the cost of such coverage during the first six months following termination and shall be reimbursed for the cost of such coverage six months after Participant’s termination. Notwithstanding any other provision of this Section 4 to the contrary, including the preceding sentence, if the provision of any medical benefits coverage pursuant to this Section 4 would be discriminatory within the meaning of Code Section 105(h), then, to the extent necessary to prevent such discrimination, the Participant (or his survivors, as the case may be) shall pay the cost of such coverage and Participant (or his survivors, as the case may be) shall not be reimbursed by any member of the Company Group for doing so.

5.  Termination of Employment.

     A Participant shall be considered terminated for purposes of the Plan if, based on all relevant facts and circumstances, the Company Group reasonably anticipates that no further services will be performed after such date for any member of the Company Group or that the level of bona fide services that the Participant will perform after such date (whether as an employee or as an independent contractor) would permanently decrease to no more than twenty percent (20%) of the average level of bona fide services performed (whether as an employee or independent contractor) over the immediately preceding 36 month period. A Participant shall be considered to have terminated in connection with a leave of absence as provided in applicable regulations issued under Code Section 409A.

6.  Amendment under the Plan.

     The terms of any outstanding award, payment, grant or incentive under the Plan may be amended from time to time by the Committee solely to provide rights under the Plan that are more favorable to any Plan Participant; provided, that if such amendment adversely affects the rights of any Plan Participant, such amendment shall be deemed to affect such Plan Participant only upon such Plan Participant’s written consent.

7.  Commencement Date; Termination Date.

     The date of commencement of the Plan shall be the Effective Date.

     Each Plan Participant shall be paid the awards, payments, grants and incentives to which such Plan Participant is entitled pursuant to the Plan as of the Effective Date, and the Plan shall not be terminated unless and until each Plan Participant receives such awards, payments, grants and incentives. No termination of the Plan shall materially and adversely affect any of the rights or obligations of any Plan Participant, without such Plan Participant’s written consent, under any grant of any incentives theretofore granted under the Plan.

8.  Severability.

     Whenever possible, each provision of the Plan shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of the Plan is held to be prohibited by or invalid under applicable law, such provision shall be ineffective only to the extent of such prohibition or invalidity, without invalidating the remainder of the Plan.

9.  Governing Law.

     The Plan shall be governed by the corporate laws of the State of Delaware, without giving effect to any choice of law provisions that might otherwise refer construction or interpretation of the Plan to the substantive law of another jurisdiction.

EX-12.1

Exhibit 12.1

NEENAH ENTERPRISES, INC.
NEENAH FOUNDRY COMPANY
RATIO OF EARNINGS TO FIXED CHARGES
(in Thousands)

	Reorganized									Predecessor
	For the Years Ended September 30,
	2007			2006		2005		2004		2003
Earnings to fixed charges calculation (1)
Income (loss) from continuing operations before income taxes	$	(22,747	)	$	25,006	$	18,504	$	7,495	$	(31,411	)
Fixed charges		32,695			34,384		34,392		34,392		48,407
	$	9,948		$	59,390	$	52,896	$	41,887	$	16,996
Fixed charges:
Interest expense	$	31,700		$	33,410	$	33,419	$	33,392	$	47,445
Interest portion of rent expense		995			974		973		1,000		962
	$	32,695		$	34,384	$	34,392	$	34,392	$	48,407
Ratio of earning to fixed charges		N/A	(2)		1.73		1.54		1.22		N/A	(2)

(1)	For purposes of the computation, the ratio of earnings to fixed charges has been calculated by dividing (a) income from continuing operations before income taxes plus fixed charges by (b) fixed charges. Fixed charges are equal to interest expense plus the portion of the rent expense estimated to represent interest.
(2)	Earnings were insufficient to cover fixed charges for the years ended September 30, 2007 and 2003 by $22.7 million and $31.4 million, respectively.

124

EX-21

Exhibit 21

Subsidiaries of Neenah Enterprises, Inc.

125

EX-31.1

Exhibit 31.1

Certification of Chief Executive Officer of Neenah Enterprises, Inc. pursuant to Rule 13a-14(a) or Rule 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Robert E. Ostendorf, Jr., President and Chief Executive Officer of Neenah Enterprises, Inc., certify that:

1.	I have reviewed this annual report on Form 10-K of Neenah Enterprises, Inc.
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

(a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(c)	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
(b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: December 28, 2007

/s/Robert E. Ostendorf, Jr. Robert E. Ostendorf, Jr.

President and Chief Executive Officer

126

EX-31.2

Exhibit 31.2

Certification of Chief Financial Officer of Neenah Enterprises, Inc. pursuant to Rule 13a-14(a) or Rule 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Gary W. LaChey, Corporate Vice President — Finance and Chief Financial Officer of Neenah Enterprises, Inc., certify that:

1.	I have reviewed this annual report on Form 10-K of Neenah Enterprises, Inc.
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

(a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(c)	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
(b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: December 28, 2007

/s/Gary W. LaChey Gary W. LaChey

Corporate Vice President- Finance

and Chief Financial Officer

127

EX-31.3

Exhibit 31.3

Certification of Chief Executive Officer of Neenah Foundry Company pursuant to Rule 13a-14(a) or Rule 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Robert E. Ostendorf, Jr., President and Chief Executive Officer of Neenah Foundry Company, certify that:

1. I have reviewed this annual report on Form 10-K of Neenah Foundry Company.

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

(a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(c)	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
(b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: December 28, 2007

/s/Robert E. Ostendorf, Jr. Robert E. Ostendorf, Jr.

President and Chief Executive Officer

128

EX-31.4

Exhibit 31.4

Certification of Chief Financial Officer of Neenah Foundry Company pursuant to Rule 13a-14(a) or Rule 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Gary W. LaChey, Corporate Vice President — Finance and Chief Financial Officer of Neenah Foundry Company, certify that:

1. I have reviewed this annual report on Form 10-K of Neenah Foundry Company.

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

(a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(c)	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
(b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: December 28, 2007

/s/Gary W. LaChey Gary W. LaChey

Corporate Vice President- Finance

and Chief Financial Officer

129

EX-32.1

Exhibit 32.1

Certification of Chief Executive Officer and Chief Financial Officer of Neenah Enterprises, Inc. pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

Solely for the purposes of complying with 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, we, the undersigned President and Chief Executive Officer, and Corporate Vice President — Finance and Chief Financial Officer of Neenah Enterprises, Inc. (the “Company”), hereby certify, based on our knowledge, that the Annual Report on Form 10-K of the Company for the year ended September 30, 2007 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

DATE: December 28, 2007

/s/Robert E. Ostendorf, Jr. Robert E. Ostendorf, Jr.

President and Chief Executive Officer

/s/Gary W. LaChey Gary W. LaChey

Corporate Vice President — Finance

and Chief Financial Officer

130

EX-32.2

Exhibit 32.2

Certification of Chief Executive Officer and Chief Financial Officer of Neenah Foundry Company pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

Solely for the purposes of complying with 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, we, the undersigned President and Chief Executive Officer, and Corporate Vice President — Finance and Chief Financial Officer of Neenah Foundry Company (the “Company”), hereby certify, based on our knowledge, that the Annual Report on Form 10-K of the Company for the year ended September 30, 2007 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

DATE: December 28, 2007

/s/Robert E. Ostendorf, Jr.

Robert E. Ostendorf, Jr.

President and Chief Executive Officer

/s/Gary W. LaChey Gary W. LaChey

Corporate Vice President — Finance

and Chief Financial Officer

131