8-K/A

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K/A

(Amendment No. 1 to Form 8-K)

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of Report (date of earliest event reported): February 23, 2009

American Greetings Corporation

(Exact Name of Registrant as Specified in its Charter)

Ohio	1-13859	34-0065325
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

One American Road
Cleveland, Ohio	44144
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (216) 252-7300

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

On February 24, 2009, American Greetings Corporation (“American Greetings”) acquired (the “Acquisition”) all of the issued and outstanding capital stock of RPG Holdings, Inc. The Acquisition was completed pursuant to a petition and pre-packaged plan of reorganization filed on January 2, 2009, by RPG Holdings, Inc. and its subsidiaries under the U.S. Bankruptcy Code and an Agreement dated December 30, 2008, by and among American Greetings and its subsidiary, Lakeshore Trading Company, and RPG Holdings, Inc. and its subsidiary, Recycled Paper Greetings, Inc.

On February 27, 2009, American Greetings filed a Current Report on Form 8-K reporting a number of events, including the February 23, 2009 drawing under its term loan facility as well as the completion of the Acquisition on February 24, 2009 and that the financial statements and pro forma financial information required to be filed under Item 9.01 of Form 8-K in connection with the Acquisition would be filed at a later date. This Amendment No. 1 is being filed solely to amend the February 27, 2009 Current Report on Form 8-K to file the financial statements and pro forma financial information required to be filed in connection with the Acquisition.

The information contained in this Amendment No. 1 to American Greetings’ Current Report on Form 8-K should be read in conjunction with information set forth in American Greetings’ February 27, 2009 Current Report on Form 8-K and its historical consolidated financial statements and notes thereto included in American Greetings’ Annual Report on Form 10-K for the year ended February 28, 2009 filed with the Securities and Exchange Commission on April 29, 2009.

Item 9.01 Financial Statements and Exhibits.

(a) Financial Statements of Businesses Acquired.

The Consolidated Audited Financial Statements of RPG Holdings, Inc. as of and for the years ended April 25, 2008 and April 27, 2007, together with the notes thereto and the related Independent Auditor’s Report thereon, are filed as Exhibit 99.1 to this Current Report on Form 8-K/A.

The Consolidated Audited Financial Statements of RPG Holdings, Inc. as of and for the years ended April 27, 2007 and April 28, 2006, together with the notes thereto and the related Independent Auditor’s Report thereon, are filed as Exhibit 99.2 to this Current Report on Form 8-K/A.

The Unaudited Balance Sheets as of, and the Unaudited Consolidated Statements of Operations and Cash Flows for the nine month periods ended, January 23, 2009 and January 25, 2008, together with the notes thereto, are filed as Exhibit 99.3 to this Current Report on Form 8-K/A.

(b) Pro Forma Financial Information.

The American Greetings Unaudited Pro Forma Combined Statement of Operations for the year ended February 28, 2009, together with the notes thereto, giving effect to the acquisition of RPG Holdings, Inc., are filed as Exhibit 99.4 to this Current Report on Form 8-K/A.

(d) Exhibits.

Exhibit No.	Exhibit Description
23.1	Consent of McGladrey & Pullen, LLP
23.2	Consent of Altschuler, Melvoin and Glasser, LLP
99.1	The Consolidated Audited Financial Statements of RPG Holdings, Inc. as of and for the years ended April 25, 2008 and April 27, 2007, together with the notes thereto and the related Independent Auditor’s Report thereon.
99.2	The Consolidated Audited Financial Statements of RPG Holdings, Inc. as of and for the years ended April 27, 2007 and April 28, 2006, together with the notes thereto and the related Independent Auditor’s Report thereon.
99.3	The Unaudited Balance Sheets as of, and the Unaudited Consolidated Statements of Operations and Cash Flows for the nine month periods ended, January 23, 2009 and January 25, 2008, together with the notes thereto.
99.4	The American Greetings Unaudited Pro Forma Combined Statement of Operations for the year ended February 28, 2009, together with the notes thereto, giving effect to the acquisition of RPG Holdings, Inc.

2

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

American Greetings Corporation
(Registrant)
By:	/s/ Joseph B. Cipollone
	Joseph B. Cipollone, Vice President,
	Corporate Controller and Chief Accounting Officer

Date: May 12, 2009

3

EX-23.1

Exhibit 23.1

Consent of Independent Auditor

We consent to the incorporation by reference in the Registration Statements of American Greetings Corporation listed below of our report dated May 12, 2009, relating to our audit of the consolidated financial statements of RPG Holdings, Inc. as of and for the years ended April 25, 2008 and April 27, 2007, included in this Current Report on Form 8-K/A.

Registration Number	Description	Filing Date
2-89471	Post-Effective Amendment No. 1 to Form S-3 Registration Statement	May 27, 1986
33-45673	American Greetings Corporation Employees’ Retirement Profit Sharing Plan – Form S-8 Registration Statement	February 4, 1992
33-58582	American Greetings Corporation 1992 Stock Option Plan – Form S-8 Registration Statement	February 22, 1993
33-61037	American Greetings Corporation 1995 Director Stock Plan – Form S-8 Registration Statement	July 14, 1995
333-08123	American Greetings Corporation 1996 Employee Stock Option Plan – Form S-8 Registration Statement	July 15, 1996
333-41912	American Greetings Corporation 1997 Equity and Performance Incentive Plan (as amended June 24, 2000) – Form S-8 Registration Statement	July 21, 2000
333-65534	American Greetings Corporation 1997 Equity and Performance Incentive Plan (as amended June 22, 2001) – Form S-8 Registration Statement	July 20, 2001
333-121982	American Greetings Corporation 1997 Equity and Performance Incentive Plan (as amended on June 25, 2004) – Form S-8 Registration Statement	January 12, 2005
333-123041	American Greetings Corporation 1995 Director Stock Plan – Form S-8 Registration Statement	February 28, 2005
333-134029	American Greetings Corporation Form S-3 Registration Statement	May 11, 2006
333-144220	American Greetings Corporation 2007 Omnibus Incentive Compensation Plan – Form S-8 Registration Statement	June 29, 2007
333-146244	American Greetings Corporation Employees’ Retirement Profit Sharing Plan – Form S-8 Registration Statement	September 21, 2007

/s/ McGladrey & Pullen LLP

Chicago, IL

May 12, 2009

EX-23.2

Exhibit 23.2

Consent of Independent Auditor

We consent to the incorporation by reference in the Registration Statements of American Greetings Corporation listed below of our report dated May 12, 2009, with respect to the consolidated financial statements of RPG Holdings, Inc. as of and for the year ended April 28, 2006, included in this Current Report on Form 8-K/A.

Registration Number	Description	Filing Date
2-89471	Post-Effective Amendment No. 1 to Form S-3 Registration Statement	May 27, 1986
33-45673	American Greetings Corporation Employees’ Retirement Profit Sharing Plan – Form S-8 Registration Statement	February 4, 1992
33-58582	American Greetings Corporation 1992 Stock Option Plan – Form S-8 Registration Statement	February 22, 1993
33-61037	American Greetings Corporation 1995 Director Stock Plan – Form S-8 Registration Statement	July 14, 1995
333-08123	American Greetings Corporation 1996 Employee Stock Option Plan – Form S-8 Registration Statement	July 15, 1996
333-41912	American Greetings Corporation 1997 Equity and Performance Incentive Plan (as amended June 24, 2000) – Form S-8 Registration Statement	July 21, 2000
333-65534	American Greetings Corporation 1997 Equity and Performance Incentive Plan (as amended June 22, 2001) – Form S-8 Registration Statement	July 20, 2001
333-121982	American Greetings Corporation 1997 Equity and Performance Incentive Plan (as amended on June 25, 2004) – Form S-8 Registration Statement	January 12, 2005
333-123041	American Greetings Corporation 1995 Director Stock Plan – Form S-8 Registration Statement	February 28, 2005
333-134029	American Greetings Corporation Form S-3 Registration Statement	May 11, 2006
333-144220	American Greetings Corporation 2007 Omnibus Incentive Compensation Plan – Form S-8 Registration Statement	June 29, 2007
333-146244	American Greetings Corporation Employees’ Retirement Profit Sharing Plan – Form S-8 Registration Statement	September 21, 2007

/s/    Altschuler, Melvoin and Glasser, LLP

Chicago, IL

May 12, 2009

EX-99.1

Exhibit 99.1

RPG Holdings, Inc. and Subsidiary

Consolidated Financial Report

April 25, 2008 and April 27, 2007

Contents

Independent Auditor’s Report	1
Financial Statements
Consolidated Balance Sheets	2
Consolidated Statements of Operations	3
Consolidated Statements of Stockholders’ Equity (Deficit)	4
Consolidated Statements of Cash Flows	5
Notes to Consolidated Financial Statements	6-15

Independent Auditor’s Report

To the Board of Directors

RPG Holdings, Inc.

Chicago, Illinois

We have audited the accompanying consolidated balance sheets of RPG Holdings, Inc. and Subsidiary (the Company) as of April 25, 2008 and April 27, 2007, and the related statements of operations, stockholders’ equity (deficit) and cash flows for the years then ended. 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 auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of RPG Holdings, Inc. and Subsidiary as of April 25, 2008 and April 27, 2007, and the results of their operations and their cash flows for the fiscal years then ended in conformity with accounting principles generally accepted in the United States of America.

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 12 to the financial statements, on January 2, 2009, the Company and its affiliated debtors filed with the United States Bankruptcy Court for the District of Delaware a proposed plan of reorganization and a proposed disclosure statement pursuant to Sections 1125 and 1126(b) of Title 11 of the United States Code, which raises substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

/s/    McGladrey & Pullen, LLP

Chicago, Illinois

May 12, 2009

1

RPG Holdings, Inc. and Subsidiary

Consolidated Balance Sheets

April 25, 2008 and April 27, 2007

	2008			2007
Assets
Current Assets
Cash and cash equivalents	$	5,156,734		$	7,557,417
Accounts receivable, trade (net of allowances of approximately $6,246,000 and $5,782,000 in 2008 and 2007)		12,121,429			21,660,485
Inventories (net of allowances of approximately $2,095,000 and $611,000 in 2008 and 2007)		4,653,753			6,179,401
Prepaid expenses and other current assets		2,223,352			1,924,004
Total current assets		24,155,268			37,321,307
Equipment and Leasehold Improvements, Net		5,523,169			4,677,023
Other Assets
Deferred financing fees, net		4,751,799			5,889,001
Goodwill		28,061,999			150,931,728
Other intangible assets, net		33,436,776			99,733,175
Other		639,539			813,545
		66,890,113			257,367,449
Total assets	$	96,568,550		$	299,365,779
Liabilities and Stockholders’ Equity (Deficit)
Current Liabilities
Revolving bank loan payable	$	15,500,000		$	—
Current portion of notes payable, bank		189,968,505			—
Accounts payable, trade		1,663,653			604,557
Accrued expenses		8,886,234			12,703,061
Total current liabilities		216,018,392			13,307,618
Long-Term Liabilities
Long-term portion of notes payable, bank		—			188,798,858
Derivative liability		4,686,176			582,704
		4,686,176			189,381,562
Stockholders’ equity (deficit)		(124,136,018	)		96,676,599
Total liabilities and stockholders’ equity (deficit)	$	96,568,550		$	299,365,779

See Notes to Consolidated Financial Statements. 2

RPG Holdings, Inc. and Subsidiary

Consolidated Statements of Operations

Years Ended April 25, 2008 and April 27, 2007

	2008			2007
Net sales	$	81,724,279		$	92,844,773
Cost of goods sold		21,676,539			17,627,856
Gross profit		60,047,740			75,216,917
Operating expenses:
Selling, general and administrative expenses		73,551,360			71,875,529
Impairment losses		179,475,593			—
		253,026,953			71,875,529
Income (loss) from operations		(192,979,213	)		3,341,388
Financial income (expense):
Interest expense		(28,550,215	)		(22,710,807	)
Interest income		293,455			317,370
		(28,256,760	)		(22,393,437	)
Loss before income taxes		(221,235,973	)		(19,052,049	)
Income tax expense		159,348			460,468
Net loss	$	(221,395,321	)	$	(19,512,517	)

See Notes to Consolidated Financial Statements. 3

RPG Holdings, Inc. and Subsidiary

Consolidated Statements of Stockholders’ Equity (Deficit)

Years Ended April 25, 2008 and April 27, 2007

	Common Stock *			Additional Paid-in Capital		Accumulated Deficit			Accumulated Other Comprehensive Income (Loss)			Total
	Shares
	Outstanding	Amount
Balance, April 28, 2006	1,100	$	11	$	113,667,227	$	(11,895,418	)	$	626,194		$	102,398,014
Capital contributions	—		—		15,000,000		—			—			15,000,000
Comprehensive loss
Net loss	—		—		—		(19,512,517	)		—			(19,512,517	)
Net change from periodic derivative evaluation	—		—		—		—			(1,208,898	)		(1,208,898	)
Comprehensive loss													(20,721,415	)
Balance, April 27, 2007	1,100		11		128,667,227		(31,407,935	)		(582,704	)		96,676,599
Comprehensive loss
Net loss	—		—		—		(221,395,321	)		—			(221,395,321	)
Net change from periodic derivative evaluation	—		—		—		—			582,704			582,704
Comprehensive loss													(220,812,617	)
Balance, April 25, 2008	1,100	$	11	$	128,667,227	$	(252,803,256	)	$	—		$	(124,136,018	)

*1,000 Class A shares authorized, issued and outstanding; 0.01 par value; voting

*100 Class B shares authorized, issued and outstanding; 0.01 par value; nonvoting

See Notes to Consolidated Financial Statements. 4

RPG Holdings, Inc. and Subsidiary

Consolidated Statements of Cash Flows

Years Ended April 25, 2008 and April 27, 2007

	2008			2007
Cash Flows from Operating Activities
Net loss	$	(221,395,321	)	$	(19,512,517	)
Depreciation and amortization		12,493,938			13,322,691
Impairment losses		179,475,593			—
Payment in kind (PIK) interest		1,169,647			611,145
Effect of net change in periodic valuation of derivatives		4,686,176			—
Amortization of deferred financing fees		1,267,202			1,096,068
Changes in:
Accounts receivable, net		9,539,056			4,304,827
Inventories, net		1,525,648			(309,846	)
Prepaid expenses and other current assets		(925,871	)		638,729
Accounts payable, trade		1,059,096			(356,618	)
Accrued expenses		(3,816,827	)		6,444,880
Net cash provided by (used in) operating activities		(14,921,663	)		6,239,359
Cash Flows from Investing Activities
Purchases of equipment and leasehold improvements		(2,933,196	)		(3,380,894	)
Other assets		174,006			(206,250	)
Purchases of intangible assets		(89,830	)		—
Net cash used in investing activities		(2,849,020	)		(3,587,144	)
Cash Flows from Financing Activities
Repayments of term loan borrowings		—			(10,750,000	)
Capital contributions		—			15,000,000
Proceeds from line of credit borrowing		15,500,000			—
Deferred financing fees		(130,000	)		(930,119	)
Net cash provided by financing activities		15,370,000			3,319,881
Net increase (decrease) in cash and cash equivalents		(2,400,683	)		5,972,096
Cash and cash equivalents:
Beginning of year		7,557,417			1,585,321
End of year	$	5,156,734		$	7,557,417
Supplemental Disclosures of Cash Flow Information
Interest paid	$	24,712,513		$	16,454,611
Income taxes paid	$	159,000		$	461,438

See Notes to Consolidated Financial Statements. 5

RPG Holdings, Inc. and Subsidiary

Notes to Consolidated Financial Statements

Note 1. Nature of Operations and Significant Accounting Policies

Organization: RPG Investment Holdings, LLC (RPG Investments) was formed during 2005 and, on December 5, 2005, through its wholly owned subsidiary, RPG Holdings, Inc. (RPG Holdings) which was also formed during 2005, acquired all of the outstanding stock of Recycled Paper Greetings, Inc. (RPG, Inc.). Concurrent with the aforementioned acquisition, RPG, Inc. acquired the outstanding capital stock of Barnyard Industries, Inc. (Barnyard, an affiliate) and the membership interests owned by the former stockholders of RPG, Inc. in Internet Media International, L.L.C. (IMI). The reporting entity, RPG Holdings, Inc. and Subsidiary, is hereinafter referred to as the Company.

Nature of Operations: The Company is engaged in the design, distribution and sale of greeting cards, stationery and other novelty items to retailers located throughout the United States and Canada. General and administrative activities are conducted from leased office facilities in Chicago, Illinois and distribution activities are conducted from a leased warehouse located in University Park, Illinois.

Principles of Consolidation and Basis of Presentation: The consolidated financial statements include the accounts of RPG Holdings and its wholly owned subsidiary, RPG, Inc., and accounts of RPG, Inc. include its wholly owned subsidiaries, Recycled Paper Greetings Canada, Inc., Barnyard and IMI. All significant intercompany accounts and transactions have been eliminated in consolidation.

Accounting Period: The Company’s financial reporting year is based upon a 52-53 week calendar ending on the last Friday in April. The years ended April 25, 2008 and April 27, 2007 both consisted of 52 weeks.

Use of Estimates: In preparing consolidated financial statements in conformity with accounting principles generally accepted in the United States of America, management makes estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements, as well as the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

Foreign Operations: The financial statements of Recycled Paper Greetings Canada, Inc. are translated into U.S. dollars using the exchange rate at each balance sheet date for assets and liabilities, the historical exchange rate for stockholders’ equity, and a weighted average exchange rate for each period for revenue and expenses. Translation adjustments are generally required to be recorded in accumulated other comprehensive income (loss) as the local currency of this entity is its functional currency. Adjustments resulting from translation as of and for the years ended April 25, 2008 and April 27, 2007 were not significant.

6

RPG Holdings, Inc. and Subsidiary

Notes to Consolidated Financial Statements

Note 1. Nature of Operations and Significant Accounting Policies (Continued)

Cash and Cash Equivalents: The Company defines cash as all highly liquid investments with an original maturity of three months or less. At certain times, the Company’s cash balances held in the United States exceed the amount insured by the Federal Deposit Insurance Corporation. The Company has not experienced any losses resulting from this concentration.

Revenue Recognition: Seasonal cards are generally sold with the right of return on unsold merchandise. In addition, the Company provides for estimated returns of these products when those sales to unrelated, third party retailers are recognized. These estimates are based on historical sales returns, the amount of current year sales and other known factors. Accrual rates utilized for establishing estimated return reserves have approximated actual returns experience. Everyday cards are generally sold without the right of return and sales credits are issued at the Company’s discretion for damaged, obsolete and outdated products.

Except for products sold to retailers with a scan-based trading (SBT) arrangement, sales are generally recognized by the Company upon shipment of products to unrelated, third party retailers.

For retailers with an SBT arrangement, the Company owns the product delivered to its retail customers until the product is sold by the retailer to the ultimate customer, at which point the Company recognizes revenue, for both seasonal and everyday products. When a retailer converts to an SBT arrangement, the Company reverses previous sales transactions. Legal ownership of the inventory at the retailer’s stores reverts back to the Company at the time of conversion. The timing and amount of the sales reversal depends on retailer inventory run rates and the estimated timing of the store conversions.

Shipping and Handling Costs: Amounts charged to customers for shipping and handling are included in net sales and the related costs are included in selling, general and administrative expenses (approximately $3,348,000 and $2,977,000 for 2008 and 2007, respectively).

Accounts Receivable and Credit Policies: The Company grants trade credit at various terms to its customers located throughout the United States and Canada. Credit limits and payment terms are established based on evaluations made on an ongoing basis throughout the year. Each customer is reviewed at least annually, with more frequent reviews being performed if necessary based on the customer’s financial condition, level of credit being extended, and timeliness of payments. Receivables are valued at management’s estimate of the amount that will be ultimately collected based on historical experience and analysis of specific accounts. Receivables are written off when deemed uncollectible. Recoveries of trade receivables previously written off are recorded when received. The Company estimates the amount of receivables that will be uncollected due to bad debts, sales made with a right of return provision and credits to be issued for customer rebates and unsalable product.

Major Customers: In 2008 and 2007, sales to two unrelated customers approximated 40 percent and 43 percent of the Company’s 2008 and 2007 net sales, respectively, with accounts receivable from such customers amounting to approximately 43 percent and 56 percent of total accounts receivable at April 25, 2008 and April 27, 2007, respectively.

Inventories: Inventories, which consist primarily of finished goods, are stated at the lower of cost or market, with cost determined on a first-in, first-out (FIFO) basis.

7

RPG Holdings, Inc. and Subsidiary

Notes to Consolidated Financial Statements

Note 1. Nature of Operations and Significant Accounting Policies (Continued)

Equipment and Leasehold Improvements: Equipment and leasehold improvements are recorded at cost. Provisions for depreciation and amortization are computed under both straight-line and accelerated methods for financial reporting purposes, based on the respective estimated useful lives of the assets. Leasehold improvements are amortized over the lesser of the term of the related lease or the estimated useful lives of the improvements. The cost of assets retired or otherwise disposed of and the accumulated depreciation and amortization thereon are removed from the accounts with gain or loss realized upon sale or disposal charged to the consolidated statement of operations. Significant improvements and betterments are capitalized while repairs and maintenance are expensed in the period incurred.

Deferred Financing Fees: Deferred financing fees are carried at cost, net of accumulated amortization, and are amortized as interest expense on a basis which approximates the effective interest rate over the term of the debt.

Intangible Assets and Goodwill: Intangible assets subject to amortization consist of artist agreements, customer relationships, completed technology and non-compete agreements. Such intangible assets are amortized on a straight-line basis over their estimated useful lives, which are generally three to ten years.

Intangible assets whose lives are deemed to be indefinite consist of the Company’s trademarks/tradenames and goodwill.

Relating to goodwill, the Company follows the provisions of Statement of Financial Accounting Standards (SFAS) No. 142, Goodwill and Other Intangible Assets (SFAS 142), under which goodwill is not amortized but is tested annually for impairment. It is the Company’s policy to perform impairment testing annually on February 28. Goodwill recorded at April 25, 2008 and April 27, 2007, resulted from the purchase of RPG Holdings, Inc. and Subsidiary. See Notes 4 and 5 for further impairment disclosure.

In accordance with Financial Accounting Standard Board (FASB) Statement No. 144, Accounting for the Impairment of Long-Lived Assets (FASB 144), it is the Company’s policy to assess whether impairment indicators exist for its property and equipment and intangible assets. If impairment indicators are present, the Company determines whether the total undiscounted future cash flows from the asset in question are less than the carrying amount of the asset and, if less, recognize an impairment loss equal to the excess of the carrying amounts of the asset in question over its fair value.

Income Taxes: The Company has elected to be taxed as a C corporation and, accordingly, accounts for income taxes pursuant to SFAS No. 109, Accounting for Income Taxes (SFAS 109). SFAS 109 requires that deferred taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carryforwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets may be reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion of all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date on enactment.

Derivative Instruments: The Company accounts for derivative instruments under the provisions of SFAS No. 133, Accounting for Derivative Instruments and Hedging Activities (SFAS 133). SFAS 133 requires all derivatives to be recognized as assets or liabilities on the balance sheet and measured at fair value. Changes in the fair value of derivatives are either recognized in income or accumulated other comprehensive income (loss), depending on the designated purpose of the derivative.

8

RPG Holdings, Inc. and Subsidiary

Notes to Consolidated Financial Statements

Note 1. Nature of Operations and Significant Accounting Policies (Continued)

Accumulated Other Comprehensive Income (Loss): The Company’s other comprehensive income (loss), as reflected in the accompanying consolidated statements of stockholders’ equity (deficit), consists of changes in the fair value adjustment for the interest rate swap prior to hedge accounting being discontinued and the adjustment to discontinue hedge accounting. See Note 8 for further disclosure of the Company’s derivative financial instruments.

Advertising and Promotion: All costs associated with advertising and promotion are charged to expense as incurred. Advertising and promotion expense amounted to approximately $72,000 and $104,000 for the years ended April 25, 2008 and April 27, 2007, respectively.

Fair Value of Financial Instruments: The Company’s financial instruments are cash and cash equivalents, accounts receivable, accounts payable and notes payable. The recorded values of cash and cash equivalents, accounts receivable, and accounts payable approximate their fair values based on their short-term nature. The fair value of our notes payable amounted to approximately $114,080,000 (at a carrying value of approximately $189,969,000) at April 25, 2008. The carrying amount significantly exceeded its fair value at April 25, 2008 due to the tighter U.S. credit markets and the credit crisis of the Company. The fair value of the Company’s interest rate swaps (used for purposes other than trading) is the estimated amount the Company would pay to terminate these agreements at the reporting date, taking into account current interest rates and the creditworthiness of the counterparty for assets and creditworthiness of the Company for liabilities.

Reclassifications: Certain amounts reported in the 2007 consolidated financial statements have been reclassified to conform with the classifications presented in the 2008 consolidated financial statements, without affecting the previously reported net loss or stockholders’ equity (deficit).

Recent Accounting Pronouncements: In July 2006, the FASB issued Interpretation No. 48, Accounting for Uncertainty in Income Taxes – an Interpretation of FASB Statement 109 (FIN 48). FIN 48 clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements in accordance with SFAS 109. FIN 48 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. FIN 48 also provides guidance on derecognition of tax benefits, classification on the balance sheet, interest and penalties, accounting in interim periods, disclosure, and transition. In December 2008, the FASB provided for a deferral of the effective date of FIN 48 for certain nonpublic enterprises to annual financial statements for fiscal years beginning after December 15, 2008. The Company has elected this deferral and accordingly will be required to adopt FIN 48 in its 2009 annual financial statements. Prior to adoption of FIN 48, the Company will continue to evaluate its uncertain tax positions and related income tax contingencies under Statement No. 5, Accounting for Contingencies. SFAS No. 5 requires the Company to accrue for losses it believes are probable and can be reasonably estimated. Management is currently assessing the impact of FIN 48 on the Company’s consolidated financial position and results of operations.

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, and expands disclosures about fair value measurement. SFAS 157 also emphasizes that fair value is a market-based measurement, not an entity-specific measurement, and sets out a fair value hierarchy with the highest priority being quoted prices in active markets. Under SFAS 157, fair value measurements are disclosed by level within that hierarchy. SFAS 157 is effective for fiscal years beginning after November 15, 2007, except for nonfinancial assets and nonfinancial liabilities that are recognized or disclosed at fair value in the financial statements on a nonrecurring basis for which delayed application is permitted until fiscal years beginning after November 15, 2008. The Company does not believe SFAS 157 will have a material impact on its financial position, results of operations and cash flows.

9

RPG Holdings, Inc. and Subsidiary

Notes to Consolidated Financial Statements

Note 1. Nature of Operations and Significant Accounting Policies (Continued)

In March 2008, the FASB issued SFAS No. 161, Disclosures about Derivative Instruments and Hedging Activities an Amendment of FASB Statement No. 133 (SFAS 161). SFAS 161 requires additional disclosures about the objectives of using derivative instruments, the method by which the derivative instruments and related hedged items are accounted for under Statement No. 133 and its related interpretations, and the effect of derivative instruments and related hedged items on financial position, financial performance, and cash flows. SFAS 161 also requires disclosure of the fair values of derivative instruments and their gains and losses in a tabular format. SFAS 161 is effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008. As this pronouncement is only disclosure related, it will not have an impact on the financial position and results of operations. However, this pronouncement will require increased disclosures around the Company’s use of its only derivatives, interest rate swap contracts.

Note 2. Equipment and Leasehold Improvements

Equipment and leasehold improvements at April 25, 2008 and April 27, 2007 consist of:

	2008			2007
Computer hardware, software and equipment	$	7,607,951		$	3,109,832
Transportation equipment		102,939			102,939
Leasehold improvements		643,142			307,156
		8,354,032			3,519,927
Accumulated depreciation and amortization		(2,887,743	)		(795,455	)
		5,466,289			2,724,472
Construction in progress		56,880			1,952,551
	$	5,523,169		$	4,677,023

Total provisions for depreciation and amortization expense of equipment and leasehold improvements charged to operations for the years ended April 25, 2008 and April 27, 2007, amounted to approximately $2,087,000 and $578,000, respectively.

Note 3. Deferred Financing Fees

Deferred financing fees at April 25, 2008 and April 27, 2007 are reflected on the accompanying consolidated balance sheets net of accumulated amortization of approximately $2,820,000 and $1,553,000, respectively. Amortization expense charged to interest expense for the years ended April 25, 2008 and April 27, 2007 amounted to approximately $1,267,000 and $1,096,000, respectively.

Note 4. Goodwill

SFAS 142 prescribes a periodic impairment test of goodwill, which the Company completed as of February 28, 2008, and determined that a portion of the value of its goodwill was impaired as of January 25, 2008. Accordingly, the Company recorded a non-cash charge amounting to approximately $122,870,000 as of January 25, 2008 (included in impairment losses in the accompanying consolidated statements of operations), as an impairment to goodwill. This amount was determined based on a valuation of the Company as of February 28, 2008, using projections of future discounted cash flows.

10

RPG Holdings, Inc. and Subsidiary

Notes to Consolidated Financial Statements

Note 5. Other Intangible Assets

Other intangible assets at April 25, 2008 and April 27, 2007 consist of:

	2008			2007			Estimated Useful Lives
Artist agreements	$	23,690,000		$	41,400,000		7 years
Trademarks/tradenames		5,830,000			34,200,000		Indefinite
Customer relationships		4,840,000			30,500,000		4-10 years
Completed technology		510,000			8,600,000		7 years
Noncompete agreements		—			800,000		3 years
		34,870,000			115,500,000
Accumulated amortization		(1,433,224	)		(15,766,825	)
	$	33,436,776		$	99,733,175

During 2008, among other factors, the Company was negatively affected by growth restrictions resulting from contract barriers, performance lagging expectations for some of the Company’s larger customers and competition intensifying beyond management’s initial estimates. Accordingly, the Company evaluated the ongoing value of the other intangible assets. Based on this evaluation, the Company determined that assets with a total carrying amount of approximately $91,476,000 were impaired and wrote them down by approximately $56,606,000 (included in impairment losses in the accompanying consolidated statements of operations) to their estimated fair value. The artist agreements, trademarks/tradenames, customer relationships, completed technology and noncompete agreements were impaired by approximately $4,896,000, $28,460,000, $17,600,000, $5,428,000 and $222,000, respectively. The estimated fair value was based on estimated cash flows to be generated by the Company, discounted at a market rate of interest. The fair value was recorded as of January 25, 2008 (at which date the respective costs were reset).

Amortization expense charged to operations for the years ended April 25, 2008 and April 27, 2007 amounted to approximately $9,780,000 and $11,130,000, respectively. No amortization expense is being recorded for trademarks/tradenames (impairment loss for 2008 amounted to approximately $28,460,000).

Estimated amortization expense for future years is as follows:

2009	$	5,733,000
2010		5,733,000
2011		5,733,000
2012		5,733,000
2013		3,647,000
Thereafter		1,028,000
	$	27,607,000

11

RPG Holdings, Inc. and Subsidiary

Notes to Consolidated Financial Statements

Note 6. Accrued Expenses

Accrued expenses at April 25, 2008 and April 27, 2007 consist of:

	2008		2007
Salary and wages	$	1,888,548	$	3,643,526
Royalties		1,476,503		1,756,356
Real estate and other taxes		249,093		76,878
Management fees		375,004		125,000
Insurance		260,000		159,308
Interest		3,123,817		5,239,449
Professional fees		395,908		657,804
Freight		305,350		218,101
Other		812,011		826,639
	$	8,886,234	$	12,703,061

Note 7. Notes Payable

Notes payable at April 25, 2008 and April 27, 2007 consist of:

	2008			2007
Borrowings from Credit Suisse, Cayman Island Branch (CS - see below):
Term loan pursuant to First Lien Credit Agreement	$	109,250,000		$	109,250,000
Term loan pursuant to Second Lien Credit Agreement		80,718,505			79,548,858
		189,968,505			188,798,858
Current portion		(189,968,505	)		—
	$	—		$	188,798,858

On December 5, 2005, the Company entered into two credit agreements (as most recently amended April 27, 2007) with CS which provide for aggregate maximum borrowings of $217,000,000 in the form of a revolving credit facility of up to $20,000,000 and term loan borrowings of $197,000,000. Term loan borrowings of $120,000,000 and $77,000,000 were made pursuant to a First Lien Credit Agreement (Term Loan 1) and Second Lien Credit Agreement (Term Loan 2), respectively.

The revolving credit facility, which matures on December 5, 2010, provides for interest on borrowings at either the alternate base rate (ABR, 5.25 percent at April 25, 2008) plus 2.50 percent per annum or adjusted LIBOR rate (LIBOR, 4.42 percent at April 25, 2008) plus 3.50 percent per annum, as defined in the agreement. There were borrowings of $15,500,000 under this facility at April 25, 2008. There were no borrowings under this facility at April 28, 2007.

Term Loan 1 borrowings (pursuant to the April 27, 2007 amendment) are to be repaid in quarterly installments of principal (commencing March 31, 2009, ranging from $500,000 to $3,750,000 per quarter) and interest (at either the ABR plus 2.50 percent or LIBOR plus 3.50 percent per annum), with the final balance due on December 5, 2011. The effective interest rate on this note was 6.85 percent and 8.66 percent at April 25, 2008 and April 27, 2007, respectively.

12

RPG Holdings, Inc. and Subsidiary

Notes to Consolidated Financial Statements

Note 7. Notes Payable (Continued)

Term Loan 2 borrowings and unpaid interest (pursuant to the April 27, 2007 amendment) are due December 5, 2012, with interest payable quarterly. Such borrowings bear interest (at either the ABR rate plus 8 percent per annum or adjusted LIBOR rate plus 9 percent per annum), as defined in the agreement, with 1 percent payment-in-kind (PIK) interest, payable at maturity. The PIK interest amounted to $1,169,647 and $611,145 for the years ended April 25, 2008 and April 27, 2007, respectively. These amounts were added to the face value of the related term loan at April 25, 2008 and April 27, 2007. The effective interest rate on this note was 12.35 percent and 14.36 percent at April 25, 2008 and April 27, 2007, respectively.

The agreements with CS contain, among other covenants, provisions setting forth requirements for interest coverage, leverage, first lien leverage, second lien leverage and fixed charge coverage ratios. Borrowings under the CS agreements are secured by all assets of the Company. For the year ended April 25, 2008, the Company was in violation of all financial covenants for which they did not receive waivers for such noncompliance. As a result, the Term Loan 1 and Term Loan 2 borrowings have been presented as current at April 25, 2008.

Note 8. Derivative Instruments

To protect the Company from adverse and unexpected interest rate fluctuations, the Company entered into an interest rate swap contract to convert a portion of its floating long-term debt to fixed rate debt. This derivative instrument was designated as a cash flow hedging instrument, was reported at fair value and was no longer designated for hedge accounting treatment effective January 25, 2008. The total notional amount outstanding under this interest rate swap contract was approximately $171,000,000 at April 25, 2008 and the contract (originally scheduled to expire January 31, 2011) was terminated on November 8, 2008. Effective January 25, 2008, the Company elected to discontinue hedge accounting treatment at which point the derivative was reported at fair value with gains and losses being recognized in the consolidated statement of operations as interest expense. Prior to January 25, 2008, the derivative instrument was designated as a highly effective cash flow hedge with the fair value of the swap included in accumulated other comprehensive income (loss). At April 25, 2008 and April 27, 2007, the fair value of such hedging instrument was a liability of $4,686,176 and $582,704, respectively, and is reported as a derivative liability in the consolidated accompanying balance sheets.

Note 9. Income Taxes

The provision for income taxes for the years ended April 25, 2008 and April 27, 2007 consisted solely of state taxes.

The Company’s net deferred tax position at April 25, 2008 and April 27, 2007 was as follows:

	2008			2007
Gross deferred tax assets	$	96,502,000		$	18,012,000
Valuation allowance		(95,651,000	)		(12,197,000	)
		851,000			5,815,000
Gross deferred tax liabilities		(851,000	)		(5,815,000	)
	$	—		$	—

13

RPG Holdings, Inc. and Subsidiary

Notes to Consolidated Financial Statements

Note 9. Income Taxes (Continued)

Gross deferred income tax assets at April 25, 2008 consist primarily of (a) a net operating loss carryforward of approximately $75,710,000 (b) amortization of goodwill for book reporting purposes and not for tax reporting purposes, (c) uniform capitalization rules (for additional inventory costs), (d) a nondeductible inventory valuation allowance, (e) nondeductible accounts receivable reserves and (f) other intangible and fixed asset amortization and depreciation differences for financial and tax reporting purposes. Gross deferred income tax liabilities at April 25, 2008 consist primarily of certain prepaid expenses deducted currently for income tax purposes.

Gross deferred income tax assets at April 27, 2007 consist primarily of (a) a net operating loss carryforward of approximately $31,990,000 (b) uniform capitalization rules (for additional inventory costs), (c) a nondeductible inventory valuation allowance, (d) nondeductible accounts receivable reserves and (e) other intangible and fixed asset amortization and depreciation differences for financial and tax reporting purposes. Gross deferred income tax liabilities at April 27, 2007 consist primarily of (a) amortization of goodwill for tax reporting purposes and not for financial reporting purposes and (b) certain prepaid expenses deducted currently for income tax purposes.

The net operating losses begin to expire in years 2026 to 2028. At April 25, 2008 and April 27, 2007, the Company recorded a valuation allowance of $95,651,000 and $12,197,000, respectively, representing an increase of $83,454,000.

Note 10. Employee Benefit Plan

The Company maintains the Recycled Paper Greetings, Inc. Employees’ Retirement Savings Plan and Trust for the benefit of eligible employees. The plan is intended to provide for elective contributions by the participants pursuant to Section 401(k)(3) of the Internal Revenue Code plus employer matching contributions of up to 2 ¹/2 percent of participant’s compensation. The matching contributions to the plan amounted to approximately $443,000 and $414,000 for the years ended April 25, 2008 and April 27, 2007, respectively.

Note 11. Commitments, Contingencies and Related-Party Transactions

The Company leases certain office, warehouse and manufacturing facilities, and equipment under several month-to-month and noncancelable leases expiring at various dates through November 2018. In addition to specified rentals, the Company is responsible for real estate taxes and common area maintenance under certain real property leases.

Minimum future lease commitments are:

2009	$	1,166,000
2010		1,448,000
2011		1,466,000
2012		1,119,000
2013		1,142,000
Thereafter		6,658,000
	$	12,999,000

Total rent expense under these operating leases (excluding real estate taxes and common area maintenance) for the years ended April 25, 2008 and April 27, 2007, amounted to approximately $1,174,000 and $583,000, respectively, of which approximately $513,000 and $488,000, respectively, was to related parties.

14

RPG Holdings, Inc. and Subsidiary

Notes to Consolidated Financial Statements

Note 11. Commitments, Contingencies and Related-Party Transactions (Continued)

The Company is a defendant in legal proceedings arising in the ordinary course of business and is subject to unasserted claims. Although the outcome of these proceedings cannot be determined, it is the opinion of management, based on consultation with legal counsel, that any amounts payable upon resolution of these matters will not have a material impact on the consolidated financial statements.

Management and administrative expenses incurred related to entities affiliated through common ownership amounted to approximately $786,000 and $904,000 during the years ended in April 25, 2008 and April 27, 2007, respectively, of which $437,000 and $245,000 is included on the accompanying consolidated balance sheets in accrued expenses at April 25, 2008 and April 27, 2007, respectively.

Note 12. Subsequent Events and Management’s Plans and Intentions

During 2008, the Company entered into negotiations with the first lien creditors, the largest of which was American Greetings Corporation (AGC), and the second lien creditors to develop a strategy to remedy the breach of Term Loan 1 and Term Loan 2. On December 30, 2008, the Company announced a definitive agreement amongst the parties whereby AGC would acquire the Company as part of a pre-packaged Chapter 11 reorganization. On January 2, 2009, the Company filed a Debtors Joint Plan of Reorganization under Chapter 11 of the Bankruptcy Code in United States Bankruptcy Court in the State of Delaware.

Under the terms of the agreement, AGC purchased from various parties all of the Company’s then outstanding first and second lien debt, totaling $113,949,570 and $81,844,013, respectively, plus the revolving credit facility of $15,500,000 and accrued interest of $13,314,557. The Company then issued new shares of RPG Holdings’ capital stock to AGC in exchange for the cancellation of all claims, principal and accrued interest, related to the first and second lien debt. In addition, all previously issued equity interests of RPG Holdings were cancelled and extinguished. No other liabilities of the Company were compromised. The agreement also provided for AGC to provide up to $10,000,000 debtor in possession (DIP) financing during the period that the Company was operating in bankruptcy.

On February 18, 2009, the Bankruptcy Court approved the reorganization plan and the transaction closed on February 24, 2009.

15

EX-99.2

Exhibit 99.2

RPG Holdings, Inc. and Subsidiary

Consolidated Financial Report

April 27, 2007 and April 28, 2006

RPG Holdings, Inc. and Subsidiary

Table of Contents

April 27, 2007 and April 28, 2006

	Page
Independent Auditor’s Report	1
Financial Statements
Consolidated Balance Sheets	3
Consolidated Statements of Operations	4
Consolidated Statements of Stockholders’ Equity	5
Consolidated Statements of Cash Flows	6 - 7
Notes to Consolidated Financial Statements	8 - 19

Independent Auditor’s Report

To the Board of Directors

RPG Holdings, Inc.

Chicago, Illinois

We have audited the accompanying consolidated balance sheet of RPG Holdings, Inc. and Subsidiary (the Company) as of April 27, 2007, and the related statements of operations, stockholders' equity and cash flows for the year then ended. 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 audit.

We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the 2007 consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of April 27, 2007, and the results of their operations and their cash flows for the fiscal year then ended, in conformity with accounting principles generally accepted in the United States of America.

/s/    McGladrey & Pullen, LLP

Chicago, Illinois

July 20, 2007

1

Independent Auditor’s Report

To the Board of Directors

RPG Holdings, Inc.

Chicago, Illinois

We have audited the accompanying consolidated balance sheet of RPG Holdings, Inc. and Subsidiary (formerly Recycled Paper Greetings, Inc. - Note 1) (the Company) as of April 28, 2006, and the related consolidated statements of operations, stockholders' equity and cash flows for the year then ended. 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 audit.

We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the 2006 consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of April 28, 2006, and the results of their operations and their cash flows for the fiscal year then ended, in conformity with accounting principles generally accepted in the United States of America.

/s/    Altschuler, Melvoin and Glasser, LLP

Chicago, Illinois

August 17, 2006

2

RPG Holdings, Inc. and Subsidiary

Consolidated Balance Sheets

April 27, 2007 and April 28, 2006

	2007		2006
	Successor		Successor
Assets
Current assets
Cash and cash equivalents	$	7,557,417	$	1,585,321
Accounts receivable, trade (net of allowances of approximately $5,782,000 and $5,669,000 in 2007 and 2006, respectively)		21,660,485		25,965,312
Inventories, net		6,179,401		5,869,555
Prepaid expenses and other current assets		1,924,004		3,409,431
Total current assets		37,321,307		36,829,619
Equipment and leasehold improvements, net		4,677,023		1,873,830
Other assets
Deferred financing fees, net		5,889,001		6,054,950
Derivative asset		—		626,194
Goodwill		150,931,728		150,931,728
Other intangible assets, net		99,733,175		110,862,698
Other		813,545		1,657,610
		257,367,449		270,133,180
Total assets	$	299,365,779	$	308,836,629
Liabilities and Stockholders’ Equity
Current liabilities
Current portion of notes payable, bank	$	—	$	750,000
Accounts payable, trade		604,557		961,175
Accrued expenses		12,703,061		6,258,181
Due to stockholders				281,546
Total current liabilities		13,307,618		8,250,902
Long-term liabilities
Long-term portion of notes payable, bank		188,798,858		198,187,713
Derivative liability		582,704		—
		189,381,562		198,187,713
Stockholders’ equity		96,676,599		102,398,014
Total liabilities and stockholders’ equity	$	299,365,779	$	308,836,629

See accompanying notes. 3

RPG Holdings, Inc. and Subsidiary

Consolidated Statements of Operations

Years Ended April 27, 2007 and April 28, 2006

	2007			2006
	Successor			(see Note 2)
Net sales	$	92,844,773		$	87,096,719
Cost of goods sold		17,627,856			19,730,794
Gross profit		75,216,917			67,365,925
Selling, general and administrative expenses		71,875,529			74,221,912
Income (loss) from operations		3,341,388			(6,855,987	)
Other income (expense):
Interest expense		(22,710,807	)		(8,883,514	)
Interest income		317,370			—
Royalty income		—			76,026
Other, net		—			547,197
		(22,393,437	)		(8,260,291	)
Loss before income taxes		(19,052,049	)		(15,116,278	)
Income tax expense		460,468			4,297,708
Net loss	$	(19,512,517	)	$	(19,413,986	)

See accompanying notes. 4

RPG Holdings, Inc. and Subsidiary

Consolidated Statements of Stockholders’ Equity

April 29, 2005 through December 5, 2005 (Predecessor)

December 6, 2005 through April 28, 2006 (Successor) and

Year Ended April 27, 2007 (Successor)

	Common Stock *				Additional Paid-in Capital		Accumulated (Deficit)			Accumulated Other Comprehensive Income (Loss)			Total
	Shares Outstanding	Amount
Balance at April 29, 2005 (Predecessor)	1,000	$	1,000		$	135,148	$	26,964,226		$			$	27,100,374
Distributions from April 30, 2005 through December 5, 2005								(5,690,972	)					(5,690,972	)
Capital contributions through December 5, 2005						27,166,102								27,166,102
Net loss from April 30, 2005 through December 5, 2005								(7,518,568	)					(7,518,568	)
Acquisition of 80.3 percent of stock of Recycled Paper Greetings, Inc. on December 5, 2005 through newly-formed upper-tier entities, RPG Holdings, Inc. and RPG Investment Holdings, LLC	100		(989	)		86,365,977		(13,754,686	)					72,610,302
Balance, December 5, 2005 (Predecessor)	1,100		11			113,667,227		—			—			113,667,238
(Successor)
Comprehensive loss
Net loss from December 6, 2005 through April 28, 2006								(11,895,418	)					(11,895,418	)
Net change from periodic derivative evaluation											626,194			626,194
Comprehensive loss														(11,269,224	)
Balance, April 28, 2006 (Successor)	1,100		11			113,667,227		(11,895,418	)		626,194			102,398,014
Capital contributions						15,000,000								15,000,000
Comprehensive loss
Net loss								(19,512,517	)					(19,512,517	)
Net change from periodic derivative evaluation											(1,208,898	)		(1,208,898	)
Comprehensive loss														(20,721,415	)
Balance, April 27, 2007 (Successor)	1,100	$	11		$	128,667,227	$	(31,407,935	)	$	(582,704	)	$	96,676,599

* 1,000 Class A shares authorized, issued and outstanding; 0.01 par value; voting

* 100 Class B shares authorized, issued and outstanding; 0.01 par value; nonvoting

See accompanying notes. 5

RPG Holdings, Inc. and Subsidiary

Consolidated Statements of Cash Flows

Years Ended April 27, 2007 and April 28, 2006

	2007			2006
	Successor			(see Note 2)
Operating activities
Net loss	$	(19,512,517	)	$	(19,413,986	)
Depreciation and amortization		13,322,691			9,132,860
Gain on sale of property and equipment		—			(18,104	)
Payment in kind (PIK) interest		611,145			1,937,713
Amortization of deferred financing fees		1,096,068
Bonus expense funded by selling stockholders		—			12,604,254
State replacement taxes funded by selling stockholders		—			4,200,000
Rent and severance expense funded by selling stockholders		—			787,133
Bank fees funded by selling stockholders		—			6,990
Changes in
Accounts receivable, net		4,304,827			5,062,777
Inventories, net		(309,846	)		(413,954	)
Other current assets		638,729			(2,696,135	)
Other assets		—			567,488
Accounts payable, trade		(356,618	)		(113,841	)
Accrued expenses		6,444,880			399,588
Net cash provided by operating activities		6,239,359			12,042,783
Investing activities
Purchases of equipment and leasehold improvements		(3,380,894	)		(998,941	)
Other assets		(206,250	)		—
Proceeds from sale of equipment and leasehold improvements		—			22,217
Net cash used in investing activities		(3,587,144	)		(976,724	)
Financing activities
Repayments of term loan borrowing		(10,750,000	)		—
Capital contributions		15,000,000			—
Distributions to stockholders		—			(202,690,972	)
Proceeds from term loan borrowing		—			197,000,000
Net repayments of line of credit		—			(4,135,000	)
Deferred financing fees		(930,119	)
Proceeds owed to selling stockholders		—			281,546
Repayments of related-party loans, net		—			(35,000	)
Net cash provided by (used in) financing activities		3,319,881			(9,579,426	)
Increase in cash and cash equivalents		5,972,096			1,486,633
Cash and cash equivalents
Beginning of year		1,585,321			98,688
End of year	$	7,557,417		$	1,585,321
Supplemental disclosures of cash flow information
Interest paid	$	16,454,611		$	8,903,292
Income taxes paid	$	461,438		$	4,311,813

See accompanying notes. 6

RPG Holdings, Inc. and Subsidiary

Consolidated Statements of Cash Flows, Continued

Years Ended April 27, 2007 and April 28, 2006

	2007		2006
	Successor		(see Note 2)
Supplemental schedule of noncash investing and financing activities
Transfer net book value of completed technology in property and equipment to goodwill at date of acquisition	$	—	$	2,296,828
Liabilities assumed in connection with business acquisition	$	—	$	2,528,217
Stock acquisition of Recycled Paper Greetings, Inc.
Assets recognized
Goodwill (approximately $2,300,000 of which was in property and equipment)	$	—	$	150,931,728
Other intangible assets		—		115,500,000
Deferred financing fees		—		6,511,645
Due from stockholders		—		4,200,000
Prepaid management fees		—		52,778
Liabilities settled
Harris Bank revolving credit note		—		7,205,000
Related-party notes payable and related interest		—		2,362,725
Liabilities incurred
Revolving credit note		—		(770,000	)
Expenses paid
Bonuses and related-party employer payroll taxes		—		12,604,254
Rent and severance expense to selling stockholders		—		787,133
Bank fees		—		6,990
	$	—	$	299,392,253

See accompanying notes. 7

RPG Holdings, Inc. and Subsidiary

Notes to the Consolidated Financial Statements

Years Ended April 27, 2007 and April 28, 2006

Note 1 Nature of Operations and Significant Accounting Policies

Organization— RPG Investment Holdings, LLC (RPG Investments) was formed during 2005 and, on December 5, 2005, through its wholly owned subsidiary, RPG Holdings, Inc. (RPG Holdings) which was also formed during 2005, acquired all of the outstanding stock of Recycled Paper Greetings, Inc. (RPG, Inc.). Concurrent with the aforementioned acquisition, RPG, Inc. acquired the outstanding capital stock of Barnyard Industries, Inc. (Barnyard, an affiliate) and the membership interests owned by the former stockholders of RPG, Inc. in Internet Media International, L.L.C. (IMI). The reporting entity, RPG Holdings, Inc. and Subsidiary, is hereinafter referred to as the Company.

Nature of Operations— The Company is engaged in the design, distribution and sale of greeting cards, stationery and other novelty items to retailers located throughout the United States and Canada. General and administrative activities are conducted from leased office facilities in Chicago, Illinois and distribution activities are conducted from a leased warehouse located in University Park, Illinois.

Principles of Consolidation and Basis of Presentation— From December 6, 2005 through April 27, 2007 (Successor), the consolidated financial statements include the accounts of RPG Holdings and its wholly owned subsidiary, RPG, Inc., and the accounts of RPG, Inc. include its wholly owned subsidiaries, Recycled Paper Greetings Canada Inc., Barnyard and IMI. From April 30, 2005 through December 5, 2005 (Predecessor), the consolidated financial statements include the accounts of RPG, Inc. and its wholly owned subsidiary, Recycled Paper Greetings Canada Inc. All significant intercompany transactions and accounts have been eliminated in consolidation.

Because of the business combination that occurred on December 5, 2005, the acquisition of the stock of Recycled Paper Greetings, Inc. and the resulting change in control and new basis of accounting, certain aspects of the results for 2006 are not comparative with 2007.

Accounting Period— The Company’s financial reporting year is based upon a 52-53 week calendar ending on the last Friday in April. The years ended April 27, 2007 and April 28, 2006 both consisted of 52 weeks.

Use of Estimates— In preparing consolidated financial statements in conformity with accounting principles generally accepted in the United States of America, management makes estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements, as well as the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

Foreign Operations— The financial statements of Recycled Paper Greetings Canada, Inc. are translated into U.S. dollars using the exchange rate at each balance sheet date for assets and liabilities, the historical exchange rate for stockholders’ equity, and a weighted average exchange rate for each period for revenue and expenses. Translation adjustments are generally required to be recorded in accumulated other comprehensive income (loss) as the local currency of this entity is its functional currency. Adjustments resulting from translation as of and for the years ended April 27, 2007 and April 28, 2006 were not significant.

Cash and Cash Equivalents— The Company defines cash as all highly liquid investments with an original maturity of three months or less. At certain times, the Company’s cash balances held in the United States exceed the amount insured by the Federal Deposit Insurance Corporation. The Company has not experienced any losses resulting from this concentration.

8

RPG Holdings, Inc. and Subsidiary

Notes to the Consolidated Financial Statements

Years Ended April 27, 2007 and April 28, 2006

Note 1 Nature of Operations and Significant Accounting Policies, Continued

Revenue Recognition— Seasonal cards are generally sold with the right of return on unsold merchandise. In addition, the Company provides for estimated returns of these products when those sales to unrelated, third party retailers are recognized. These estimates are based on historical sales returns, the amount of current year sales and other known factors. Accrual rates utilized for establishing estimated return reserves have approximated actual returns experience. Everyday cards are generally sold without the right of return and sales credits are issued at the Company’s discretion for damaged, obsolete and outdated products.

Except for products sold to retailers with a scan-based trading (SBT) arrangement, sales are generally recognized by the Company upon shipment of products to unrelated, third party retailers.

For retailers with an SBT arrangement, the Company owns the product delivered to its retail customers until the product is sold by the retailer to the ultimate customer, at which point the Company recognizes revenue, for both seasonal and everyday products. When a retailer converts to an SBT arrangement, the Company reverses previous sales transactions. Legal ownership of the inventory at the retailer’s stores reverts back to the Company at the time of conversion. The timing and amount of the sales reversal depends on retailer inventory run rates and the estimated timing of the store conversions.

Shipping and Handling Costs— Amounts charged to customers for shipping and handling are included in net sales and the related costs are included in selling, general and administrative expenses (approximately $2,977,000 and $2,717,000 for 2007 and 2006, respectively).

Accounts Receivable and Credit Policies— The Company grants trade credit at various terms to its customers located throughout the United States and Canada. Credit limits and payment terms are established based on evaluations made on an ongoing basis throughout the year. Each customer is reviewed at least annually, with more frequent reviews being performed if necessary based on the customer's financial condition, level of credit being extended, and timeliness of payments. Receivables are valued at management’s estimate of the amount that will be ultimately collected based on historical experience and analysis of specific accounts. Receivables are written off when deemed uncollectible. Recoveries of trade receivables previously written off are recorded when received. The Company estimates the amount of receivables that will be uncollected due to bad debts, sales made with a right of return provision and credits to be issued for customer rebates and unsalable product.

Major Customers— In 2007, sales from two unrelated customers approximated 43 percent of the Company’s 2007 net sales with accounts receivable from such customers amounting to approximately 56 percent of total accounts receivable at April 27, 2007. In 2006, sales from one unrelated customer approximated 33 percent of the Company’s 2006 net sales with accounts receivable from such customer amounting to approximately 57 percent of total accounts receivable at April 28, 2006.

9

RPG Holdings, Inc. and Subsidiary

Notes to the Consolidated Financial Statements

Years Ended April 27, 2007 and April 28, 2006

Note 1 Nature of Operations and Significant Accounting Policies, Continued

Inventories— Inventories, which consist primarily of finished goods, are stated at the lower of cost or market, with cost determined on a first-in, first-out (FIFO) basis.

Equipment and Leasehold Improvements— Equipment and leasehold improvements are recorded at cost. Provisions for depreciation and amortization are computed under both straight-line and accelerated methods for financial reporting purposes, based on the respective estimated useful lives of the assets. Leasehold improvements are amortized over the lesser of the term of the related lease or the estimated useful lives of the improvements. The cost of assets retired or otherwise disposed of and the accumulated depreciation and amortization thereon are removed from the accounts with gain or loss realized upon sale or disposal charged to the consolidated statement of operations. Significant improvements and betterments are capitalized while repairs and maintenance are expensed in the period incurred.

Deferred Financing Fees— Deferred financing fees are carried at cost, net of accumulated amortization, and are amortized as interest expense on a basis which approximates the effective interest rate over the term of the debt.

Intangible Assets and Goodwill— Intangible assets subject to amortization consist of artist agreements, customer relationships, completed technology and non-compete agreements. Such intangible assets are amortized on a straight-line basis over their estimated useful lives, which are generally three to ten years.

Intangible assets whose lives are deemed to be indefinite consist of the Company’s trademarks/tradenames and goodwill.

Relating to goodwill, the Company follows the provisions of Statement of Financial Accounting Standards (SFAS) No. 142, Goodwill and Other Intangible Assets (SFAS 142), under which goodwill is not amortized but is tested annually for impairment. It is the Company’s policy to perform impairment testing annually on February 28. Goodwill recorded at April 25, 2008 and April 27, 2007, resulted from the purchase of RPG Holdings, Inc. and Subsidiary. No impairment loss was recognized for the period from December 6, 2005 through April 27, 2007.

In accordance with Financial Accounting Standard Board (FASB) Statement No. 144, Accounting for the impairment of Long-Lived Assets (FASB 144), it is the Company’s policy to assess whether impairment indicators exist for its property and equipment and intangible assets. If impairment indicators are present, the Company determines whether the total undiscounted future cash flows from the asset in question are less than the carrying amount of the asset and, if less, recognize an impairment loss equal to the excess of the carrying amounts of the asset in question over its fair value.

Income Taxes— Through December 4, 2005, RPG, Inc. had elected to be treated as an S corporation under the Internal Revenue Code. Under these provisions, federal corporate income taxes were not paid. The provision for income taxes relates to state taxes. Effective December 5, 2005, the Company elected to be taxed as a C corporation and, accordingly, began to account for income taxes pursuant to SFAS No. 109, Accounting for Income Taxes (SFAS 109). SFAS 109 requires that deferred taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carryforwards and deferred tax liabilities are recognized

10

RPG Holdings, Inc. and Subsidiary

Notes to the Consolidated Financial Statements

Years Ended April 27, 2007 and April 28, 2006

Note 1 Nature of Operations and Significant Accounting Policies, Continued

for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets may be reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion of all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date on enactment.

Derivative Instruments— The Company accounts for derivative instruments under the provisions of SFAS No. 133, Accounting for Derivative Instruments and Hedging Activities (SFAS 133). SFAS 133 requires all derivatives to be recognized as assets or liabilities on the balance sheet and measured at fair value. Changes in the fair value of derivatives are either recognized in income or accumulated other comprehensive income (loss), depending on the designated purpose of the derivative.

Accumulated Other Comprehensive Income (Loss)— The Company’s other comprehensive income (loss), as reflected in the accompanying consolidated statements of stockholders’ equity, consists of changes in the fair value adjustment for the interest rate swap.

11

RPG Holdings, Inc. and Subsidiary

Notes to the Consolidated Financial Statements

Years Ended April 27, 2007 and April 28, 2006

Note 1 Nature of Operations and Significant Accounting Policies, Continued

Advertising and promotion— All costs associated with advertising and promotion are charged to expense as incurred. Advertising and promotion expense was approximately $104,000 and $238,000 for the years ended April 27, 2007 and April 28, 2006, respectively.

Fair value of financial instruments— The Company’s financial instruments are cash and cash equivalents, accounts receivable, accounts payable and notes payable. The recorded values of cash and cash equivalents, accounts receivable, and accounts payable approximate their fair values based on their short-term nature. The recorded values of notes payable approximate their fair values because the interest rates fluctuate or, if they are fixed, they are based on current rates offered to the Company for debt with similar terms and maturities. The fair value of the Company’s interest rate swaps (used for purposes other than trading) is the estimated amount the Company would pay to terminate these agreements at the reporting date, taking into account current interest rates and the creditworthiness of the counterparty for assets and creditworthiness of the Company for liabilities.

Recent accounting pronouncements— The Financial Accounting Standards Board (“FASB”) has issued Interpretation No. 48, Accounting for Uncertainty in Income Taxes (“FIN 48”). FIN 48 clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements in accordance with FAS 109. FIN 48 also prescribes a recognition threshold and measurement standard for the financial statement recognition and measurement of an income tax position taken or expected to be taken in a tax return. In addition, FIN 48 provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition.

The Company presently recognizes income tax positions based on management’s estimate of whether it is reasonably possible that a liability has been incurred for unrecognized income tax benefits by applying FASB No. 5, Accounting for Contingencies.

The provisions of FIN 48 will be effective for the Company’s fiscal year ending April 25, 2008. The provisions of FIN 48 are to be applied to all tax positions upon initial application of this standard. Only tax positions that meet more-likely-than-not recognition threshold at the effective date may be recognized or continue to be recognized upon adoption.

The cumulative effect of applying the provisions of FIN 48, if any, will be reported as an adjustment to the opening balance of stockholder’s equity for the year of adoption. Management is currently assessing the impact of FIN 48 on the Company’s Consolidated financial position and results of operations.

12

RPG Holdings, Inc. and Subsidiary

Notes to the Consolidated Financial Statements

Years Ended April 27, 2007 and April 28, 2006

Note 2 Acquisition

Effective December 5, 2005, RPG Investments acquired the stock of RPG, Inc. through its subsidiary, RPG Holdings. The former stockholders of RPG, Inc. retained a 19.7 percent ownership interest in that entity by virtue of owning corporations that own 19.7 percent of RPG Investments. The acquisition was accounted for under the provisions of SFAS No. 141, Business Combinations, which requires the use of the purchase method of accounting. Under the purchase method, the total purchase price was allocated to the tangible and separately identified intangible assets acquired based on the estimated fair values as of December 5, 2005, as follows:

Current assets	$	49,113,168
Equipment		1,567,665
Intangibles		115,500,000
Deferred financing fees		6,511,645
Other non-current assets		3,135,764
Liabilities assumed		(2,528,217	)
		173,300,025
Purchase price		324,231,753
Goodwill (excess of purchase price over fair values of assets acquired and liabilities assumed at date of acquisition)	$	150,931,728

The following represents the accompanying consolidated statement of operations and cash flows for the year ended April 28, 2006, which presents separately the consolidated statements of operations and cash flows from April 30, 2005 through December 5, 2005 and December 6, 2005 through April 28, 2006:

	Statements of Operations
	April 30, 2005 through December 5, 2005			December 6, 2005 through April 28, 2006			Total for Fiscal Year Ended April 28, 2006
	(Predecessor)			(Successor)
Net sales	$	51,359,811		$	35,736,908		$	87,096,719
Cost of goods sold		9,787,751			9,943,043			19,730,794
Gross profit		41,572,060			25,793,865			67,365,925
Selling, general and administrative expenses		44,619,326			29,602,586			74,221,912
Loss from operations		(3,047,266	)		(3,808,721	)		(6,855,987	)
Other income (expense)
Interest expense		(373,502	)		(8,510,012	)		(8,883,514	)
Other, net		169,400			453,823			623,223
		(204,102	)		(8,056,189	)		(8,260,291	)
Loss before income taxes		(3,251,368	)		(11,864,910	)		(15,116,278	)
Income tax expense		4,267,200			30,508			4,297,708
Net loss	$	(7,518,568	)	$	(11,895,418	)	$	(19,413,986	)

13

RPG Holdings, Inc. and Subsidiary

Notes to the Consolidated Financial Statements

Years Ended April 27, 2007 and April 28, 2006

Note 2 Acquisition, Continued

	Statements of Cash Flows
	April 30, 2005 through December 5, 2005			December 6, 2005 through April 28, 2006			Total for Fiscal Year Ended April 28, 2006
	(Predecessor)			(Successor)
Operating activities
Net loss	$	(7,518,568	)	$	(11,895,418	)	$	(19,413,986	)
Depreciation and amortization		2,356,422			6,776,438			9,132,860
Payment in Kind (PIK) interest		—			1,937,713			1,937,713
Bonus expense funded by selling stockholders		12,604,254			—			12,604,254
Other		8,694,817			(912,875	)		7,781,942
		16,136,925			(4,094,142	)		12,042,783
Investing activities
Purchases of equipment		(399,106	)		(599,835	)		(998,941	)
Other		55,808			(33,591	)		22,217
		(343,298	)		(633,426	)		(976,724	)
Financing activities
Distributions to stockholders		(5,690,972	)		(197,000,000	)		(202,690,972	)
Increase in related party loans, net		206,885			39,661			246,546
Proceeds from term loan borrowings		—			197,000,000			197,000,000
Net (repayment of) line of credit		(3,365,000	)		(770,000	)		(4,135,000	)
		(8,849,087	)		(730,339	)		(9,579,426	)
Increase (decrease) in cash and cash equivalents	$	6,944,540		$	(5,457,907	)	$	1,486,633

Note 3 Equipment and Leasehold Improvements

Equipment and leasehold improvements at April 27, 2007 and April 28, 2006 consist of:

	2007			2006
Computer hardware, software and equipment	$	3,109,832		$	1,575,866
Transportation equipment		102,939			102,939
Leasehold improvements		307,156			248,277
		3,519,927			1,927,082
Accumulated depreciation and amortization		(795,455	)		(210,752	)
		2,724,472			1,716,330
Construction in progress		1,952,551			157,500
	$	4,677,023		$	1,873,830

On December 5, 2005, the property and equipment was restated to their respective fair values and, accordingly, accumulated depreciation and amortization as of such date was eliminated.

Total provisions for depreciation and amortization of equipment and leasehold improvements charged to operations for the years ended April 27, 2007 and April 28, 2006, amounted to approximately $578,000 and $1,215,000, respectively.

14

RPG Holdings, Inc. and Subsidiary

Notes to the Consolidated Financial Statements

Years Ended April 27, 2007 and April 28, 2006

Note 4 Deferred Financing Fees

Deferred financing fees at April 27, 2007 and April 28, 2006 are reflected on the accompanying consolidated balance sheets net of accumulated amortization of approximately $1,553,000 and $457,000, respectively. Amortization expense charged to interest expense for the years ended April 27, 2007 and April 28, 2006 amounted to approximately $1,096,000 and $457,000, respectively.

Note 5 Other Intangible Assets

Other intangible assets at April 27, 2007 and April 28, 2006 consist of:

	2007			2006			Estimated Useful Lives
Artist agreements	$	41,400,000		$	41,400,000		7 years
Trademarks/tradenames		34,200,000			34,200,000		Indefinite
Customer relationships		30,500,000			30,500,000		4-10 years
Completed technology		8,600,000			8,600,000		7 years
Noncompete agreements		800,000			800,000		3 years
		115,500,000			115,500,000
Accumulated amortization		(15,766,825	)		(4,637,302	)
	$	99,733,175		$	110,862,698

Amortization expense charged to operations for the years ended April 27, 2007 and April 28, 2006 amounted to approximately $11,130,000 and $4,637,000, respectively. No amortization expense is being recorded for trademarks/tradenames.

Estimated amortization expense for future years is as follows:

2008	$	11,130,000
2009		11,018,000
2010		10,634,000
2011		10,230,000
2012		10,113,000
Thereafter		12,409,000
	$	65,534,000

15

RPG Holdings, Inc. and Subsidiary

Notes to the Consolidated Financial Statements

Years Ended April 27, 2007 and April 28, 2006

Note 6 Accrued Expenses

Accrued expenses at April 27, 2007 and April 28, 2006 consist of:

	2007		2006
Salary and wages	$	3,643,526	$	3,625,573
Royalties		1,756,356		1,409,850
Real estate and other taxes		76,878		226,604
Management fees		125,000		125,000
Insurance		159,308		104,786
Interest		5,239,449		59,332
Professional fees		657,804		59,571
Freight		218,101		—
Other		826,639		647,465
		$12,703,061		$6,258,181

Note 7 Notes Payable

Notes payable at April 27, 2007 and April 28, 2006 consist of:

	2007		2006
Borrowings from Credit Suisse, Cayman Island Branch (CS - see below):
Term loan pursuant to First Lien Credit Agreement	$	109,250,000	$	120,000,000
Term loan pursuant to Second Lien Credit Agreement		79,548,858		78,937,713
		188,798,858		198,937,713
Current portion		—		(750,000	)
	$	188,798,858	$	198,187,713

On December 5, 2005, the Company entered into two credit agreements (as most recently amended April 27, 2007) with CS which provide for aggregate maximum borrowings of $217,000,000 in the form of a revolving credit facility of up to $20,000,000 and term loan borrowings of $197,000,000. Term loan borrowings of $120,000,000 and $77,000,000 were made pursuant to a First Lien Credit Agreement (Term Loan 1) and Second Lien Credit Agreement (Term Loan 2), respectively.

The revolving credit facility, which matures on December 5, 2010, provides for interest on borrowings at either the alternate base rate (ABR, 8.25 percent at April 27, 2007) plus 2.50 percent per annum or adjusted LIBOR rate (LIBOR, 5.16 percent at April 27, 2007) plus 3.50 percent per annum, as defined in the agreement. There were no borrowings under this facility at April 27, 2007 and April 28, 2006.

Term Loan 1 borrowings (pursuant to the April 27, 2007 amendment) are to be repaid in quarterly installments of principal (commencing March 31, 2009, ranging from $500,000 to $3,750,000 per quarter) and interest (at either the ABR plus 2.50 percent or LIBOR plus 3.50 percent per annum), with the final balance due on December 5, 2011. The effective interest rate on this note was 8.66 percent and 8.63 percent at April 27, 2007 and April 28, 2006, respectively.

16

RPG Holdings, Inc. and Subsidiary

Notes to the Consolidated Financial Statements

Years Ended April 27, 2007 and April 28, 2006

Note 7 Notes Payable, Continued

Term Loan 2 borrowings and unpaid interest (pursuant to the April 27, 2007 amendment) are due December 5, 2012, with interest payable quarterly. Such borrowings bear interest (at either the ABR rate plus 8 percent per annum or adjusted LIBOR rate plus 9 percent per annum), as defined in the agreement, with 1 percent payment-in-kind (PIK) interest, payable at maturity. The PIK interest amounted to $611,145 and $1,937,713 for the years ended April 27, 2007 and April 28, 2006, respectively, which amounts served to increase the related term loan at April 27, 2007 and April 28, 2006. The effective interest rate on this note was 14.36 percent and 14.13 percent at April 27, 2007 and April 28, 2006, respectively.

The agreements with CS contain, among other covenants, provisions setting forth requirements for interest coverage, leverage, first lien leverage, second lien leverage and fixed charge coverage ratios. Borrowings under the CS agreements are secured by all assets of the Company.

Aggregate maturities of long-term debt at April 27, 2007 are as follows:

2008	$	—
2009		500,000
2010		9,750,000
2011		12,750,000
2012		86,250,000
Thereafter		79,548,858
	$	188,798,858

Note 8 Derivative Instruments

To protect the Company from adverse and unexpected interest rate fluctuations, the Company has entered into an interest rate swap to convert a portion of its outstanding debt, which is based on floating interest rates, to fixed rate debt. This derivative instrument has been designated as a cash flow hedging instrument and is reported at fair value. The interest rate swap has a total notional amount of $171,000,000 and expires January 31, 2011.

The swap is utilized to manage interest rate exposure and is designed as a highly effective cash flow hedge. The differential to be paid or received on the swap agreement is accrued as interest rates change and is recognized over the life of the agreement in interest income (expense). Included in accumulated other comprehensive income (loss) is $(582,704) and $626,194, respectively, relating to the fair value of the swap agreement at April 27, 2007 and April 28, 2006, respectively. As the instrument ages towards maturity and/or interest rates increase/decrease, the gain/loss will be reclassified from accumulated other comprehensive income (loss) into earnings.

17

RPG Holdings, Inc. and Subsidiary

Notes to the Consolidated Financial Statements

Years Ended April 27, 2007 and April 28, 2006

Note 9 Income Taxes

The provision for income taxes for the years ended April 27, 2007 and April 28, 2006 consisted solely of state taxes. The 2006 provision resulted primarily from the sale of the stock of RPG, Inc. at December 5, 2005, which was effectively treated for tax reporting purposes as an asset sale.

The primary differences between the statutory and effective tax rates for the period from December 6, 2005 (beginning of the C corporation period) through April 28, 2006, and for the fiscal year ended April 27, 2007, relates to changes in the valuation allowance established for deferred income taxes.

The Company’s net deferred tax position at April 27, 2007 and April 28, 2006 was as follows:

	2007			2006
Gross deferred tax assets	$	18,012,000		$	6,160,000
Valuation allowance		(12,197,000	)		(4,624,000	)
		5,815,000			1,536,000
Gross deferred tax liabilities		(5,815,000	)		(1,536,000	)
	$	—		$	—

Gross deferred income tax assets at April 27, 2007 and April 28, 2006 consist primarily of (a) a net operating loss carryforward of $31,990,000 and $7,100,000 at April 27, 2007 and April 28, 2006, respectively, (b) uniform capitalization rules (for additional inventory costs), (c) a nondeductible inventory valuation allowance, (d) nondeductible accounts receivable reserves and (e) other intangible and fixed asset amortization and depreciation differences for financial and tax reporting purposes. Gross deferred income tax liabilities at April 27, 2007 and April 28, 2006 consist primarily of (a) amortization of goodwill for tax reporting purposes and not for financial reporting purposes and (b) certain prepaid expenses deducted currently for income tax purposes. The net operating losses will expire in 2027. At April 27, 2007 and April 28, 2006, the Company recorded a valuation allowance of $12,197,000 and $4,624,000, respectively, representing an increase of $7,573,000.

Note 10 Employee Benefit Plan

The Company maintains the Recycled Paper Greetings, Inc. Employees’ Retirement Savings Plan and Trust for the benefit of eligible employees. The plan is intended to provide for elective contributions by the participants pursuant to Section 401(k)(3) of the Internal Revenue Code plus employer matching contributions of up to 2 ¹/2 percent of participant’s compensation. The matching contributions to the plan approximated $414,000 and $402,000 for the years ended April 27, 2007 and April 28, 2006, respectively.

Note 11 Commitments, Contingencies and Related-Party Transactions

The Company leases certain office, warehouse and manufacturing facilities, and equipment under several month-to-month and noncancelable leases expiring at various dates through November 2018. In addition to specified rentals, the Company is responsible for real estate taxes and common area maintenance under certain real property leases.

18

RPG Holdings, Inc. and Subsidiary

Notes to the Consolidated Financial Statements

Years Ended April 27, 2007 and April 28, 2006

Note 11 Commitments, Contingencies and Related-Party Transactions, Continued

Minimum future lease commitments are:

2008	$	841,000
2009		1,148,000
2010		1,430,000
2011		1,456,000
2012		1,119,000
Thereafter		7,800,000
	$	13,794,000

Total rent expense under these operating leases (excluding real estate taxes and common area maintenance) for the years ended April 27, 2007 and April 28, 2006, approximated $583,000 and $880,000, respectively, of which $488,000 and $798,000, respectively, was to related parties.

The Company did not incur any interest expense with related parties for the year ended April 27, 2007. Interest expense to related parties approximated $207,000 for the year ended April 28, 2006.

The Company is a defendant in legal proceedings arising in the ordinary course of business and is subject to unasserted claims. Although the outcome of these proceedings cannot be determined, it is the opinion of management, based on consultation with legal counsel, that any amounts payable upon resolution of these matters will not have a material impact on the consolidated financial statements.

Management and administrative expenses incurred related to entities affiliated through common ownership approximated $742,000 and $716,000 during the years ended in 2007 and 2006, respectively, of which $245,000 and $125,000 is included on the accompanying consolidated balance sheets in accrued expenses at April 27, 2007 and April 28, 2006, respectively.

19

EX-99.3

Exhibit 99.3

RPG Holdings, Inc. and Subsidiary

Debtor-In-Possession

Unaudited Condensed Consolidated Balance Sheets

January 23, 2009 and January 25, 2008

	2009			2008
Assets
Current assets:
Cash and cash equivalents	$	1,020,266		$	1,735,746
Accounts receivable, trade (net of allowances of approximately $5,271,000 and $6,695,000 in 2008 and 2007)		6,227,798			11,633,033
Inventories (net of allowances of approximately $3,201,000 and $2,178,000 in 2008 and 2007)		5,297,422			6,368,912
Prepaid expenses and other current assets		1,701,791			2,423,879
Total current assets		14,247,277			22,161,570
Equipment and leasehold improvements, net		4,223,125			5,271,139
Other assets:
Deferred financing fees, net		—			4,954,277
Goodwill		28,061,999			28,061,999
Other intangible assets, net		29,137,104			34,870,000
Other		410,999			553,528
		57,610,102			68,439,804
Total assets	$	76,080,504		$	95,872,513
Liabilities and Stockholders’ Deficit
Liabilities Not Subject to Compromise (pre-petition):
Revolving bank loan payable	$	—		$	4,400,000
Debtor in possession (DIP) financing		6,544,000			—
Accounts payable, trade		507,558			3,035,227
Accrued expenses		986,707			13,828,020
Long-term portion of notes payable, bank		—			189,505,819
Total Liabilities Not Subject to Compromise (pre-petition)		8,038,265			210,769,066
Liabilities Subject to Compromise (pre-petition):
Revolving bank loan payable		15,500,000			—
Notes payable, bank		195,793,583			—
Accrued interest		13,314,557			—
Accrued interest, related parties		994,746			—
Liabilities Subject to Compromise (pre-petition)		225,602,886			—
Liabilities Not Subject to Compromise (post-petition):
Accounts payable, trade		3,269,881			—
Accrued expenses		2,027,093			—
Liabilities Not Subject to Compromise (post-petition)		5,296,974			—
Stockholders’ deficit		(162,857,621	)		(114,896,553	)
Total liabilities and stockholders’ deficit	$	76,080,504		$	95,872,513

See accompanying notes. 1

RPG Holdings, Inc. and Subsidiary

Debtor-In-Possession

Unaudited Condensed Consolidated Statements of Operations

Nine Months Ended January 23, 2009 and January 25, 2008

	2009			2008
Net sales	$	53,862,678		$	60,692,466
Cost of goods sold		11,984,561			15,289,492
Gross profit		41,878,117			45,402,974
Operating expenses:
Selling, general and administrative expenses		50,231,422			55,414,753
Impairment losses		—			179,475,593
Professional fees		7,261,021			—
		57,492,443			234,890,346
Loss from operations		(15,614,326	)		(189,487,372	)
Financial income (expense):
Interest expense		(16,170,543	)		(22,837,421	)
Interest income		39,438			262,339
		(16,131,105	)		(22,575,082	)
Loss before reorganization items		(31,745,431	)		(212,062,454	)
Reorganization Items:
Professional fees		3,028,971			—
Interest expense (deferred financing fees)		3,787,949			—
		6,816,920			—
Loss before income taxes		(38,562,351	)		(212,062,454	)
Income tax expense		139,022			93,401
Net loss	$	(38,701,373	)	$	(212,155,855	)

See accompanying notes. 2

RPG Holdings, Inc. and Subsidiary

Debtor-In-Possession

Unadudited Condensed Consolidated Statements of Cash Flows

Nine Months Ended January 23, 2009 and January 25, 2008

	2009			2008
Operating activities
Net loss	$	(38,701,373	)	$	(212,155,855	)
Depreciation and amortization		5,942,793			10,238,688
Impairment losses		—			179,475,593
Payment in kind (PIK) interest		1,125,508			706,961
Amortization of deferred financing fees		4,751,432			999,734
Settlement amount from interest rate swap		4,699,570
Changes in
Accounts receivable, net		5,893,631			10,027,452
Inventories, net		(643,669	)		(189,511	)
Prepaid expenses and other current assets		604,033			(1,136,716	)
Accounts payable, trade		(2,151,285	)		(678,638	)
Accrued interest payable		10,190,740			(103,464	)
Accrued expenses		(5,200,409	)		4,537,745
Net cash used in operating activities before reorganization items		(13,489,029	)		(8,278,011	)
Operating cash flows from reorganization items
Professional fees accrued for services rendered in connection with the Chapter 11 proceedings		3,028,971			—
Net cash provided by reorganization items		3,028,971			—
Investing activities
Purchases of equipment and leasehold improvements		(220,412	)		(2,003,660	)
Other assets		—			60,000
Net cash used in investing activities		(220,412	)		(1,943,660	)
Financing activities
Borrowings under DIP loan agreement		6,544,000			—
Proceeds from line of credit borrowings		—			4,400,000
Net cash provided by financing activities		6,544,000			4,400,000
Decrease in cash and cash equivalents		(4,136,470	)		(5,821,671	)
Cash and cash equivalents
Beginning of period		5,156,734			7,557,417
End of period	$	1,020,264		$	1,735,746
Supplemental disclosures of cash flow information
Interest paid	$	5,016,320		$	16,397,189
Income taxes paid	$	151,397		$	—
Supplemental schedule of noncash financing activities
Settlement amount from interest rate swap	$	4,699,570		$	—

3

RPG Holdings, Inc. and Subsidiary

Debtor-In-Possession

Notes to the Unaudited Condensed Consolidated Financial Statements

For the Nine Months Ended January 23, 2009 and January 25, 2008

Note 1 Nature of Operations and Significant Accounting Policies

Organization— RPG Investment Holdings, LLC (RPG Investments) was formed during 2005 and, on December 5, 2005, through its wholly owned subsidiary, RPG Holdings, Inc. (RPG Holdings) which was also formed during 2005, acquired all of the outstanding stock of Recycled Paper Greetings, Inc. (RPG, Inc.). Concurrent with the aforementioned acquisition, RPG, Inc. acquired the outstanding capital stock of Barnyard Industries, Inc. (Barnyard, an affiliate) and the membership interests owned by the former stockholders of RPG, Inc. in Internet Media International, L.L.C. (IMI). The reporting entity, RPG Holdings, Inc. and Subsidiary, is hereinafter referred to as the Company.

Nature of Operations— The Company is engaged in the design, distribution and sale of greeting cards, stationery and other novelty items to retailers located throughout the United States and Canada. General and administrative activities are conducted from leased office facilities in Chicago, Illinois and distribution activities are conducted from a leased warehouse located in University Park, Illinois.

Petition for Relief under Chapter 11— Pursuant to a petition and pre-packaged plan of reorganization filed on January 2, 2009, the Company filed for relief under Chapter 11 of the federal bankruptcy laws in the United States Bankruptcy Court in the State of Delaware. Under Chapter 11, certain claims against the Debtor in existence prior to the filing of the petitions for relief under the federal bankruptcy laws are stayed while the Debtor continues business operations as Debtor-in-Possession (DIP). These claims are reflected in the accompanying January 23, 2009, balance sheet as “liabilities subject to compromise.”

During Chapter 11, the Company was provided with a Senior Secured Super-Priority DIP revolving credit facility of $10,000,000 by American Greetings Corporation (AGC). The revolving credit facility provides for interest on borrowings at Prime Rate plus 5.0 percent per annum or LIBOR plus 6.0 percent per annum. There were borrowings under this facility of $6,544,000 as of January 23, 2009 at an effective rate of 9.0 percent.

The Debtor received approval from the Bankruptcy Court to pay or otherwise honor certain of its prepetition obligations, including employee wages and some suppliers designated as critical to the Company’s operations.

On February 18, 2009, the Company filed a Disclosure Statement and a Joint Plan of Reorganization that was confirmed by the court in Delaware. The Company’s plan became effective on February 24, 2009 at which time the Company was acquired by American Greetings Corporation (AGC). See Note 9 for a more complete description of the reorganization plan.

Condensed Financial Information— The accompanying condensed consolidated financial statements of RPG Holdings, Inc. have been prepared in accordance with United States (U.S.) generally accepted accounting principles (GAAP) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all information and footnotes required by GAAP for complete financial statements. The financial information included herein reflects all adjustments (all of which are normal and recurring in nature) which are, in the opinion of management, necessary for a fair presentation of financial position and results of operations. Operating results for all periods presented are not necessarily indicative of the results that may be expected for the full year.

Principles of Consolidation and Basis of Presentation— The consolidated financial statements include the accounts of RPG Holdings and its wholly owned subsidiary, RPG, Inc., and accounts of RPG, Inc. include its wholly owned subsidiaries, Recycled Paper Greetings Canada, Inc., Barnyard and IMI. All significant intercompany accounts and transactions have been eliminated in consolidation.

Accounting Period—The Company’s financial reporting year is based upon a 52-53 week calendar ending on the last Friday in April. The accounting period covered in this financial report is the nine month period ended January 23, 2009 and January 25, 2008 (the Period). For the fore mentioned Period, both year’s consist of 39 weeks.

Use of Estimates— In preparing consolidated financial statements in conformity with accounting principles generally accepted in the United States of America, management makes estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements, as well as the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

Foreign Operations—The financial statements of Recycled Paper Greetings Canada, Inc. are translated into U.S. dollars using the exchange rate at each balance sheet date for assets and liabilities, the historical exchange rate for stockholders’ equity, and a weighted average exchange rate for each period for revenue and expenses. Translation adjustments are generally required to be recorded in accumulated other comprehensive income (loss) as the local currency of this entity is its functional currency. Adjustments resulting from translation as of and for the 2009 and 2008 Period were not significant.

Cash and Cash Equivalents— The Company defines cash as all highly liquid investments with an original maturity of three months or less. At certain times, the Company’s cash balances held in the United States exceed the amount insured by the Federal Deposit Insurance Corporation. The Company has not experienced any losses resulting from this concentration.

4

RPG Holdings, Inc. and Subsidiary

Debtor-In-Possession

Notes to the Unaudited Condensed Consolidated Financial Statements

For the Nine Months Ended January 23, 2009 and January 25, 2008

Note 1 Nature of Operations and Significant Accounting Policies, Continued

Revenue Recognition— Seasonal cards are generally sold with the right of return on unsold merchandise. In addition, the Company provides for estimated returns of these products when those sales to unrelated, third party retailers are recognized. These estimates are based on historical sales returns, the amount of current year sales and other known factors. Accrual rates utilized for establishing estimated return reserves have approximated actual returns experience. Everyday cards are generally sold without the right of return and sales credits are issued at the Company’s discretion for damaged, obsolete and outdated products.

Except for products sold to retailers with a scan-based trading (SBT) arrangement, sales are generally recognized by the Company upon shipment of products to unrelated, third party retailers.

For retailers with an SBT arrangement, the Company owns the product delivered to its retail customers until the product is sold by the retailer to the ultimate customer, at which point the Company recognizes revenue, for both seasonal and everyday products. When a retailer converts to an SBT arrangement, the Company reverses previous sales transactions. Legal ownership of the inventory at the retailer’s stores reverts back to the Company at the time of conversion. The timing and amount of the sales reversal depends on retailer inventory run rates and the estimated timing of the store conversions.

Shipping and Handling Costs—Amounts charged to customers for shipping and handling are included in net sales and the related costs are included in selling, general and administrative expenses (approximately $2,241,000 and $2,455,000 for the 2009 and 2008 Period, respectively).

5

RPG Holdings, Inc. and Subsidiary

Debtor-In-Possession

Notes to the Unaudited Condensed Consolidated Financial Statements

For the Nine Months Ended January 23, 2009 and January 25, 2008

Note 1 Nature of Operations and Significant Accounting Policies, Continued

Accounts Receivable and Credit Policies— The Company grants trade credit at various terms to its customers located throughout the United States and Canada. Credit limits and payment terms are established based on evaluations made on an ongoing basis throughout the year. Each customer is reviewed at least annually, with more frequent reviews being performed if necessary based on the customer’s financial condition, level of credit being extended, and timeliness of payments. Receivables are valued at management’s estimate of the amount that will be ultimately collected based on historical experience and analysis of specific accounts. Receivables are written off when deemed uncollectible. Recoveries of trade receivables previously written off are recorded when received. The Company estimates the amount of receivables that will be uncollected due to bad debts, sales made with a right of return provision and credits to be issued for customer rebates and unsalable product.

Major Customers—For the nine months ended January 23, 2009 and January 25, 2008, sales to two unrelated customers approximated 39 percent of the Company’s net sales in each Period, with accounts receivable from such customers amounting to approximately 22 percent and 42 percent of total accounts receivable at January 23, 2009 and January 25, 2008, respectively.

Inventories—Inventories, which consist primarily of finished goods, are stated at the lower of cost or market, with cost determined on a first-in, first-out (FIFO) basis.

Equipment and Leasehold Improvements— Equipment and leasehold improvements are recorded at cost. Provisions for depreciation and amortization are computed under both straight-line and accelerated methods for financial reporting purposes, based on the respective estimated useful lives of the assets. Leasehold improvements are amortized over the lesser of the term of the related lease or the estimated useful lives of the improvements. The cost of assets retired or otherwise disposed of and the accumulated depreciation and amortization thereon are removed from the accounts with gain or loss realized upon sale or disposal charged to the consolidated statement of operations. Significant improvements and betterments are capitalized while repairs and maintenance are expensed in the period incurred.

Deferred Financing Fees— Deferred financing fees are carried at cost, net of accumulated amortization, and are amortized as interest expense on a basis which approximates the effective interest rate over the term of the debt.

Intangible Assets and Goodwill— Intangible assets subject to amortization consist of artist agreements, customer relationships, completed technology and non-compete agreements. Such intangible assets are amortized on a straight-line basis over their estimated useful lives, which are generally three to ten years.

Intangible assets whose lives are deemed to be indefinite consist of the Company’s trademarks/tradenames and goodwill.

6

RPG Holdings, Inc. and Subsidiary

Debtor-In-Possession

Notes to the Unaudited Condensed Consolidated Financial Statements

For the Nine Months Ended January 23, 2009 and January 25, 2008

Note 1 Nature of Operations and Significant Accounting Policies, Continued

Relating to goodwill, the Company follows the provisions of Statement of Financial Accounting Standards (SFAS) No. 142, Goodwill and Other Intangible Assets (SFAS 142), under which goodwill is not amortized but is tested annually for impairment. It is the Company’s policy to perform impairment testing annually on February 28. Goodwill recorded at January 25, 2008, resulted from the purchase of RPG Holdings, Inc. and Subsidiary. See Notes 4 and 5 for further impairment disclosure.

In accordance with Financial Accounting Standard Board (FASB) Statement No. 144, Accounting for the Impairment of Long-Lived Assets (FASB 144), it is the Company’s policy to assess whether impairment indicators exist for its property and equipment and intangible assets. If impairment indicators are present, the Company determines whether the total undiscounted future cash flows from the asset in question are less than the carrying amount of the asset and, if less, recognize an impairment loss equal to the excess of the carrying amounts of the asset in question over its fair value.

Income Taxes— The Company has elected to be taxed as a C corporation and, accordingly, accounts for income taxes pursuant to SFAS No. 109, Accounting for Income Taxes (SFAS 109). SFAS 109 requires that deferred taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carryforwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets may be reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion of all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date on enactment.

Derivative Instruments— The Company accounts for derivative instruments under the provisions of SFAS No. 133, Accounting for Derivative Instruments and Hedging Activities (SFAS 133). SFAS 133 requires all derivatives to be recognized as assets or liabilities on the balance sheet and measured at fair value. Changes in the fair value of derivatives are either recognized in income or accumulated other comprehensive income (loss), depending on the designated purpose of the derivative.

Advertising and Promotion—All costs associated with advertising and promotion are charged to expense as incurred.

7

RPG Holdings, Inc. and Subsidiary

Debtor-In-Possession

Notes to the Unaudited Condensed Consolidated Financial Statements

For the Nine Months Ended January 23, 2009 and January 25, 2008

Note 1 Nature of Operations and Significant Accounting Policies, Continued

Fair Value of Financial Instruments— The Company’s financial instruments are cash and cash equivalents, accounts receivable, accounts payable and notes payable. The recorded values of cash and cash equivalents, accounts receivable, and accounts payable approximate their fair values based on their short-term nature. The fair value of notes payable amounted to approximately $114,080,000 (at a carrying value of approximately $221,294,000) at January 23, 2009. The carrying amount significantly exceeded its fair value at January 23, 2009 due to the tighter U.S. credit markets and the credit crisis of the Company. The fair value of the Company’s interest rate swaps (used for purposes other than trading) is the estimated amount the Company would pay to terminate these agreements at the reporting date, taking into account current interest rates and the creditworthiness of the counterparty for assets and creditworthiness of the Company for liabilities.

Recent Accounting Pronouncements— In April 2008, the FASB issued FASB Staff Position FAS 142-3, Determination of the Useful Life of an Intangible Asset (FSP 142-3). FSP 142-3 amends the factors that should be considered in developing renewal or extension assumptions used to determine the useful life of a recognizable intangible asset under SFAS 142. The intent of FSP 142-3 is to improve the consistency between the useful life of a recognized intangible asset under SFAS 142 and the period of expected cash flows used to measure the fair value of the asset under other generally accepted accounting principles in the United States of America. FSP 142-3 is effective for financial statements issued for fiscal years beginning after December 15, 2008, and interim periods within those fiscal years. Early adoption is prohibited. The guidance for determining the useful life of a recognized intangible asset shall be applied prospectively to intangible assets acquired after the effective date. Certain disclosure requirements shall be applied prospectively to all intangible assets recognized as of, and subsequent to, the effective date.

In May 2008, the FASB issued SFAS No. 162, The Hierarchy of Generally Accepted Accounting Principles (SFAS 162). The new standard is intended to improve financial reporting by identifying a consistent framework for selecting accounting principles to be used in preparing financial statements that are presented in conformity with Accounting Principles Generally Accepted in the United States of America for nongovernmental entities. SFAS 162 became effective on November 15, 2008. The adoption of SFAS 162 did not have a significant impact on our consolidated financial statements.

8

RPG Holdings, Inc. and Subsidiary

Debtor-In-Possession

Notes to the Unaudited Condensed Consolidated Financial Statements

For the Nine Months Ended January 23, 2009 and January 25, 2008

Note 2 Liabilities Subject to Compromise

Liabilities subject to compromise as of January 23, 2009 consist of the following:

Revolving bank loan payable	$	15,500,000
Notes payable, bank		195,793,583
Accrued interest		13,314,557
Accrued interest, related parties		994,746
	$	225,602,886

Note 3 Goodwill

SFAS 142 prescribes a periodic impairment test of goodwill, which the Company completed as of February 28, 2008, and determined that a portion of the value of its goodwill was impaired as of January 25, 2008. Accordingly, the Company recorded a non-cash charge amounting to approximately $122,870,000 as of January 25, 2008 (included in impairment losses in the accompanying statements of operations), as an impairment to goodwill. This amount was determined based on a valuation of the Company as of February 28, 2008, using projections of future discounted cash flows.

9

RPG Holdings, Inc. and Subsidiary

Debtor-In-Possession

Notes to the Unaudited Condensed Consolidated Financial Statements

For the Nine Months Ended January 23, 2009 and January 25, 2008

Note 4 Other Intangible Assets

Other intangible assets at January 23, 2009 and January 25, 2008 consist of:

	2009			2008		Estimated Useful Lives
Artist agreements	$	23,690,000		$	23,690,000	7 years
Trademarks/tradenames		5,830,000			5,830,000	Indefinite
Customer relationships		4,840,000			4,840,000	4-10 years
Completed technology		510,000			510,000	7 years
		34,870,000			34,870,000
Accumulated amortization		(5,732,896	)		—
	$	29,137,104		$	34,870,000

During 2008, among other factors, the Company was negatively affected by growth restrictions resulting from contract barriers, performance lagging expectations for some of the Company’s larger customers and competition intensifying beyond management’s initial estimates. Accordingly, the Company evaluated the ongoing value of the other intangible assets. Based on this evaluation, the Company determined that assets with a total carrying amount of approximately $91,476,000 were impaired and wrote them down by approximately $56,606,000 (included in impairment losses in the accompanying statements of operations) to their estimated fair value. The artist agreements, trademarks/tradenames, customer relationships, completed technology and noncompete agreements were impaired by approximately $4,896,000, $28,460,000, $17,600,000, $5,428,000 and $222,000, respectively. The estimated fair value was based on estimated cash flows to be generated by the Company, discounted at a market rate of interest. The fair value was recorded as of January 25, 2008 (at which date the respective costs were reset).

Amortization expense charged to operations for the Period ended January 23, 2009 and January 25, 2008 amounted to approximately $4,300,000 and $7,426,000, respectively. No amortization expense is being recorded for trademarks/tradenames (impairment loss for 2008 amounted to approximately $28,460,000).

Estimated amortization expense for future years is as follows:

2009	$	1,433,000
2010		5,733,000
2011		5,733,000
2012		5,733,000
2013		3,647,000
2014 and thereafter		1,028,000
	$	23,307,000

10

RPG Holdings, Inc. and Subsidiary

Debtor-In-Possession

Notes to the Unaudited Condensed Consolidated Financial Statements

For the Nine Months Ended January 23, 2009 and January 25, 2008

Note 5 Notes Payable

Notes payable at January 23, 2009 and January 25, 2008 consist of:

	2009			2008
Borrowings from Credit Suisse, Cayman Island Branch (CS - see below):
Term loan pursuant to First Lien Credit Agreement	$	113,949,570		$	109,250,000
Term loan pursuant to Second Lien Credit Agreement		81,844,013			80,255,819
		195,793,583			189,505,819
Current portion		(195,793,583	)		(189,505,819	)
	$	—		$	—

On December 5, 2005, the Company entered into two credit agreements (as most recently amended April 27, 2007) with CS which provide for aggregate maximum borrowings of $217,000,000 in the form of a revolving credit facility of up to $20,000,000 and term loan borrowings of $197,000,000. Term loan borrowings of $120,000,000 and $77,000,000 were made pursuant to a First Lien Credit Agreement (Term Loan 1) and Second Lien Credit Agreement (Term Loan 2), respectively.

The revolving credit facility, which matures on December 5, 2010, provides for interest on borrowings at either the alternate base rate (ABR, 5.25 percent at April 25, 2008) plus 2.50 percent per annum or adjusted LIBOR rate (LIBOR, 4.42 percent at April 25, 2008) plus 3.50 percent per annum, as defined in the agreement. There were borrowings of $15,500,000 and $4,400,000 under this facility at January 23, 2009 and January 25, 2008, respectively.

On October 31, 2008, the Company defaulted on an interest rate swap agreement payment. As a result, the contract was terminated on November 8, 2008 and the settled amount per the contract of $4,699,570 was added to the Term Loan 1.

11

RPG Holdings, Inc. and Subsidiary

Debtor-In-Possession

Notes to the Unaudited Condensed Consolidated Financial Statements

For the Nine Months Ended January 23, 2009 and January 25, 2008

Note 5 Notes Payable, Continued

Term Loan 1 borrowings (pursuant to the April 27, 2007 amendment) are to be repaid in quarterly installments of principal (commencing March 31, 2009, ranging from $500,000 to $3,750,000 per quarter) and interest (at either the ABR plus 2.50 percent or LIBOR plus 3.50 percent per annum), with the final balance due on December 5, 2011. The effective interest rate on this note was 8.00 percent and 8.71 percent at January 23, 2009 and January 25, 2008, respectively.

Term Loan 2 borrowings and unpaid interest (pursuant to the April 27, 2007 amendment) are due December 5, 2012, with interest payable quarterly. Such borrowings bear interest (at either the ABR rate plus 8.0 percent per annum or adjusted LIBOR rate plus 9.0 percent per annum), as defined in the agreement, with 1.0 percent payment-in-kind (PIK) interest, payable at maturity. The PIK interest amounted to $1,125,508 and $706,961 for the 2009 and 2008 Period, respectively, which amounts served to increase the Term Loan 2 at January 23, 2009 and January 25, 2008. The effective interest rate on this note was 13.50 percent and 14.21 percent at January 23, 2009 and January 25, 2008, respectively.

On December 30, 2008, the Company was provided with a Senior Secured Super-Priority DIP revolving credit facility (DIP financing) up to $10,000,000 by AGC. The DIP financing provides for interest on borrowings at Prime Rate plus 5.0 percent per annum or LIBOR plus 6.0 percent per annum. There were borrowings under this DIP financing facility of $6,544,000 as of January 23, 2009 at an effective rate of 9.0 percent.

The agreements with CS contain, among other covenants, provisions setting forth requirements for interest coverage, leverage, first lien leverage, second lien leverage and fixed charge coverage ratios. Borrowings under the CS agreements are secured by all assets of the Company. As of January 25, 2008, the Company was in violation of all financial covenants for which they did not receive waivers for such noncompliance. As a result, the Term Loan 1 and Term Loan 2 borrowings have been presented as current, on the unaudited consolidated balance sheet, at January 23, 2009 and January 25, 2008.

12

RPG Holdings, Inc. and Subsidiary

Debtor-In-Possession

Notes to the Unaudited Condensed Consolidated Financial Statements

For the Nine Months Ended January 23, 2009 and January 25, 2008

Note 6 Income Taxes

The provision for income taxes for the nine months ended January 23, 2009 and January 25, 2008 consisted solely of state taxes.

The Company’s net deferred tax position at January 23, 2009 and January 25, 2008 was as follows:

	2009			2008
Gross deferred tax assets	$	112,676,000		$	92,202,000
Valuation allowance		(112,078,000	)		(91,516,000	)
		598,000			686,000
Gross deferred tax liabilities		(598,000	)		(686,000	)
	$	—		$	—

Note 7 Commitments, Contingencies and Related-Party Transactions

There is an amount payable for professional services of approximately $1,738,000 contingent upon the purchase of RPG Holdings, Inc. by AGC. AGC committed to paying this amount post acquisition.

The Company is a defendant in legal proceedings arising in the ordinary course of business and is subject to unasserted claims. Although the outcome of these proceedings cannot be determined, it is the opinion of management, based on consultation with legal counsel, that any amounts payable upon resolution of these matters will not have a material impact on the consolidated financial statements.

Management and administrative expenses incurred related to entities affiliated through common ownership amounted to approximately $665,000 and $679,000 during the 2009 and 2008 Period, respectively, of which approximately $995,000 and $257,000 is included on the accompanying unaudited consolidated balance sheets in accrued expenses at January 23, 2009 and January 25, 2008, respectively.

13

RPG Holdings, Inc. and Subsidiary

Debtor-In-Possession

Notes to the Unaudited Condensed Consolidated Financial Statements

For the Nine Months Ended January 23, 2009 and January 25, 2008

Note 8 Reorganization Items

During 2009, the Company incurred approximately $3,029,000 of professional fees and other expenses related to its Chapter 11 restructuring. The professional fees were primarily legal charges and costs related to financial advisors. Prior to reorganization, the Company incurred approximately $7,260,000 of professional fees related to negotiations with its first and second lien holders and their attorneys.

Note 9 Subsequent Events and Management’s Plans and Intentions

During 2008, the Company entered into negotiations with the first lien creditors, the largest of which was AGC, and the second lien creditors to develop a strategy to remedy the breach of Term Loan 1 and Term Loan 2. On December 30, 2008, the Company announced a definitive agreement amongst the parties whereby AGC would acquire the Company as part of a pre-packaged Chapter 11 reorganization. On January 2, 2009, the Company filed a Debtors Joint Plan of Reorganization under Chapter 11 of the Bankruptcy Code in United States Bankruptcy Court in the State of Delaware.

Under the terms of the agreement, AGC purchased from various parties all of the Company’s then outstanding first and second lien debt, totaling $113,949,570 and $81,844,013, respectively plus the revolving credit facility of $15,500,000 and accrued interest of $13,314,557. The Company then issued new shares of RPG Holdings Capital Stock to AGC in exchange for the cancellation of all claims, principle and accrued interest, related to the first and second lien debt. In addition, all previously issued equity interests of RPG Holdings were cancelled and extinguished. No other liabilities of the Company were compromised. The agreement also provided for AGC to provide up to $10,000,000 DIP financing during the period that the Company was operating in bankruptcy.

On February 18, 2009, the Bankruptcy Court approved the reorganization plan and the transaction closed on February 24, 2009.

14

EX-99.4

Exhibit 99.4

Unaudited Pro Forma Combined Statement of Operations

On February 24, 2009, American Greetings Corporation (“American Greetings”) acquired (the “Acquisition”) all of the issued and outstanding capital stock of RPG Holdings, Inc. (“RPG”).

The accompanying unaudited pro forma financial information and notes have been prepared to give effect to the Acquisition. The unaudited pro forma combined statement of operations for the year ended February 28, 2009 gives effect to the Acquisition as if the Acquisition had occurred on March 1, 2008. The unaudited pro forma combined statement of operations presented for the year ended February 28, 2009 includes the historical financial results of American Greetings for the year ended February 28, 2009 and of RPG for the twelve months ended January 23, 2009. Synergies and expected cost savings from the integration of RPG with American Greetings’ previously existing businesses or any additional profitability resulting from the application of American Greetings’ revenue enhancement measures have not been included in the unaudited pro forma combined statement of operations.

The pro forma adjustments modify the historical financial information to give effect for items that are directly attributable to the Acquisition, conform RPG’s accounting policies to American Greetings’ accounting policies, reclassify RPG’s financial statement presentations to conform to those of American Greetings, are factually supportable and are expected to have a continuing impact on American Greetings. The pro forma adjustments are based upon preliminary information, certain management judgments and are described in the notes to the unaudited pro forma financial information. See Note 1 – Basis of Pro Forma Presentation for the calculation of the purchase price and estimated purchase price allocation.

The unaudited pro forma financial information and accompanying notes are presented for illustrative purposes only and do not purport to be indicative of and should not be relied upon as indicative of the operating results which may occur in the future, or that would have occurred if the Acquisition had been consummated on March 1, 2008. The unaudited pro forma financial information should be read in conjunction with (1) American Greetings’ Current Report on Form 8-K filed on February 27, 2009; (2) RPG’s consolidated financial statements and notes thereto for the year ended April 25, 2008 and the unaudited condensed financial statements for the nine months ended January 23, 2009 filed as Exhibit 99.1 and Exhibit 99.3, respectively, to the Current Report on Form 8-K/A to which this Exhibit 99.4 is attached; (3) and American Greetings’ consolidated financial statements and notes thereto and management’s discussion and analysis for the year ended February 28, 2009 filed with its Annual Report on Form 10-K for the fiscal year ended February 28, 2009.

A pro forma statement of financial position is not presented herewith, as the acquired assets and liabilities of RPG are included in the Consolidated Statement of Financial Position as of February 28, 2009 filed on American Greetings’ Annual Report on Form 10-K for the fiscal year ended February 28, 2009.

Unaudited Pro Forma Combined Statement of Operations

For the Year Ended February 28, 2009

Thousands of dollars except per share amounts

	Historical						Pro Forma
	American Greetings Corporation			RPG Holdings, Inc.			Reclassifications			Adjustments			Combined
Net sales	$	1,646,399		$	74,905		$	—		$	(2,466	)(F)	$	1,718,838
Other revenue		44,339			191			—			—			44,530
Total revenue		1,690,738			75,096			—			(2,466	)		1,763,368
Material, labor and other production costs		809,956			18,372			7,701	(A)		(1,406	)(G)		834,796
								45	(C)		128	(H)
Selling, distribution and marketing expenses		618,899			33,667			2,441	(D)		—			655,265
								(208	)(B)
								259	(E)
								207	(C)
Administrative and general expenses		226,317			45,269			(7,701	)(A)		(2,233	)(I)		255,879
								(2,441	)(D)		(3,029	)(J)
								208	(B)
								(259	)(E)
								(252	)(C)
Goodwill and other intangible assets impairment		290,166			—			—			—			290,166
Other operating income - net		(1,396	)		—			—			—			(1,396	)
Operating (loss) income		(253,204	)		(22,212	)		—			4,074			(271,342	)
Interest expense		22,854			21,931			—			(14,903	)(K)		29,882
Interest income		(3,282	)		(71	)		—			200	(J)		(3,153	)
Other non-operating expense - net		2,157			3,664			—			—			5,821
(Loss) income before income tax (benefit) expense		(274,933	)		(47,736	)		—			18,777			(303,892	)
Income tax (benefit) expense		(47,174	)		205			—			(11,209	)(L)		(58,178	)
Net (loss) income	$	(227,759	)	$	(47,941	)	$	—		$	29,986		$	(245,714	)
Loss per share	$	(4.89	)										$	(5.28	)
Loss per share - assuming dilution	$	(4.89	)										$	(5.28	)
Average number of shares outstanding		46,543,780												46,543,780
Average number of shares outstanding - assuming dilution		46,543,780												46,543,780

See Notes to Unaudited Pro Forma Combined Statement of Operations

Notes to Unaudited Pro Forma Combined Statement of Operations

Thousands of dollars

Note 1 – Basis of Pro Forma Presentation

The unaudited pro forma combined statement of operations related to the Acquisition presented for the year ended February 28, 2009 includes the historical financial results of American Greetings for the year ended February 28, 2009 and of RPG for the 12 months ended January 23, 2009.

The Acquisition is being accounted for as a purchase business combination in accordance with Statement of Financial Accounting Standards No. 141, “Business Combinations.” Under this method of accounting, the purchase price was allocated to RPG’s assets acquired and liabilities assumed based upon their estimated fair values at the date of acquisition. The process of valuing RPG’s tangible and intangible assets and liabilities, as well as evaluating accounting policies for conformity, is still in the preliminary stages. Accordingly, the purchase price allocation pro forma adjustments are preliminary and have been made solely for the purpose of providing the unaudited pro forma combined statement of operations. Material revisions to the current estimates could be necessary as the valuation process and accounting policy review are finalized. As a result, the actual amount of depreciation and amortization expense may be materially different from that presented. American Greetings currently expects that the process of determining the fair values of the tangible and intangible assets acquired (including independent appraisals) and liabilities assumed will be completed within one year of the date of the Acquisition.

The following represents the preliminary purchase price allocation:

Purchase price (in millions):
Cash paid (including transaction costs and debtor-in-possession financing)	$	22.9
Purchase price payable (including transaction costs)		4.8
Fair market value of first lien debt securities		41.4
Fair market value of long-term debt issued		28.4
Cash acquired		(0.6	)
	$	96.9
Allocation (in millions):
Current assets	$	17.1
Property, plant and equipment		3.9
Other assets (including deferred tax assets)		18.8
Intangible assets		41.5
Goodwill		22.5
Liabilities assumed		(6.9	)
	$	96.9

Note 2 – Pro Forma Adjustments

The pro forma reclassifications and adjustments included in the unaudited pro forma combined statement of operations are as follows:

(A) Royalty expenses and internal creative costs are included in administrative and general costs by RPG. These costs and expenses are included in material, labor and other production costs by American Greetings. This adjustment conforms the classification of creative costs and royalty expenses to that of American Greetings.

(B) Portions of retirement plan expenses are included in selling, distribution and marketing expenses by RPG. These expenses are included in administrative and general expenses by American Greetings. This adjustment conforms the classification of retirement plan expenses to that of American Greetings.

(C) Expenses for premiums for health care insurance, workers’ compensation and unemployment insurance are included in administrative and general expenses by RPG. These expenses are allocated to material, labor and other production costs; selling, distribution and marketing expenses; and administrative and general expenses based on payroll costs by American Greetings. This adjustment conforms the classification of expenses for premiums for health care insurance, workers’ compensation and unemployment insurance to that of American Greetings.

(D) Marketing costs are included in administrative and general costs by RPG. These costs are included in selling, distribution and marketing costs by American Greetings. This adjustment conforms the classification of marketing costs to that of American Greetings.

(E) Depreciation expense attributable to property, plant and equipment utilized in selling, distribution and marketing activities is classified as administrative and general expenses by RPG. This expense is included in selling, distribution and marketing expense by American Greetings. This adjustment conforms the classification of depreciation expense to that of American Greetings.

(F) Payments to certain customers under agreements with those customers are recognized in the period when the event that triggered the payment occurs by RPG. Such payments to customers are amortized over the stated term of the agreement by American Greetings. This adjustment reflects the net change in accounting treatment to conform to that of American Greetings.

(G) This adjustment represents the net change in the valuation of inventory to conform to American Greetings’ methods and policies.

(H) This adjustment represents the net change in the recognition of royalty expense to conform to American Greetings’ methods and policies

(I) Intangible assets, primarily artist agreements and customer relationships, are amortized over estimated useful lives ranging from four to ten years by RPG; the amount included in RPG’s expense for the 12 months ended January 23, 2009 was approximately $5,733. Subsequent to the final purchase price allocation, these intangible assets will be amortized on a straight-line basis over an estimated useful life of ten years by American Greetings; the estimated amount to be included in American Greetings’ annual expense is approximately $3,500.

(J) Elimination of non-recurring expenses related to RPG’s bankruptcy filing, including $200 paid to American Greetings under the debtor-in-possession financing.

(K) Estimated pro forma interest expense on financing of Acquisition. The pro forma interest expense was estimated assuming that the net cash payments of $44,153 made during the second quarter of 2009 and approximately $27,100 committed at the acquisition date of February 24, 2009, as well as the principal amount of American Greetings’ notes totaling $54,686 tendered at the acquisition date of February 24, 2009, were all made as of March 1, 2008. An estimated average borrowing rate of 3% was used to determine the estimated pro forma interest expense for the net cash payments of $44,153 and $27,100 for the year ended February 28, 2009. The stated interest rate of 7.375% was used to determine the estimated pro forma interest expense for the notes issued, increased by the amortization of the discount related to those notes.

The interest expense incurred of $20,652 by RPG is eliminated, as RPG’s debt was extinguished at the date of the Acquisition.

(L) Provision to adjust income tax benefit on RPG’s loss from continuing operations before income taxes and pro forma adjustments at 38%. This rate represents American Greetings’ estimate of its statutory income tax rates for all relevant tax jurisdictions.